Vol. 85 Wednesday, No. 237 December 9, 2020

Pages 79117–79378

OFFICE OF THE FEDERAL REGISTER

VerDate Sep 11 2014 18:36 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4710 Sfmt 4710 E:\FR\FM\09DEWS.LOC 09DEWS jbell on DSKJLSW7X2PROD with FR_WS II Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020

The FEDERAL REGISTER (ISSN 0097–6326) is published daily, SUBSCRIPTIONS AND COPIES Monday through Friday, except official holidays, by the Office PUBLIC of the Federal Register, National Archives and Records Administration, under the Federal Register Act (44 U.S.C. Ch. 15) Subscriptions: and the regulations of the Administrative Committee of the Federal Paper or fiche 202–512–1800 Register (1 CFR Ch. I). The Superintendent of Documents, U.S. Assistance with public subscriptions 202–512–1806 Government Publishing Office, is the exclusive distributor of the official edition. Periodicals postage is paid at Washington, DC. General online information 202–512–1530; 1–888–293–6498 Single copies/back copies: The FEDERAL REGISTER provides a uniform system for making available to the public regulations and legal notices issued by Paper or fiche 202–512–1800 Federal agencies. These include Presidential proclamations and Assistance with public single copies 1–866–512–1800 Executive Orders, Federal agency documents having general (Toll-Free) applicability and legal effect, documents required to be published FEDERAL AGENCIES by act of Congress, and other Federal agency documents of public Subscriptions: interest. Assistance with Federal agency subscriptions: Documents are on file for public inspection in the Office of the Federal Register the day before they are published, unless the Email [email protected] issuing agency requests earlier filing. For a list of documents Phone 202–741–6000 currently on file for public inspection, see www.federalregister.gov. The seal of the National Archives and Records Administration The Federal Register Printing Savings Act of 2017 (Pub. L. 115- authenticates the Federal Register as the official serial publication 120) placed restrictions on distribution of official printed copies established under the Federal Register Act. Under 44 U.S.C. 1507, of the daily Federal Register to members of Congress and Federal the contents of the Federal Register shall be judicially noticed. offices. Under this Act, the Director of the Government Publishing The Federal Register is published in paper and on 24x microfiche. Office may not provide printed copies of the daily Federal Register It is also available online at no charge at www.govinfo.gov, a unless a Member or other Federal office requests a specific issue service of the U.S. Government Publishing Office. or a subscription to the print edition. For more information on how to subscribe use the following website link: https:// The online edition of the Federal Register is issued under the www.gpo.gov/frsubs. authority of the Administrative Committee of the Federal Register as the official legal equivalent of the paper and microfiche editions (44 U.S.C. 4101 and 1 CFR 5.10). It is updated by 6:00 a.m. each day the Federal Register is published and includes both text and graphics from Volume 1, 1 (March 14, 1936) forward. For more information, contact the GPO Customer Contact Center, U.S. Government Publishing Office. Phone 202-512-1800 or 866-512- 1800 (toll free). E-mail, gpocusthelp.com. The annual subscription price for the Federal Register paper edition is $860 plus postage, or $929, for a combined Federal Register, Federal Register Index and List of CFR Sections Affected (LSA) subscription; the microfiche edition of the Federal Register including the Federal Register Index and LSA is $330, plus postage. Six month subscriptions are available for one-half the annual rate. The prevailing postal rates will be applied to orders according to the delivery method requested. The price of a single copy of the daily Federal Register, including postage, is based on the number of pages: $11 for an issue containing less than 200 pages; $22 for an issue containing 200 to 400 pages; and $33 for an issue containing more than 400 pages. Single issues of the microfiche edition may be purchased for $3 per copy, including postage. Remit check or money order, made payable to the Superintendent of Documents, or charge to your GPO Deposit Account, VISA, MasterCard, American Express, or Discover. Mail to: U.S. Government Publishing Office—New Orders, P.O. Box 979050, St. Louis, MO 63197-9000; or call toll free 1-866-512-1800, DC area 202-512-1800; or go to the U.S. Government Online Bookstore site, see bookstore.gpo.gov. There are no restrictions on the republication of material appearing in the Federal Register. How To Cite This Publication: Use the volume number and the page number. Example: 85 FR 12345. Postmaster: Send address changes to the Superintendent of Documents, Federal Register, U.S. Government Publishing Office, Washington, DC 20402, along with the entire mailing label from the last issue received.

.

VerDate Sep 11 2014 18:36 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4710 Sfmt 4710 E:\FR\FM\09DEWS.LOC 09DEWS jbell on DSKJLSW7X2PROD with FR_WS III

Contents Federal Register Vol. 85, No. 237

Wednesday, December 9, 2020

Agriculture Department Environmental Protection Agency See Natural Resources Conservation Service RULES Implementation of the Revoked 1997 8-Hour Ozone Antitrust Division National Ambient Air Quality Standards; Updates for NOTICES Areas That Attained by the Attainment Date; Changes Under the National Cooperative Research and Withdrawal, 79129–79130 Production Act: NOTICES Electrified Vehicle And Energy Storage Evaluation, Meetings: 79218–79219 Science Advisory Board 2020 Scientific and Medical Technology Enterprise Consortium, 79219–79221 Technological Achievement Awards Committee, 79179–79180 Bureau of Safety and Environmental Enforcement PROPOSED RULES Federal Aviation Administration Oil and Gas and Sulfur Operations on the Outer RULES Continental Shelf: Airspace Designations and Reporting Points: Revisions to the Requirements for Exploratory Drilling on Vicinity of Clarion, PA, 79117–79118 the Arctic Outer Continental Shelf, 79266–79321 NOTICES Agency Information Collection Activities; Proposals, Census Bureau Submissions, and Approvals: NOTICES Safety Management Systems for Certificate Holders, Agency Information Collection Activities; Proposals, 79256–79258 Submissions, and Approvals: Service Annual Survey, 79162–79163 Federal Communications Commission NOTICES Centers for Disease Control and Prevention Agency Information Collection Activities; Proposals, NOTICES Submissions, and Approvals, 79180–79183 Meetings: Advisory Committee on Immunization Practices, 79184– Federal Contract Compliance Programs Office 79185 RULES Sexually Transmitted Infection Treatment Guidelines Implementing Legal Requirements Regarding the Equal Update; Webinar, 79183–79184 Opportunity Clause’s Religious Exemption, 79324– 79372 Children and Families Administration NOTICES Federal Energy Regulatory Commission Agency Information Collection Activities; Proposals, NOTICES Submissions, and Approvals: Application: Social Services Block Grant Post-Expenditure Report, Pre- Pacific Gas and Electric Co., City of Santa Clara, CA, Expenditure Report, and Intended Use Plan, 79185– 79178–79179 79186 Town of Dover-Foxcroft, 79176–79177 Commerce Department Combined Filings, 79175–79178 See Census Bureau See International Trade Administration Federal Highway Administration See National Oceanic and Atmospheric Administration NOTICES See Patent and Trademark Office Draft Environmental Impact Statement: El Camino Real Roadway Renewal Project on State Route Education Department 82, in San Mateo County, CA, 79258–79259 NOTICES Final Federal Agency Actions: Agency Information Collection Activities; Proposals, Proposed Highway in California, 79259–79260 Submissions, and Approvals: Application for the U.S. Presidential Scholars Program, Federal Motor Carrier Safety Administration 79169–79170 NOTICES Higher Education Act Title II Report Cards on State Commercial Driver’s License Standards; Exemption Teacher Credentialing and Preparation, 79170–79171 Applications: Daimler Trucks North America, LLC; Correction, 79260– Energy Department 79261 See Federal Energy Regulatory Commission NOTICES Federal Railroad Administration Energy Conservation Program: RULES Decision and Order Granting a Waiver to CNA Revision of Method for Calculating Monetary Threshold for International, Inc. From the Dishwashers Test Reporting Rail Equipment Accidents/Incidents, 79130– Procedure, 79171–79175 79135

VerDate Sep<11>2014 18:55 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4748 Sfmt 4748 E:\FR\FM\09DECN.SGM 09DECN jbell on DSKJLSW7X2PROD with CONTENTS IV Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Contents

Federal Reserve System Justice Department NOTICES See Antitrust Division Change in Bank Control Notices: RULES Acquisitions of Shares of a Bank or Bank Holding Radiation Exposure Compensation Act: Company, 79183 Procedures for Claims Submitted at the Statutory Filing Deadline, 79118–79120 Fish and Wildlife Service NOTICES Labor Department Privacy Act; Systems of Records, 79215–79216 See Federal Contract Compliance Programs Office See Occupational Safety and Health Administration Food and Drug Administration See Workers Compensation Programs Office NOTICES Agency Information Collection Activities; Proposals, National Aeronautics and Space Administration Submissions, and Approvals: NOTICES Formal Dispute Resolution: Scientific and Technical Privacy Act; Systems of Records, 79224–79227 Issues Related to Pharmaceutical Current Good National Institutes of Health Manufacturing Practice, 79186–79187 Guidance: NOTICES Meetings: Best Practices in Developing Proprietary Names for Advisory Committee to the Director, 79204 Human Nonprescription Drug Products, 79187–79189 Best Practices in Developing Proprietary Names for National Oceanic and Atmospheric Administration Human Prescription Drug Products, 79189–79190 RULES Atlantic Highly Migratory Species: Health and Human Services Department North Atlantic Swordfish Fishery, 79136–79139 See Centers for Disease Control and Prevention Fisheries of the Caribbean, Gulf of Mexico, and South See Children and Families Administration Atlantic: See Food and Drug Administration 2020 Commercial Closure for South Atlantic Snowy See National Institutes of Health NOTICES Grouper, 79135–79136 Declaration Under the Public Readiness and Emergency Fisheries of the Exclusive Economic Zone Off Alaska: Preparedness Act for Countermeasures Against Modifying Seasonal Allocations of Pollock and Pacific marburgvirus and/or Marburg disease, 79198–79204 Cod for Trawl Catcher Vessels in the Central and Fourth Amendment to the Declaration Under the Public Western Gulf of Alaska; Correction, 79139–79141 Readiness and Emergency Preparedness Act for Fisheries of the Northeastern United States: Medical Countermeasures Against COVID-19, 79190– Atlantic Bluefish Fishery; Quota Transfer From Maine to 79198 Rhode Island, 79139 NOTICES Homeland Security Department Permits: See U.S. Citizenship and Immigration Services Marine Mammals and Endangered Species, 79169 See U.S. Customs and Border Protection National Park Service NOTICES Interior Department National Register of Historic Places: See Bureau of Safety and Environmental Enforcement Pending Nominations and Related Actions, 79216–79217 See Fish and Wildlife Service See National Park Service National Science Foundation See Ocean Energy Management Bureau NOTICES Meetings: International Trade Administration Virtual Workshop on Pioneering the Future of Federally NOTICES Supported Data Repositories, 79227–79228 Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Natural Resources Conservation Service Crystalline Silicon Photovoltaic Cells, Whether or Not NOTICES Assembled Into Modules, From the People’s Republic Meetings: of China, 79165–79168 Natural Resources Conservation Service Programs and Crystalline Silicon Photovoltaic Cells, Whether or Not Western Water Quantity, 79162 Assembled Into Modules, From the People’s Republic of China, 79163–79165 Neighborhood Reinvestment Corporation Polyethylene Retail Carrier Bags From the People’s NOTICES Republic of China, 79168 Meetings; Sunshine Act, 79228 International Trade Commission Nuclear Regulatory Commission NOTICES NOTICES Investigations; Determinations, Modifications, and Rulings, Environmental Assessments; Availability, etc.: etc.: Westinghouse Electric Company, LLC; Columbia Fuel Certain Movable Barrier Operator Systems and Fabrication Facility; and US Ecology, Inc.; Idaho Components Thereof, 79217–79218 Resource Conservation and Recovery Act Subtitle C Utility Scale Wind Towers From India, Malaysia, and Hazardous Disposal Facility Located Near Grand Spain, 79217 View, Idaho, 79228–79230

VerDate Sep<11>2014 18:55 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4748 Sfmt 4748 E:\FR\FM\09DECN.SGM 09DECN jbell on DSKJLSW7X2PROD with CONTENTS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Contents V

Occupational Safety and Health Administration See Federal Highway Administration NOTICES See Federal Motor Carrier Safety Administration Agency Information Collection Activities; Proposals, See Federal Railroad Administration Submissions, and Approvals: See Pipeline and Hazardous Materials Safety Safe and Sound Campaign, 79222–79223 Administration Requests for Nominations: Advisory Committee on Construction Safety and Health, U.S. Citizenship and Immigration Services 79221–79222 NOTICES Continuation of Documentation for Beneficiaries of Ocean Energy Management Bureau Temporary Protected Status Designations for El PROPOSED RULES Salvador, Haiti, Nicaragua, Sudan, Honduras, and Oil and Gas and Sulfur Operations on the Outer Nepal, 79208–79215 Continental Shelf: Revisions to the Requirements for Exploratory Drilling on U.S. Customs and Border Protection the Arctic Outer Continental Shelf, 79266–79321 NOTICES Final Determination: Patent and Trademark Office Issuance of Final Determination Concerning Three RULES Vehicle Tracking Devices, a Satellite Device, an NFC Appeal Board Rules of Practice for Instituting on All READER, and an NFC KEYRING FOB, 79204–79208 Challenged Patent Claims and All Grounds and Eliminating the Presumption at Institution Favoring Veterans Affairs Department Petitioner as to Testimonial Evidence, 79120–79129 PROPOSED RULES Loan Guaranty: Pipeline and Hazardous Materials Safety Administration COVID–19 Veterans Assistance Partial Claim Payment NOTICES Program, 79142–79161 Hazardous Materials: Actions on Special Permits, 79261–79262 Workers Compensation Programs Office Applications for Modifications to Special Permit, 79262– NOTICES 79263 Agency Information Collection Activities; Proposals, Applications for New Special Permits, 79263–79264 Submissions, and Approvals: Certification of Medical Necessity, 79223–79224 Postal Regulatory Commission NOTICES New Postal Products, 79230 Separate Parts In This Issue Presidential Documents Part II PROCLAMATIONS Interior Department, Bureau of Safety and Environmental Special Observances: Enforcement, 79266–79321 Human Rights Day, Bill of Rights Day, and Human Rights Interior Department, Ocean Energy Management Bureau, Week (Proc. 10124), 79373–79376 79266–79321 National Pearl Harbor Remembrance Day (Proc. 10125), 79377–79378 Part III Securities and Exchange Commission Labor Department, Federal Contract Compliance Programs Office, 79324–79372 NOTICES Agency Information Collection Activities; Proposals, Part IV Submissions, and Approvals, 79248–79249, 79251– Presidential Documents, 79373–79378 79252, 79256 Self-Regulatory Organizations; Proposed Rule Changes: ICE Clear Europe Limited, 79243–79244 MEMX LLC, 79244–79248 Reader Aids MIAX PEARL, LLC, 79250–79256 Consult the Reader Aids section at the end of this issue for Nasdaq PHLX, LLC, 79231–79235 phone numbers, online resources, finding aids, and notice NYSE Arca, Inc., 79235–79239 of recently enacted public laws. NYSE National, Inc., 79239–79242 To subscribe to the Federal Register Table of Contents The Nasdaq Stock Market LLC, 79249–79250 electronic mailing list, go to https://public.govdelivery.com/ accounts/USGPOOFR/subscriber/new, enter your e-mail Transportation Department address, then follow the instructions to join, leave, or See Federal Aviation Administration manage your subscription.

VerDate Sep<11>2014 18:55 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4748 Sfmt 4748 E:\FR\FM\09DECN.SGM 09DECN jbell on DSKJLSW7X2PROD with CONTENTS VI Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Contents

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: 10124...... 79375 10125...... 79377 14 CFR 71...... 79117 28 CFR 79...... 79118 30 CFR Proposed Rules: 250...... 79266 550...... 79266 37 CFR 42...... 79120 38 CFR Proposed Rules: 36...... 79142 40 CFR 52...... 79129 41 CFR 60–1...... 79324 49 CFR 225...... 79130 50 CFR 622...... 79135 635...... 79136 648...... 79139 679...... 79139

VerDate Sep 11 2014 18:37 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4711 Sfmt 4711 E:\FR\FM\09DELS.LOC 09DELS jbell on DSKJLSW7X2PROD with FR_LS 79117

Rules and Regulations Federal Register Vol. 85, No. 237

Wednesday, December 9, 2020

This section of the FEDERAL REGISTER Records Administration (NARA). For Availability and Summary of contains regulatory documents having general information on the availability of FAA Documents for Incorporation by applicability and legal effect, most of which Order 7400.11E at NARA, email: Reference are keyed to and codified in the Code of [email protected] or go to https:// Federal Regulations, which is published under This document amends FAA Order 50 titles pursuant to 44 U.S.C. 1510. www.archives.gov/federal-register/cfr/ 7400.11E, Airspace Designations and ibr-locations.html. Reporting Points, dated July 21, 2020, The Code of Federal Regulations is sold by FOR FURTHER INFORMATION CONTACT: and effective September 15, 2020. FAA the Superintendent of Documents. Colby Abbott, Rules and Regulations Order 7400.11E is publicly available as Group, Office of Policy, Federal listed in the ADDRESSES section of this DEPARTMENT OF TRANSPORTATION Aviation Administration, 800 document. FAA Order 7400.11E lists Independence Avenue SW, Washington, Class A, B, C, D, and E airspace areas, Federal Aviation Administration DC 20591; telephone: (202) 267–8783. air traffic service routes, and reporting points. SUPPLEMENTARY INFORMATION: 14 CFR Part 71 The Rule [Docket No. FAA–2020–0709; Airspace Authority for This Rulemaking The FAA is amending Title 14 Code Docket No. 20–AEA–2] The FAA’s authority to issue rules of Federal Regulations (14 CFR) part 71 RIN 2120–AA66 regarding aviation safety is found in by modifying VOR Federal airways V–6, V–30, V–58, V–119, and V–226. Title 49 of the United States Code. Amendment of V–6, V–30, V–58, V–119, The planned decommissioning of the Subtitle I, Section 106 describes the and V–226 in the Vicinity of Clarion, PA VOR portion of the Clarion, PA, VOR/ authority of the FAA Administrator. DME NAVAID has made this action AGENCY: Subtitle VII, Aviation Programs, Federal Aviation necessary. The VOR Federal airway describes in more detail the scope of the Administration (FAA), DOT. changes are outlined below. ACTION: Final rule. agency’s authority. This rulemaking is V–6: V–6 extends between the promulgated under the authority Oakland, CA, VOR/DME and the SUMMARY: This action amends VHF described in Subtitle VII, Part A, DuPage, IL, VOR/DME; between the Omnidirectional Range (VOR) Federal Subpart I, Section 40103. Under that intersection of the Chicago Heights, IL, airways V–6, V–30, V–58, V–119, and section, the FAA is charged with VOR/Tactical Air Navigation (VORTAC) V–226 in the vicinity of Clarion, PA. prescribing regulations to assign the use 358° and Gipper, MI, VORTAC 271° The VOR Federal airway modifications of the airspace necessary to ensure the radials (NILES fix) and the intersection are necessary due to the planned safety of aircraft and the efficient use of of the Gipper, MI, VORTAC 092° and decommissioning of the VOR portion of airspace. This regulation is within the Litchfield, MI, VOR/DME 196° radials the Clarion, PA, VOR/Distance scope of that authority as it modifies the (MODEM fix); and between the Clarion, Measuring Equipment (VOR/DME) route structure as necessary to preserve PA, VOR/DME and the La Guardia, NY, navigation aid (NAVAID). The Clarion the safe and efficient flow of air traffic VOR/DME. The airway segment VOR/DME provides navigation guidance within the National Airspace System. overlying the Clarion, PA, VOR/DME for portions of the affected ATS routes. between the Clarion, PA, VOR/DME and The Clarion VOR is being History the Philipsburg, PA, VORTAC is decommissioned as part of the FAA’s removed. The unaffected portions of the VOR Minimum Operational Network The FAA published a notice of existing airway remain as charted. (MON) program. proposed rulemaking for Docket No. FAA–2020–0709 in the Federal Register V–30: V–30 extends between the DATES: Effective date 0901 UTC, (85 FR 49324; August 13, 2020), Badger, WI, VOR/DME and the February 25, 2021. The Director of the amending VOR Federal airways V–6, Litchfield, MI, VOR/DME; and between Federal Register approves this the Clarion, PA, VOR/DME and the incorporation by reference action under V–30, V–58, V–119, and V–226 in the vicinity of Clarion, PA. The proposed Solberg, NJ, VOR/DME. The airway Title 1 Code of Federal Regulations part segment overlying the Clarion, PA, 51, subject to the annual revision of amendment actions were due to the planned decommissioning of the VOR VOR/DME between the Clarion, PA, FAA Order 7400.11 and publication of VOR/DME and the Philipsburg, PA, conforming amendments. portion of the Clarion, PA, VOR/DME. Interested parties were invited to VORTAC is removed. The unaffected ADDRESSES: FAA Order 7400.11E, participate in this rulemaking effort by portions of the existing airway remain Airspace Designations and Reporting as charted. submitting written comments on the Points, and subsequent amendments can V–58: V–58 extends between the proposal. No comments were received. be viewed online at https:// intersection of the Franklin, PA, VOR www.faa.gov/air_traffic/publications/. VOR Federal airways are published in 176° and Clarion, PA, VOR/DME 222° For further information, you can contact paragraph 6010(a) of FAA Order radials (GRACE fix) and the the Rules and Regulations Group, 7400.11E, dated July 21, 2020, and Williamsport, PA, VOR/DME; and Federal Aviation Administration, 800 effective September 15, 2020, which is between the intersection of the Sparta, Independence Avenue SW, Washington, incorporated by reference in 14 CFR NJ, VORTAC 018° and Kingston, NY, DC 20591; telephone: (202) 267–8783. 71.1. The VOR Federal airways listed in VOR/DME 270° radials (HELON fix) and The Order is also available for this document will be subsequently the Nantucket, MA, VOR/DME. The inspection at the National Archives and published in the Order. airspace within R–4105 is excluded

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79118 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

during times of use. The airway segment the National Environmental Policy Act Rock Springs, WY; 20 miles, 39 miles, 95 between the Franklin, PA, VOR 176° and its implementing regulations at 40 MSL, Cherokee, WY; 39 miles, 27 miles, 95 ° MSL, Medicine Bow, WY; INT Medicine Bow and Clarion, PA, VOR/DME 222 radials CFR part 1500, and in accordance with ° ° (GRACE fix) and the Philipsburg, PA, FAA Order 1050.1F, Environmental 106 and Sidney, NE, 291 radials; Sidney; North Platte, NE; Grand Island, NE; Omaha, VORTAC is removed. Additionally, the Impacts: Policies and Procedures, IA; Des Moines, IA; Iowa City, IA; Davenport, restricted area exclusion language is paragraph 5–6.5a, which categorically IA; INT Davenport 087° and DuPage, IL, 255° removed also. The unaffected portions excludes from further environmental radials; to DuPage. From INT Chicago of the existing airway remain as charted. impact review rulemaking actions that Heights, IL, 358° and Gipper, MI, 271° V–119: V–119 extends between the designate or modify classes of airspace radials; Gipper; to INT Gipper 092° and Henderson, WV, VORTAC and the areas, airways, routes, and reporting Litchfield, MI, 196° radials. From Clarion, PA, VOR/DME. The airway points (see 14 CFR part 71, Designation Philipsburg, PA; Selinsgrove, PA; Allentown, PA; Solberg, NJ; INT Solberg 107° and segment overlying the Clarion, PA, of Class A, B, C, D, and E Airspace ° ° VOR/DME between the Indian Head, Yardley, PA, 068 radials; INT Yardley 068 Areas; Air Traffic Service Routes; and and La Guardia, NY, 213° radials; to La PA, VORTAC and the Clarion, PA, VOR/ Reporting Points). As such, this action Guardia. DME is removed. The unaffected is not expected to result in any * * * * * portions of the existing airway remain potentially significant environmental as charted. impacts. In accordance with FAA Order V–30 [Amended] V–226: V–226 extends between the 1050.1F, paragraph 5–2 regarding From Badger, WI; INT Badger 102° and intersection of the Franklin, PA, VOR Extraordinary Circumstances, the FAA Pullman, MI, 303° radials; Pullman; to 175° and Clarion, PA, VOR/DME 222° has reviewed this action for factors and Litchfield, MI. From Philipsburg, PA; radials (GRACE fix) and the Stillwater, Selinsgrove, PA; East Texas, PA; INT East circumstances in which a normally ° ° NJ, VOR/DME. The airway segment categorically excluded action may have Texas 095 and Solberg, NJ, 264 radials; to Solberg. overlying the Clarion, PA, VOR/DME a significant environmental impact between the intersection of the Franklin, requiring further analysis. The FAA has * * * * * ° PA, VOR 175 and Clarion, PA, VOR/ determined that no extraordinary V–58 [Amended] DME 222° radials (GRACE fix) and the circumstances exist that warrant From Philipsburg, PA; to Williamsport, PA. Keating, PA, VORTAC is removed. The preparation of an environmental From INT Sparta, NJ, 018° and Kingston, NY, unaffected portions of the existing assessment or environmental impact 270° radials; Kingston; INT Kingston 095° airway remain as charted. study. and Hartford, CT, 269° radials; Hartford; The NAVAID radials in the VOR Groton, CT; Sandy Point, RI; to Nantucket, Federal airway descriptions below are List of Subjects in 14 CFR Part 71 MA. unchanged and stated in True degrees. Airspace, Incorporation by reference, * * * * * FAA Order 7400.11, Airspace Navigation (air). Designations and Reporting Points, is V–119 [Amended] published yearly and effective on Adoption of the Amendment From Henderson, WV; Parkersburg, WV; September 15. In consideration of the foregoing, the INT Parkersburg 067° and Indian Head, PA, Federal Aviation Administration 254° radials; to Indian Head. Regulatory Notices and Analyses amends 14 CFR part 71 as follows: * * * * * The FAA has determined that this regulation only involves an established PART 71—DESIGNATION OF CLASS A, V–226 body of technical regulations for which B, C, D, AND E AIRSPACE AREAS; AIR From Keating, PA; Williamsport, PA; frequent and routine amendments are TRAFFIC SERVICE ROUTES; AND Wilkes-Barre, PA; to Stillwater, NJ. necessary to keep them operationally REPORTING POINTS * * * * * current. It, therefore: (1) Is not a ■ Issued in Washington, DC, on December 3, ‘‘significant regulatory action’’ under 1. The authority citation for part 71 2020. continues to read as follows: Executive Order 12866; (2) is not a George Gonzalez, ‘‘significant rule’’ under Department of Authority: 49 U.S.C. 106(f), 106(g); 40103, Acting Manager, Rules and Regulations Transportation (DOT) Regulatory 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, Group. 1959–1963 Comp., p. 389. Policies and Procedures (44 FR 11034; [FR Doc. 2020–26914 Filed 12–8–20; 8:45 am] February 26, 1979); and (3) does not § 71.1 [Amended] BILLING CODE 4910–13–P warrant preparation of a regulatory ■ evaluation as the anticipated impact is 2. The incorporation by reference in 14 CFR 71.1 of FAA Order 7400.11E, so minimal. Since this is a routine DEPARTMENT OF JUSTICE matter that will only affect air traffic Airspace Designations and Reporting Points, dated July 21, 2020, and procedures and air navigation, it is 28 CFR Part 79 certified that this rule, when effective September 15, 2020, is promulgated, will not have a significant amended as follows: [CIV Docket No.159] economic impact on a substantial Paragraph 6010(a) Domestic VOR Federal Radiation Exposure Compensation number of small entities under the Airways. Act: Procedures for Claims Submitted criteria of the Regulatory Flexibility Act. * * * * * at the Statutory Filing Deadline Environmental Review V–6 [Amended] AGENCY: ° Civil Division, Department of The FAA has determined that this From Oakland, CA; INT Oakland 039 and Justice. Sacramento, CA, 212° radials; Sacramento; action of amending VOR Federal ACTION: Notification of procedures. airways V–6, V–30, V–58, V–119, and Squaw Valley, CA; Mustang, NV; Lovelock, NV; Battle Mountain, NV; INT Battle V–226, due to the planned Mountain 062° and Wells, NV, 256° radials; SUMMARY: The Department of Justice decommissioning of the VOR portion of Wells; 5 miles, 40 miles, 98 MSL, 85 MSL, (‘‘the Department’’) is publishing this the Clarion, PA, VOR/DME NAVAID, Lucin, UT; 43 miles, 85 MSL, Ogden, UT; 11 document to inform the public of the qualifies for categorical exclusion under miles, 50 miles, 105 MSL, Fort Bridger, WY; Department’s procedures for filing

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79119

claims under the Radiation Exposure the Torts Branch of the Civil Division of examination for substantial compliance Compensation Act (‘‘RECA’’) at the the United States Department of Justice. with this part.’’ The final rulemaking statutory filing deadline. RECA requires did not address filing procedures on the Statutory Deadline for RECA Claims that claims shall be barred unless filed statutory deadline for filing claims. within 22 years after the date of RECA was enacted on October 15, Statement of Policy enactment of the Radiation Exposure 1990, by Public Law 101–426. The Compensation Act Amendments of statute of limitations under Public Law As the deadline for filing claims 2000. The Department is publishing this 101–426 set a 20 year period from the approaches, several stakeholders have document to articulate its policy that date of its enactment for parties to file requested clarification with respect to RECA claims that bear a date of July 11, claims with the Department of Justice. the date of the last day for filing claims 2022 on the postmark or stamp by On July 10, 2000, the RECA and the procedures for determining another commercial carrier shall be Amendments of 2000 were enacted as when a claim is filed. RECA does not set deemed timely filed upon receipt by the Public Law 106–245. The RECA forth a method for calculating time. In Radiation Exposure Compensation Amendments of 2000 provided addition, the apparent statutory filing Program. The Department will return expanded coverage and extended the deadline, July 10, 2022, is a Sunday. untimely claims and will not accept filing period for claims 22 years from its Finally, the Department’s implementing electronic submissions. Consistent with date of enactment. regulations do not clearly state filing the statutory requirement that the As codified at 42 U.S.C. 2210 note procedures on the last day. Department make a determination (2018), the deadline for claims under The Department is publishing this within 12 months of filing for timely RECA is as follows: document to articulate its policy that Under section 8, Limitations on filed claims, documentation to establish RECA claims that bear a date of July 11, Claims: the eligibility of any potential • In general—A claim to which this 2022 on the postmark or stamp by beneficiary of an awarded claim must be Act applies shall be barred unless the another commercial carrier shall be provided by July 12, 2023, or the award claim is filed within 22 years after the deemed timely filed upon receipt by the shall be deemed rejected. date of the enactment of the Radiation Radiation Exposure Compensation DATES: This document is effective on Exposure Compensation Act Program. December 9, 2020. Amendments of 2000 [July 10, 2000]. A Monday, July 11, 2022 deadline is • consistent with methods for computing FOR FURTHER INFORMATION CONTACT: Resubmittal of claims—After the date of the enactment of the Radiation time set forth at Federal Rule of Civil Gerard W. Fischer (Assistant Director), Procedure 6(a), and with standard 202–616–4090, Constitutional and Exposure Compensation Act Amendments of 2000 [July 10, 2000], agency practice in the event a deadline Specialized Tort Litigation Section, falls on a weekend or holiday Torts Branch, Civil Division, any claimant who has been denied compensation under this Act may establishing the next business day as the Department of Justice, Washington, DC deadline for submissions. The postmark 20530. resubmit a claim for consideration by the Attorney General in accordance with requirement is consistent with the SUPPLEMENTARY INFORMATION: this Act not more than three times. Any Department’s existing procedures for submitting claims at § 79.71(a) and (b), Background resubmittal made before the date of the enactment of the Radiation Exposure requiring a claim to be submitted in Codified at 42 U.S.C. 2210 note, the Compensation Act Amendments of 2000 writing on a standard claim form and Radiation Exposure Compensation Act shall not be applied to the limitation mailed to the address of the Radiation (‘‘RECA’’) offers an apology and under the preceding sentence. Exposure Compensation Program. In monetary compensation to individuals RECA delegates authority to the addition, this policy allows claimants to (or their survivors) who have contracted Department to establish procedures affirmatively establish the timely filing certain cancers and other serious whereby individuals may submit claims of their claim by obtaining a postmark diseases following exposure to radiation for payments under the Act. 42 U.S.C. or other mailing date stamp consistent released during above-ground 2210 note (2018), Sec. 6(a). For timely with the filing deadline. atmospheric nuclear weapons tests or filed claims, RECA requires the The regulation at § 79.71(a) requires following their employment in the Department to complete the that claims be mailed to the Department. uranium production industry during determination on each claim filed not Accordingly, the Department will not specified periods. This unique program later than twelve months after the claim accept electronically submitted claims. was designed by Congress as an is filed. 42 U.S.C. 2210 note (2018), sec. Claims bearing a date on and after alternative to litigation in that the 6(d)(1). July 12, 2022, as indicated by the statutory criteria do not require On March 23, 2004, the Department postmark or stamp by another claimants to establish causation. Rather, published a final rulemaking to commercial carrier, shall be returned to if the claimant can satisfy the implement the RECA Amendments of the submitting party due to untimely requirements outlined in the statute, 2000. See 69 FR 13628; 28 CFR part 79. filing. Claims returned due to untimely which include demonstrating that he or The regulation at § 79.71(a) sets forth filing will include a letter from the she contracted a compensable disease procedures for filing of claims, and Radiation Exposure Compensation after working or residing in a designated requires them to be submitted in writing Program indicating the Department is location for a specific period of time, he on a standard claim form and mailed barred by statute from reviewing the or she qualifies for compensation. with supporting documentation to the claim or awarding compensation. Congress charged the Attorney Radiation Exposure Compensation This policy applies to all claims General with authority to establish filing Program, P.O. Box 146, Ben Franklin received at the filing deadline, procedures and responsibility for Station, Washington DC 20044–0146. including the resubmission of a adjudicating claims under the Act. The The regulation at § 79.71(b) sets forth previously denied claim under Sec. 8(b) Attorney General delegated this that ‘‘[t]he Assistant Director will file a of RECA. Resubmissions of previously function to the Constitutional and claim after receipt of the standard form denied claims bearing a postmark or Specialized Tort Litigation Section of with supporting documentation and stamp by another commercial carrier

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79120 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

dated July 12, 2022 or later shall be challenged claims that are asserted in a none. Under the amended rule, returned due to untimely filing. petition. Additionally, the Office revises therefore, in all pending IPR, PGR, and For timely filed claims in which a the rules to conform to the current CBM proceedings before the Office, the share of the compensation award is held standard practice of providing sur- Board will either institute review on all in trust pending documentation to replies to principal briefs and providing of the challenged claims and grounds of establish the eligibility of a potential that a reply and a patent owner response unpatentability presented in the petition beneficiary, such shares of may respond to a decision on or deny the petition. compensation shall be deemed rejected institution. The Office further revises The second change is conforming the consistent with 28 CFR 79.75(b) if the rules to eliminate the presumption rules to certain standard practices before sufficient documentation to establish that a genuine issue of material fact the PTAB in IPR, PGR, and CBM the eligibility of the potential created by the patent owner’s proceedings. Specifically, this final rule beneficiary is not received within the 12 testimonial evidence filed with a amends the rules to set forth the briefing month determination period provided preliminary response will be viewed in requirements of sur-replies to principal by the Act, or by July 12, 2023, the light most favorable to the petitioner briefs and to provide that a reply and a whichever date falls earlier. for purposes of deciding whether to patent owner response may respond to This document is intended to inform institute a review. a decision on institution. Finally, this final rule amends the the public of the Department’s policy DATES: Effective date: The changes in rules to eliminate, when deciding regarding procedures for filing claims at this final rule are effective January 8, whether to institute an IPR, PGR, or the statutory deadline. The Department 2021. will post this document to its RECA Applicability date: This final rule CBM review, the presumption in favor website at www.justice.gov/civil/ applies to all IPR and PGR petitions of the petitioner for a genuine issue of material fact created by testimonial common/reca, and continue to filed on or after January 8, 2021. announce this policy at outreach events evidence submitted with a patent FOR FURTHER INFORMATION CONTACT: owner’s preliminary response. As with and in communications with claimants, Michael Tierney, Vice Chief counsel, and support groups. all other evidentiary questions at the Administrative Patent Judge, by institution phase, the Board will Dated: December 1, 2020. telephone at 571–272–9797. consider all evidence to determine Gerard W. Fischer, SUPPLEMENTARY INFORMATION: whether the petitioner has met the Assistant Director, Torts Branch, Civil Executive Summary applicable standard for institution of the Division. proceeding. [FR Doc. 2020–26869 Filed 12–8–20; 8:45 am] Purpose: The final rule revises the Costs and Benefits: This rulemaking is BILLING CODE 4410–12–P rules of practice for IPR, PGR, and CBM not economically significant under proceedings that implemented Executive Order 12866 (Sept. 30, 1993). provisions of the Leahy-Smith America Background DEPARTMENT OF COMMERCE Invents Act (AIA) providing for trials before the Office. On September 16, 2011, the AIA was Patent and Trademark Office The U.S. Supreme Court held in SAS enacted into law (Pub. L. 112–29, 125 that a decision to institute an IPR under Stat. 284 (2011)), and within one year, 37 CFR Part 42 35 U.S.C. 314 may not institute on fewer the Office implemented rules to govern [Docket No. PTO–P–2019–0024] than all claims challenged in a petition. Office practice for AIA trials, including See SAS Institute Inc. v. Iancu, 138 S. IPR, PGR, CBM,1 and derivation RIN 0651–AD40 Ct. 1348 (2018). The Court held that the proceedings pursuant to 35 U.S.C. 135, Office has the discretion to institute on 316, and 326 and AIA 18(d)(2). See PTAB Rules of Practice for Instituting either all of the claims challenged in the Rules of Practice for Trials Before the on All Challenged Patent Claims and petition or to deny the petition. Patent Trial and Appeal Board and All Grounds and Eliminating the Previously, the Board exercised Judicial Review of Patent Trial and Presumption at Institution Favoring discretion to institute an IPR, PGR, or Appeal Board Decisions, 77 FR 48612 Petitioner as to Testimonial Evidence CBM on all or some of the challenged (Aug. 14, 2012); Changes to Implement AGENCY: United States Patent and claims and on all or some of the grounds Inter Partes Review Proceedings, Post- Trademark Office, Department of of unpatentability asserted in a petition. Grant Review Proceedings, and Commerce. For example, the Board exercised Transitional Program for Covered ACTION: Final rule. discretion to authorize a review to Business Method Patents, 77 FR 48680 proceed on only those claims and (Aug. 14, 2012); and Transitional SUMMARY: The United States Patent and grounds for which the required Program for Covered Business Method Trademark Office (USPTO or Office) threshold had been met, thus narrowing Patents—Definitions of Covered revises the rules of practice for the issues for efficiency in conducting a Business Method Patent and instituting review on all challenged proceeding. Technological Invention, 77 FR 48734 claims or none in inter partes review In light of SAS, the Office provided (Aug. 14, 2012). Additionally, the Office (IPR), post-grant review (PGR), and the guidance that, if the Board institutes a published a Patent Trial Practice Guide transitional program for covered trial under 35 U.S.C. 314 or 324, the to advise the public on the general business method patents (CBM) Board will institute on all claims and all framework of the regulations, including proceedings before the Patent Trial and grounds included in a petition of an the structure and times for taking action Appeal Board (PTAB or Board) in IPR, PGR, or CBM. To implement this in each of the new proceedings. See accordance with the U.S. Supreme practice in the regulation, this final rule Court decision in SAS Institute Inc. v. revises the rules of practice for 1 The transitional covered business method patent Iancu (SAS). Consistent with SAS, the instituting an IPR, PGR, or CBM to review program expired on September 16, 2020, in accordance with AIA 18(a)(3). Although the Office also revises the rules of practice require institution on either all program has sunset, existing CBM proceedings, for instituting a review, if at all, on all challenged claims (and all of the based on petitions filed before September 16, 2020, grounds of unpatentability for the grounds) presented in a petition or are still pending.

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79121

Office Patent Trial Practice Guide, 77 FR institute proceedings on a claim-by- by the Board.’’ 37 CFR 42.107(c) and 48756 (Aug. 14, 2012) (TPG2012). This claim and ground-by-ground basis’’ as 42.207(c) (2012). guide has been periodically updated. in ex parte reexamination, id. at 1356). In April 2016, after receiving See Office Patent Trial Practice Guide, The Federal Circuit has also held that comments from the public and carefully August 2018 Update, 83 FR 39989 (Aug. ‘‘if the Board institutes an IPR, it must reviewing them, the Office promulgated 13, 2018) (TPG2018); and Office Patent similarly address all grounds of a rule to allow new testimonial evidence Trial Practice Guide, July 2019 Update, unpatentability raised by the to be submitted with a patent owner’s 84 FR 33925 (July 16, 2019) (TPG2019). petitioner.’’ AC Techs. S.A. v. preliminary response. Amendments to A consolidated Trial Practice Guide, Amazon.com, Inc., 912 F.3d 1358, 1364 Rules of Practice for Trials Before the incorporating updates to the original (Fed. Cir. 2019). Patent Trial and Appeal Board, 81 FR August 2012 Practice Guide, was Consistent with SAS, the Office’s 18750 (April 1, 2016). The Office also published in November 2019. See guidance, and Federal Circuit’s case amended the rules to provide a Consolidated Trial Practice Guide, 84 law, this final rule revises §§ 42.108(a) presumption in favor of the petitioner FR 64280 (Nov. 21, 2019) (CTPG). and 42.208(a) to provide for instituting for a genuine issue of material fact Previously, under 37 CFR 42.108(a) an IPR, PGR, or CBM trial on all created by such testimonial evidence and 42.208(a), the Board exercised the challenged claims or none. This final solely for purposes of deciding whether discretion to institute an IPR, PGR, or rule also revises these rules for to institute an IPR, PGR, or CBM review. CBM on all or some of the challenged instituting a review, if at all, on all of Id. at 18755–57. claims and on all or some of the grounds the grounds of unpatentability for the Stakeholder feedback received in of unpatentability asserted for each challenged claims that are presented in party and amicus briefing as part of the claim presented in a petition. For a petition. In all pending IPR, PGR, and Precedential Opinion Panel (POP) example, the Board exercised the CBM proceedings before the Office, the review process in Hulu, LLC v. Sound discretion to authorize a review to Board will either institute on all of the View Innovations, LLC, Case IPR2018– proceed on only those claims and challenged claims and on all grounds of 01039, Paper 15 (PTAB Apr. 3, 2019) grounds for which the required unpatentability asserted for each claim (granting POP review), indicated that threshold under 35 U.S.C. 314(a) or or deny the petition. the rule has caused some confusion at 324(a) had been met, narrowing the In addition, consistent with the the institution stage for AIA issues for efficiency. TPG2018, this final rule amends proceedings. For example, certain The U.S. Supreme Court held in SAS, §§ 42.23, 42.24, 42.120, and 42.220 to stakeholders indicated that the however, that a decision to institute an permit (1) replies and patent owner presumption in favor of the petitioner IPR trial under 35 U.S.C. 314 may not responses to address issues discussed in for genuine issues of material fact institute review on fewer than all claims the institution decisions, and (2) sur- created by patent owner testimonial challenged in a petition. The Court held replies to principal briefs (i.e., to a reply evidence also creates a presumption in that the Office has the discretion to to a patent owner response or to a reply favor of the petitioner for questions institute trial on either all of the claims to an opposition to a motion to amend). relating to whether a document is a challenged in the petition or to deny the TPG2018 at 14–15. printed publication. Hulu, Paper 29 at petition. On April 26, 2018, the Office As noted in the TPG2018, in response 16. The Office has clarified in Hulu that posted guidance on the impact of SAS to issues arising from SAS, the this is not the case—the only on AIA trial proceedings at https:// petitioner is permitted to address in its presumption in favor of the petitioner is www.uspto.gov/patents-application- reply brief issues discussed in the set forth in 37 CFR 42.108(c) applying process/patent-trial-and-appeal-board/ institution decision. Similarly, the to genuine issues of material fact created trials/guidance-impact-sas-aia-trial. In patent owner is permitted to address the by testimonial evidence. Id. As to that light of SAS, the guidance states that if institution decision in its response and presumption, the Office’s experience is the Board institutes a trial for an IPR, a sur-reply, if necessary to respond to consistent with the concerns raised by PGR, or CBM under 35 U.S.C. 314 or the petitioner’s reply. However, the sur- commenters here that the presumption 324, the Board will institute on all reply may not be accompanied by new may discourage patent owners from claims and all grounds included in a evidence other than deposition filing testimonial evidence with their petition. The guidance provides that transcripts of the cross-examination of preliminary responses to avoid creating ‘‘the PTAB will institute as to all claims any reply witness. Sur-replies may only a presumption against the patent owner or none,’’ and ‘‘[a]t this time, if the respond to arguments made in reply where none would otherwise exist. PTAB institutes a trial, the PTAB will briefs, comment on reply declaration Section 314(a) of 35 U.S.C. provides institute on all challenges raised in the testimony, or point to cross-examination that ‘‘[t]he Director may not authorize petition.’’ Id. testimony. A sur-reply may also address an inter partes review to be instituted Subsequently, the U.S. Court of the institution decision if necessary to unless the Director determines that the Appeals for the Federal Circuit (the respond to the petitioner’s reply. This information presented in the petition Federal Circuit) has held that ‘‘[e]qual sur-reply practice essentially replaces . . . and any response . . . shows that treatment of claims and grounds for the previous practice of filing there is a reasonable likelihood that the institution purposes has pervasive observations on cross-examination petitioner would prevail with respect to support in SAS.’’ PGS Geophysical AS testimony. at least 1 of the claims challenged in the v. Iancu, 891 F.3d 1354, 1360 (Fed. Cir. In 2012, the Office also promulgated petition.’’ 35 U.S.C. 314(a). That is, the 2018) (noting that the Supreme Court in §§ 42.107(c) and 42.207(c), which statute provides that a petitioner is SAS wrote that ‘‘the petitioner is master initially included a prohibition against required to present evidence and of its complaint and normally entitled to a patent owner filing new testimony arguments sufficient to show that it is judgment on all of the claims it raises,’’ evidence with its preliminary response. reasonably likely that it will prevail in SAS, 138 S. Ct. at 1355, and that section In particular, these rules stated: ‘‘No showing unpatentability. Hulu, Paper 314 ‘‘indicates a binary choice—either new testimonial evidence. The 29, at 12–13 (citing 35 U.S.C. 312(a)(3), institute review or don’t,’’ id., adding preliminary response shall not present 314(a)). For a PGR proceeding, the that ‘‘Congress didn’t choose to pursue’’ new testimony evidence beyond that standard for institution is whether it is a statute that ‘‘allows the Director to already of record, except as authorized ‘‘more likely than not’’ that the

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79122 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

petitioner would prevail at trial. See 35 Paragraph (b) of § 42.23 is amended to where such a response is filed, U.S.C. 324(a). In determining whether permit petitioners to address issues including any testimonial evidence.’’ the information presented in the discussed in the institution decision in Sections 42.120 and 42.220 petition meets the standard for the reply briefs. Specifically, § 42.23(b) institution, the PTAB considers the is amended to replace the second The first sentence of each of totality of the evidence currently in the sentence with: ‘‘A reply may only §§ 42.108(a) and 42.208(a) is replaced record. See Hulu, Paper 29, at 3, 19. respond to arguments raised in the with the following: ‘‘(a) Scope. A patent Thus, a petitioner carries the burden in corresponding opposition, patent owner owner may file a single response to the both IPRs and PGRs at the institution preliminary response, patent owner petition and/or decision on institution.’’ stage. The Office’s experience with the response, or decision on institution.’’ Response to Comments 2016 rule change, however, is that Paragraph (b) of § 42.23 is amended to having a presumption in favor of the address the content of a sur-reply by In the notice of proposed rulemaking, petitioner at the institution stage for one adding the following: ‘‘A sur-reply may the Office sought comments on these class of evidence may lead to results only respond to arguments raised in the proposed changes. PTAB Rules of that are inconsistent with this statutory corresponding reply, and may not be Practice for Instituting on All scheme. accompanied by new evidence other Challenged Patent Claims and All Accordingly, the Office has an interest than deposition transcripts of the cross- Grounds and Eliminating the in ensuring that testimonial evidence is examination of any reply witness.’’ Presumption at Institution Favoring treated similarly to other evidence for Petitioner as to Testimonial Evidence, purposes of institution and consistently Section 42.24 85 FR 31728 (May 27, 2020). The Office with the statutory scheme. This final The title and § 42.24(c) are amended received a total of 40 comments, rule amends the rules of practice to to provide for word count limit for sur- including 5 comments from individuals, eliminate the presumption in favor of replies so that they are amended as 30 comments from associations, 1 the petitioner for a genuine issue of follows: ‘‘§ 42.24 Type-volume or page comment from a law firm, and 4 material fact created by testimonial limits for petitions, motions, comments from corporations. The Office evidence submitted with a patent oppositions, replies, and sur-replies’’ appreciates the thoughtful comments owner’s preliminary response when and ‘‘(c) Replies and Sur-replies. The representing a diverse set of views from deciding whether to institute an IPR, following word counts or page limits for the various public stakeholder PGR, or CBM review. Thus, consistent replies and sur-replies apply . . . ’’ communities. All of the comments are with the statutory framework, any Paragraph (c) of § 42.24 is amended to posted on the PTAB website at https:// testimonial evidence submitted with a add a new paragraph (4) that would www.uspto.gov/patents-application- patent owner’s preliminary response limit sur-replies to replies to patent process/patent-trial-and-appeal-board/ will be taken into account as part of the owner responses to petitions to 5,600 comments-proposed-rules-aia-trial. totality of the evidence. Doing so will words. Upon careful consideration of the remove a disincentive to patent owners public comments, and taking into submitting pre-institution testimony, Section 42.71 account the effect of the rule changes on eliminate a source of confusion, and The third sentence of § 42.71(d) is the economy, the integrity of the patent align the Board’s practice with its amended to add ‘‘a sur-reply’’ so that a system, the efficient administration of treatment of other evidence at the time rehearing request may identify matters the Office, and the ability of the Office of institution, without adversely in a sur-reply consistent with §§ 42.23 to timely complete instituted impacting petitioners’ ability to ensure and 42.24 that allow the parties to file proceedings, the Office adopts the that otherwise meritorious petitions sur-replies to principal briefs. proposed rule changes (with minor deviations in the rule language, as proceed to trial. Further, while parties Sections 42.108 and 42.208 normally do not have an opportunity to discussed below). Any deviations from depose the testifying parties prior to Each of §§ 42.108(a) and 42.208(a) is the proposed rule are based upon a institution, the Board’s experience is amended to state that when instituting logical outgrowth of the comments that cross-examination is not necessary IPR or PGR, the Board will authorize the received. to weigh the strengths and weaknesses review to proceed on all of the The Office’s responses address the of the testimony for purposes of challenged claims and on all grounds of comments that are directed to the institution. unpatentability asserted for each claim. proposed changes set forth in the notice Each of §§ 42.108(b) and 42.208(b) is of proposed rulemaking. 85 FR 31728. Discussion of Specific Rules amended to state that at any time prior Any comments directed to topics that 37 CFR, part 42, is amended as to institution of IPR or PGR, the Board are beyond the scope of the notice of follows: may deny all grounds for proposed rulemaking will not be unpatentability for all of the challenged addressed at this time. Section 42.23 claims. Denial of all grounds is a Board Section 42.23 is amended to permit decision not to institute IPR or PGR. Instituting on All Claims and All patent owners and petitioners to file The second sentence in each of Grounds sur-replies to principal briefs (i.e., to a §§ 42.108(c) and 42.208(c) is amended Comment 1: Most comments strongly reply to a patent owner response or to to delete the phrase ‘‘but a genuine issue supported the proposed rules that a reply to an opposition to a motion to of material fact created by such codify the Board’s existing practice for amend). In particular, the title and testimonial evidence will be viewed in instituting on all challenged claims and § 42.23(a) are amended to add ‘‘sur- the light most favorable to the petitioner all grounds presented in a petition when replies’’ so that the rule is amended as solely for purposes of deciding whether the Board institutes a review. Several follows: ‘‘42.23 Oppositions, replies, to institute [a] review.’’ Therefore, the comments indicated that instituting on and sur-replies. (a) Oppositions, replies, second sentence in each of §§ 42.108(c) all challenged claims and grounds is the and sur-replies . . . and, if the paper to and 42.208(c) states the following: ‘‘The most efficient course of action to fully which the opposition, reply, or sur- Board’s decision will take into account address the parties’ dispute before the reply . . . ’’ a patent owner preliminary response Board and to allow district courts to

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79123

apply AIA estoppel in the most efficient As discussed above, this final rule Office’s guidance, issued on June 5, manner during any subsequent, parallel codifies the Board’s existing practice 2018, also explains that the Board may litigation, including making the that has been in place for over two years consider the number of claims and estoppel provisions of section 315(e)(2) for instituting on all challenged claims grounds that meet the reasonable more predictable and robust. A number and grounds when the Board institutes likelihood standard when deciding of comments also stated that this type of a review. The Office of Management and whether to institute a review. SAS review structure is consistent with the Budget (OMB) has determined this rule Q&As, Part D, Effect of SAS on Future Supreme Court’s decision in SAS and to be not economically significant under Challenges that Could Be Denied for promotes efficiency by resolving all Executive Order 12866. Further, there is Statutory Reasons (June 5, 2018), challenges presented in a single no significant economic impact as the available at https://www.uspto.gov/sites/ proceeding, which will increase rule merely implements the law, as default/files/documents/sas_qas_ certainty for patent owners. A few mandated by SAS and further supported 20180605.pdf (‘‘[T]he panel will comments further noted that instituting by subsequent Federal Circuit precedent evaluate the challenges and determine on all claims and grounds may strike a like PGS Geophysical AS, 891 F.3d at whether, in the interests of efficient balance that helps achieve the 1360. As some of the comments have administration of the Office and Congressional objective of providing a recognized, on balance, the amended integrity of the patent system (see 35 fair, comprehensive, and efficient rules promote clarity and efficiency by U.S.C. 316(b)), the entire petition should alternative to district court litigation, addressing in one proceeding all be denied under 35 U.S.C. 314(a).’’). and adopting the proposed rules may challenges asserted in a petition. Comment 4: One comment suggested help promote clarity. In short, instituting on all challenged several changes in the language of Response: The Office appreciates the claims and grounds is consistent with § 42.108. For example, the comment thoughtful comments and agrees with the Supreme Court’s decision in SAS, is suggested (1) changing the title of them. In this final rule, the Office mandated by the Federal Circuit, and is § 42.108 from ‘‘Institution of inter partes adopts the proposed rules that codify consistent with the Board’s existing review’’ to ‘‘Decision whether to the Board’s existing practice that has practice. In adopting the proposed rules, institute review’’; (2) changing ‘‘When’’ been in place for over two years. Under the Office has considered the effect of to ‘‘If’’ in the phrase ‘‘When instituting the amended rules, when instituting a the rules on the economy, the integrity inter partes review’’ in § 42.108(a); (3) review, the Board will authorize the of the patent system, the efficient deleting the phrase ‘‘the Board will review to proceed on all of the administration of the Office, and the authorize’’ in § 42.108(a); and (4) challenged claims and on all grounds of ability of the Office to timely complete replacing ‘‘all of the challenged claims’’ unpatentability asserted for each claim. proceedings instituted. with ‘‘all involved claims.’’ Comment 2: A comment stated that Comment 3: Some comments the Supreme Court in SAS did not encouraged the Office to clarify that the Response: The Office appreciates the squarely address partial-grounds preexistence of a claim where no comment. The suggested changes are institution and that if the rules were reasonable likelihood of success has not necessary to codify the existing implemented rigidly, they would harm been demonstrated does not create a practice for instituting on all challenged patent owners, petitioners, and the presumption against institution where claims and grounds when the Board public affected by the challenged patent. there is another claim that does have a institutes a review. Notably, the title of In particular, the comment suggested reasonable likelihood of succeeding. A § 42.108 is consistent with the title of 35 that denying petitions that have some few comments urged the Office not to U.S.C. 314, which is ‘‘Institution of inter meritorious grounds or instituting apply the rules for instituting on all partes review.’’ Moreover, the term reviews that have some non-meritorious claims and grounds to deny meritorious ‘‘challenged claims’’ is consistent with grounds would constitute waste, making petitions as to some claims or grounds. 35 U.S.C. 318 and 328, each of which this rulemaking economically Response: The Office appreciates the states ‘‘a final written decision with significant under Executive Orders thoughtful comments. Even when a respect to the patentability of any patent 12866 and 13771. petitioner demonstrates a reasonable claim challenged by the petitioner and Response: The Federal Circuit has likelihood of prevailing with respect to any new claim added.’’ held that ‘‘[e]qual treatment of claims one or more claims, institution of Addressing the Institution Decision and grounds for institution purposes has review remains discretionary. SAS, 138 pervasive support in SAS.’’ PGS S. Ct. at 1356 (‘‘[Section] 314(a) invests Comment 5: Most comments strongly Geophysical AS, 891 F.3d at 1360. The the Director with discretion on the supported the proposed rules codifying Federal Circuit noted that the Supreme question whether to institute review the Board’s existing practice that allows Court in SAS wrote that ‘‘the petitioner . . . ’’ (emphasis omitted)); Harmonic the parties to address issues raised in is master of its complaint and normally Inc. v. Avid Tech., Inc., 815 F.3d 1356, the institution decision. Several entitled to judgment on all of the claims 1367 (Fed. Cir. 2016) (‘‘[T]he PTO is comments recognized that the it raises’’ and that section 314 ‘‘indicates permitted, but never compelled, to institution decision is a vehicle by a binary choice—either institute review institute an IPR proceeding.’’). In which the Board can solicit responsive or don’t,’’ adding that ‘‘‘Congress didn’t exercising that discretion, the Board is evidence and arguments on certain choose to pursue’ a statute that ‘allows guided by the statutory requirement, in issues and that allowing the parties to the Director to institute proceedings on promulgating regulations for IPR, PGR, address those issues may lead to a claim-by-claim and ground-by-ground and CBM, to consider the effect of any developing a more complete written basis’ as in ex parte reexamination.’’ Id. regulations on ‘‘the efficient record, clarifying the issues, and (quoting SAS, 138 S. Ct at 1355–1356). administration of the Office [and] the ensuring fairness. A few comments The Federal Circuit has also held that ability of the Office to timely complete sought clarification about whether a ‘‘if the Board institutes an IPR, it must proceedings,’’ 35 U.S.C. 316(b) and patent owner may file a response to similarly address all grounds of 326(b), as well as the requirement to either or both the petition and decision unpatentability raised by the construe our rules to ‘‘secure the just, on institution, and whether a petitioner petitioner.’’ AC Techs. S.A., 912 F.3d at speedy, and inexpensive resolution of may file a reply when the patent owner 1364. every proceeding,’’ 37 CFR 42.1(b). The elects not to file a response.

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79124 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

Response: The Office appreciates the are preferable to the previous procedure comments noted that this rule provides thoughtful comments. In this final rule, of authorizing a patent owner to file certainty as well as fairness. the Office adopts the proposed rules observations on cross-examination Response: The Office appreciates codifying the Board’s existing practice testimony in response to testimonial these comments. The amended rule is that allows the parties to address issues evidence submitted with a reply intended to conform to existing practice. raised in the institution decision. Under because they provide a more complete Consistent with the practice as outlined the amended rules, a patent owner may record. in the TPG2018 and the CTPG, sur- file a single response to address issues Response: The Office appreciates replies are subject to the same word or raised in either or both the petition and these thoughtful comments. The page limit as a reply. institution decision, and a petitioner amended rules are intended to conform Comment 11: The Office has also may file a single reply to address issues to existing practice. Consistent with the received comments on the existing raised in either or both the patent owner practice as outlined in the TPG2018, practice of requiring, in response to a response and institution decision. For and the CTPG published in November paper that contains a statement of those rare circumstances in which the 2019, the new rules will permit sur- material fact, a listing of facts that are patent owner elects not to file a replies to principal briefs (i.e., to a reply admitted, denied, or cannot be admitted response, the patent owner must arrange to a patent owner response or to a reply or denied. a conference call with the parties and to an opposition to a motion to amend). Response: The Office appreciates the the Board, as required by the scheduling However, a sur-reply may not be comments received; however, they are order, and the petitioner is expected to accompanied by new evidence other beyond the scope of the current notify the Board during the conference than transcripts of the cross- rulemaking. No changes to that practice call whether it intends to file a reply to examination testimony of any reply are implemented in the amended rules. the decision on institution. The absence witness. Sur-replies are permitted only The Office will take these comments of a patent owner response will not to respond to arguments made in reply into account as the Office continually prevent a petitioner from filing a reply briefs, comment on reply declaration seeks to improve the AIA review where appropriate to address the testimony, or point to cross-examination process to maintain fair procedures. institution decision. testimony. A sur-reply also may address Comment 12: The Office has also Comment 6: One comment does not the institution decision if necessary to received some comments suggesting support the rule changes that allow the respond to the petitioner’s reply. This changes to the word count limit. For parties to address the issues raised in sur-reply practice essentially replaces example, one comment requested that the institution decision because the the previous practice of filing the word count be a function of the Board should not take sides in the observations on cross-examination number of claims in a challenged patent dispute. Another comment suggested testimony. or the length of those claims. Another that the rules should not provide a basis Comment 8: Some comments comment expressed concern about for parties to re-litigate the institution expressed concern that the amended perceived unfairness in word counts, decision. rules do not expressly provide for a sur- wherein patent owners may file both a Response: As noted above, a few reply as a matter of right, stating that preliminary response and an opposition, comments have recognized that the this may lead to uncertainty among each containing 14,000 words, in institution decision is a vehicle by parties involved in an AIA trial addition to a sur-reply of 5,600 words, which the Board can solicit responsive proceeding. whereas a petitioner is limited to a evidence and arguments on certain Response: See response to comment 7. petition of 14,000 words followed by a issues. Notably, a decision instituting a Consistent with existing practice as reply of 5,600 words. This comment review does not make a final provided in the TPG2018 and the CTPG, suggested that some of this disparity determination with respect to the no prior authorization is required to file could be mitigated if petitioners are patentability of the challenged claims or a sur-reply to a reply to a patent owner allowed to file a reply whenever a with respect to the claim construction. response or to a reply to an opposition patent owner files a preliminary Allowing the parties to address the to a motion to amend. response. issues raised in the institution decision Comment 9: Some comments Response: The Office appreciates the may promote developing a more expressed concern that the Proposed comments received; however, they are complete written record, clarify the Rules do not place limits on the beyond the scope of the current issues, and ensure fairness in issuing introduction of new evidence in a sur- rulemaking. The Office will take these the final written decision on reply, which could lead to uncertainty comments into account as the Office patentability. and gamesmanship. continually seeks to improve the AIA Response: The Office appreciates Sur-Replies review process to maintain fair these thoughtful comments. The Office procedures. Comment 7: Most comments strongly has revised the text of rule 42.23(b) to supported the proposed rules that clarify that the sur-reply ‘‘may not be Eliminating the Presumption at codify the Board’s existing practice of accompanied by new evidence other Institution allowing sur-replies to principal briefs. than transcripts of the cross- Comment 13: Most comments favored Several comments indicated that examination testimony of any reply adoption of the proposed rule allowing sur-replies provides certainty witness.’’ This conforms to existing eliminating the presumption at to Board processes. Some comments practice as stated in the TPG2018 and institution that a genuine issue of also noted that allowing sur-replies the CTPG. material fact created by testimonial gives a patent owner an opportunity to evidence will be viewed in a light most respond to new exhibits or other new Word Limits for Sur-Replies favorable to petitioner for purposes of information in a petitioner’s reply, Comment 10: Most comments strongly deciding whether to institute. However, providing balance during AIA supported the proposed rule change to a number of comments opposed proceedings and affording patent 37 CFR 42.24(c), which imposes a limit adopting the proposed rule. owners a fair opportunity to be heard. of 5,600 words for sur-replies to patent Response: The Office appreciates the Some comments stated that sur-replies owner responses to petitions. Some input from the public on this issue,

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79125

whether supporting or opposing the Response: The Office appreciates the intent. In addition, elimination of the proposed rule. The suggestion that the comments and agrees that any presumption does not impact the ability present rule be retained is not adopted. presumption in favor of institution is of petitioners to file with the Office a The presumption in favor of the inappropriate. The Office also agrees petition to institute a review of a patent. petitioner where there is a genuine that under the current rule, a patent Comment 16: A number of comments dispute of material fact created by owner might not be inclined to submit opposing the proposed rule questioned testimonial evidence in a patent owner pre-institution testimony that might, the fairness of the proposed rule to preliminary response has created under the presumption, create an issue petitioners. One comment expressed confusion as to how other evidence of material fact. As in the proposed rule, concern that under the proposed rule, should be weighed. This confusion was the final rule modifies the existing rule the patent owner would have a ‘‘one- resolved in large part in Hulu, but Hulu to address these concerns and no longer sided ability to enter unchallenged highlights an inconsistency in the specifies that a genuine issue of material evidence prior to institution.’’ Other treatment of evidence that the proposed fact created by testimonial evidence comments expressed concern that rule is intended to resolve. In particular, results in a presumption in favor of a crediting a patent owner’s testimonial in Hulu, the Board held that disputed petitioner. The rule change removes any evidence without providing cross- questions of material fact raised by bias or appearance of bias in favor of examination or an opportunity to evidence other than testimonial petitioner, and provides a balanced respond may lead to denials of evidence are resolved by the Board at approach to ensure that all testimonial institution that cannot be appealed, the institution phase without a evidence submitted by the parties is even where the patent owner’s factual presumption, even where additional fairly considered. contentions are mistaken. Several evidence or discovery might have Comment 15: Several comments in comments expressed the view that the illuminated them. See Hulu, Paper 29, at support of the rule change noted that lack of cross-examination is especially 16–20 (addressing the standard for the practice to view testimonial concerning when the patent owner proving printed publication pre- evidence in the light most favorable to introduces testimony asserting institution). The proposed rule confirms the petitioner for purposes of instituting ‘‘secondary considerations’’ such as that no presumption applies in favor of a review conflicts with the decision of unexpected results, commercial success, institution regardless of the existence or Congress to place the burden of proof on copying by others, and long-felt but nature of a factual dispute in the pre- the petitioner. One comment noted that, unmet need. One comment expressed institution record and regardless of the by eliminating the presumption, the concern that the proposed rule would type of evidence, testimonial or proposed rule change enables the PTAB lead to more discretionary denials of otherwise. to consider the totality of the evidence institution. One comment expressed Many of the comments opposing the in deciding whether the petition meets concern that the proposed rule would proposed rule are arguments in favor of the standard for institution. Another reduce patent quality, drive up costs, an institution presumption generally. comment opposing the rule change and invite ‘‘gamesmanship.’’ This would conflict with the statute, stated the change thwarts Congress’s Response: The Office appreciates which makes clear that the burden is on purposes in establishing the AIA by these comments but does not adopt the petitioner to meet the applicable hampering the ability to challenge low- them. The Office believes the Board is standard that it would prevail with quality patents. adequately able to weigh the parties’ respect to at least one of the claims Response: The Office appreciates testimonial evidence and fairly resolve challenged in the petition. See 35 U.S.C. these thoughtful comments. As set forth factual disputes at the institution stage 314(a), 324(a). Moreover, the in the statutes established by Congress, without a presumption crediting the presumption provided by the existing the burden is on the petitioner to meet petitioner’s testimony. For example, rule has proved unnecessary to resolve the applicable standard that it would testimony must still disclose the the institution question in other prevail with respect to at least one of the underlying facts and data upon which it contexts. Disputed questions of material claims challenged in the petition. See 35 relies, or it will be entitled to little fact raised by other than testimonial U.S.C. 314(a), 324(a). In response to weight. See 37 CFR 42.65(a); CTPG, at evidence are resolved by the Board at recent feedback received from the 35. Moreover, consistent with existing the institution phase without a public, the Office agrees it is practice, limited pre-institution presumption. See Hulu, Paper 29, at 16– inconsistent with the statutory discovery may be granted at the 20 (addressing the standard for proving framework to view testimonial evidence discretion of the Board. Nonetheless, printed publication pre-institution). in the light most favorable to although cross-examination of pre- Comment 14: A number of comments petitioners. The presumption has institution testimony might be helpful supporting the rule change asserted that caused confusion at the institution stage in a few cases, as a general matter, the the current presumption in favor of the for AIA proceedings and has proved Office believes that its benefits will be petitioner is biased towards institution unnecessary to resolve the institution outweighed by the greater expense to and discourages patent owners from question in other contexts. With the the Office and the parties, where the submitting conflicting testimonial elimination of the presumption, the Board is able to reach a decision on evidence with a preliminary response. PTAB will consider the totality of the institution based on the briefs and One comment suggested that, in view of evidence to determine whether the documents as submitted by the parties. the presumption of validity, testimonial petitioner has met the standard for Comment 17: Several comments evidence should instead be viewed in institution of the procedure. expressed concern that adopting the the light most favorable to patentability The Office disagrees that elimination proposed rule would unduly complicate and that a presumption in favor of the of the presumption frustrates the the pre-institution phase for AIA trials. patent owner would be appropriate. intention of Congress. To the contrary, This is sometimes described in the Another comment suggested that a Congress provided that institution of comments as creating a ‘‘trial within a neutral presumption is best in the IPR is discretionary and conditioned on trial.’’ One comment expressed concern interest of fairness and reduces the risk the petitioner meeting the applicable that the proposed rule could give rise to that innovators will be deprived of their standard for review. Id. Elimination of ‘‘almost universal requests’’ for pre- innovations. the presumption furthers Congressional institution discovery and additional

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00009 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79126 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

briefing, leading to greater costs and eliminating the presumption may allow Comment 21: Several comments burdens to the parties. Another a patent owner to introduce disputes of addressed the standard of review under comment expressed concern that there material fact via expert testimony on the the rule. One comment expressed are no procedural guidelines in place to patentability of the challenged claims concern that the rule does not make it prevent this. This comment expressed that lead to a denial of institution, the clear how pre-institution testimony will concern that ‘‘over complication’’ of the petitioner should be entitled to take the be evaluated. Another stated that the pre-institution stage advantages more deposition of an expert whose rule should specify the burden and experienced parties, and that the costs declaration is submitted with the asserted that removing the summary and burdens to the Office may increase preliminary response. The comment judgment standard in the proposed rule due to pre-institution depositions and stated that if a new expert declaration is would make Board decisions on additional briefing. Several other submitted with the patent owner disputed facts arbitrary and capricious. comments suggested that the rule response, the petitioner should also be Response: The Office appreciates but should give petitioners the opportunity permitted to take the deposition of that does not adopt the comments. The final to reply if a patent owner submits expert as well. rule provides no presumption as to testimony with the preliminary Response: The Office appreciates but disputed issues of material fact. response that raises a genuine issue of does not adopt the comments. Under the However, the decision in Hulu provides material fact. One comment expressed current rule, once a trial is instituted, a guidance on the institution standard the view that the chances of error by the patent owner may choose not to rely on and evidentiary dynamics, albeit in the Board are greater if institution is testimony submitted with the context of a printed publication issue. decided without the safeguards of preliminary response. CTPG, at 51. That Hulu, Paper 29, at 11–19. The Office has discovery, cross-examination, additional would not change under the final rule. ample experience in evaluating briefing, and a hearing. Another Once a trial commences, petitioners can declaration testimony without cross- comment opposed the proposed rule also withdraw evidence. See Hulu, examination in a variety of contexts and because it endorses resolution of Paper 29, at 6 (additional evidence does not see the need to provide further disputes of fact at the institution phase regarding the date of publication at guidance in the rule itself. Additional on an incomplete record and without issue raised more questions than it guidance on the application of the rule judicial review. answered and was withdrawn). If both change may be provided in future Response: The Office appreciates parties can withdraw their reliance on precedential and informative Board these thoughtful comments and evidence that turns out to be weak, there decisions. Comment 22: Several comments concerns on this issue. At present, is no unfairness. opposing the rule change expressed although timely and well-supported The Office does not believe patent requests are permitted, as consistent concerns that removal of the owners will be motivated to provide with existing practice, no additional presumption would violate due process ‘‘less supportable’’ testimony from their briefing or discovery (e.g., depositions requirements because it would allow for declarants as a result of the rule change. of declarants) during the institution a decision not to institute based on The Office believes parties generally phase is contemplated as a result of the unchallenged testimonial evidence. One recognize that their goals are best served submission of testimony with the comment asserted the change would be by providing the most credible preliminary response. In this way, no unconstitutional because it does not testimony from their declarants. See 37 trial within a trial is anticipated, and the allow a petitioner to confront an adverse CFR 42.65(a); CTPG, at 51. If, after trial parties will not be burdened with witness. is initiated, the patent owner withdraws greater costs. The Board has the benefit Response: The Office appreciates the of the documentary evidence of record, reliance on a declarant and a declaration comments but disagrees the final rule as well as elucidating argument from the submitted with the preliminary violates due process requirements or is parties, in evaluating the testimonial response, that declarant will usually not unconstitutional. Institution of AIA evidence. In most cases, in the Board’s be subject to a deposition on the review proceedings is discretionary, and experience, this evidence is sufficient to withdrawn declaration. CTPG, at 51. there is no right provided in the resolve the facts in dispute. For Comment 19: One comment expressed statutory framework to challenge instance, declaration evidence alleging a concern that the new rule should not testimony at the institution stage. See 35 secondary considerations would, alter the standard for instituting a trial. U.S.C. 314(a), 324(a). Under the final consistent with normal practice, be Response: The Office agrees. The final rule, both the petitioner and patent given little weight absent supporting rule does not change the standard for owner are able to submit testimonial documentary evidence. Thus, a instituting trial and does not shift the evidence. The Office has ample declaration alleging commercial success burden of proving unpatentability away experience in evaluating declaration would not be given much weight on from the petitioner. testimony without cross-examination in institution absent sufficient supporting Comment 20: One comment opposing a variety of contexts. Such testimony evidence demonstrating sales figures, the rule change suggested that a must be supported as appropriate, or it etc. presumption in favor of the petitioner will be accorded little weight. See 37 Comment 18: Several comments should continue and should apply to all CFR 42.65(a); CTPG, at 51. The Board opposing the proposed rule expressed disputed evidentiary issues, including will consider the totality of the evidence concern about unfairness to the questions of whether a document is a presented to determine if the petitioner petitioner if the patent owner withdraws printed publication. meets the threshold standard to institute its reliance on testimony submitted with Response: The Office appreciates but review. the preliminary response. One comment does not adopt this comment. The final Comment 23: A number of comments suggested that the patent owner might rule eliminates the presumption as to expressed concern that the Office did be ‘‘incentivized’’ to introduce less genuine issues of material fact. The not provide adequate justification for supportable testimony prior to Hulu decision expressly provides the rule change and asserted the institution that can be withdrawn if a guidance on establishing a document as rationale for the change is inconsistent trial is instituted. Another comment a printed publication. Hulu, Paper 29, at with the Office findings in the 2016 expressed concern that, because 11–19. rulemaking that established the

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00010 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79127

presumption. A few comments Administrative Procedure Act and or practice’’) (quoting 5 U.S.C. suggested that any stakeholder Executive Order 12866. The comments 553(b)(3)(A)). confusion caused by the rule does not assert that the rule making is The Office, nevertheless, published justify abandoning the rule but should significant—economically significant— the notice of proposed rulemaking for instead be addressed by precedential and the 30-day comment period failed comment, as it sought the benefit of the decisions or the next revision of the to provide the public a meaningful public’s views on the Office’s proposed Trial Practice Guide. opportunity to respond to the changes. See 85 FR 31728. Response: As part of ongoing efforts to comments. B. Regulatory Flexibility Act: For the improve AIA proceedings, the Office Response: The OMB has determined reasons set forth herein, the Deputy continuously evaluates its procedures this rule to be not significant for General Counsel for General Law of the based on feedback from the public. purposes of Executive Order 12866. USPTO has certified to the Chief Upon evaluation of recent feedback, the Further, the Office disagrees that the Counsel for Advocacy of the Small Office has determined that the final rule will impose additional costs Business Administration that changes presumption causes confusion at the because no additional briefing or adopted in this final rule will not have institution stage and potentially discovery is contemplated as a result of a significant economic impact on a discourages patent owners from the rule change. substantial number of small entities. See submitting testimonial evidence. In 5 U.S.C. 605(b). addition, the Office’s experience is that Rulemaking Considerations This final rule revises certain trial practice procedures before the Board in having a presumption in favor of the A. Administrative Procedure Act light of the Supreme Court’s ruling in petitioner at the institution stage may (APA): This final rule revises the rules SAS Institute Inc. v. Iancu, 138 S. Ct. lead to results that are inconsistent with relating to Office trial practice for IPR, 1348 (2018), that a decision to institute the statutory scheme, which places the PGR, and CBM proceedings. The an IPR under 35 U.S.C. 314 may not burden on the petitioner. changes set forth in this final rule do not Although there were valid reasons for institute on fewer than all claims change the substantive criteria of promulgating the original rule, the challenged in a petition. In accordance patentability. These changes involve Office has determined that the problems with that ruling, this final rule revises rules of agency procedure and and confusion engendered by the rule, the rules of practice for instituting interpretation. See Perez v. Mortg. discussed above, outweigh those review on all challenged claims or none Bankers Ass’n, 135 S. Ct. 1199, 1204 reasons. The Office has ample in IPR, PGR, and CBM proceedings (2015) (Interpretive rules ‘‘advise the experience in evaluating declaration before the PTAB. This final rule also public of the agency’s construction of testimony without cross-examination in revises the rules of practice for the statutes and rules which it a variety of contexts. The Office instituting a review on all grounds of believes, therefore, that the Board will administers.’’) (citation and internal unpatentability for the challenged remain able to fairly and efficiently quotation marks omitted); Bachow claims that are asserted in a petition. resolve factual disputes at the Commc’ns, Inc. v. F.C.C., 237 F.3d 683, Additionally, this final rule revises the institution phase in deciding whether to 690 (D.C. Cir. 2001) (Rules governing an rules to conform to the current standard institute the requested trial without the application process are procedural practice of providing sur-replies to current presumption. The Office under the Administrative Procedure principal briefs and providing that a received numerous comments that Act.); Inova Alexandria Hosp. v. patent owner response and reply may support and agree with the Office’s Shalala, 244 F.3d 342, 350 (4th Cir. respond to a decision on institution. rationale for the change as eliminating 2001) (Rules for handling appeals were This final rule further revises the rules a source of confusion, removing a procedural where they did not change to eliminate the presumption that a disincentive to patent owners to provide the substantive requirements for genuine issue of material fact created by pre-institution testimonial evidence, reviewing claims.); Nat’l Org. of the patent owner’s testimonial evidence and better according with the statutory Veterans’ Advocates, Inc. v. Sec’y of filed with a preliminary response will standards for institution. See 35 U.S.C. Veterans Affairs, 260 F.3d 1365, 1375 be viewed in the light most favorable to 314(a), 324(a). Accordingly, the Office (Fed. Cir. 2001) (Rule that clarifies the the petitioner for purposes of deciding has elected to revise its rule. interpretation of a statute is whether to institute a review. The Comment 24: A few comments interpretive.); JEM Broadcasting Co. v. changes in this final rule are procedural expressed concern with the retroactive F.C.C., 22 F.3d 320, 328 (D.C. Cir. 1994) in nature, and any requirements application of the rule change and (Rules are not legislative because they resulting from these changes are of requested that the rule not go into do not ‘‘foreclose effective opportunity minimal or no additional burden to immediate effect. Several other to make one’s case on the merits.’’). those practicing before the Board. comments stated that the Office should Accordingly, prior notice and For the foregoing reasons, the changes provide an opportunity for further opportunity for public comment are not in this final rule will not have a discussion and consideration on this required pursuant to 5 U.S.C. 553(b) or significant economic impact on a proposed rule change. (c) (or any other law). See Perez, 135 S. substantial number of small entities. Response: The Office acknowledges Ct. 1199, 1206 (Notice-and-comment C. Executive Order 12866 (Regulatory the concerns with the retroactive procedures are required neither when Planning and Review): This rulemaking application of the rule. The change to an agency ‘‘issue[s] an initial has been determined to be not eliminate the presumption will apply interpretive rule’’ nor ‘‘when it amends significant for purposes of Executive only to petitions filed on or after the or repeals that interpretive rule.’’); Order 12866 (Sept. 30, 1993). effective date of the rule. The Office Cooper Techs. Co. v. Dudas, 536 F.3d D. Executive Order 13563 (Improving appreciates all comments submitted in 1330, 1336–37 (Fed. Cir. 2008) (stating Regulation and Regulatory Review): The response to the proposed rule and does that 5 U.S.C. 553, and thus 35 U.S.C. Office has complied with Executive not believe further discussion is needed. 2(b)(2)(B), do not require notice and Order 13563 (Jan. 18, 2011). Comment 25: A few comments stated comment rulemaking for ‘‘interpretative Specifically, the Office has, to the extent the rulemaking fails to comply with the rules, general statements of policy, or feasible and applicable: (1) Made a procedural requirements imposed by the rules of agency organization, procedure, reasoned determination that the benefits

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00011 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79128 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

justify the costs of the rule; (2) tailored provisions of the Small Business packages to OMB for its review and the rule to impose the least burden on Regulatory Enforcement Fairness Act of approval because the revisions in this society consistent with obtaining the 1996 (5 U.S.C. 801 et seq.), prior to rulemaking do not materially change the regulatory objectives; (3) selected a issuing any final rule, the USPTO will information collections approved under regulatory approach that maximizes net submit a report containing the rule and OMB control number 0651–0069. benefits; (4) specified performance other required information to the United Notwithstanding any other provision objectives; (5) identified and assessed States Senate, the United States House of law, no person is required to respond available alternatives; (6) involved the of Representatives, and the Comptroller to, nor shall any person be subject to, a public in an open exchange of General of the Government penalty for failure to comply with a information and perspectives among Accountability Office. The changes in collection of information subject to the experts in relevant disciplines, affected this final rule are not expected to result requirements of the Paperwork stakeholders in the private sector, and in an annual effect on the economy of Reduction Act unless that collection of the public as a whole, and provided $100 million or more, a major increase information displays a currently valid online access to the rulemaking docket; in costs or prices, or significant adverse OMB control number. (7) attempted to promote coordination, effects on competition, employment, simplification, and harmonization investment, productivity, innovation, or List of Subjects in 37 CFR Part 42 across government agencies and the ability of United States-based identified goals designed to promote enterprises to compete with foreign- Administrative practice and innovation; (8) considered approaches based enterprises in domestic and procedure, Inventions and patents, that reduce burdens and maintain export markets. Therefore, this Lawyers. flexibility and freedom of choice for the rulemaking is not a ‘‘major rule’’ as For the reasons set forth in the public; and (9) ensured the objectivity of defined in 5 U.S.C. 804(2). preamble, the Office amends part 42 of L. Unfunded Mandates Reform Act of scientific and technological information title 37 as follows: and processes. 1995: The changes set forth in this final E. Executive Order 13771 (Reducing rule do not involve a federal PART 42—TRIAL PRACTICE BEFORE Regulation and Controlling Regulatory intergovernmental mandate that will THE PATENT TRIAL AND APPEAL Costs): This final rule is not expected to result in the expenditure by state, local, BOARD be an Executive Order 13771 (Jan. 30, and tribal governments, in the aggregate, 2017) regulatory action because this of $100 million (as adjusted) or more in ■ 1. The authority citation for part 42 final rule is not significant under any one year, or a federal private-sector continues to read as follows: Executive Order 12866 (Sept. 30, 1993). mandate that will result in the F. Executive Order 13132 expenditure by the private sector of Authority: 35 U.S.C. 2(b)(2), 6, 21, 23, 41, (Federalism): This rulemaking does not $100 million (as adjusted) or more in 135, 311, 312, 316, 321–326; Pub. L. 112–129, contain policies with federalism any one year, and will not significantly 125 Stat. 284; and Pub. L. 112–274, 126 Stat. implications sufficient to warrant or uniquely affect small governments. 2456. preparation of a Federalism Assessment Therefore, no actions are necessary ■ under Executive Order 13132 (Aug. 4, under the provisions of the Unfunded 2. Revise § 42.23 to read as follows: 1999). Mandates Reform Act of 1995. See 2 § 42.23 Oppositions, replies, and sur- G. Executive Order 13211 (Energy U.S.C. 1501 et seq. replies. Effects): This rulemaking is not a M. National Environmental Policy significant energy action under Act: This rulemaking will not have any (a) Oppositions, replies, and sur- Executive Order 13211 because this effect on the quality of the environment replies must comply with the content rulemaking is not likely to have a and is thus categorically excluded from requirements for motions and, if the significant adverse effect on the supply, review under the National paper to which the opposition, reply, or distribution, or use of energy. Therefore, Environmental Policy Act of 1969. See sur-reply is responding contains a a Statement of Energy Effects is not 42 U.S.C. 4321 et seq. statement of material fact, must include required under Executive Order 13211 N. National Technology Transfer and a listing of facts that are admitted, (May 18, 2001). Advancement Act: The requirements of denied, or cannot be admitted or H. Executive Order 12988 (Civil section 12(d) of the National denied. Any material fact not Justice Reform): This rulemaking meets Technology Transfer and Advancement specifically denied may be considered applicable standards to minimize Act of 1995 (15 U.S.C. 272 note) are not admitted. litigation, eliminate ambiguity, and applicable because this rulemaking does (b) All arguments for the relief reduce burden as set forth in sections not contain provisions that involve the requested in a motion must be made in 3(a) and 3(b)(2) of Executive Order use of technical standards. the motion. A reply may only respond O. Paperwork Reduction Act: The 12988 (Feb. 5, 1996). to arguments raised in the Paperwork Reduction Act of 1995 (44 I. Executive Order 13045 (Protection corresponding opposition, patent owner U.S.C. 3501–3549) requires that the of Children): This rulemaking does not preliminary response, patent owner Office consider the impact of paperwork concern an environmental risk to health response, or decision on institution. A and other information collection or safety that may disproportionately sur-reply may only respond to burdens imposed on the public. This affect children under Executive Order arguments raised in the corresponding final rule does not involve an 13045 (Apr. 21, 1997). reply and may not be accompanied by information collection requirement that J. Executive Order 12630 (Taking of new evidence other than deposition is subject to review by the OMB under Private Property): This rulemaking will transcripts of the cross-examination of the Paperwork Reduction Act of 1995 not affect a taking of private property or any reply witness. otherwise have taking implications (44 U.S.C. 3501–3549). This rulemaking under Executive Order 12630 (Mar. 15, does not add any additional information ■ 3. Amend § 42.24 by revising the 1988). requirements or fees for parties before section heading and paragraph (c) K. Congressional Review Act: Under the Board. Therefore, the Office is not introductory text and adding paragraph the Congressional Review Act resubmitting information collection (c)(4) to read as follows:

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00012 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79129

§ 42.24 Type-volume or page limits for § 42.120 Patent owner response. ENVIRONMENTAL PROTECTION petitions, motions, oppositions, replies, and AGENCY sur-replies. (a) Scope. A patent owner may file a * * * * * single response to the petition and/or 40 CFR Part 52 decision on institution. A patent owner (c) Replies and sur-replies. The response is filed as an opposition and is [EPA–HQ–OAR–2019–0611; FRL–10017–82– following word counts or page limits for OAR] replies and sur-replies apply and subject to the page limits provided in include any statement of facts in § 42.24. RIN 2060–AU54 * * * * * support of the reply. The word counts Implementation of the Revoked 1997 8- or page limits do not include a table of ■ 7. Amend § 42.208 by revising Hour Ozone National Ambient Air contents; a table of authorities; a listing paragraphs (a), (b), and (c) to read as Quality Standards; Updates to 40 CFR of facts that are admitted, denied, or follows: Part 52 for Areas That Attained by the cannot be admitted or denied; a Attainment Date; Withdrawal of Direct certificate of service or word count; or § 42.208 Institution of post-grant review. Final Rule an appendix of exhibits. (a) When instituting post-grant * * * * * AGENCY: Environmental Protection review, the Board will authorize the (4) Sur-replies to replies to patent Agency (EPA). owner responses to petitions: 5,600 review to proceed on all of the ACTION: Withdrawal of direct final rule. words. challenged claims and on all grounds of unpatentability asserted for each claim. SUMMARY: Due to the receipt of adverse * * * * * comment, the Environmental Protection (b) At any time prior to institution of ■ 4. Amend § 42.71 by revising the third Agency (EPA) is withdrawing the post-grant review, the Board may deny sentence of paragraph (d) introductory October 9, 2020, direct final rule to text to read as follows: all grounds for unpatentability for all of update the Code of Federal Regulations the challenged claims. Denial of all (CFR) to codify its findings that nine § 42.71 Decision on petitions or motions. grounds is a Board decision not to areas in four states attained the revoked * * * * * institute post-grant review. 1997 8-hour ozone National Ambient (d) *** The request must (c) Post-grant review shall not be Air Quality Standards (NAAQS) by the specifically identify all matters the party instituted unless the Board decides that applicable attainment dates. The EPA believes the Board misapprehended or the information presented in the will address all comments received in a overlooked, and the place where each petition demonstrates that it is more subsequent final rule for which the EPA matter was previously addressed in a likely than not that at least one of the will not institute a second comment motion, an opposition, a reply, or a sur- claims challenged in the petition is period. reply. * * * unpatentable. The Board’s decision will DATES: The direct final rule published * * * * * take into account a patent owner on October 9, 2020 (85 FR 64046) is ■ 5. Revise § 42.108 to read as follows: preliminary response where such a withdrawn effective December 9, 2020. response is filed, including any FOR FURTHER INFORMATION CONTACT: Ms. § 42.108 Institution of inter partes review. testimonial evidence. A petitioner may Virginia Raps, Air Quality Policy (a) When instituting inter partes seek leave to file a reply to the Division, Office of Air Quality Planning review, the Board will authorize the preliminary response in accordance and Standards, U.S. Environmental review to proceed on all of the with §§ 42.23 and 42.24(c). Any such Protection Agency, Mail Code: C539–01, challenged claims and on all grounds of request must make a showing of good Research Triangle Park, NC 27711, unpatentability asserted for each claim. cause. telephone (919) 541–4383; fax number: (b) At any time prior to a decision on (919) 541–5315; email address: * * * * * institution of inter partes review, the [email protected]. Board may deny all grounds for ■ 8. Amend § 42.220 by revising SUPPLEMENTARY INFORMATION: On unpatentability for all of the challenged paragraph (a) to read as follows: October 9, 2020, the EPA published a claims. Denial of all grounds is a Board direct final rule (85 FR 64046) to codify decision not to institute inter partes § 42.220 Patent owner response. its findings that nine areas in four states review. (a) Scope. A patent owner may file a attained the revoked 1997 8-hour ozone (c) Inter partes review shall not be single response to the petition and/or NAAQS by the applicable attainment instituted unless the Board decides that decision on institution. A patent owner dates. In the proposal for the direct final the information presented in the response is filed as an opposition and is rule published on the same day (85 FR petition demonstrates that there is a 64089), the EPA stated that written reasonable likelihood that at least one of subject to the page limits provided in § 42.24. comments must be received on or before the claims challenged in the petition is November 9, 2020. The EPA stated that unpatentable. The Board’s decision will * * * * * if any relevant adverse comments are take into account a patent owner Andrei Iancu, received on the proposal, the EPA will preliminary response where such a Under Secretary of Commerce for Intellectual publish a timely withdrawal of the response is filed, including any direct final rule in the Federal Register. testimonial evidence. A petitioner may Property and Director of the United States Patent and Trademark Office. On November 2, 2020, an anonymous seek leave to file a reply to the [FR Doc. 2020–27048 Filed 12–8–20; 8:45 am] comment was posted in the docket that preliminary response in accordance the EPA interprets as relevant and with §§ 42.23 and 42.24(c). Any such BILLING CODE 3510–16–P adverse. Therefore, the EPA is request must make a showing of good withdrawing the direct final rule and cause. will publish a subsequent final rule ■ 6. Amend § 42.120 by revising wherein the EPA will address all paragraph (a) to read as follows: comments received. The EPA will not

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00013 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79130 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

institute a second comment period on U.S. Department of Transportation, notice on its website no later than the subsequent final rule. Docket Operations, West Building November 30th of each year, providing Ground Floor, Room W12–140, 1200 at least one month advance notice to List of Subjects in 40 CFR Part 52 New Jersey Avenue SE, Washington, DC stakeholders of the new threshold before Environmental protection, 20590, between 9 a.m. and 5 p.m., it becomes effective. Issuing a notice Administrative practice and procedure, Monday through Friday, except Federal each year, as opposed to a final rule, Air pollution control, Designations and holidays. will simplify and expedite the classifications, Incorporation by FOR FURTHER INFORMATION CONTACT: communication of the reporting reference, Intergovernmental relations, Prabhdeep S. Chawla, Industry threshold, and will be more practical Nitrogen oxides, Ozone, Reporting and Economist, U.S. Department of and efficient than FRA annually recordkeeping requirements, Volatile Transportation, Federal Railroad publishing a final rule incorporating the organic compounds. Administration, Office of Safety reporting threshold amount in the rule Analysis, RRS–21, W33–321, 1200 New text in 49 CFR 225.19(c) and (e). Andrew Wheeler, In the NPRM, FRA proposed no Administrator. Jersey Ave. SE, Washington, DC 20590 (telephone 202–493–6298); or Senya revisions to 49 CFR 225.19(c) regarding rail equipment accidents. However, PART 52—APPROVAL AND Waas, Attorney Adviser, U.S. because that section currently lists the PROMULGATION OF Department of Transportation, Federal reporting threshold for each calendar IMPLEMENTATION PLANS Railroad Administration, Office of Chief Counsel, RCC–10, W31–223, 1200 New year since 2002, FRA is revising that ■ Accordingly, the rule amending 40 Jersey Ave. SE, Washington, DC 20590 section to remove those specific CFR 52.282, 52.350, 52.1683, and (telephone 202–493–0665). references consistent with the revisions to § 225.19(e) discussed above. 52.2585 published in the Federal SUPPLEMENTARY INFORMATION: Register on October 9, 2020 (85 FR Specifically, FRA will no longer publish 64046) is withdrawn effective December Table of Contents for Supplementary each year’s reporting threshold in the 9, 2020. Information rule text of part 225. Instead, each year, FRA will issue a notice announcing the [FR Doc. 2020–26960 Filed 12–8–20; 8:45 am] I. Executive Summary II. Background reporting threshold for the upcoming BILLING CODE 6560–50–P III. Discussion of Specific Comments and year. Conclusions FRA analyzed the economic impacts IV. Regulatory Review and Notices of this final rule against a ‘‘no action’’ DEPARTMENT OF TRANSPORTATION A. Executive Orders 12866, 13771, and baseline reflecting what would happen DOT Regulatory Policies and Procedures in the absence of this final rule. That is, Federal Railroad Administration B. Regulatory Flexibility Act and Executive what would happen if the reporting Order 13272: Certification of No threshold continued to be calculated 49 CFR Part 225 Significant Economic Impact on a according to the current, technically- Substantial Number of Small Entities flawed formula. FRA estimated that, [Docket No. FRA–2014–0099, Notice No. 2] C. Other Specialized Analyses (Paperwork going forward, the technical revisions to RIN 2130–AC49 Reduction Act, Federalism, Environmental Impact, Unfunded the reporting threshold formula adopted Mandates Reform Act of 1995, Energy in this final rule will yield slightly Revision of Method for Calculating lower reporting thresholds than the Monetary Threshold for Reporting Rail Impact) D. Privacy Act existing formula would produce. This Equipment Accidents/Incidents E. Regulation Identifier Number (RIN) lower threshold will likely result in AGENCY: Federal Railroad I. Executive Summary railroads being required to report more Administration (FRA), Department of rail equipment accidents/incidents On May 17, 2019, FRA published a Transportation (DOT). under this final rule. As noted in the notice of proposed rulemaking (NPRM) NPRM, FRA estimated this rule would ACTION: Final rule. proposing two technical revisions to the cause the railroads to report an average SUMMARY: FRA’s accident/incident formula for calculating its accident/ of 140 more rail equipment accidents/ reporting regulation requires railroads to incident reporting threshold and an incidents annually over the 10-year report to FRA all rail equipment administrative change to the way FRA period from 2019 to 2028.1 The present accidents/incidents above the monetary communicates the reporting threshold value of the costs to report these reporting threshold (reporting applicable to the upcoming year. See 84 accidents/incidents to FRA totals threshold) applicable to that calendar FR 22410. This final rule substantially $138,913 using a 7 percent discount year. In this final rule, FRA amends this adopts all of the proposals in the NPRM. rate, and $170,744 using a 3 percent regulation to modify the way it First, FRA revises the percentage term discount rate. The annualized costs are calculates periodic adjustments to the used to determine a change in $19,778 using a 7 percent discount rate, reporting threshold and the way it equipment costs, so it is consistent with and $20,016 using a 3 percent discount communicates each calendar year’s the percentage term used to determine rate. To place the estimated marginal threshold to railroads. This final rule a change in labor costs. Second, to increase in reported rail equipment will improve the accuracy of accident/ reflect overall economic data trends accidents/incidents in perspective, the incident data gathered from the better, this final rule revises the formula expected increase represents about 7.5 railroads. to use full-year data instead of only percent of the 1,850 total reported rail second-quarter data to calculate the equipment accidents/incidents every DATES: This final rule is effective reporting threshold. Third, FRA is year (an average over the years 2014 to January 8, 2021. revising 49 CFR 225.19(e) to indicate 2018)—and an even smaller percentage ADDRESSES: Docket: For access to the that it will publish an annual notice on of the approximately 12,000 total docket to read background documents its website stating the reporting or comments received, go to http:// threshold for the upcoming calendar 1 This estimate was based on projections using www.regulations.gov at any time or visit year (CY). FRA will publish this annual data from 2006–2018, as described in the NPRM.

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00014 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79131

accidents/incidents reported annually upcoming year to railroads and the a Government shutdown. However, any on average (including highway-rail public at-large. The Railroads specific service a user might need incidents and other incidents). recommended three changes to the would be deferred until after the FRA also quantified the cost-savings NPRM. First, they suggested FRA shutdown. FRA also suggests that users from not publishing the reporting provide a dedicated website address who need the reporting threshold threshold in the Federal Register. Over where the reporting threshold could be simply print or save a copy the 10 years, the expected present value of reliably found. Second, to provide reporting threshold for their records, as cost savings totals $8,927 discounted at certainty regarding the effective date of it will remain the same for the entire 7 percent, and $10,842 discounted at 3 any changes to the threshold, the calendar year. percent. The corresponding annualized Railroads asked FRA to provide an FRA received an anonymous cost savings are $1,271 using a 7 percent annual date for when to expect comment recommending every discount rate, and also $1,271 using a 3 publication of the reporting threshold accident/incident be investigated percent discount rate. notice on FRA’s website. Third, the without regard to the reporting Although this final rule may require Railroads suggested FRA should have threshold. The commenter stated that railroads to report slightly more and communicate a plan to keep the small incidents can indicate systemic accidents and incidents in any given reporting threshold on the FRA website issues leading to catastrophic events. year, FRA expects it will result in more in case of a partial Government While FRA does not have the accurate and consistent train accident shutdown. The Railroads did not object resources to investigate every accident/ data for analyzing railroad safety trends. to the proposed technical revisions to incident, it exercises its jurisdiction in The improved data is expected to help the reporting threshold formula. the course of conducting inspections inform future regulatory and other In consideration of the Railroads’ and investigations to request actions that better address safety risks comments, FRA has established a information on accidents/incidents and reduce the occurrence of rail dedicated web page for the reporting below the reporting threshold from the equipment accidents/incidents. threshold on its website. The web page railroads. See 49 CFR 225.25. To Additionally, users of FRA’s data address is: https://railroads.dot.gov/ mandate railroads regularly report every (including states, researchers, and other forms-guides-publications/guides/ accident/incident to FRA is beyond the stakeholders), will benefit from access monetary-threshold-notice. In addition, scope of this rulemaking. to more accurate and consistent data. a link to the reporting threshold will be Overall, the revisions will benefit a featured under ‘‘Related Links’’ on the Other than the change to the rule text broad range of analyses. FRA Safety Data & Reporting web page discussed above, FRA has adopted the at https://railroads.dot.gov/safety-data, requirements proposed in the NPRM in II. Background when it is first published and for some this final rule. The NPRM contained a detailed time thereafter. These websites will help IV. Regulatory Review and Notices background discussion of the existing the public find the reporting threshold formula FRA used to calculate the when needed. A. Executive Orders 12866 and 13771, annual reporting threshold, the In response to the Railroads’ second and DOT Regulatory Policies and proposed revisions to that formula, and concern, FRA is modifying the rule text Procedures the agency’s proposal to issue a notice to state that it will publish a notice on This final rule is a nonsignificant on its website each year announcing the its website no later than November 30th rulemaking and evaluated in accordance reporting threshold for the upcoming each year announcing the new reporting with existing policies and procedures calendar year. threshold that will take effect on under Executive Order 12866 and DOT’s Given that FRA received limited January 1st of the upcoming calendar Administrative Rulemaking, Guidance, comments to the NPRM, FRA is not year. This change will provide the and Enforcement Procedures in 49 CFR reproducing the NPRM analysis here. Railroads and other stakeholders part 5. This rulemaking is not a Please refer to the NPRM for the full advance notification about when the regulatory action under Executive Order background discussion. 84 FR at 22411– reporting threshold will be published. 13771, ‘‘Reducing Regulation and 22417. While partial Government shutdowns Controlling Regulatory Costs,’’ because III. Discussion of Specific Comments noted by the Railroads occur, they are it is not significant under Executive and Conclusions infrequent events. From 1990 to 2019, Order 12866. See 82 FR 9339, Jan. 30, there have been 7 Government 2017. In the NPRM, FRA requested shutdowns totaling 83 days, accounting FRA is revising its formula for comments on the assumptions and for less than 1 percent of the total determining the reporting threshold. methodology used in its analysis. In number of days over those 30 years.2 response, FRA received two comments. The changes are summarized in the Moreover, FRA’s web pages continue to ‘‘Executive Summary’’ section above, One comment was filed jointly by the operate during a Government shutdown. Association of American Railroads and and discussed in detail in the NPRM. Routine operations, including hosting The changes are intended to improve the American Short Line and Regional the reporting threshold, continue under Railroad Association (Railroads), and a the accuracy of the reporting threshold, and the resulting rail equipment second comment was submitted 2 Jennifer Earl, ‘‘A Look Back at Every anonymously. The comments received Government Shutdown in US History,’’ Fox News, accident/incident data gathered from are in the public docket for this published February 9, 2018, updated January 28, the railroads over time. The improved rulemaking at www.regulations.gov. 2019, accessed December 17, 2019, https:// data is expected to help formulate www.foxnews.com/politics/a-look-back-at-every- regulations and other actions that better In their comment, the Railroads government-shutdown-in-us-history. expressed concern over how FRA will Calculation: 83 days/(30 years * 365 days per address safety risks. Table 1 below communicate the threshold for the year) = 0.0076, or about 0.8%. summarizes these costs and benefits.

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00015 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79132 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

TABLE 1—SUMMARY OF COSTS AND BENEFITS [Over a 10-year period of analysis]

Costs Cost savings* Benefits

Undiscounted, Nominal ...... $202,032 $12,710 Qualitative: More Accurate Data. Present Value (PV) at 3% ...... 170,744 10,842 Qualitative: More Accurate Data. Present Value (PV) at 7% ...... 138,913 8,927 Qualitative: More Accurate Data. Annualized at 3% ...... 20,016 1,271 Qualitative: More Accurate Data. Annualized at 7% ...... 19,778 1,271 Qualitative: More Accurate Data. * FRA will realize cost savings from issuing the reporting threshold on its website due to a reduction in printing costs.

To estimate these costs, FRA’s NPRM, FRA is standardizing the way All railroads currently governed by 49 analysis in the NPRM indicated the the percent change in equipment costs CFR part 225 railroad accident/incident changes in the reporting threshold is calculated. Equipment cost changes reporting requirements will be subject to formula would produce a slightly lower will be calculated consistently with the this final rule. Of those, FRA considers threshold in future years as compared to way that labor costs are calculated. FRA about 735 of the approximately 784 the existing formula.3 FRA’s analysis is also incorporating 12 months of data railroads in the United States to be also showed, for rail equipment in the reporting threshold calculation. small entities. The final rule will result accidents/incidents near the reporting In addition, FRA is notifying railroads in a slightly lower future reporting threshold, railroads reported an average of the new reporting threshold for the threshold. Small entities affected by this of 8 rail equipment accidents/incidents upcoming year by publishing an annual rulemaking will be those that report for every $100 increase in the reporting notice on FRA’s website. accidents/incidents with associated threshold. FRA forecasts both the The Regulatory Flexibility Act of 1980 monetary damages near the reporting baseline and slightly lower revised (i.e., (RFA), 5 U.S.C. 601–612, and Executive threshold amount. Small railroads that final rule) thresholds from 2019 to 2028, Order 13272, Proper Consideration of report rail equipment accidents/ and calculated the monetary differences Small Entities in Agency Rulemaking, incidents with monetary damages that between them. Next, FRA applied the 67 FR 53461 (Aug. 16, 2002), require are much above (or below) the reporting rate of 8 accidents/incidents per $100 agency review of proposed and final threshold will continue to report (or not increase to the monetary differences rules to assess their impact on small report) these to FRA. FRA’s analysis in between the reporting thresholds to entities unless the Secretary certifies the IRFA showed a range of 8 to 18 estimate the marginal increase in that the rule will not have a significant small railroads reported accidents/ reported accidents/incidents. Finally, economic impact on a substantial incidents near the reporting threshold FRA multiplied the $144 cost to submit number of small entities. FRA prepared annually over the period from 2014 to an accident/incident report to FRA on an Initial Regulatory Flexibility 2018, or an average of 12 small railroads Form F 6180.54 to the marginal increase Analysis (IRFA) at the time the that would be affected. On average, in reported accidents/incidents, to proposed reporting threshold rule was these railroads represent about 1.7 calculate the costs presented in the table published in the Federal Register. The percent of the 735 small railroads. Given above. analysis below supports that the final the low proportion of small railroads This final rule modifies the NPRM rule will not have a significant impacted, this final rule is not expected rule text by stating FRA will publish the economic effect on a substantial number to impact a substantial number of small upcoming reporting threshold on its of small entities. entities. FRA requested comment on potential website before it becomes effective, per Description of Compliance small business impacts of the proposed comments received from the Railroads. Requirements No additional costs are expected from rule. No commenters objected to the this change. This change will provide technical revisions to the reporting In the NPRM, to determine the advance notification of the new threshold formula, or to the potential potential compliance costs for small reporting threshold to the railroads and costs of the proposed changes on small entities, FRA conducted an analysis public. entities. similar to the economic analysis for all railroads. The steps and calculations in B. Regulatory Flexibility Determination Description of Regulated Entities the analysis are summarized here. First, and Executive Order 13272: Under section 312 of the Small FRA calculated the rate of additional Certification of No Significant Economic Business Regulatory Enforcement rail equipment accidents/incidents that Impact on a Substantial Number of Fairness Act of 1996, Public Law 104– small entities may have to report for Small Entities 121, FRA has issued a final policy every $100 change in the reporting Need for the Final Rule statement that formally establishes threshold. FRA found an average of one ‘‘small entities’’ are railroads that meet more rail equipment accident/incident This section examines the impact of the line-haulage revenue requirements reported per $100 change. This rate is the final rule on small entities. FRA is of a Class III railroad, which is $20 based on rail equipment accidents/ changing the way the reporting million or less in inflation-adjusted incidents reported by the small entities threshold is calculated because FRA annual revenues, and commuter in the past for the period 2006 to 2018. found the existing formula was railroads or small governmental FRA lacks information on accidents/ overestimating the change in equipment jurisdictions that serve populations of incidents below the current threshold costs. As explained in detail in the 50,000 or less. See 49 CFR part 209, app. because railroads do not have to report C. For other entities, the same dollar these. Therefore, FRA broadly assumed 3 For the years 2006 to 2018, the revised threshold formula in this final rule produces a reporting limit in revenues governs whether a the pattern of accidents/incidents below threshold about six percent lower on average than railroad, contractor, or other respondent a lower threshold calculated under this the no-action baseline reporting threshold formula. is a small entity. Id. final rule would be similar to those

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00016 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79133

above the threshold, a mirror image for year. Next, FRA converted the monetary number of additional rail equipment accidents/incidents near the threshold. differences between the reporting accident/incident reports, to produce To estimate the trend of the thresholds to the number of additional the compliance cost per year for the thresholds calculated using the baseline rail equipment accident/incident reports small entities. Please see the cost formula (i.e., the reporting threshold that small railroads may have to submit schedule below. For the 10-year period, formula in effect before this final rule), to FRA under the final rule. FRA the undiscounted (nominal) costs and the thresholds calculated using the estimated these additional accident/ amount to $25,488. The present value of formula in this final rule, FRA forecast incident reports by applying the rate of total costs discounted at a 7 percent both thresholds for the years 2019 to accidents/incidents per $100 change in discount rate equals $17,526, and when 2028. The forecasts allowed FRA to the reporting threshold noted above. discounted at a 3 percent rate equals calculate the monetary differences Finally, FRA multiplied the railroad’s $21,541. between the baseline and final-rule cost to submit an accident/incident reporting thresholds in the future, by report to FRA ($144 per report) by the

TABLE 2—ESTIMATED COSTS BASED ON FORECASTED NUMBER OF RAIL EQUIPMENT ACCIDENTS/INCIDENTS: SMALL ENTITIES

Reporting Number threshold Reporting Difference of extra Estimated (baseline threshold between final- accidents/ annual cost @ Calendar year formula, pre- (final-rule rule and pre- incidents $144 per final rule) formula with final rule reported accident/ calculated full-year data) thresholds (rounded) incident

2019 ...... $12,021 $ 10,566 ¥$1,456 15 $2,160 2020 ...... 12,329 10,807 ¥1,522 15 2,160 2021 ...... 12,637 11,048 ¥1,589 16 2,304 2022 ...... 12,944 11,289 ¥1,655 17 2,448 2023 ...... 13,252 11,530 ¥1,721 17 2,448 2024 ...... 13,559 11,771 ¥1,788 18 2,592 2025 ...... 13,867 12,012 ¥1,854 19 2,736 2026 ...... 14,174 12,254 ¥1,921 19 2,736 2027 ...... 14,482 12,495 ¥1,987 20 2,880 2028 ...... 14,789 12,736 ¥2,053 21 3,024

Total Undiscounted Cost 2019–2028 (10 Years), Nominal ...... 25,488 Present Value (PV) of Total Cost Discounted at 7% 2019–2028 ...... 17,526 Present Value (PV) of Total Cost Discounted at 3% 2019–2028 ...... 21,541 Total Annualized Cost Using 7% Discount Rate 2019– 2028 ...... 2,495 Total Annualized Cost Using 3% Discount Rate 2019– 2028 ...... 2,525

In terms of the estimated economic revenue per railroad, FRA estimates the final rule will not have a significant impact of the final rule on small proposed rule will affect less than 0.1 economic impact on a substantial entities, FRA expects the impact to be percent of revenues. (Calculated as $210 number of small entities. minimal based on the above analysis. compliance cost per year per railroad/ C. Other Specialized Analyses Given the annualized cost is $4,800,000 average freight revenue per approximately $2,500, the cost per railroad = 0.00004 = 0.004 percent.) Paperwork Reduction Act railroad for this group of railroads is FRA therefore expects the average The burden for Accident/Incident about $139 to $313 per year—or on compliance costs for a small entity to be Reporting and Recordkeeping is average about $210 per year per not significant. approved in the information collection railroad. (Calculated as $2,500/18 for 49 CFR part 225 under OMB No. railroads = $139; and $2,500/8 railroads Certification 2130–0500. OMB re-approval for this = $312.50; for a range of about $139 to Under the RFA, FRA prepared and collection of information was granted on $313.) When compared to annual made available for public comment an June 6, 2018, and the expiration date is revenues, the impact is very small. The IRFA describing the impacts of the June 30, 2021. industry trade organization representing proposed rule on small entities (5 U.S.C small railroads, the American Short 603(a)). FRA received no comments Federalism Line and Regional Railroad Association regarding the impact on small entities. Executive Order 13132, ‘‘Federalism,’’ (ASLRRA), reports the average freight Additionally, the ASLRRA did not 64 FR 43255 (Aug. 10, 1999), requires revenue per Class III railroad is $4.8 object to the technical revisions or costs FRA to develop an accountable process million.4 Relative to the average freight of the proposed rule. As explained to ensure ‘‘meaningful and timely input above, FRA finds the average by State and local officials in the 4 See American Short Line and Regional Railroad compliance costs for a small entity to be Association. (2014). Short Line and Regional development of regulatory policies that Railroad Facts and Figures. (Pamphlet). not significant. Accordingly, the FRA have federalism implications.’’ ‘‘Policies Washington, DC: Author. Administrator hereby certifies that this that have federalism implications’’ are

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00017 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79134 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

defined in the Executive order to and criteria contained in E.O. 13132. As proposed rulemaking that is likely to include regulations that have explained above, FRA has determined result in the promulgation of any rule ‘‘substantial direct effects on the States, that this final rule has no federalism that includes any Federal mandate that on the relationship between the national implications, other than the possible may result in expenditure by State, government and the States, or on the preemption of State laws under the local, and tribal governments, in the distribution of power and former FRSA. Accordingly, FRA has aggregate, or by the private sector, of responsibilities among the various determined that preparation of a $100,000,000 or more (adjusted levels of government.’’ Under E.O. federalism summary impact statement annually for inflation) in any one year, 13132, the agency may not issue a for this final rule is not required. and before promulgating any final rule regulation with federalism implications for which a general notice of proposed Environmental Impact that imposes substantial direct rulemaking was published, the agency compliance costs and that is not FRA has evaluated this final rule in shall prepare a written statement required by statute, unless the Federal accordance with the National detailing the effect on State, local, and government provides the funds Environmental Policy Act (NEPA), 42 tribal governments and the private necessary to pay the direct compliance U.S.C. 4321 et seq., other environmental sector. This final rule is not expected to costs incurred by State and local statutes, related regulatory result in the expenditure, in the governments, the agency consults with requirements, and its ‘‘Procedures for aggregate, of $100,000,000 or more, State and local governments, or the Considering Environmental Impacts’’ adjusted for inflation, in any one year, agency consults with State and local (FRA’s Procedures) (64 FR 28545, May and thus preparation of such a government officials early in the process 26, 1999). FRA has determined that this statement is not required. of developing the regulation. Where a final rule is categorically excluded from Energy Impact regulation has federalism implications detailed environmental review pursuant and preempts State law, the Agency to section 4(c)(20) of FRA’s NEPA Executive Order 13211 requires seeks to consult with State and local Procedures, ‘‘Promulgation of railroad Federal agencies to prepare a Statement officials in the process of developing the safety rules and policy statements that of Energy Effects for any ‘‘significant regulation. do not result in significantly increased energy action.’’ See 66 FR 28355 (May This final rule has been analyzed in emissions of air or water pollutants or 22, 2001). Under the Executive Order, a accordance with the principles and noise or increased traffic congestion in ‘‘significant energy action’’ is defined as criteria contained in E.O. 13132. FRA any mode of transportation.’’ See 64 FR any action by an agency (normally has determined that, if adopted, the 28547 (May 26, 1999). Categorical published in the Federal Register) that final rule would not have substantial exclusions (CEs) are actions identified promulgates or is expected to lead to the direct effects on the States, on the in an agency’s NEPA implementing promulgation of a final rule or relationship between the national procedures that do not normally have a regulation, including notices of inquiry, government and the States, or on the significant impact on the environment advance notices of proposed distribution of power and and therefore do not require either an rulemaking, and notices of proposed responsibilities among the various environmental assessment (EA) or rulemaking (1) that is a significant levels of government. In addition, FRA environmental impact statement (EIS). regulatory action under Executive Order has determined that this final rule will See 40 CFR 1508.4. 12866 or any successor order, and is not impose substantial direct In analyzing the applicability of a CE, likely to have a significant adverse effect compliance costs on State and local the agency must also consider whether on the supply, distribution, or use of governments. Therefore, the extraordinary circumstances are present energy; or (2) that is designated by the consultation and funding requirements that would warrant a more detailed Administrator of the Office of of E.O. 13132 do not apply. environmental review through the Information and Regulatory Affairs as a However, this final rule could have preparation of an EA or EIS. Id. In ‘‘significant energy action.’’ FRA has preemptive effect by operation of law accordance with section 4(c) and (e) of evaluated this final rule under under certain provisions of the Federal FRA’s Procedures, the Agency has Executive Order 13211. FRA has does railroad safety statutes, specifically the further concluded that no extraordinary not anticipate that this final rule is former Federal Railroad Safety Act of circumstances exist with respect to this likely to have a significant adverse effect 1970 (FRSA), repealed and recodified at regulation that might trigger the need for on the supply, distribution, or use of 49 U.S.C. 20106, and the former a more detailed environmental review. energy. Consequently, FRA has Accident Reports Act of 1910, repealed As a result, FRA finds this rule is not determined that this regulatory action is and recodified at 49 U.S.C. 20901. See a major Federal action that significantly not a ‘‘significant energy action’’ within Public Law 103–272 (July 5, 1994). The affects the quality of the human the meaning of Executive Order 13211. former FRSA provides that States may environment. not adopt or continue in effect any law, D. Privacy Act Unfunded Mandates Reform Act of 1995 regulation, or order related to railroad Under 5 U.S.C. 553(c), DOT solicits safety or security that covers the subject Under Section 201 of the Unfunded comments from the public to better matter of a regulation prescribed or Mandates Reform Act of 1995, Public inform its rulemaking process. DOT order issued by the Secretary of Law 104–4 (Mar. 22, 1995); 2 U.S.C. posts these comments, without edit, Transportation (with respect to railroad 1531, each Federal agency shall, unless including any personal information the safety matters) or the Secretary of otherwise prohibited by law, assess the commenter provides, to Homeland Security (with respect to effects of Federal regulatory actions on www.regulations.gov, as described in railroad security matters), except when State, local, and tribal governments, and the system of records notice (DOT/ALL– the State law, regulation, or order the private sector (other than to the 14 FDMS), which can be reviewed at qualifies under the ‘‘local safety or extent that such regulations incorporate www.dot.gov/privacy. security hazard’’ exception to section requirements specifically set forth in 20106. law). Section 202 of the Act (2 U.S.C. E. Regulation Identifier Number (RIN) In sum, FRA has analyzed this final 1532) further requires that before A regulation identifier number (RIN) rule in accordance with the principles promulgating any general notice of is assigned to each regulatory action

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00018 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79135

listed in the Unified Agenda of Federal components: (a) The average hourly earnings DEPARTMENT OF COMMERCE Regulations. The Regulatory Information of certain railroad maintenance employees as Service Center publishes the Unified reported to the STB by the Class I railroads National Oceanic and Atmospheric Agenda in April and October of each and Amtrak; and (b) an overall rail Administration year. The RIN contained in the heading equipment cost index determined by the of this document can be used to cross- BLS. The wage component is weighted by 50 CFR Part 622 40% and the equipment component by 60%. reference this action with the Unified [Docket No. 200113–0013; RTID 0648– 2. For the wage component, the average of Agenda. XA688] the data from Form A—STB Wage Statistics List of Subjects in 49 CFR Part 225 for Group No. 300 (Maintenance of Way and Fisheries of the Caribbean, Gulf of Investigations, Penalties, Railroad Structures) and Group No. 400 (Maintenance Mexico, and South Atlantic; 2020 safety, Reporting and recordkeeping of Equipment and Stores) employees is used. Commercial Closure for South Atlantic requirements. 3. For the equipment component, Snowy Grouper LABSTAT Series Report, Producer Price The Final Rule Index (PPI) Series WPU 144 for Railroad AGENCY: National Marine Fisheries In consideration of the foregoing, FRA Equipment is used. Service (NMFS), National Oceanic and amends part 225 of chapter II, subtitle 4. In the month of October, second-quarter Atmospheric Administration (NOAA), B of title 49, Code of Federal and first-quarter wage data for the current Commerce. Regulations, as follows: year, and fourth-quarter and third-quarter ACTION: Temporary rule; closure. wage data for the previous year are obtained PART 225—RAILROAD ACCIDENTS/ from the STB. For equipment costs, the SUMMARY: NMFS implements an INCIDENTS: REPORTS corresponding BLS railroad equipment accountability measure for the CLASSIFICATION, AND indices for the same time period as the STB commercial sector of snowy grouper in INVESTIGATIONS wage data are obtained. the exclusive economic zone (EEZ) of 5. The wage data are reported in terms of the South Atlantic. NMFS projects ■ 1. The authority citation for part 225 dollars earned per hour, while the equipment commercial landings of snowy grouper continues to read as follows: cost data are indexed to a base year of 1982. will reach the commercial annual catch Authority: 49 U.S.C. 103, 322(a), 20103, 6. The procedure for adjusting the limit (ACL) for the July through 20107, 20901–20902, 21301, 21302, 21311; reporting threshold is shown in the formula December season by December 12, 2020. 28 U.S.C. 2461, note; and 49 CFR 1.89. below. The wage and equipment components Therefore, NMFS closes the commercial ■ 2. In § 225.19, revise paragraphs (c) appear as fractional changes relative to the sector for snowy grouper in the South and (e) and remove the parenthetical prior year. After performing the calculation, Atlantic EEZ on December 12, 2020. authority citation at the end of the the result is rounded to the nearest $100. This closure is necessary to protect the section to read as follows: 7. The weightings result from using STB snowy grouper resource. wage data and BLS equipment cost data to DATES: § 225.19 Primary groups of accidents/ produce a reasonable estimation of the This temporary rule is effective incidents. reporting threshold that was calculated using at 12:01 a.m., local time, on December * * * * * the threshold formula in effect immediately 12, 2020, until 12:01 a.m., local time, on (c) Group II—Rail equipment. Rail before calendar year 2006, a formula that January 1, 2021. equipment accidents/incidents are assumed damage repair costs, at levels at or FOR FURTHER INFORMATION CONTACT: collisions, derailments, fires, near the threshold, were split approximately Mary Vara, NMFS Southeast Regional explosions, acts of God, and other evenly between labor and materials. Office, telephone: 727–824–5305, email: events involving the operation of on- 8. Formula: [email protected]. track equipment (standing or moving) New Threshold = Prior Threshold × [1 + SUPPLEMENTARY INFORMATION: The that result in damages higher than the 0.4(Wnew—Wprior)/Wprior + snapper-grouper fishery of the South current reporting threshold to railroad 0.6(Enew¥Eprior)/Eprior] Atlantic includes snowy grouper and is on-track equipment, signals, tracks, Where: managed under the Fishery track structures, or roadbed, including Management Plan for the Snapper- labor costs and costs for acquiring new Wnew = New average hourly wage rate ($). Grouper Fishery of the South Atlantic equipment and material. Wprior = Prior average hourly wage rate ($). Region (FMP). The FMP was prepared Enew = New equipment average PPI value. by the South Atlantic Fishery * * * * * Eprior = Prior equipment average PPI value. (e) Notice. No later than November 30 Management Council and is of each year, the Administrator will Issued in Washington, DC. implemented by NMFS under the publish a notice on FRA’s website Quintin C. Kendall, authority of the Magnuson-Stevens announcing the reporting threshold that Deputy Administrator. Fishery Conservation and Management will take effect on January 1 of the [FR Doc. 2020–25863 Filed 12–8–20; 8:45 am] Act (Magnuson-Stevens Act) by following calendar year. regulations at 50 CFR part 622. BILLING CODE 4910–06–P ■ 3. Appendix B to part 225 is revised All weights described in this to read as follows: temporary rule are in gutted weight. The commercial ACL (commercial Appendix B to Part 225—Procedure for quota) for snowy grouper in the South Determining Reporting Threshold Atlantic is divided into two 6-month 1. Wage data used in the calculation are fishing seasons. The total commercial collected from railroads by the Surface ACL for snowy grouper is allocated 70 Transportation Board (STB) on Form A—STB Wage Statistics. Rail equipment data from the percent, or 107,754 lb (48,876 kg), for U.S. Department of Labor, Bureau of Labor the January through June commercial Statistics (BLS), LABSTAT Series reports are fishing season, and 30 percent, or used in the calculation. The equation used to 46,181 lb (20,947 kg), for the July adjust the reporting threshold has two through December fishing season, as

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00019 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79136 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

specified in 50 CFR 622.190(a)(1)(i) and whether the fish are harvested in state DEPARTMENT OF COMMERCE (ii). or Federal waters, as specified in 50 After the January through June 2020 CFR 622.190(c)(1)(ii). National Oceanic and Atmospheric fishing season, 3,048 lb (1,382 kg) of the Administration snowy grouper commercial quota Classification remained unharvested. As specified in 50 CFR Part 635 NMFS issues this action pursuant to 50 CFR 622.190(a)(1)(iii), NMFS added [Docket No. 120627194–3657–02] this unused portion of the snowy section 305(d) of the Magnuson-Stevens grouper commercial quota to the Act. This action is required by 50 CFR RTID 0648–XA629 commercial quota for the July through 622.193(b)(1), which was issued December 2020 fishing season. pursuant to section 304(b) of the Atlantic Highly Migratory Species; Therefore, the snowy grouper Magnuson-Stevens Act, and is exempt North Atlantic Swordfish Fishery from review under Executive Order commercial quota for the July through AGENCY: National Marine Fisheries December 2020 fishing season is 49,229 12866. Service (NMFS), National Oceanic and lb (22,329 kg). Any unused commercial These measures are exempt from the Atmospheric Administration (NOAA), quota for the July through December procedures of the Regulatory Flexibility Commerce. fishing season becomes void and will Act because the temporary rule is issued ACTION: Temporary rule; inseason not be added to any subsequent quota without opportunity for prior notice and Swordfish General Commercial permit (622.190(a)(1)(iii)). comment. retention limit adjustment. Under 50 CFR 622.193(b)(1), NMFS is required to close the commercial sector Pursuant to 5 U.S.C. 553(b)(B), there SUMMARY: NMFS is adjusting the for snowy grouper when the commercial is good cause to waive prior notice and Swordfish General Commercial permit quota specified in 50 CFR 622.190(a)(1) an opportunity for public comment as retention limits for the Northwest is reached or is projected to be reached, such procedures are unnecessary and Atlantic, Gulf of Mexico, and U.S. by filing a notification to that effect with contrary to the public interest. Such Caribbean regions for January through the Office of the Federal Register. NMFS procedures are unnecessary because the June of the 2021 fishing year, unless projects that commercial landings of regulations associated with the otherwise later noticed. The Swordfish South Atlantic snowy grouper, as commercial quota for South Atlantic General Commercial permit retention estimated by the Science and Research snowy grouper have already been limit in each of these regions is Director, will reach the adjusted July subject to notice and comment, and all increased from the regulatory default through December 2020 commercial that remains is to notify the public of limit (either two or three fish) to six quota by December 12, 2020. the commercial closure for the swordfish per vessel per trip. The Accordingly, the commercial sector for remainder of the July through December Swordfish General Commercial permit South Atlantic snowy grouper is closed 2020 fishing season. Prior notice and retention limit in the Florida Swordfish effective at 12:01 a.m., local time, on opportunity for public comment on this Management Area will remain December 12, 2020, and remains closed action is contrary to the public interest unchanged at the default limit of zero until the start of the next January swordfish per vessel per trip, as through June fishing season on January because of the need to immediately implement the commercial closure to discussed in more detail below. These 1, 2021. adjustments apply to Swordfish General The operator of a vessel with a valid protect South Atlantic snowy grouper, because the capacity of the fishing fleet Commercial permitted vessels and to commercial vessel permit for South Highly Migratory Species (HMS) Atlantic snapper-grouper having snowy allows for rapid harvest of the Charter/Headboat permitted vessels grouper on board must have landed and commercial quota. Prior notice and with a commercial endorsement when bartered, traded, or sold such snowy opportunity for public comment would on a non-for-hire trip. This action is grouper prior to 12:01 a.m., local time, require time and would potentially based upon consideration of the on December 12, 2020. During the result in a harvest that exceeds the applicable inseason regional retention commercial closure, harvest and commercial quota. limit adjustment criteria. possession of snowy grouper in or from For the aforementioned reasons, there the South Atlantic EEZ is limited to the DATES: The adjusted Swordfish General is good cause under 5 U.S.C. 553(d)(3) bag and possession limits, as specified Commercial permit retention limits in in § 622.187(b)(2)(ii) and (c)(1). Also to waive the 30-day delay in the the Northwest Atlantic, Gulf of Mexico, during the commercial closure, the sale effective date of this action. and U.S. Caribbean regions are effective or purchase of snowy grouper taken Authority: 16 U.S.C. 1801 et seq. from January 1, 2021, through June 30, 2021. from the EEZ is prohibited. The Dated: December 4, 2020. prohibition on sale or purchase does not FOR FURTHER INFORMATION CONTACT: apply to the sale or purchase of snowy Jennifer M. Wallace, Sarah McLaughlin, sarah.mclaughlin@ grouper that were harvested, landed Acting Director, Office of Sustainable noaa.gov 978–281–9260, Lauren ashore, and sold prior to 12:01 a.m., Fisheries, National Marine Fisheries Service. Latchford, [email protected] local time, on December 12, 2020, and [FR Doc. 2020–27064 Filed 12–7–20; 8:45 am] 301–427–8503, or Larry Redd, were held in cold storage by a dealer or BILLING CODE 3510–22–P [email protected] 301–427–8503. processor. SUPPLEMENTARY INFORMATION: For a person on board a vessel for Regulations implemented under the which a Federal commercial or charter authority of the Atlantic Tunas vessel/headboat permit for South Convention Act (ATCA; 16 U.S.C. 971 et Atlantic snapper-grouper has been seq.) and the Magnuson-Stevens Fishery issued, the bag and possession limits Conservation and Management Act and the sale and purchase provisions (Magnuson-Stevens Act; 16 U.S.C. 1801 during the commercial closure for et seq.) governing the harvest of North snowy grouper apply regardless of Atlantic swordfish by persons and

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00020 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79137

vessels subject to U.S. jurisdiction are species (HMS) Commercial Caribbean adjustments to the retention limits must found at 50 CFR part 635. Section Small Boat (CCSB) permit holders, be based upon a consideration of the 635.27 subdivides the U.S. North Swordfish General Commercial permit relevant criteria provided in Atlantic swordfish quota recommended holders, and HMS Charter/Headboat § 635.24(b)(4)(iv). NMFS has considered by the International Commission for the permit holders with a commercial these criteria as discussed below and Conservation of Atlantic Tunas (ICCAT) endorsement on a non-for hire (i.e., their applicability to the Swordfish and implemented by the United States commercial) trip, and add inseason General Commercial permit retention into two equal semi-annual directed adjustment criteria to the CCSB permit. limit in all regions for January through fishery quotas; an annual incidental NMFS anticipates that the proposed rule June of the 2021 North Atlantic catch quota for fishermen targeting other would streamline HMS regulations to swordfish fishing year. species or catching swordfish align retention limits for commercial NMFS must consider the effects of the recreationally, and a reserve category, swordfish permits established for HMS adjustment on accomplishing the according to the allocations established CCSB permit holders under Amendment objectives of the fishery management in the 2006 Consolidated Atlantic 4 with those established in Amendment plan and its amendments. See Highly Migratory Species Fishery 8 to the 2006 Consolidated HMS FMP § 635.24(b)(4)(iv)(D). The objective is to Management Plan (2006 Consolidated for Swordfish General Commercial provide opportunities to harvest the full Atlantic HMS FMP) (71 FR 58058, permit holders. If the rule were to be North Atlantic directed swordfish quota October 2, 2006), as amended, and in finalized as proposed, NMFS anticipates without exceeding it, and the goal, accordance with implementing that it would no longer be necessary to based upon the 2006 Consolidated regulations. NMFS is required under increase the default swordfish retention Atlantic HMS FMP, is to manage ATCA and the Magnuson-Stevens Act to limit through inseason adjustment for Atlantic HMS fisheries for continuing provide U.S. fishing vessels with a Swordfish General Commercial permit optimum yield so as to provide the reasonable opportunity to harvest the holders and HMS Charter/Headboat greatest overall benefit to the Nation, ICCAT-recommended quota. permit with a commercial endorsement particularly with respect to food The increase in the retention limit on a commercial trip to provide production, providing recreational will help provide a reasonable additional fishing opportunities for opportunities, preserving traditional opportunity to harvest available quota. these permit holders. The ability to fisheries, and taking into account the The current annual U.S. baseline quota reduce the default retention limit protection of marine ecosystems. This is 2,937.6 mt dressed weight (dw) (3,907 through inseason adjustment to account action will help preserve the swordfish mt whole weight (ww)). Under for possible quota overages would handgear fishery (rod and reel, § 635.27(c)(3)(ii), and consistent with remain in effect. handline, harpoon, bandit gear, and the applicable ICCAT recommendation, greenstick). Although this action does NMFS may carry over underharvest Adjustment of Swordfish General not specifically provide recreational from 2020, limited to 15 percent of the Commercial Permit Vessel Retention fishing opportunities, it will have a 2020 annual baseline quota, which is a Limits minimal impact on the recreational maximum of 440.6 mt dw (586.0 mt The 2021 North Atlantic swordfish sector because recreational landings are ww). With underharvest as expected in fishing year will begin on January 1, counted against a separate incidental 2020, NMFS anticipates carrying over 2021. Regional default retention limits swordfish quota. the maximum underharvest allowed, for the Swordfish General Commercial NMFS has examined dealer reports which would result in an adjusted permit have been established and are and landing trends and determined that North Atlantic swordfish quota for the automatically effective from January 1 the information obtained from biological 2021 fishing year of 3,378.2 mt dw through December 31 each year, unless sampling and monitoring of the North (2,937.6 + 440.6 = 3,378.2 mt dw). As in changed based on the inseason regional Atlantic swordfish stock is useful. See past years, NMFS anticipates allocating retention limit adjustment criteria at § 635.24(b)(4)(iv)(A). Regarding the 50 mt dw from the adjusted quota to the § 635.24(b)(4)(iv). The Swordfish estimated ability of vessels participating Reserve category for inseason General Commercial permit default in the fishery to land the amount of adjustments/research and allocating 300 retention limits are: (1) Northwest swordfish quota available before the end mt dw to the Incidental category, which Atlantic region—three swordfish per of the fishing year, § 635.24(b)(4)(iv)(B), includes recreational landings and vessel per trip; (2) Gulf of Mexico NMFS reviewed electronic dealer landings by incidental swordfish permit region—three swordfish per vessel per landings data, which indicates that holders, consistent with trip; (3) U.S. Caribbean region—two sufficient directed swordfish quota § 635.27(c)(1)(i)(D) and (B). This would swordfish per vessel per trip; and, (4) should be available for the January result in a final adjusted quota of Florida Swordfish Management Area— through June 2021 semi-annual quota 3,028.2 mt dw for the directed fishery, zero swordfish per vessel per trip. The period if recent swordfish landings which would be split equally (1,514.1 default retention limits apply to trends continue. The directed swordfish mt dw) between the two semi-annual Swordfish General Commercial quota has not been fully harvested for periods in 2021 (January through June, permitted vessels and to HMS Charter/ several years and, based upon current and July through December). Headboat permitted vessels with a landing trends, is not likely to be For additional context and commercial endorsement when fishing harvested or exceeded in 2021. Based information on a related matter, NMFS on non-for-hire trips. Permitted vessels upon recent landings rates from dealer notes that earlier this year, NMFS may not possess, retain, or land any reports, an increase in the vessel published a proposed rule to modify the more swordfish than is specified for the retention limits to six fish for Swordfish North Atlantic swordfish and shark region in which the vessel is located. General Commercial permit holders and retention limits for certain permit Under § 635.24(b)(4)(iii), NMFS may Charter/Headboat permit holders with a holders and add inseason adjustment increase or decrease the Swordfish commercial endorsement (when on a authorization criteria (85 FR 23315, General Commercial permit vessel non-for-hire trip) in three regions is not April 27, 2020). Relevant to swordfish, retention limit in any region within a likely to cause quotas for other the proposed rule would modify range from zero to a maximum of six categories of the fishery to be exceeded. retention limits for highly migratory swordfish per vessel per trip. Any See § 635.24(b)(4)(iv)(C). Similarly,

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00021 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79138 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

regarding the criteria about the effects of may fish for them. Public comment on of quota, increasing the Swordfish catch rates in one region precluding Amendment 8 indicated concern about General Commercial permit retention vessels in another region from having a the resultant high potential for the limits in three regions to six fish per reasonable opportunity to harvest a improper rapid growth of a commercial vessel per trip will increase the portion of the overall swordfish quota, fishery, increased catches of undersized likelihood that directed swordfish § 635.24(b)(4)(iv)(F), NMFS expects swordfish, the potential for larger landings will approach, but not exceed, there to be sufficient swordfish quota for numbers of fishermen in the area, and the available annual swordfish quota, the entirety of the 2021 fishing year. the potential for crowding of fishermen, and increase the opportunity for Thus, increased catch rates in these which could lead to gear and user catching swordfish during the 2021 three regions as a result of this action conflicts. These concerns remain valid. fishing year. would not be expected to preclude NMFS continues to collect information Monitoring and Reporting vessels in the other region (e.g., the to evaluate the appropriateness of the buoy gear fishery in the Florida retention limit in the Florida Swordfish NMFS will continue to monitor the Swordfish Management Area) from Management Area and other regional swordfish fishery closely during 2021 having a reasonable opportunity to retention limits. through mandatory landings and catch harvest a portion of the overall The directed swordfish quota has not reports. Dealers are required to submit swordfish quota. been fully harvested for several years landing reports and negative reports (if In making adjustments to the and, based upon current landing trends, no swordfish were purchased) on a retention limits, NMFS must also is not likely to be harvested or exceeded weekly basis. consider variations in seasonal during 2021. In 2020, a six swordfish Depending upon the level of fishing distribution, abundance, or migration per vessel trip limit was in effect for effort and catch rates of swordfish, patterns of swordfish, and the Swordfish General Commercial permit NMFS may determine that additional availability of swordfish on the fishing holders in the Northwest Atlantic, Gulf retention limit adjustments or closures grounds. See § 635.24(b)(4)(iv)((E) and of Mexico, and U.S. Caribbean regions are necessary to ensure that the (G). With regard to swordfish for the entire fishing season. As of available quota is not exceeded or to abundance, the 2020 report by ICCAT’s October 31, 2020, this limit resulted in enhance fishing opportunities. Standing Committee on Research and total annual directed swordfish landings Subsequent actions, if any, will be Statistics indicated that the North of approximately 760.1 mt dw, or 25.1 published in the Federal Register. In Atlantic swordfish stock is not percent of the 3,028.2-mt dw annual addition, fishermen may access https:// overfished and overfishing is not adjusted directed quota for 2020, which www.fisheries.noaa.gov/atlantic-highly- occurring. Increasing retention limits for includes landings under the six-fish trip migratory-species/atlantic-highly- the General Commercial fishery is not limit. This information indicates that migratory-species-landings-updates for expected to affect the swordfish stock sufficient directed swordfish quota updates on quota monitoring. status determination because any should be available from January 1 Classification additional landings would be within the through June 30, 2021, at the higher ICCAT-recommended U.S. North retention levels, within the limits of the NMFS issues this action pursuant to Atlantic swordfish quota allocation, scientifically-supported Total Allowable section 305(d) of the Magnuson-Stevens which is consistent with conservation Catch (TAC) and consistent with the Act. This action is required by 50 CFR and management measures to prevent goals of the 2006 Consolidated Atlantic part 635, which was issued pursuant to overfishing on the stock. Increasing HMS FMP as amended, ATCA, and the section 304(c), and is exempt from opportunities by increasing retention Magnuson-Stevens Act, and are not review under Executive Order 12866. limits from the default levels beginning expected to negatively impact stock The Assistant Administrator for on January 1, 2021, is also important health. NMFS (AA) finds that it is impracticable because of the migratory nature and Given that 2020 swordfish directed and contrary to the public interest to seasonal distribution of swordfish. In a landings will likely fall well below the provide prior notice of, and an particular geographic region, or waters available 2020 quota, and that 2021 opportunity for public comment on, this accessible from a particular port, the landings will likely follow a similar action for the following reasons: amount of fishing opportunity for trend, and in consideration of the The regulations implementing the swordfish may be constrained by the inseason regional retention limit 2006 Consolidated Atlantic HMS FMP, short amount of time that the swordfish adjustment criteria above, NMFS has as amended, provide for inseason are present in the area as they migrate. determined that the Swordfish General retention limit adjustments to respond NMFS has determined that the Commercial permit retention limits in to changes in swordfish landings, the retention limit for the Swordfish the Northwest Atlantic, Gulf of Mexico, availability of swordfish on the fishing General Commercial permit will remain and U.S. Caribbean regions applicable to grounds, the migratory nature of this at zero swordfish per vessel per trip in persons issued a Swordfish General species, and regional variations in the the Florida Swordfish Management Area Commercial permit or HMS Charter/ fishery. Based on available swordfish at this time. As described in Headboat permit with a commercial quota, stock abundance, fishery Amendment 8 to the 2006 Consolidated endorsement (when on a non-for-hire performance in recent years, and the Atlantic HMS FMP (78 FR 52011, trip) should be increased from the availability of swordfish on the fishing August 21, 2013), the area off the default levels that would otherwise grounds, among other considerations, southeastern coast of Florida, automatically become effective on adjustment to the Swordfish General particularly the Florida Straits, contains January 1, 2021, to six swordfish per Commercial permit retention limits oceanographic features that make the vessel per trip from January 1 through from the default levels of two or three area biologically unique. It provides June 31, 2021. These are the same limits fish to six swordfish per vessel per trip important juvenile swordfish habitat, that were implemented through an as discussed above is warranted, while and is essentially a narrow migratory inseason adjustment for the period July maintaining the default limit of zero- corridor containing high concentrations 1 through December 31, 2020 (85 FR fish retention in the Florida Swordfish of swordfish located in close proximity 38091, June 25, 2020). Given the rebuilt Management Area. Analysis of available to high concentrations of people who status of the stock and the availability data shows that adjustment to the

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00022 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79139

swordfish retention limit from the DEPARTMENT OF COMMERCE overall annual quota from being fully default levels would result in minimal harvested; the transfer addresses an risk of exceeding the ICCAT-allocated National Oceanic and Atmospheric unforeseen variation or contingency in quota. Administration the fishery; and the transfer is consistent Delays in temporarily increasing these with the objectives of the FMP and the 50 CFR Part 648 Magnuson-Stevens Act. retention limits caused by the time Massachusetts is transferring 15,000 required to publish a proposed rule and [Docket No.200623–0167; RTID 0648– XA697] lb (6,804 kg) of bluefish commercial accept public comment would adversely quota to Rhode Island through mutual and unnecessarily affect those Fisheries of the Northeastern United agreement of the states. This transfer Swordfish General Commercial permit States; Atlantic Bluefish Fishery; was requested to ensure that Rhode holders and HMS Charter/Headboat Quota Transfer From MA to RI Island would not exceed its 2020 state permit holders with a commercial quota. The revised bluefish quotas for endorsement (when on a non-for-hire AGENCY: National Marine Fisheries 2020 are: Massachusetts, 170,838 lb trip) that would otherwise have an Service (NMFS), National Oceanic and (77,491 kg); and Rhode Island, 313,366 opportunity to harvest more than the Atmospheric Administration (NOAA), lb (142,140 kg). otherwise applicable lower default Commerce. Classification retention limits of three swordfish per ACTION: Notification; quota transfer. vessel per trip in the Northwest Atlantic NMFS issues this action pursuant to and Gulf of Mexico regions, and two SUMMARY: NMFS announces that the section 305(d) of the Magnuson-Stevens swordfish per vessel per trip in the U.S. Commonwealth of Massachusetts is Act. This action is required by 50 CFR transferring a portion of its 2020 Caribbean region. Limiting 648.162(e)(1)(i) through (iii), which was commercial bluefish quota to the State opportunities to harvest available issued pursuant to section 304(b), and is of Rhode Island. This quota adjustment directed swordfish quota may have exempted from review under Executive is necessary to comply with the Atlantic Order 12866. negative social and economic impacts Bluefish Fishery Management Plan Authority: 16 U.S.C. 1801 et seq. for U.S. fishermen. Adjustment of the quota transfer provisions. This retention limits needs to be effective on announcement informs the public of the Dated: December 4, 2020. January 1, 2021, to allow Swordfish revised commercial bluefish quotas for Jennifer M. Wallace, General Commercial permit holders and Massachusetts and Rhode Island. Acting Director, Office of Sustainable HMS Charter/Headboat permit holders Fisheries, National Marine Fisheries Service. DATES: Effective December 4, 2020, with a commercial endorsement (when through December 31, 2020. [FR Doc. 2020–27044 Filed 12–4–20; 4:15 pm] on a non-for-hire trip) to benefit from FOR FURTHER INFORMATION CONTACT: BILLING CODE 3510–22–P the adjustment during the relevant time Laura Hansen, Fishery Management period, which could pass by for some Specialist, (978) 281–9225. fishermen who have access to the DEPARTMENT OF COMMERCE SUPPLEMENTARY INFORMATION: fishery during a short time period Regulations governing the Atlantic National Oceanic and Atmospheric because of seasonal fish migration, if the bluefish fishery are found in 50 CFR Administration action is delayed for notice and public 648.160 through 648.167. These comment. Furthermore, the public was regulations require annual specification 50 CFR Part 679 given an opportunity to comment on the of a commercial quota that is [Docket No. 200604–0152] underlying rulemakings, including the apportioned among the coastal states adoption of the North Atlantic from Maine through Florida. The RIN 0648–BJ35 swordfish U.S. quota, and the retention process to set the annual commercial limit adjustments in this action would quota and the percent allocated to each Fisheries of the Exclusive Economic not have any additional effects or state is described in § 648.162, and the Zone off Alaska; Modifying Seasonal impacts since the retention limit does final 2020 allocations were published Allocations of Pollock and Pacific Cod not affect the overall quota. Thus, there on June 29, 2020 (85 FR 38794). for Trawl Catcher Vessels in the would be little opportunity for The final rule implementing Central and Western Gulf of Alaska; meaningful input and review with Amendment 1 to the Bluefish Fishery Correction public comment on this action. Management Plan (FMP) published in AGENCY: National Marine Fisheries Therefore, the AA finds good cause the Federal Register on July 26, 2000 Service (NMFS), National Oceanic and under 5 U.S.C. 553(b)(B) to waive prior (65 FR 45844), and provided a Atmospheric Administration (NOAA), notice and the opportunity for public mechanism for transferring bluefish Commerce. comment. For all of the above reasons, quota from one state to another. Two or ACTION: Final rule; correction. there is also good cause under 5 U.S.C. more states, under mutual agreement 553(d) to waive the 30-day delay in and with the concurrence of the NMFS SUMMARY: NMFS is correcting a final effectiveness. Greater Atlantic Regional Administrator, rule that published in the Federal can request approval to transfer or Register on June 25, 2020, Authority: 16 U.S.C. 971 et seq. and 1801 combine bluefish commercial quota implementing Amendment 109 to the et seq. under § 648.162(e)(1)(i) through (iii). Fishery Management Plan for Dated: December 1, 2020. The Regional Administrator must Groundfish of the Gulf of Alaska (GOA Jennifer M. Wallace, approve any such transfer based on the FMP) and a regulatory amendment to Acting Director, Office of Sustainable criteria in § 648.162(e). In evaluating the regulations governing pollock Fisheries, National Marine Fisheries Service. requests to transfer a quota or combine fishing in the Gulf of Alaska (GOA). The quotas, the Regional Administrator shall final rule’s intent as to Pacific cod was [FR Doc. 2020–26796 Filed 12–8–20; 8:45 am] consider whether: The transfer or to change the seasonal apportionments BILLING CODE 3510–22–P combinations would preclude the of Pacific cod for the trawl catcher

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00023 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79140 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

vessel (CV) sector. However, in WGOA TAC apportioned to the B In order to clarify the seasonal changing the seasonal apportionments, season, and 64.16 percent of the CGOA apportionment to the jig sector for the final rule’s regulatory text TAC apportioned to the A season and Pacific cod in the WGOA and CGOA, inadvertently affected the jig sector such 35.84 percent of the CGOA TAC the final rule for Amendment 109 will that it became unclear if the new, apportioned to the B season. be revised to expressly state the A and overall seasonal apportionments apply In changing these seasonal B season apportionments of Pacific cod to the jig sector. This correction is apportionments, however, the final rule to the jig sector. As revised, the necessary to clarify seasonal for Amendment 109 inadvertently regulations now will provide that a apportionments of Pacific cod for the jig affected the jig sector: Because the portion of the annual Pacific cod TAC, sector. regulations do not specify the jig sector pursuant to § 679.20(a)(12)(i)(A) and DATES: This rule is effective on January seasonal apportionment, unlike the A (B), will be allocated to vessels with a 1, 2021. and B season apportionments for all Federal Fishing Permit that use jig gear, other sectors and gear and operation FOR FURTHER INFORMATION CONTACT: before TAC is apportioned among other types in the CGOA and WGOA, it Kelly Cates, 907–586–7228. non-jig sectors. This portion of the became ambiguous if the new, overall CGOA and WGOA Pacific cod TACs SUPPLEMENTARY INFORMATION: Pacific cod seasonal apportionments will be seasonally apportioned to the jig Need for Correction should be applied to the jig sector. To sector such that 60 percent of the TAC remove any ambiguity, NMFS is NMFS published Amendment 109 to is apportioned to the A season and 40 correcting the final rule to implement the GOA FMP and a regulatory percent of the TAC is apportioned to the Amendment 109 to specify that the amendment to the regulations governing B season, as specified in § 679.23(d)(3). CGOA and WGOA Pacific cod TACs pollock fishing in the GOA in the Once the TAC for Pacific cod is will be seasonally apportioned to the jig apportioned to the jig sector, the Federal Register on June 25, 2020 (85 sector such that 60 percent of the TAC FR 38093), which will be referred to in remainder of the WGOA and CGOA is apportioned to the A season and 40 Pacific cod TACs will be seasonally this correction collectively as percent of the TAC is apportioned to the Amendment 109. The final rule apportioned among the non-jig sectors B season. such that 63.84 percent of the WGOA addresses operational and management In implementing the final rule for inefficiencies in the trawl CV pollock TAC is apportioned to the A season and Amendment 109, the North Pacific 36.16 percent of the WGOA TAC is and Pacific cod fisheries in the Central Fishery Management Council (Council) Regulatory Area (CGOA) and the apportioned to the B season, and 64.16 and NMFS were clear that they did not percent of the CGOA TAC is Western Regulatory Area (WGOA) of the intend for Amendment 109 to affect any GOA. This correction does not affect the apportioned to the A season and 35.84 sectors other than the trawl CV sector. percent of the CGOA TAC is pollock seasons and allocations as In the preambles to both the proposed revised by Amendment 109. apportioned to the B season, as rule (85 FR 11939, February 28, 2020) specified in § 679.23(d)(3). This The final rule to implement and final rule (85 FR 38093, June 25, Amendment 109 is effective on January correction makes these clarifications in 2020) to implement Amendment 109, § 679.20(a)(12)(i). 1, 2021, and, in part, revises NMFS specified that although the § 679.20(a)(12)(i) to specify the new This correction to the final rule to overall ratio of A and B seasonal implement Amendment 109 will ensure seasonal apportionments of Pacific cod apportionments of Pacific cod for the total allowable catch (TAC) for the trawl that the new seasonal allocations of trawl CV sector is changing, the rule Pacific cod are available at the start of CV sector in the CGOA and the WGOA. does not affect the seasonal The trawl CV sector is one of several the fishing year. The purposes of apportionments of Pacific cod to any Amendment 109 are to allow the sectors for which the regulations other sectors. The preambles further allocate the Pacific cod TAC in the fisheries to more fully harvest the clarified that the seasonal Pacific cod and pollock TACs in the WGOA and CGOA and apportion those apportionment of Pacific cod remains WGOA and CGOA, increase allocations seasonally (among gear and unchanged for all other sectors in the management flexibility, and, operation types) between the A and B CGOA and the WGOA. seasons (§ 679.20(a)(12)(i)(A) and (B)). In addition, the Council and NMFS potentially, decrease the prohibited The final rule to implement have clearly indicated their intention species catch, while not redistributing Amendment 109 changes the trawl CV regarding the jig sector’s seasonal fishing opportunities between sector’s seasonal apportionments in the apportionment on two fronts. First, the management areas or harvest sectors. CGOA and WGOA: The A seasonal rulemaking to implement Amendment Correction apportionment increases by 83 to the GOA FMP (76 FR 74670, Effective January 1, 2021, in rule approximately 4 percent, while the B December 1, 2011) specified that the jig document 2020–12453 at 85 FR 38093 seasonal apportionment decreases by sector seasonal apportionment would be in the issue of June 25, 2020, on page approximately 4 percent. Because the 60 percent for the A season and 40 38100, in the third column, in final rule shifts one sector’s seasonal percent for the B season in the CGOA amendatory instruction 2, paragraph apportionment between the A and B and the WGOA (76 FR 44700, July 26, (a)(12)(i) introductory text is corrected seasons, the overall seasonal 2011). Second, NMFS has implemented to read as follows: apportionment across all sectors in the the same apportionment in the annual CGOA and WGOA also shifts between GOA groundfish harvest specifications § 679.20 [Corrected] the A and B seasons. The final rule to since the approval of Amendment 83. * * * * * implement Amendment 109 therefore However, the regulatory text at (a) * * * changes the WGOA and CGOA Pacific § 679.20(a)(12)(i) does not specify the (12) * * * cod overall seasonal apportionments jig sector seasonal apportionment (like (i) Seasonal allowances by sector. The from 60 percent (A season) and 40 the A and B season apportionments are Western and Central GOA Pacific cod percent (B season) as follows: 63.84 for all other sectors and gear and TACs will be seasonally apportioned to percent of the WGOA TAC apportioned operation types in the CGOA and the jig sector such that 60 percent of the to the A season and 36.16 percent of the WGOA). TAC is apportioned to the A season and

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00024 Fmt 4700 Sfmt 4700 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79141

40 percent of the TAC is apportioned to season and 36.16 percent of the Western Dated: December 2, 2020. the B season, as specified in GOA TAC is apportioned to the B Samuel D. Rauch III, § 679.23(d)(3), before TAC is season, and 64.16 percent of the Central Deputy Assistant Administrator for apportioned among other non-jig GOA TAC is apportioned to the A Regulatory Programs, National Marine sectors. The Western and Central GOA season and 35.84 percent of the Central Fisheries Service. Pacific cod TACs will be seasonally GOA TAC is apportioned to the B [FR Doc. 2020–26954 Filed 12–8–20; 8:45 am] apportioned among the non-jig sectors season, as specified in § 679.23(d)(3). BILLING CODE 3510–22–P such that 63.84 percent of the Western * * * * * GOA TAC is apportioned to the A

VerDate Sep<11>2014 15:44 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00025 Fmt 4700 Sfmt 9990 E:\FR\FM\09DER1.SGM 09DER1 jbell on DSKJLSW7X2PROD with RULES 79142

Proposed Rules Federal Register Vol. 85, No. 237

Wednesday, December 9, 2020

This section of the FEDERAL REGISTER Payment Program.’’ Comments received would be secured as a lien against the contains notices to the public of the proposed will be available at regulations.gov for veteran’s home upon execution and issuance of rules and regulations. The public viewing, inspection or copies. recordation of the security instrument. purpose of these notices is to give interested FOR FURTHER INFORMATION CONTACT: The servicer would handle all aspects of persons an opportunity to participate in the the origination. With the veteran’s rule making prior to the adoption of the final Andrew Trevayne, Assistant Director, rules. Loan Property and Management, Loan guaranteed loan brought current, the Guaranty Service (26), Veterans Benefits veteran would resume making regularly Administration, Department of Veterans scheduled monthly loan payments to DEPARTMENT OF VETERANS Affairs, 810 Vermont Avenue NW, the servicer. The veteran would also AFFAIRS Washington, DC 20420, (202) 632–8862. repay VA for the new loan, under the (This is not a toll-free telephone terms proposed below. The new loan 38 CFR Part 36 number.) would be serviced under VA’s existing loan portfolio. SUPPLEMENTARY INFORMATION: RIN 2900–AR05 While VA’s proposed COVID–VAPCP Loan Guaranty: COVID–19 Veterans I. Summary of the Proposed Rule would bear many similarities to the One of the primary goals of VA’s COVID-related partial claim programs Assistance Partial Claim Payment 1 Program Home Loan Guaranty Service is to help offered by FHA and USDA, VA’s veterans who use their guaranteed loan program would not be identical to AGENCY: Department of Veterans Affairs. benefit retain their homes and avoid either. Similarities to such agencies’ ACTION: Proposed rule. foreclosure. To that end, VA and loan programs would include the following: servicers intervene dynamically when (1) The guaranteed loan for which a SUMMARY: The Department of Veterans guaranteed loans are more than 60 days partial claim payment is requested must Affairs (VA) proposes to establish the in default. Such actions to assist have been, on March 1, 2020, either COVID–19 Veterans Assistance Partial current or less than 30 days past due; (2) veterans in default not only help Claim Payment program (COVID– a partial claim payment would only be veterans retain their homes and VAPCP), a temporary program to help payable to the servicer if the veteran minimize damage to their credit ratings, veterans return to making normal loan missed at least one scheduled monthly but also help produce cost savings to the payments on a VA-guaranteed loan payment under a CARES Act Government. (guaranteed loan) after exiting a Given the unique needs of veterans forbearance and at least one such Coronavirus Aid, Relief, and Economic and loan servicers during the novel payment remains unpaid; (3) VA would Security Act (CARES Act) forbearance coronavirus disease (COVID–19) only pay one partial claim payment per veteran; (4) the veteran would need to period. Under this proposed program, a national emergency, VA proposes to occupy, as the veteran’s residence, the servicer could consider a partial claim initiate a temporary program that would property securing the guaranteed loan option after the servicer has evaluated establish a partial claim option to aid for which the partial claim is associated; all loss-mitigation options for feasibility. veterans who suffer financial hardship and (5) the servicer would be required If the veteran qualifies and opts to move due to COVID–19. VA’s program would to determine whether the veteran forward, VA would act as a mortgage be modeled after existing partial claim satisfies the program requirements, to investor of last resort by purchasing the programs already available to borrowers prepare the appropriate loan documents amount of indebtedness necessary to with other federally backed loans; that on VA’s behalf, and to bring the bring the veteran’s guaranteed loan is, those guaranteed or insured by the current. The veteran would have up to veteran’s guaranteed loan current, U.S. Department of Housing and Urban before submitting to VA a request for 60 months to defer repayment to VA Development’s (HUD) Federal Housing and up 120 months to repay the loan in partial claim payment. Administration (FHA) and the U.S. Distinguishing aspects of VA’s full, with the interest rate fixed at 1 Department of Agriculture’s (USDA) percent per annum. program would include the following: Rural Housing Service. (1) The partial claim payment could not DATES: Comments must be received on Under VA’s proposed COVID–VAPCP, or before January 8, 2021. exceed 15 percent of the unpaid servicers would consider a veteran for principal balance of the guaranteed loan ADDRESSES: Comments may be the program only after evaluating the as of the date the veteran entered into submitted through www.Regulations.gov feasibility of loss-mitigation options that a CARES Act forbearance; (2) the or mailed to Stephanie Li, Chief of are already available in VA’s program. If veteran would have up to 120 months Regulations, Loan Guaranty Service a servicer determines that the veteran to repay the partial claim VA paid to the (26), Veterans Benefits Administration, satisfies the COVID–VAPCP servicer on the veteran’s behalf; (3) Department of Veterans Affairs, 810 requirements and the veteran elects to Vermont Avenue NW, Washington, DC participate, VA would purchase the 1 See 12 U.S.C. 1715u(b); 24 CFR 203.371; 20420. Please note that due to veteran’s forborne indebtedness, which Mortgagee Letter 2020–06, FHA’s Loss Mitigation circumstances associated with the is similar to VA’s existing loan refund Options for Single Family Borrowers Affected by the Presidentially-Declared COVID–19 National COVID–19 pandemic, VA discourages process. As a mortgage investor of last Emergency in Accordance with the CARES Act the submission of comments by mail. resort, VA would purchase the amount (Apr. 1, 2020), https://www.hud.gov/sites/dfiles/ Comments should indicate that they are of indebtedness that is necessary to OCHCO/documents/20-06hsngml.pdf; Mortgagee submitted in response to ‘‘RIN 2900– bring the veteran’s guaranteed loan Letter 2020–22, FHA’s COVID–19 Loss Mitigation Options (Jul. 8, 2020), https://www.hud.gov/sites/ AR05—Loan Guaranty: COVID–19 current. The veteran would repay VA dfiles/OCHCO/documents/20-22hsgml.pdf. See also Veterans Assistance Partial Claim for this amount, and the indebtedness 42 U.S.C. 1472(h)(14); 7 CFR 3555.304(d).

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79143

repayment in full would be required VA’s proposed COVID–VAPCP would servicer completes one of five borrower- immediately upon the veteran’s transfer create a ‘‘soft landing’’ for certain assistance actions (i.e., loss-mitigation of title to the property, the refinancing veterans, enabling them to return to options and alternatives to foreclosure).7 of the guaranteed loan for which the their regularly scheduled monthly Additionally, while VA generally does partial claim payment is associated, or payments without suffering another not require servicers to pursue loss- payment in full of such guaranteed loan; financial shock. The program would mitigation options and alternatives to (4) VA would automatically defer a also provide a lifeline for certain foreclosure in a particular order, VA has veteran’s monthly payments for the first servicers, thereby mitigating the risk informed servicers of VA’s preferred 60 months of the loan, meaning that a that veterans would be left without the order of alternatives (i.e., a hierarchy for veteran would not have to make any benefit of prudent loan servicing. review), as follows: Repayment plan, payment to VA during the period of special forbearance, loan modification, II. Background deferment; (5) a veteran would be compromise sale, and deed-in-lieu of allowed to pay during such deferment, A. VA’s Existing Policies for Delinquent foreclosure.8 without premium or fee, the entire Loans Loss-mitigation options are pursued indebtedness or any portion thereof, VA’s loan administration policies and with the intent of bringing the provided that such portion is not less oversight have resulted in one of the delinquent guaranteed loan current and than what would be due for one full lowest foreclosure inventory rates in the keeping the veteran in his or her home. As mentioned, these options include monthly payment as specified in the industry over the past decade.2 Data repayment plans, special forbearances, loan documents; (6) VA would charge a reported in the most recent Veterans and loan modifications. Under a fixed interest rate of 1.00 percent per Benefits Administration Annual repayment plan, the borrower agrees to annum on the loan; and (7) VA would Benefits Report reflects that such pay the normal monthly payment plus require servicers to certify that the policies and oversight saved an agreed upon portion of the veteran’s monthly residual income, as approximately 100,000 veterans from delinquency each month to the described in 38 CFR 36.4340(e), would foreclosure annually over the past four be adequate to meet living expenses servicer.9 A special forbearance fiscal years.3 after estimated monthly shelter VA requires holders of guaranteed suspends or reduces a borrower’s normal monthly payments for an agreed expenses (e.g., payments on the loans to establish and maintain a loan upon period of time.10 A loan guaranteed loan) have been paid and servicing program consistent with modification permanently changes one other monthly obligations have been industry standards.4 If a veteran misses or more terms of the guaranteed loan met. one loan payment, the guaranteed loan Another distinguishing aspect of VA’s and may include re-amortization of the becomes delinquent.5 Once a program is that VA would expect that balance due. While all loan guaranteed loan reaches 61 days servicers consider the partial claim modifications must meet the delinquent, servicers are required to payment option only as a last resort, requirements set forth by 38 CFR report the delinquency to VA, to work after a servicer has evaluated the 36.4315, VA generally classifies a loan with the veteran to consider loss- feasibility of providing loss-mitigation modification as one of four types— options that are already available in mitigation options or alternatives to traditional loan modification, streamline foreclosure, and to report updates on the VA’s program. Consistent with VA’s 6 modification, VA affordable existing regulations and policies, status of the guaranteed loan to VA. modification, and VA disaster servicers would evaluate a veteran’s Upon notification to VA, a VA loan modification—depending on a financial situation and, if appropriate, technician will review the case, monitor borrower’s circumstances.11 offer the veteran options that are within servicer activities, and intervene as Servicers generally pursue the servicer’s financial capabilities and needed during the delinquency to compromise sales and deeds-in-lieu of business model. ensure that the servicer has provided foreclosure when a traditional, private As initial CARES Act forbearance adequate servicing and has presented all sale is not feasible and the borrower periods near their end, VA stakeholders appropriate options to attempt to either has no desire to retain the confront numerous decisions that have reinstate the guaranteed loan or avoid property or when a loss-mitigation far-reaching consequences. Many foreclosure. option is not feasible given the veterans, for example, must decide Servicers are ultimately responsible borrower’s current financial whether to request additional for utilizing loss-mitigation options and circumstances. Under a compromise forbearance and watch their forborne alternatives to foreclosure to help indebtedness grow, or attempt to resume veterans avoid foreclosure. VA 7 38 CFR 36.4319. their regularly scheduled monthly regulations allow VA to pay an 8 38 CFR 36.4319(a). payments, despite potential hardships incentive to a servicer whenever the 9 A repayment plan is a ‘‘written executed agreement by and between the borrower and the and uncertainties caused by the national holder to reinstate a loan that is 61 or more calendar 2 Mortgage Bankers Association, National emergency. VA’s partial claim days delinquent, by requiring the borrower to pay Delinquency Survey Data, 2010 through 2020, each month over a fixed period (minimum of three assistance may well be the determining https://www.mba.org/news-research-and-resources/ months duration) the normal monthly payments factor for certain veterans, affecting the research-and-economics/single-family-research/ plus an agreed upon portion of the delinquency extent to which they can recover national-delinquency-survey. each month.’’ 38 CFR 36.4301. 3 financially from the crisis. Similarly, See VBA Annual Benefits Report: Home Loan 10 A special forbearance is ‘‘a written agreement servicers must evaluate their liquidity Guaranty, Fiscal Year 2019, page 19, https:// executed by and between the holder and the www.benefits.va.gov/REPORTS/abr/docs/2019- positions and other factors to determine borrower where the holder agrees to suspend all loan-guaranty.pdf. payments or accept reduced payments for one or how to make the advances necessary for 4 38 CFR 36.4350(a). more months, on a loan 61 or more calendar days investor requirements. Some servicers 5 VA Servicer Handbook, VA Manual 26–4, Chap. delinquent, and the borrower agrees to pay the total may even be questioning whether they 4: Delinquent Loan Servicing, 4.01a. (Feb. 26, 2019), delinquency at the end of the specified period or can stay afloat, which ultimately harms https://www.benefits.va.gov/WARMS/docs/ enter into a repayment plan.’’ 38 CFR 36.4301. admin26/m26_04/Ch4.docx. 11 not just the servicer, but also the VA Servicer Handbook, VA Manual 26–4, 6 38 CFR 36.4317(c)(7) (requiring an electronic Chap. 5: Loss Mitigation, 5.06 (Feb. 26, 2019), veterans whose guaranteed loans are default notification (EDN) when the guaranteed https://www.benefits.va.gov/WARMS/docs/ being serviced. loan becomes at least 61 days delinquent). admin26/m26_04/Ch5_Loss_Mitigation.docx.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79144 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

sale (sometimes called a short sale), the B. COVID–19 Emergency and CARES forbearances must repay the forborne servicer agrees to release the guaranteed Act Forbearances payments. To ensure that servicers do loan obligation in exchange for the By late March 2020, the COVID–19 not attempt to require immediate proceeds of a sale to a third party for an national emergency was significantly payment of forborne amounts upon the amount that is less than the borrower’s affecting the economy. Between March borrower’s exit from a CARES Act total indebtedness on the guaranteed 15 and May 15, 2020, over 35 million forbearance (as can be required under a loan.12 Under this alternative, the Americans filed initial jobless claims, special forbearance), VA issued servicer recovers some portion of the and the unemployment rate climbed to guidance notifying servicers that they unpaid balance of the guaranteed loan over 14 percent in April—the highest should not require a veteran to make a through the sale. In cases where there is monthly level since 1948, which is lump sum payment equal to what would little or no likelihood of a private sale when the U.S. Bureau of Labor Statistics have been due if a forbearance was not or compromise sale, servicers should started tracking this data.16 in effect, after the forbearance period consider a deed-in-lieu of foreclosure. On March 27, 2020, the President ends. VA is instead encouraging Under this alternative to foreclosure, the signed the CARES Act into law. Section servicers to consider other loss- borrower voluntarily transfers title to 4022(b) of the Act, in relevant part, mitigation options, such as those the property to the servicer in exchange states that borrowers with a ‘‘Federally described above. for a release of all obligations under the backed mortgage loan’’ (e.g., a VA- As of August 1, 2020, VA’s internal guaranteed loan.13 VA considers guaranteed loan) experiencing a data showed that approximately 149,645 compromise sales and deeds-in-lieu of financial hardship due, directly or active guaranteed loans are in a CARES foreclosure to be successfully completed indirectly, to the COVID–19 emergency Act forbearance (approximately 4.3 when the servicer files a claim under may request forbearance on such loan, percent of all active guaranteed loans). VA’s guaranty.14 regardless of delinquency status, by Of those loans, 61,795 were current as submitting a request to the borrower’s of March 1, 2020, and were also paid In cases where servicers are unable to servicer and affirming that the borrower current through July 31, 2020. An complete a loss-mitigation option or an is experiencing a financial hardship additional 51,043 loans were current as alternative to foreclosure, servicers during the COVID–19 emergency. Upon of March 1, 2020, but were no longer must, before initiating a foreclosure, such a request, servicers must, with no current through July 31, 2020, meaning provide VA with the option of what is additional documentation required the veteran missed at least one loan commonly called a ‘‘loan refund.’’ This other than the borrower’s attestation to payment between such dates. process, authorized under 38 U.S.C. a financial hardship caused by the C. COVID–19 Emergency: Post- 3732, is where VA takes assignment of COVID–19 emergency, and with no fees, Forbearance Options and Post- the existing guaranteed loan penalties, or interest (beyond the Delinquency Options indebtedness in exchange for VA’s amounts scheduled or calculated as if payment to the servicer of the unpaid the borrower made all contractual VA and the servicing industry have principal balance, plus accrued payments on time and in full under the significant experience applying VA’s interest.15 The loan is then placed into terms of the housing loan contract) current loss-mitigation policies to assist VA’s portfolio, and the veteran makes provide the forbearance for up to 180 veterans struggling financially due to loan payments to VA. VA’s internal data days.17 The forbearance period can be major disasters, such as natural disasters from fiscal year 2015 to date indicates extended for an additional period of up like hurricanes and floods. that VA has completed an average of 20 to 180 days at the request of the Nevertheless, there are many key loan refunds per fiscal year. borrower, provided that the borrower’s differences between discrete natural VA has employed contractors since request for an extension is made during disasters and the widespread and long- the late 1990s to perform loan boarding the covered period. Either the initial or lasting crisis caused by the COVID–19 extended period of forbearance may be pandemic. and servicing functions for VA’s 18 portfolio. VA’s portfolio currently shortened at the borrower’s request. The current national emergency will comprises approximately 4,500 loans While borrowers can postpone loan likely have more far-reaching payments under a CARES Act totaling approximately $420 million. consequences of greater magnitudes for forbearance, borrowers are still obliged Notably, this amounts to about half the veterans than the consequences posed to repay the forborne indebtedness. In number of loans that VA has held in by a natural disaster, for example. other words, forbearance is not Unlike a natural disaster, it is previous years. The portfolio includes forgiveness. However, many borrowers impossible to approximate when the refunded loans, as well as the loans simply have no choice but to postpone imminent danger caused by a global where VA was, in contrast to its role in payments to weather the economic pandemic will recede. Generally, at the the refunding program, the direct lender storm. Given the broad protections outset of natural disasters like (as in the Native American Direct Loan afforded by CARES Act forbearances, hurricanes and floods, public policy and vendee loan programs; neither of servicers have utilized such experts can reasonably predict the which would be affected under this forbearances as a primary tool in endpoint of imminent danger, after rulemaking). helping borrowers who are struggling to which an assessment of the damage and afford housing loan payments due to the impact to the borrower may be 12 A compromise sale is a sale to a third party for COVID–19 emergency. completed. A comparable endpoint to an amount less than is sufficient to repay the The CARES Act does not specify how unpaid balance on the guaranteed loan where the the COVID–19 pandemic is much more holder has agreed in advance to release the lien in borrowers receiving CARES Act difficult to predict because multiple exchange for the proceeds of such sale. 38 CFR factors change daily, including rates of 36.4301. VA requirements for a compromise sale are 16 U.S. Bureau of Labor Statistics, Labor Force infection and death. Rising and falling set forth by 38 CFR 36.4322(e). Statistics from the Current Population Survey, 13 VA requirements for a DIL of foreclosure are set https://www.bls.gov/ces. infection rates directly influence forth by 38 CFR 36.4322(f). 17 Public Law 116–136, section 4022(c)(1) (Mar. economic factors such as employment 14 38 CFR 36.4319(c). 27, 2020). levels and expected borrower income. 15 See 38 U.S.C. 3732(a)(2); 38 CFR 36.4320. 18 Id. These factors are also affected by policy

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79145

approaches that may vary at federal, loans, package them into loan pools, the servicer would allow the veteran to state, and local levels. and issue mortgage-backed securities defer repayment of forborne payments Further, unlike geographically and (MBS) backed by such pools. Ginnie until the guaranteed loan matures, is temporally bounded disasters, COVID– Mae can then guarantee, to MBS refinanced, or otherwise paid in full, or 19 has spread across the globe over the investors, the timely payment of when the borrower transfers the course of months, affecting communities principal and interest on such property, whichever occurs first. The of all sizes and compositions. Borrowers securities. Because Ginnie Mae requires deferred indebtedness would not accrue will likely not have safety nets in place servicers to purchase such securitized any additional interest, and the veteran to mitigate the harrowing outcomes. loans out of the Ginnie Mae pools before would not incur any fees or costs Conversely, borrowers affected by major completing a loan modification, associated with the deferment option. natural disasters like hurricanes and servicers facing liquidity shortages due The option would not necessarily floods often are covered by hazard and to, for example, covering an require the servicer to modify the other insurance policies, which can unprecedented amount of forborne loan existing guaranteed loan. Ordinarily, help to offset financial losses. payments, may not be financially able to VA’s regulation at 38 CFR 36.4310(a) The duration, scope, and impact of purchase such loans out of the pools. would prohibit a final installment the COVID–19 pandemic, along with the This means that such servicers would payment on a guaranteed loan from lack of safety nets to help absorb the not be able to offer crucial loan exceeding two times the average of the financial upheaval, has created modifications to veterans. preceding installments. In cases where enormous challenges for the housing Servicers’ decreased ability to offer veterans have deferred several months’ finance market. When borrowers do not loan modifications due to the worth of payments, the final installment make their regularly scheduled monthly repurchase requirement discussed above (i.e., the total deferred indebtedness), loan payments, loan servicers are often is especially significant given that will often exceed the limit. However, in contractually obligated to step in and veterans with large amounts of forborne order to provide veterans with a full advance such missed amounts to the indebtedness may not be able to return gamut of options, VA temporarily loan holder.19 The volume of CARES to normal loan repayment under other waived 23 this limit for certain cases Act forbearances in a servicer’s available loss-mitigation options. For where servicers can offer a loan portfolio, coupled with the protracted example, while a veteran who ceased deferment option that complies with length of such a forbearance (i.e., up to making payments under a CARES Act VA’s policy guidance. 360 days), has placed many servicers in forbearance for 360 days may be able to While loan deferment may present the a position where they may be required resume making regularly scheduled best option for certain borrowers, many to cover up to 12 months of loan monthly loan payments, post- servicers are facing a liquidity crunch payments for a significant segment of forbearance, the veteran may be unable and lack financial resources to float the loans they service. Federally backed to repay a whole year’s worth of missed large amounts of forborne indebtedness mortgages, that is, those for which payments under a repayment plan, in a for what can be, depending on the case, servicers must generally grant CARES relatively short timeframe established two to three decades. As a result, VA Act forbearances upon a borrower’s by a servicer that may be facing continues to consider innovative ways request, account for approximately 70 liquidity strains. to assist veterans mitigate the effects of percent of all housing loans in the Similarly, a special forbearance may the COVID–19 emergency, including United States.20 Recent data reveals that also not be financially feasible from the options that, until recently, were not approximately 7 percent of all housing perspective of both the veteran and the considered or utilized in VA’s home loans in the United States, servicer. A central issue is the ability of loan program. the borrower to repay forborne corresponding to 3.6 million indebtedness over a relatively short D. The Partial Claim Loss-Mitigation homeowners, are currently in period. A special forbearance could be Option forbearance.21 This increased number of problematic in that the veteran would As part of VA’s effort to analyze all borrowers in forbearance means that have even more forborne indebtedness possible options that could help servicers can be left without budgetary to repay, and the servicer would need to veterans, VA considered home retention resources to offer certain loss-mitigation advance additional payments without options available to borrowers with options to borrowers, including veterans receiving any offsetting payments from other types of federally backed with VA-guaranteed loans. the veteran. mortgages; that is, those available VA notes that most VA-guaranteed Given the issues described above, the through single-family loan guarantee/ loans are not held by the lenders that unprecedented nature of the COVID–19 insurance programs administered by originate the loans. Rather, lenders that emergency, its impact on the economy, are issuers approved by the Government and the lengthy forbearance period 23 See 38 CFR 36.4338(a) (authorizing VA, National Mortgage Association (Ginnie authorized under the CARES Act (i.e., notwithstanding any requirement, condition, or Mae) often originate VA-guaranteed limitation stated in or imposed by regulations up to 360 days), VA is continuously governing guaranteed loans, to relieve undue evaluating how best to help veterans 19 prejudice to a debtor, holder, or other person, Deloitte, Mortgage Series on Management which might otherwise result, if VA finds that such Estimates, pg. 7, https://www2.deloitte.com/ with large amounts of forborne indebtedness avoid foreclosure. For action does not adversely affect the interests of the content/dam/Deloitte/us/Documents/risk/us-aers- Government or impair the vested rights of any msme-perational-considerations-july2013r.pdf. example, VA recently issued guidance person affected thereby). See also Executive Order 20 Urban Institute, The Price Tag for Keeping 29 clarifying that servicers may offer what 13924, 85 FR 31353 (May 19, 2020) (stating that Million Families in Their Homes: $162 Billion, the servicing industry commonly calls agencies should, to the extent possible, address the (Mar. 27, 2020), https://www.urban.org/urban-wire/ economic consequences of the COVID–19 price-tag-keeping-29-million-families-their-homes- loan ‘‘deferment,’’ as a novel home 22 emergency by rescinding, modifying, waiving, or 162-billion; Mortgage Bankers Association (MBA), retention option. Under this option, providing exemptions from regulations and other Share of Mortgage Loans in Forbearance Declines requirements that may inhibit economic recovery); Slightly to 7.20%, (Aug. 24, 2020), https:// 22 VA Circular 26–20–33, Deferment as a COVID– Executive Order 13945, 85 FR 49935 (Aug. 8, 2020) www.mba.org/2020-press-releases/august/share-of- 19 Loss-Mitigation Option for CARES Act (stating that it is the policy of the United States to mortgage-loans-in-forbearance-declines-slightly-to- Forbearance Cases, (Sept. 14, 2020), https:// minimize, to the greatest extent possible, residential 720. www.benefits.va.gov/HOMELOANS/documents/ evictions and foreclosures during the ongoing 21 Id. circulars/26_20_33.pdf. COVID–19 national emergency).

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00004 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79146 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

FHA and USDA. Notably, both agencies suffered loss due to disasters.26 In be unnecessary for those individuals offer a ‘‘partial claim’’ as part of the applying the authorities as a consistent, because there would be no forborne suite of loss-mitigation options available coherent framework, VA would, by way indebtedness to resolve upon exiting the to borrowers and servicers.24 More of a loan to the veteran, purchase from forbearance. Consistent with FHA’s recently, FHA announced COVID–19 the servicer the veteran’s CARES Act COVID–19 National Emergency specific guidelines to maximize use of indebtedness and establish repayment Standalone Partial Claim, VA would its partial claim option while providing terms favorable to the veteran, while only pay one partial claim payment per streamlined loss-mitigation for leaving intact the veteran’s guaranteed veteran and require that the veteran borrowers and servicers.25 Under these loan. occupy, as a residence, the property securing the guaranteed loan for which programs, the partial claim option IV. COVID–19 Veterans Assistance the partial claim is requested. Also defers the repayment of housing loan Partial Claim Payment Program principal through the creation of an consistent with FHA and USDA, VA’s interest-free subordinate loan (payable VA, therefore, proposes to establish a proposed COVID–VAPCP would require to the Government) that is generally not temporary program that would provide the servicer to determine whether the due until the primary loan is paid off. a partial claim option to certain veterans veteran satisfies the program During the COVID–19 emergency, both who are financially impacted by requirements, prepare the appropriate FHA and USDA have authorized COVID–19. Under VA’s proposed loan documents on VA’s behalf, and servicers to utilize the partial claim COVID–VAPCP, servicers would present bring the veteran’s guaranteed loan option to cover all housing loan the partial claim option to a veteran current, prior to submitting to VA a payments borrowers do not make while only after evaluating the feasibility of request for partial claim payment. under a CARES Act forbearance, up to loss-mitigation options already available While VA’s proposed COVID–VAPCP 30 percent of the unpaid principal in VA’s program (i.e., repayment plan, would bear many similarities to FHA balance, subject to certain requirements. special forbearance, and loan and USDA’s COVID-related partial modification). If the veteran qualifies claim programs, it would not be III. Legal Authority and opts to move forward with a partial identical to either program. VA notes claim option, VA would purchase the Unlike FHA and USDA, VA has never that FHA and USDA provide 100 veteran’s forborne indebtedness, like had explicit authority to establish a percent and 90 percent backing on their when VA refunds a guaranteed loan. 27 partial claim option. To help veterans guaranteed/insured loans, Acting as a mortgage investor of last recover from the financial hardships respectively, whereas VA’s guaranty is resort, VA would purchase the amount 28 posed by the COVID–19 national typically no more than 25 percent. of indebtedness that is necessary to emergency, VA looked to its loan refund VA’s smaller guaranty is relevant for bring the veteran’s guaranteed loan authority in 38 U.S.C. 3732 and the two reasons. current (instead of the whole amount of First, compared to FHA- and USDA- broad powers authorized under 38 the guaranteed loan, as would be the backed loans with similar loan balances, U.S.C. 3720. When read together, the case in a typical loan refund). The VA-guaranteed loans generally expose text of these two sections authorizes VA veteran would repay VA for this the Government to less financial risk per to establish the COVID–VAPCP as an amount, and the indebtedness would be loan. While VA’s unique mission emergency measure. secured as a lien against the veteran’s requires VA to promote favorable Under 38 U.S.C. 3732(a), VA has the home upon execution and recordation outcomes for veterans, which might legal right to prevent a foreclosure by of the security instrument. The servicer increase costs, VA must also continue to purchasing indebtedness that VA has would handle all aspects of the be a responsible steward of taxpayer already guaranteed. VA refers to such a origination of the new COVID–VAPCP funds. VA has determined that any purchase as a loan refund. If VA loan. The new loan would be serviced proposed amount of assistance via a exercises the option, the holder must under VA’s existing loan portfolio. partial claim option cannot cause VA to assign the loan to VA. VA then steps To ensure that veterans can benefit incur financial risk that would eclipse into the shoes of the holder and often from a partial claim option in ways like the guaranty. allows for a loan modification, which FHA and USDA borrowers, VA proposes Therefore, while both the FHA and makes the terms more affordable for the to mirror requirements from FHA’s and USDA partial claim programs provide veteran. USDA’s COVID–19 partial claim payment to the servicer, on the VA also has broad powers under 38 programs, whenever feasible. Therefore, borrower’s behalf, up to 30 percent of U.S.C. 3720, ‘‘notwithstanding the like FHA’s and USDA’s COVID-related the unpaid principal balance at the time provisions of any other law,’’ to partial claim programs, VA’s proposed of initial default,29 VA’s proposed purchase assets and pay any claim, COVID–VAPCP would only be available program would provide for payment to however acquired, relating to or arising for guaranteed loans that were, on the servicer, on the veteran’s behalf, up from matters in the VA-guaranteed loan March 1, 2020, either current or less to 15 percent of the unpaid principal program and to offer forbearances or than 30 days past due. Additionally, balance of the guaranteed loan as of the indulgences to veterans who have VA’s partial claim payment would only date the veteran entered into a CARES be payable to a servicer on behalf of a 24 See 12 U.S.C. 1715u(b); 24 CFR 203.371. See veteran if there remains unpaid at least 27 See 12 U.S.C. 1709; 42 U.S.C. 1472(h)(2). also 42 U.S.C. 1472(h)(14); 7 CFR 3555.304(d) and one scheduled monthly payment that 28 See 38 U.S.C. 3703(a)(1). While VA notes that 3555.307. the veteran missed while under a the guaranty may be higher on loans with lower 25 Mortgagee Letter 2020–06, FHA’s Loss balances, such as 50 percent for loans with balances Mitigation Options for Single Family Borrowers CARES Act forbearance. VA notes that less than or equal to $45,000, the average balance Affected by the Presidentially-Declared COVID–19 some borrowers have continued to make on guaranteed loans has exceeded $200,000 since National Emergency in Accordance with the CARES their monthly loan payments despite 2008. See VBA Annual Benefits Reports, Fiscal Act, (Apr. 1, 2020), https://www.hud.gov/sites/ being under a CARES Act forbearance. Years 2008 to 2019, https://www.benefits.va.gov/ dfiles/OCHCO/documents/20-06hsngml.pdf; REPORTS/abr/docs/2019-loan-guaranty.pdf (Fiscal Mortgagee Letter 2020–22, FHA’s COVID–19 Loss A partial claim payment option would Year 2019); https://www.benefits.va.gov/REPORTS/ Mitigation Options, (Jul. 8, 2020), https:// abr/archive.asp (Fiscal Years 2008 to 2018). www.hud.gov/sites/dfiles/OCHCO/documents/20- 26 See 38 U.S.C. 3720(a), 3720(a)(3) through (5), 29 12 U.S.C. 1715u(b)(2)(A); 42 U.S.C. 22hsgml.pdf. and 3720(f). 1472(h)(14)(A).

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00005 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79147

Act forbearance. VA notes that, based on VA also proposes to charge a nominal, mitigation options that are within the an initial analysis of loans in fixed interest rate of 1.00 percent per servicer’s financial capabilities and forbearance, VA believes that a 15 annum on any loan established under business model. percent cap would provide sufficient the COVID–VAPCP. VA notes that this VA further notes that, because of the room for servicers to bring the is below what is generally charged for way the COVID–VAPCP is structured, guaranteed loans current, even if a VA’s portfolio loans (including the COVID–VAPCP is a standalone veteran invokes the maximum period of refunded loans) and, in fact, represents home retention option. In other words, forbearance; that is, 360 days, under the no more than the approximate net the COVID–VAPCP cannot be combined CARES Act. present value of the money to be paid with loss-mitigation options, such as a FHA and USDA do not charge to servicers on behalf of veterans.31 In special forbearance or loan borrowers interest on the subordinate other words, the 1.00 percent interest modification, to assist borrowers who indebtedness that results from a partial rate established under the COVID– are exiting CARES Act forbearances. For claim payment. Also, in such programs, VAPCP represents roughly the 10-year example, a servicer cannot tack on a no payment on the subordinate cost of borrowing money from the U.S. special forbearance period to the end of indebtedness is generally due until such Treasury that would be needed to a CARES Act forbearance and then use time as the property securing the reimburse servicers, on behalf of the COVID–VAPCP to bring the insured/guaranteed loan is transferred veterans, for partial claim payments. guaranteed loan current. When a or sold or the insured/guaranteed loan The relatively small size of VA’s servicer offers a special forbearance to is refinanced or otherwise paid-in-full. guaranty is also relevant because the assist the borrower in returning to However, in both programs, the partial holder 32 of a VA-guaranteed loan bears normal repayment, it indicates that the claim is essentially treated as an significantly more financial risk for a servicer views the option as the most advance paid to the servicer, on behalf VA-guaranteed loan than for a loan prudent choice based on the of the borrower, enabling the insured/ insured or guaranteed by FHA or USDA. circumstances. Similarly, if a servicer guaranteed loan to return to current.30 Due to VA’s smaller guaranty brings a veteran’s guaranteed loan This arrangement is to be expected percentage, the servicer has just as current through a loan modification, but given that FHA and USDA back all, or much, if not more, financial interest shortly thereafter the veteran cannot nearly all, of the insured/guaranteed than the Government in seeing a make payments on the modified loan, loan. VA, on the other hand, views its delinquent VA-guaranteed loan brought the servicer cannot then pursue a partial partial claim payment option more like current because, unlike in FHA and claim payment. A loan modification its loan refund program. As previously USDA’s programs, VA will not pay more requires servicers to ensure that the discussed, under the loan refund than 25 percent of the loan. Given the guaranteed loan ‘‘will be reinstated to holder’s significant financial incentive performing status by virtue of the loan program, VA generally takes assignment 33 of the guaranteed loan in exchange for to offer a veteran the loss-mitigation modification.’’ If the servicer VA’s payment of the unpaid balance of option that is most likely to help the reinstated the guaranteed loan to performing status by virtue of the loan the obligation, plus accrued interest. In veteran return to normal repayment, VA modification, there would not be any the event VA takes the loan into its own generally does not prescribe which loss- remaining ‘‘indebtedness that [would portfolio for servicing, no guaranty mitigation options servicers must first be] necessary to bring the guaranteed claim is paid. The veteran continues to offer to a veteran before considering loan current,’’ under VA’s proposed rule pay interest on the indebtedness and other options. text below. Therefore, where FHA has mandated monthly payments as obligated, but to By requiring servicers to consider that servicers consider every owner- VA as noteholder, not to the former loan loss-mitigation options before servicer. occupant borrower exiting a CARES Act evaluating a veteran for COVID–VAPCP, Under this rulemaking, VA proposes forbearance who was current or less VA’s proposed policy would help to make COVID–VAPCP loans on terms than 30 days past due as of March 1, ensure that veterans are afforded extremely favorable to veterans; 2020, for a COVID–19 National options that may be more advantageous providing a lifeline to veterans as they Emergency Standalone Partial Claim, to them than a partial claim, without recover financially. First, VA proposes and USDA has authorized a Disaster imposing additional administrative to require repayment of the loan within Mortgage Recovery Advance for requirements on servicers. For example, 120 months of origination or upon the similarly situated borrowers, VA would servicers that have adequate resources veteran’s transfer of title to the property, not mandate that servicers consider to offer deferment 34 as a home retention the refinancing of the guaranteed loan veterans for a partial claim payment option would be able to do so under with which the partial claim payment is option. Rather, VA would expect VA’s proposed program. Deferment can associated, or payment in full otherwise servicers to consider the feasibility of present a better option for certain of such guaranteed loan. VA would also loss-mitigation options before veterans as compared to the COVID– automatically defer any monthly considering a partial claim payment. VAPCP because, as explained above, the payments for the first 60 months of the Consistent with VA’s existing deferred amount does not accrue loan. Based on the partial claim loan regulations and policies, servicers interest and may provide a veteran balances that VA anticipates, VA would evaluate a veteran’s financial significantly more time before a believes this time horizon would situation and, if appropriate, offer loss- payment would become due. Moreover, provide veterans with a reasonable path without a requirement that certain to repayment without additional undue 31 VA’s analysis of the net present value of partial veterans be evaluated for COVID– claim payments made in accordance with the financial hardship. COVID–VAPCP was based on a review of the 10- VAPCP, servicers willing and able to year Treasury Yield Rate from Jan. 1, 2020, through 30 See 24 CFR 203.341, 203.371, and 203.401 Aug. 28, 2020. 33 38 CFR 36.4315(a)(6). (casting FHA’s partial claim as an ‘‘application for 32 38 CFR 36.4301 defines holder as ‘‘[t]he lender 34 See VA Circular 26–20–33, Deferment as a insurance benefits’’). See also 7 CFR 3555.304(d)(8) or any subsequent assignee or transferee of the COVID–19 Loss-Mitigation Option for CARES Act (stating that a USDA loss claim will be adjusted by guaranteed obligation or the authorized servicing Forbearance Cases, (Sept. 14, 2020), https:// any amount of mortgage recovery advance agent (also referred to as ‘‘the servicer’’) of the www.benefits.va.gov/HOMELOANS/documents/ reimbursed to the lender). lender or of the assignee or transferee.’’ circulars/26_20_33.pdf.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79148 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

offer deferments would not have to alter remaining and an unpaid principal VA would define ‘‘alternative to their servicing process, train employees, balance of $239,450. Given a total foreclosure’’, ‘‘CARES Act forbearance’’, and possibly upgrade technology to monthly payment of $1,587.83, at the ‘‘CARES Act indebtedness’’, complete such evaluations. end of a 12-month forbearance period, ‘‘Guaranteed loan’’, ‘‘Loss-mitigation Nevertheless, the option of COVID– the veteran would owe $19,054 in option’’, ‘‘Secretary’’, and ‘‘Servicer’’ as VAPCP assistance may very well be missed guaranteed loan payments.36 A set out in the regulatory text below. necessary to ensure certain veterans can loan modification at the same interest C. Section 36.4802 General Purpose of recover financially. In this regard, as rate and a new 30-year term would the COVID–19 Veterans Assistance servicers evaluate their liquidity result in a $26 decrease in monthly loan Partial Claim Payment Program positions and other factors, to determine payments but $39,518 in additional how to make the advances necessary for interest over the life of the guaranteed In § 36.4802, VA would set forth the investor requirements, some servicers loan. Conversely, a VA partial claim general purpose of the COVID–VAPCP. may find themselves unable to offer payment would result in a $341.58 per Intending to provide some introductory certain loss-mitigation options, such as month payment to VA in years 6 context for this novel option within a loan modification. VA notes that, through 10 but only $1,441 in additional VA’s home loan program, VA would unlike a loan modification, a partial interest over the life of the guaranteed state that the COVID–VAPCP is a claim payment under VA’s proposed loan. temporary program to help veterans COVID–VAPCP would not require the In cases where the servicer could not who have suffered a COVID–19 guaranteed loan to be purchased out of offer a deferment but could perhaps financial hardship. Notwithstanding the the Ginnie Mae pools. Thus, for these offer a modification, the partial claim requirements elsewhere in part 36 servicers, and the veterans whose option might present an even more regarding payment of a guaranty claim guaranteed loans they service, the beneficial outcome for both the veteran or refunding a loan, this proposed assistance VA is proposing would and the servicer. As the partial claim section would allow VA to assist a ensure veterans are afforded an option option would require the servicer to veteran exiting a CARES Act that enables them to retain their home, determine that the veteran can meet forbearance by purchasing from the while simultaneously helping servicers residual income standards, the veteran servicer the veteran’s CARES Act avoid liquidity crunches, thereby would not necessarily need the short- indebtedness. Such a purchase would affording veterans prudent and term savings of reduced monthly loan be called a partial claim payment. In uninterrupted loan servicing. payments under a loan modification. It exchange for VA’s partial claim As mentioned above, VA’s proposed could be more beneficial for such a payment on behalf of the veteran, the COVID–VAPCP would be available to veteran to realize an overall interest veteran would have to agree to repay the veterans whose guaranteed loan was savings of $38,077 under a partial claim Secretary, in the amount of such partial current or less than 30 days past due as option. claim payment, upon loan terms established by the Secretary. of March 1, 2020, and who certify that V. Section-by-Section Analysis of the they can resume making scheduled Proposed Regulatory Amendments D. Section 36.4803 General monthly payments, on time and in full. Requirements of the COVID–19 Veterans VA, however, would also require As previously noted, VA is proposing the COVID–VAPCP as a temporary Assistance Partial Claim Payment servicers to ensure that the veteran’s Program monthly residual income, as described program to help veterans return to in 38 CFR 36.4340(e), is adequate to making normal loan payments on their In § 36.4803, VA would set forth the meet living expenses after estimated guaranteed loans after exiting a CARES general requirements of the COVID– monthly shelter expenses (e.g., Act forbearance period. VA further VAPCP. First, VA would require that the payments on the guaranteed loan) have noted that its existing loss-mitigation loan for which a partial claim payment been paid and other monthly obligations and other servicing regulations and is requested must be a guaranteed loan have been met. Residual income has policies remain in effect. Thus, to avoid that was, on March 1, 2020, either long been a critical component of VA confusion, VA is proposing to add a current or less than 30 days past due. Second, VA would require that the underwriting.35 As the information new subpart F to part 36 of the Code of veteran on whose behalf VA would pay collected from the veteran to conduct Federal Regulations (CFR) to contain the a partial claim payment both received a this analysis coincides with the regulations that would govern this CARES Act forbearance and missed at information already requested to temporary program. The following least one scheduled monthly payment. evaluate VA’s existing loss-mitigation outlines VA’s proposed regulations, Third, VA would require that there options, this residual income with further explanation of each remains unpaid at least one scheduled requirement would help ensure that individual section, as necessary. monthly payment that the veteran did servicers have considered all loss- A. Section 36.4800 Applicability not make while under a CARES Act mitigation options for feasibility before In proposed § 36.4800, VA would note forbearance. Fourth, VA would require pursuing a partial claim payment. that this subpart applies to all loans the veteran to certify that the veteran Veterans would ultimately benefit from guaranteed by VA, to the extent such can resume making scheduled monthly this additional financial assessment loans are affected by the COVID–19 payments, on time and in full, and that because servicers would be able to national emergency. the veteran occupies, as the veteran’s evaluate the financial impact of loss- residence, the property securing the mitigation options, such as loan B. Section 36.4801 Definitions guaranteed loan for which the partial modification, compared to a partial In proposed § 36.4801, VA would set claim is requested. Fifth, VA would claim option. Take, for example, a forth the definitions applicable to new require the servicer to determine and veteran who enters a CARES Act subpart F. certify that the veteran’s monthly forbearance with 300 monthly payments residual income, as described in 36 This example assumes a starting guaranteed 35 See Public Law 99–576, section 402(b) (Oct. 28, loan balance of $245,000, fixed 3.75 percent interest § 36.4340(e), will be adequate to meet 1986); 55 FR 4829, 4869 (Feb. 12, 1990); 56 FR rate, 360-month loan term, and monthly escrows of living expenses after estimated monthly 9835, 9853 (Mar. 8, 1991). $453.20. shelter expenses have been paid and

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79149

other monthly obligations have been of proposed paragraph (b), the unpaid veterans’ guaranteed loans current met. Lastly, VA would require the principal balance of the guaranteed loan without additional financial hardship veteran to execute, in a timely manner, would mean such balance as of the date (e.g., having to find a way to replenish all loan documents necessary to the veteran entered into a CARES Act escrow accounts), VA determined the establish an obligation to repay the forbearance. Paragraph (c) would state veteran’s obligation could not be fully Secretary for the partial claim payment. that VA would pay only one partial met unless VA also included in the claim payment per guaranteed loan. E. Section 36.4804 Partial Claim partial claim calculation the amounts to Paragraph (d) would state that VA Payment as Last Resort cover missed escrow payments. would pay only one partial claim Also, VA is proposing under In § 36.4804, VA would state that a payment per veteran. partial claim payment would be an In proposed paragraph (e)(1), VA § 36.4805(e)(3) that, in cases where option of last resort. VA would reiterate would state that because VA would pay veterans make monthly escrow that the COVID–VAPCP is designed to only one partial claim payment per payments for taxes or insurance address the financial hardships due, guaranteed loan, and only one partial premiums, or both, servicers would be directly or indirectly, to the COVID–19 claim payment per veteran, a servicer required to include not just the forborne national emergency. VA would state would be required, in calculating the amounts of taxes and insurance that servicers must consider all possible amount of partial claim payment to be escrows, but also those amounts that are loss-mitigation options and that VA paid by VA to the servicer, to include due within 31 days of the date the expects the partial claim payment the full amount of indebtedness that is veteran executes the COVID–VAPCP option would be considered only as a necessary to bring the guaranteed loan note and security instrument. This is to last resort, after a servicer has evaluated current. In paragraph (e)(2), VA would help ensure a smooth handoff of the full loss-mitigation options for feasibility. state that to bring the guaranteed loan obligation, rather than to learn, perhaps VA would also state that the servicer current, servicers must include in the months after the fact, that an escrow would be able to immediately proceed partial claim payment the full CARES payment was missed during the transfer to offering an alternative to foreclosure Act indebtedness, comprising (i) all of paperwork. if the veteran notifies the servicer that scheduled but missed monthly VA recognizes that there are cases the veteran does not want to retain payments of principal and interest; and where a veteran does not make escrow ownership of the property securing the (ii) as applicable, all scheduled but payments to the servicer for taxes or guaranteed loan. missed monthly escrow payments for insurance premiums. In such cases, F. Section 36.4805 Terms of the Partial real estate taxes and insurance corresponding to less than 1 percent of Claim Payment premiums, or where the guaranteed loan guaranteed loans, the veterans make documents do not provide for monthly their payments directly to tax In § 36.4805, VA would set forth the escrowing, all payments the servicer terms of the partial claim payment. In authorities and insurance providers. In made to real estate tax authorities and such cases, while servicers are not paragraph (a), in order for a partial insurance providers, on the veteran’s taking funds from escrow accounts to claim payment to be payable, the behalf, during the CARES Act make these payments, servicers still servicer would be required to submit to forbearance. the Secretary, not later than 90 days VA chose to require inclusion of monitor whether the veteran satisfies after the date the veteran exits the payments of taxes and insurance the veteran’s tax and insurance CARES Act forbearance, a request for because veterans are generally obligated, obligations. such payment, as prescribed in under the terms of the documents that Notably, VA requires servicers to proposed § 36.4807. This would require establish a guaranteed loan, to keep obtain and retain a lien of proper a servicer to evaluate the veteran for all current their taxes and insurance dignity; that is, a primary lien, for all loss-mitigation options, as well as a premiums. VA internal data shows that, guaranteed loans. In that regard, VA can partial claim option, and prepare and in a little more than 99 percent of the adjust its guaranty and take other execute the appropriate loan time, servicers of guaranteed loans actions against servicers that allow, for documents, all before submitting an require borrowers to remit monthly, in example, tax authorities to jeopardize application to VA. VA notes that 90 addition to their principal and interest the primacy of the guaranteed loan lien. days is consistent with FHA’s COVID– payments, the amounts necessary to Similarly, VA requires servicers to 37 19 loss-mitigation policies. ensure payment of the full year’s tax ensure that the property is adequately Nevertheless, in recognition of the fact and insurance obligations. When insured. In instances where a veteran that servicers will be faced with large servicers require such monthly does not pay taxes or insurance numbers of borrowers exiting remittances, they hold the funds in premiums timely, the servicer will forbearance in the coming year, VA is escrow accounts until the sums are due. advance payments, from its own funds, specifically requesting comments on the When the veteran’s tax and insurance to avoid a lapse in payment, and to proposed timeframe to complete these obligations become due, the servicer ensure that future guaranty payments, if actions and submit an application for takes out of the escrow accounts the any, are not jeopardized. partial claim payment. amounts necessary to keep the taxes up Paragraph (b) of this section would to date and the insurance coverage in In cases where servicers were forced state that the amount of the partial claim place. to advance payment on a veteran’s payment that VA would pay to the If the guaranteed loan documents behalf to tax authorities or insurance servicer, as calculated under proposed provide for monthly escrow obligations, providers because the veteran (who paragraph (e), shall not exceed 15 the loan can be considered in default normally makes payments directly to percent of the unpaid principal balance when such obligations are missed. The such entities) did not meet such of the guaranteed loan. For the purposes default, and the resultant consequences obligations during a CARES Act of default, are the same as if the veteran forbearance, the veteran would need to 37 Mortgagee Letter 2020–22, FHA’s COVID–19 defaults on payments of principal and repay the servicer to bring the Loss Mitigation Options, (Jul. 8, 2020), https:// guaranteed loan current. That is why www.hud.gov/sites/dfiles/OCHCO/documents/20- interest. Because an objective of the 22hsgml.pdf. COVID–VAPCP is to help bring VA proposes to require these obligations

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79150 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

in the partial claim payment.38 VA premiums directly to taxing authorities payments (comprising principal, would not, however, authorize or insurance providers set aside funds interest, and escrow payments for real inclusion of any such amounts to cover each month to save up for tax and estate taxes and insurance premiums) payments that were not due on the date insurance bills that come due that were missed after March 1, 2020, the veteran executes the COVID–VAPCP throughout the year. It would also put but before the veteran was granted a note and security instrument. servicers in a situation where they CARES Act forbearance, provided the For example, consider a veteran who would be required either to remit the guaranteed loan was, as of March 1, pays property taxes directly to their amount paid as part of the partial claim 2020, current or less than 30 days past local tax office on a semi-annual basis directly to the veteran or make another due. However, in order to include these (i.e., on the first of January and of July) payment on behalf of the veteran. Both payments, the servicer must waive any and elects a seven-month CARES Act scenarios could create unnecessary late charges and fees associated with forbearance beginning May 1, 2020. confusion. There would also be need for these missed payments. Assuming the veteran does not pay the oversight by VA to ensure that any VA recognizes that some borrowers property tax bill on July 1, 2020, the amounts to cover future payments not may not have been immediately aware servicer would advance payment from collected as part of a scheduled monthly of the availability of forbearance under its own funds. The veteran then exits loan payment are calculated correctly the CARES Act, but nevertheless missed the CARES Act forbearance on and ultimately used for their intended their guaranteed loan payment(s) due to November 1, 2020 and executes the note purpose (i.e., taxes or insurance, or circumstances related to the COVID–19 and security instrument, consistent with both). national emergency before requesting proposed § 36.4806, on December 1, Given VA’s estimate that less than 1 forbearance. The effect of the above 2020. The partial claim payment percent of veterans pay their taxes and/ requirements would be to enable amount calculated under paragraph (e) or insurance directly to the appropriate veterans, whose loans meet the criteria, would include the amount of taxes paid authority/provider, rather than through to bring their guaranteed loans current by the servicer on behalf of the veteran monthly escrow payments to their via the COVID–VAPCP. In that in July. The veteran, however, would be servicer, VA proposes that, for partial circumstance, the servicer would responsible for paying the property tax claim payments associated with these include, if applicable, certain payments bill due on January 1, 2021, and no veterans’ guaranteed loans, a servicer not paid between March 1, 2020, and dollar amount would be included in the can include only amounts the servicer the date the veteran entered the CARES partial claim payment to account for the actually paid on behalf of the veteran Act forbearance in the amount of the during the CARES Act forbearance fact that the veteran was in forbearance partial claim payment. Additionally, period. Nevertheless, VA invites public five out of the six months leading up to under proposed paragraph (e)(3)(iii), VA comment on whether VA should cover the next property tax bill. would require servicers to include the prorated amounts associated with The previous example contrasts with actual amount of recording fees, missed guaranteed loan payments for a veteran whose monthly loan payment recording taxes, or other charges levied these veterans and, if so, how VA might to the servicer includes an amount that by the recording authority, that must be best accomplish this for veterans and is set aside in an escrow account to be paid in order to record the security used for payment of property taxes. servicers. In proposed paragraph (e)(3), VA instrument described in proposed Using the same dates as above, the § 36.4806. servicer would still advance payment would also require servicers to include all scheduled monthly payments In proposed paragraph (e)(4), VA from its own funds to cover the July would clarify that servicers shall not property tax bill. However, the partial (comprising principal, interest, and escrow payments for real estate taxes include any amounts in the partial claim payment amount calculated under and insurance premiums) that are due claim total that are not listed by paragraph (e) will include the monthly within 31 days of the date the veteran paragraph (e)(2) or (3). This means scheduled amounts for taxes that should executes the note and security servicers could not include any have been paid as part of the monthly instrument described in proposed amounts, for example, for fees, loan payments missed for May through § 36.4806. VA notes that any such penalties, or interest, beyond the December 2020. The servicer would be payment due within 31 days of such amounts scheduled or calculated as if reimbursed from this amount for the date may be considered part of the the borrower made all contractual advance payment made in July; the veteran’s obligation to bring the payments on time and in full under the remaining amount would be deposited guaranteed loan current. As such, VA terms of the guaranteed loan, or any late into the veteran’s escrow account and would require servicers to include this charges and fees that the veteran would be available for use when the amount in the partial claim payment. incurred between March 1, 2020, and January 1, 2021, property tax bill is due. From a practical standpoint, this means the date the veteran entered the CARES While VA does not intend to create that a veteran who executes, on January Act forbearance.39 differences between veterans who 15, 2021, a COVID–VAPCP note and In proposed paragraph (e)(5), VA escrow and who do not escrow, VA security instrument described in would state that nothing in proposed notes the complexities associated with § 36.4806, would not have a guaranteed § 36.4805 shall preclude a veteran from determining and disbursing funds to the loan payment due to the servicer until making an optional payment or a servicer to cover tax and/or insurance March 1, 2021, as the February 1, 2021 servicer from waiving a veteran’s bills that are not yet due and payable. payment would be due within 31 days indebtedness, such that the amount of In this regard, allowing for inclusion of and would need to be included in the partial claim payment would not exceed such amounts in a partial claim partial claim amount. (Note: As payment might assume that veterans explained below, the veteran would not 39 who opt to pay taxes or insurance See Public Law 116–136, section 4022(b)(3) have to begin repaying VA under the (Mar. 27, 2020) (expressly prohibiting a servicer COVID–VAPCP loan until 2026.) from charging any ‘‘fees, penalties, or interest 38 See 38 U.S.C. 3732(a)(2)(A) (stating that VA’s beyond the amounts scheduled or calculated as if refund authority includes ability to ‘‘pay the holder Additionally, as discussed below, VA the borrower made all contractual payments on of the obligation the unpaid balance of the proposes to allow servicers to include, time and in full under the terms of the mortgage obligation plus accrued interest’’). if applicable, all scheduled monthly contract’’).

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79151

the 15 percent cap described in security instrument read in favor of ‘‘the period of deferment. Interest would proposed paragraph (b). Secretary of Veterans Affairs, an Officer accrue on the loan during such As explained above, VA’s initial of the United States’’. deferment and a borrower could, analysis of guaranteed loans in VA would require that the note be without premium or fee, make payments forbearance suggests that a 15 percent consistent with the terms described in during such deferment for the entire cap (based on the unpaid principal proposed § 36.4806 and include all indebtedness, or any portion thereof, balance as of the date the veteran borrowers who are obligated on the provided that such portion is not less entered into a CARES Act forbearance) guaranteed loan. The security than what would be due for one would provide enough room for instrument would also be required to monthly payment as calculated based servicers to bring the guaranteed loans include all persons (borrowers, as well on a 60-month term. VA would require current, even if a veteran invokes the as non-borrowers) who hold a title the term of the loan to be 120 months. maximum period of forbearance; that is, interest in the property securing the The loan would be amortized fully 360 days, under the CARES Act. In the guaranteed loan. In proposed paragraph within the term of the loan in event that the amount needed to bring (g), subject to the requirement that the accordance with any generally an eligible veteran’s guaranteed loan servicer submit the application for a recognized plan of amortization current exceeds 15 percent of the partial claim payment to VA not later requiring approximately equal monthly unpaid principal balance, VA would than 90 days after the date the veteran payments. VA would require repayment allow a veteran to make an optional exits the CARES Act forbearance, VA in full immediately upon the veteran’s payment or a servicer to waive the would require all loan documents to be transfer of title to the property, the veteran’s indebtedness, such that the fully executed not later than 90 days refinancing, or payment in full partial claim payment would not exceed after the veteran exits the CARES Act otherwise, of the guaranteed loan with the 15 percent cap. forbearance. Proposed paragraph (h) which the partial claim payment is In proposed paragraph (e)(6), VA would require the servicer to record the associated. would explain that if the servicer security instrument timely, as miscalculates the partial claim amount, prescribed in § 36.4807. Finally, in H. Section 36.4807 Application for resulting in an overpayment to the paragraph (i), the servicer would be Partial Claim Payment servicer, the amount of such prevented from charging, or allowing to overpayment shall constitute a liability be charged, to the veteran any fee in In proposed § 36.4807, VA would of the servicer to the United States. The connection with the COVID–VAPCP. require the veteran and the servicer to servicer would be required to remit the complete an application form prescribed overpaid amount immediately to VA. In G. Section 36.4806 Terms of the by the Secretary. Assistance to the Veteran paragraph (e)(7), VA would state that if Along with a complete application the servicer miscalculates the partial If a veteran chooses to accept VA’s form, the original note (required by claim amount, resulting in assistance (i.e., a partial claim payment proposed § 36.4805) must be included to the servicer, on the veteran’s behalf), underpayment (i.e., an amount when the servicer submits a request for the veteran, and all co-borrowers on the insufficient to bring the guaranteed loan a partial claim. Not later than 180 days guaranteed loan, would be required to current), the servicer would be required following the date the security execute a note and security instrument to waive the difference. instrument (as required by § 36.4805) is Finally, proposed paragraph (e)(8) in favor of ‘‘the Secretary of Veterans fully executed, the servicer would be would prohibit servicers from including Affairs, an Officer of the United States’’. required to provide VA with the original any amounts for a monthly payment In addition, all non-borrowers holding a security instrument and evidence that that is scheduled to be paid on a date title interest in the property would be the servicer recorded such instrument. If that is more than 31 days after the required to sign the security instrument. the recording authority causes a delay, veteran executes the note and security VA would establish the terms of the the servicer could request an extension instrument described in § 36.4806. note and security instrument. Under proposed paragraph (f), the Specifically, VA would require the note of time, in writing, from VA. servicer would be required to prepare a and security instrument to include the Servicers would utilize VA’s existing note and security instrument in favor of amount to be repaid to the Secretary, by loan servicing platform, the VA Loan ‘‘the Secretary of Veterans Affairs, an the veteran, to be the amount calculated Electronic Reporting Interface (VALERI) Officer of the United States’’. Using the under § 36.4805(e). The interest rate on system, to report the partial claim ‘‘Department of Veterans Affairs’’ or the the loan created by the note and security payment event. Servicers would need to ‘‘United States’’ is legally incorrect. instrument would be required to be report the event within seven days of Furthermore, certain states have their fixed at 1.00 percent per annum. VA the borrower’s execution of the note own Departments of Veterans Affairs, would automatically defer monthly required by § 36.4805. Below, VA has and without the explicit distinction payments for the first 60 months of the identified the specific data elements made here, confusion could result. loan, meaning that there would be no that servicers must input into VALERI Therefore, it is critical that the note and payment due to the Secretary during the when reporting the partial claim event.

DATA ELEMENT DEFINITIONS

Event name Data elements Business definition of data element

Partial claim ...... Principal amount ...... Total dollar amount of all scheduled but missed monthly payments of principal, as described in § 36.4805(e)(2)(i) and (e)(3)(ii), and all scheduled monthly pay- ments of principal due within 31 days of the date the veteran executes the note and security instrument described in § 36.4806. Partial claim ...... Interest amount ...... Total dollar amount of all scheduled but missed monthly payments of interest, as described in § 36.4805(e)(2)(i) and (e)(3)(ii), and all scheduled monthly pay- ments of interest due within 31 days of the date the veteran executes the note and security instrument described in § 36.4806.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00010 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79152 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

DATA ELEMENT DEFINITIONS—Continued

Event name Data elements Business definition of data element

Partial claim ...... Tax payments missed amount ...... Total dollar amount of all scheduled but missed monthly escrow payments for real estate taxes, as described in § 36.4805(e)(2)(ii) and (e)(3)(ii), and all scheduled monthly escrow payments for real estate taxes due within 31 days of the date the veteran executes the note and security instrument described in § 36.4806. Partial claim ...... Insurance payments missed amount ...... Total dollar amount of all scheduled but missed monthly escrow payments for in- surance premiums, as described in § 36.4805(e)(2)(ii) and (e)(3)(ii), and all scheduled monthly escrow payments for insurance premiums due within 31 days of the date the veteran executes the note and security instrument de- scribed in § 36.4806. Partial claim ...... Tax advance amount ...... Total dollar amount of all payments the servicer made to real estate tax authori- ties on the veteran’s behalf, as described in § 36.4805(e)(2)(ii). Partial claim ...... Tax advance date ...... The date on which the servicer made the tax advance on the veteran’s behalf, as described in § 36.4805(e)(2)(ii). Partial claim ...... Insurance advance amount ...... Total dollar amount of all payments the servicer made to insurance providers on the veteran’s behalf, as described in § 36.4805(e)(2)(ii). Partial claim ...... Insurance advance date ...... The date on which the servicer made the insurance advance on veteran’s behalf, as described in § 36.4805(e)(2)(ii). Partial claim ...... Recording fees ...... Total dollar amount of recording fees, recording taxes, or other charges levied by the recording authority, that must be paid in order to record the security instru- ment, as described in § 36.4805(e)(3)(iii). Partial claim ...... Partial claim origination date ...... The date the borrower executes the note required by § 36.4805. Partial claim ...... Partial claim first payment due date ...... The date on which the first payment on the partial claim loan is due to the Sec- retary. Partial claim ...... Partial claim maturity date ...... The date on which the final payment on the partial claim loan is due to the Sec- retary. Partial claim ...... Partial claim P&I payment amount ...... The monthly payment corresponding to principal and interest on the partial claim loan. Partial claim ...... Partial claim legal description ...... The legal description of the property. Partial claim ...... Partial claim lien position ...... The lien position of the partial claim loan. Partial claim ...... Second borrower birth date ...... The birth dates of all co-borrowers.

VA has proposed VA Standard Form I. Section 36.4808 No Effect on the after the subject date, the Secretary 26–10213, Application for a COVID–19 Servicing of the Guaranteed Loan could still accept a request for a partial Veterans Assistance Partial Claim In § 36.4808, VA would require claim payment, provided that such Payment (COVID–VAPCP), to collect servicers to continue to service the request is submitted to the Secretary not basic information necessary to identify guaranteed loan in accordance with later than 90 days after the date the the borrower(s), the servicer, and the VA subpart B of part 36. The liability of the veteran exits the CARES Act loan number for the guaranteed loan for United States for any guaranteed loan forbearance. However, in no event which partial claim payment is being would decrease or increase pro rata with would the Secretary accept a request for requested. This form would also collect any decrease or increase of the amount a partial claim payment after September information regarding the date the of the unpaid portion of the guaranteed 9, 2021. veteran entered into a CARES Act loan. A partial claim payment would In proposing September 9, 2021, as forbearance, along with the unpaid not affect the guaranty percentage the last date on which VA could accept principal balance on that date, the latter established at the time the guaranteed a request for a partial claim payment, of which is necessary to determine the loan was made. Receipt of a partial VA notes that this date is 180 days from maximum amount of the partial claim claim payment would not eliminate a the one-year anniversary of the payment under proposed § 36.4805. VA servicer’s option under 38 U.S.C. 3732, President’s March 13, 2020 COVID–19 proposes that the servicer must indicate, to convey to the Secretary the security national emergency declaration. Under on the proposed form, the date on for the guaranteed loan in the event the National Emergencies Act, any which the borrower will resume such loan is foreclosed or if the veteran ‘‘national emergency declared by the monthly guaranteed loan payments to executes a deed-in-lieu of foreclosure. President . . . not otherwise previously the servicer, along with the amount of terminated, shall terminate on the those monthly payments. The servicer J. Section 36.4809 Expiration of the anniversary of the declaration of that would then provide the amount of COVID–19 Veterans Assistance Partial emergency if, within the ninety-day partial claim payment being requested, Claim Payment Program period prior to each anniversary date, along with the date the note and In proposed § 36.4809, VA would note the President does not publish in the security instrument were executed, as that the Secretary will not accept a Federal Register and transmit to the required under proposed § 36.4805. request for a partial claim payment after Congress a notice stating that such Finally, both the borrower and servicer the date that is 180 days after the date emergency is to continue . . .’’ 40 would sign statements certifying to the the COVID–19 national emergency ends Without clear indication of whether the elements required under proposed (as provided under the National national emergency will be extended § 36.4803. Emergencies Act), unless a veteran’s beyond its one-year anniversary, and the Further documentation would only be CARES Act forbearance does not end future state of the economy and lending reviewed under VA’s existing auditing until after such date. In cases where a and oversight processes. veteran’s CARES Act forbearance ends 40 50 U.S.C. 1622(d).

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00011 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79153

industry, VA finds it prudent to publish and audit activities as part of VA’s proposes to delete the phrase ‘‘for which a termination date that is tied to the regular monitoring related to adequacy an incentive is paid in accordance with one-year anniversary and also provides of loan servicing. If VA determines, § 36.4319(a).’’ To ensure that VA’s sufficient notice for VA and servicers to during an audit, that a servicer did not partial claim payment option is covered, close out any actions related to the follow VA’s requirements when VA would add a sentence noting that program. It also provides sufficient time participating in the COVID–VAPCP, the holder would be required to for VA to extend the sunset date via proposed § 36.4810 would expressly maintain records supporting their rulemaking, depending on VA’s authorize appropriate enforcement decision to pursue a partial claim continued monitoring of the national actions. payment under the COVID–19 Veterans emergency and its impact on veterans. L. Conforming Technical Amendments Assistance Partial Claim Payment K. Section 36.4810 Oversight of the program as established by proposed VA proposes to add new section 38 subpart F. Regarding the length of the COVID–19 Veterans Assistance Partial CFR 36.4336 that would reiterate VA’s Claim Payment Program recordkeeping requirement, VA parameters for oversight of loan proposes to retain an element of the In proposed § 36.4810, VA would set servicing. This technical amendment is status quo, namely that such records forth the parameters for oversight of the necessary to ensure that servicers shall be retained a minimum of three COVID–VAPCP. It is an almost verbatim adhere to the parameters outlined in years from the date of any incentive restatement of 38 U.S.C. 3704(d). § 36.4804, wherein the servicer must paid in accordance with § 36.4319(a) or Specifically, subject to notice and consider the partial claim payment the date the veteran’s guaranteed loan is opportunity for a hearing, whenever the option after evaluating loss-mitigation made current via the COVID–VAPCP, Secretary finds with respect to a partial options in subpart B for feasibility. As whichever is later. Finally, VA proposes claim payment that any servicer has with proposed § 36.4810, it would to amend the specific authority for failed to maintain adequate loan include an almost verbatim restatement § 36.4333 to include 38 U.S.C. 3704(d), accounting records, or to demonstrate of 38 U.S.C. 3704(d). Under this new as this section requires the maintenance proper ability to service loans section, subject to notice and of adequate loan accounting records. adequately or to exercise proper credit opportunity for a hearing, whenever the judgment or has willfully or negligently Secretary finds that any servicer has VI. Specific Questions for Comment engaged in practices otherwise failed to maintain adequate loan While VA welcomes comments on all detrimental to the interest of veterans or accounting records, or to demonstrate aspects of this proposed rule, VA of the Government, the Secretary could proper ability to service loans specifically requests comments on the refuse either temporarily or adequately or to exercise proper credit following: permanently to guarantee or insure any judgment or has willfully or negligently 1. Is the servicer’s 90-day deadline as loans made by such servicer and may engaged in practices otherwise proposed by § 36.4805 to submit the bar such servicer from servicing or detrimental to the interest of veterans or request for partial claim payment acquiring guaranteed loans.41 of the Government, the Secretary may reasonable? If not, what would be a Notwithstanding the above, but subject refuse either temporarily or reasonable timeframe, recognizing VA’s to § 36.4328, the Secretary would not permanently to guarantee or insure any goal of ensuring that veterans exiting a refuse to pay a guaranty or insurance loans made by such servicer and may CARES Act forbearance are evaluated claim on guaranteed loans theretofore bar such servicer from servicing or and processed for home retention entered into in good faith between a acquiring guaranteed loans.44 actions in a timely manner? veteran and such servicer.42 The Notwithstanding the above, but subject Secretary could also refuse either to § 36.4328, the Secretary would not 2. Is information collected as part of temporarily or permanently to guarantee refuse to pay a guaranty or insurance a complete loss-mitigation evaluation or insure any loans made by a lender or claim on guaranteed loans theretofore adequate to determine a borrower(s) holder refused the benefits of entered into in good faith between a monthly residual income as described participation under the National veteran and such servicer.45 The by 38 CFR 36.4340(e)? If not, what Housing Act pursuant to a Secretary may also refuse either additional information would be needed determination of the Secretary of temporarily or permanently to guarantee from the borrower(s)? Housing and Urban Development.43 or insure any loans made by a lender or 3. Understanding that many veterans As noted above, VA would utilize its holder refused the benefits of and servicers are in need of VA’s existing loan refund process to handle participation under the National assistance, but also that veterans, applications for partial claim payments Housing Act pursuant to a servicers, and other stakeholders would via the VA Loan Electronic Report determination of the Secretary of need time to understand and implement Interface (VALERI). Upon receipt of an Housing and Urban Development.46 VA VA’s proposed regulatory requirements, application, VA would conduct a two- also proposes to amend 38 CFR VA seeks public comment as to how a tier review and approval of the partial 36.4333(a)(2) to ensure that records final rule that is not effective for 30 or claim payment, utilizing information referenced in proposed §§ 36.4336 and 60 days following publication might already in its VALERI systems to verify 36.4810 are included in VA’s negatively impact veterans, servicers, that the servicer has brought the maintenance of record requirements. and other stakeholders. VA also requests veteran’s guaranteed loan current, that Currently, holders are required to input as to whether there would be the amount requested is consistent with ‘‘maintain records supporting their enough time for industry other proposed requirements, and that decision to approve any loss-mitigation implementation of the partial claim VA has received all necessary option for which an incentive is paid in payment program if VA were to publish documentation. Partial claim payments accordance with § 36.4319(a).’’ 47 VA a final rule that is effective 7 days after would also be subject to VA’s oversight publication. Please be specific in 44 38 U.S.C. 3704(d). communicating any concerns, including 41 38 U.S.C. 3704(d). 45 Id. any additional costs associated with 42 Id. 46 Id. accelerated timetables for training, 43 Id. 47 38 CFR 36.4333(a)(2). technology upgrades, etc.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00012 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79154 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

4. In the case of a veteran who pays their regularly scheduled monthly determined that this rule is an real estate taxes and/or insurance payments, despite potential hardships economically significant regulatory premiums directly to a tax authority or and uncertainties caused by the national action under Executive Order 12866. insurance provider, should VA allow emergency. VA’s partial claim VA’s impact analysis can be found as the partial claim payment to include assistance may well be the determining a supporting document at http:// amounts corresponding to what will be factor for certain veterans, affecting the www.regulations.gov, usually within 48 due on tax and/or insurance bills, where extent to which they can recover hours after the rulemaking document is the bills were not due and payable financially from the crisis. Similarly, published. Additionally, a copy of the during the veteran’s CARES Act servicers must evaluate their liquidity rulemaking and its Regulatory Impact forbearance? If so, should such amounts positions and other factors to determine Analysis (RIA) are available on VA’s be prorated to correspond only to the how to make the advances necessary for website at http://www.va.gov/orpm/, by months during which the veteran was investor requirements. Some servicers following the link for ‘‘VA Regulations under forbearance? How should may even be questioning whether they Published From FY 2004 Through Fiscal servicers handle monies in cases where can stay afloat, which ultimately harms Year to Date.’’ such future tax and insurance premium not just the servicer, but also the Regulatory Flexibility Act payments are not due and payable at the veterans whose guaranteed loans are time of the partial claim payment, being serviced. Many of these servicers The Secretary hereby certifies that resulting in an excess of funds being will find that the assistance VA is this proposed rule will not have a paid to the servicer? Should servicers proposing for veterans may significant economic impact on a remit such amounts directly to the simultaneously be the servicer’s lifeline, substantial number of small entities as veteran? Or should servicers be required thereby affording veterans prudent and they are defined in the Regulatory to hold such amounts in escrow until uninterrupted loan servicing. Flexibility Act (5 U.S.C. 601–612). To the bills become due and payable? How Despite the urgency noted above, VA assess whether the proposed rule can be should VA conduct oversight of these strongly believes that the novelty of this expected to have a ‘‘significant activities? program, including the differences economic impact’’ on small entities, VA between VA’s proposed partial claim considers the annual cost of the rule for VII. Explanation of Comment Period payment program and other federal small entities compared to their annual VA is issuing this proposed rule with agencies’ partial claim programs, revenue. VA was able to determine the a 30-day public comment period. The necessitates an opportunity for public size of 89 out of 108 companies that Administrative Procedure Act (APA) input before finalization and service VA-guaranteed loans in CARES does not specify the length of the implementation. VA did consider Act forbearances, where the borrowers comment period, requiring only that an implementing this program via an could likely qualify for assistance via a agency give the public an ‘‘opportunity interim final rule but decided partial claim. VA made this to participate.’’ 48 Agencies commonly stakeholder feedback was needed in determination using the size standards allow 30 to 60 days for comment on a advance of implementation in a number from the Small Business Administration proposed rule. VA is shortening the of specific areas, as addressed in section (SBA).51 52 VA used data from InfoUSA comment period to 30 days because this VI above. Further, VA recognizes that and Factiva (two business data rule is proposed in response to allowing for servicers to communicate providers) along with data from the heightened concerns surrounding the potential concerns with VA’s rule ahead Federal Deposit Insurance Corporation COVID–19 national emergency and of implementation would ensure (FDIC) and the National Credit Union outcomes for veterans as they exit veterans are better served when the final Administration (NCUA). Out of the 89 CARES Act forbearance periods. rule goes into effect. Balancing the need servicers for which VA has sufficient Under section 4022 of the CARES Act, for a final regulation against the need for data to determine their size, 26 (or 29.21 enacted on March 27, 2020, borrowers public input on this new partial claim percent) are considered small by SBA may obtain up to 180 days of option, VA believes that a 30-day public standards. The average annual revenue forbearance on their Federally backed comment period is appropriate to of those 26 small servicers is $11.98 loans.49 VA-guaranteed loans are ensure VA can gather input from million.53 considered Federally backed. Section interested parties while accelerating the 4022 also provides borrowers the option process toward a final rule to assist 51 VA uses data from InfoUSA and Factiva to of extending the forbearance for an veterans. determine the industry (as identified by the primary additional 180 days.50 Section 4022 NAICS code) for the active VA-guaranteed loan Executive Orders 12866 and 13563 servicers. For industries where size standards are allows borrowers to shorten their Executive Orders 12866 and 13563 determined by the average annual revenue, VA periods of forbearance. This means that direct agencies to assess the costs and compares the revenue of each servicer in these some borrowers may have already industries, as reported in InfoUSA and Factiva, to benefits of available regulatory exited CARES Act forbearances and the SBA annual revenue threshold for small alternatives and, when regulation is businesses. For industries where size standards are more borrowers could do so at any time. necessary, to select regulatory determined by assets, VA compares the relevant As initial CARES Act forbearance approaches that maximize net benefits SBA threshold for small businesses to asset data periods near their end, VA stakeholders from the FDIC for servicers with primary NAICS (including potential economic, confront numerous decisions that have codes 522110 (Commercial Banking) and 522120 environmental, public health and safety (Savings Institutions), and asset data from the far-reaching consequences. Many effects, and other advantages; NCUA for lenders with a primary NAICS code of veterans, for example, must decide distributive impacts; and equity). 522130 (Credit Unions). whether to request additional 52 U.S. Small Business Administration, SBA Executive Order 13563 (Improving forbearance and watch their forborne Table of Size Standards, (2019), https:// Regulation and Regulatory Review) indebtedness grow, or attempt to resume www.sba.gov/sites/default/files/2019-08/ emphasizes the importance of SBA%20Table%20of%20Size%20Standards_ quantifying both costs and benefits, Effective%20Aug%2019%2C%202019_Rev.pdf. 48 5 U.S.C. 553(c). 53 VA averages the sales volumes from Factiva for 49 Public Law 116–136, section 4022(b)(2) (Mar. reducing costs, harmonizing rules, and all servicers considered small, including those 27, 2020). promoting flexibility. The Office of primarily considered commercial banks, savings 50 Id. Information and Regulatory Affairs has institutions, and credit unions.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00013 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79155

To determine the economic burden of participate in the partial claim program. Veterans Affairs, Office of Information the proposed rule on small entities, VA As described above, 26 VA servicers out and Regulatory Affairs, Washington, DC compares the average annual costs of of the 89 servicers with sufficient data 20503 or submitted through the rule that fall on small servicers to available are small (29.21 percent). www.Regulations.gov. Comments the average annual revenue of the small Therefore, the proposed rule is expected should indicate that they are submitted servicers. The costs of the rule come to affect a substantial number of small in response to ‘‘RIN 2900–AR05.’’ from rule familiarization and the entities. OMB is required to make a decision Paperwork Reduction Act (PRA) costs, While the proposed rule is expected concerning the collections of which include the costs for servicers to to affect a substantial number of small information contained in this proposed complete the VA form 26–10213 and entities, the impact will not be rule between 30 and 60 days after prepare and execute the original note economically significant. On this basis, publication of this document in the and security instrument. The cost of the Secretary certifies that the adoption Federal Register. Therefore, a comment rule familiarization is $99.90 for each of this proposed rule will not have a to OMB is best assured of having its full guaranteed loan servicer, including the significant economic impact on a effect if OMB receives it within 30 days small servicers. The PRA cost estimates substantial number of small entities as of publication. vary across servicers depending on how they are defined in the Regulatory The Department considers comments many CARES Act forbearance loans they Flexibility Act. Therefore, pursuant to 5 by the public on proposed collections of service that either meet or could U.S.C. 605(b), the initial and final information in— potentially meet COVID–VAPCP regulatory flexibility analysis • Evaluating whether the proposed requirements. requirements of 5 U.S.C. 603 and 604 do collections of information are necessary As described in the impact analysis, not apply. for the proper performance of the the lower and upper bound estimates for functions of the Department, including Unfunded Mandates the number of borrowers who will likely whether the information will have qualify for assistance via a partial claim The Unfunded Mandates Reform Act practical utility; are 33,644 and 60,512, respectively. VA of 1995 requires, at 2 U.S.C. 1532, that • Evaluating the accuracy of the estimates that 28.538 percent of those agencies prepare an assessment of Department’s estimate of the burden of loans are serviced by small entities, or anticipated costs and benefits before the proposed collections of information, between 9,601 and 17,269 loans. Given issuing any rule that may result in the including the validity of the the total PRA cost for servicers of $54.96 expenditure by State, local, and tribal methodology and assumptions used; per loan, the total PRA cost per average governments, in the aggregate, or by the • Enhancing the quality, usefulness, small servicer is $20,295.04 at the lower private sector, of $100 million or more and clarity of the information to be bound and $36,504.01 at the upper (adjusted annually for inflation) in any collected; and bound. one year. This proposed rule would • Minimizing the burden of the The total cost of this rule per average have no such effect on State, local, and collections of information on those who small VA-guaranteed loan servicer tribal governments, or on the private are to respond, including through the ranges from $20,395 ($99.90 + sector. use of appropriate automated, $20,295.04) to $36,604 ($99.90 + electronic, mechanical, or other Paperwork Reduction Act $36,504.01), while the average annual technological collection techniques or revenue to small servicers is $11.98 This proposed rule includes other forms of information technology, million. VA considers a rule to have a provisions constituting both revised and such as permitting electronic ‘‘significant economic impact’’ when the new collections of information under submission of responses. total annual cost associated with the the Paperwork Reduction Act of 1995 The collections of information rule for a small entity is equal to or (44 U.S.C. 3501–3521) that require contained in 38 CFR 36.4333, 36.4336, exceeds 1 percent of annual revenue. approval by the Office of Management and 36.4810 are described immediately The total upper bound cost to small and Budget (OMB). Accordingly, under following this paragraph, under its servicers is 0.30 percent of the average 44 U.S.C. 3507(d), VA has submitted a respective title. annual revenue to small servicers. This copy of this rulemaking action to OMB Title: Maintenance of Records. ratio is calculated using the total costs for review. OMB Control No.: 2900–0515. on small servicers, rather than the total OMB assigns control numbers to CFR Provisions: 38 CFR 36.4333, annual costs. In subsequent years, collections of information it approves. 36.4336, and 36.4810. absent the rule familiarization costs and VA may not conduct or sponsor, and a Summary of collection of information: with the dispersion of the PRA costs, person is not required to respond to, a These requirements are covered under the average annual cost to small collection of information unless it OMB control number 2900–0515. VA servicers is even below that level. Thus, displays a currently valid OMB control proposes to revise this information the rule is not expected to have a number. Proposed §§ 36.4333, 36.4336, collection to include the proposed significant economic impact on the 36.4803, 36.4805, 36.4806, 36.4807, and revisions to § 36.4333 and new small servicers. 36.4810 contain collections of proposed §§ 36.4336 and 36.4810. To assess whether the rule can be information under the Paperwork Under current 38 CFR 36.4333, VA expected to affect a ‘‘substantial number Reduction Act of 1995. If OMB does not requires holders to maintain and lenders of small entities,’’ VA considers a ratio approve the collections of information to retain all records pertaining to loans that captures the incidence of small VA as requested, VA will immediately guaranteed by VA. Under this same servicers in the potential universe of remove the provisions containing a authority, VA has a right to inspect, servicers. Specifically, VA uses the ratio collection of information or take such examine, or audit, at a reasonable time of small VA servicers with guaranteed other action as is directed by OMB. and place, such records to ensure loans in CARES Act forbearance that are Comments on the collections of program participants are in compliance likely to participate in the partial claim information contained in this proposed with applicable laws, regulations, program to the total number of VA rule should be submitted to the Office policies, procedures, and contract servicers with guaranteed loans in of Management and Budget, Attention: provisions. The revised collection of CARES Act forbearance that are likely to Desk Officer for the Department of information in proposed 38 CFR

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00014 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79156 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

36.4333 would require holders to Estimated frequency of responses: can resume making scheduled monthly maintain records supporting their Under the current information payments, on time and in full, and that decision to approve any home retention collection, VA estimates a one-time the veteran occupies, as the veteran’s option exercised by the servicer and response to an audit request or residence, the property securing the borrower. The holder would also be voluntary electronic submission. VA guaranteed loan for which the partial required to maintain records supporting does not anticipate an increase in the claim is requested. In § 36.4803, the their decision to pursue a partial claim frequency of responses. servicer would be required to certify payment under the COVID–19 Veterans Estimated average burden per that the veteran’s monthly residual Assistance Partial Claim Payment response: The revisions proposed in this income, as described in § 36.4340(e), program. VA would require those rule would neither increase nor will be adequate to meet living expenses records to be retained a minimum of 3 decrease the average burden per after estimated monthly shelter years from the date of any incentive response, which in this case would be expenses have been paid and other paid in accordance with § 36.4319(a) or, the time a servicer spends uploading monthly obligations have been met. In in the case of a partial claim payment records requested by VA in conjunction § 36.4805, the servicer would be under the COVID–19 Veterans with servicer audit and oversight required to prepare a note and security Assistance Partial Claim Payment activities. Similarly, VA notes that instrument in favor of ‘‘the Secretary of program, the date the veteran’s recordkeeping requirements related to Veterans Affairs, an Officer of the guaranteed loan is made current under servicing and loss-mitigation activities United States’’. VA would require that such program, whichever is later, and are consistent with customary and usual the note be consistent with the terms shall include, but not be limited to, business practices for loan holders described in § 36.4806 and include all credit reports, verifications of income, (servicers); VA therefore assigns no borrowers who are obligated on the employment, assets, liabilities, and additional time burden to servicers in guaranteed loan. The security other factors affecting the obligor’s maintaining such records, including instrument would be required to credit worthiness, worksheets, and other those contemplated by the revisions include all persons (borrowers, as well documents supporting the holder’s proposed in this rule. as non-borrowers) who have a title decision. In § 36.4336, VA would be Estimated total annual reporting and interest in the property securing the authorized to take action if it found that recordkeeping burden: VA does not, guaranteed loan. The servicer would be a servicer failed to maintain adequate with this proposed rulemaking, required to record the security loan accounting records, to demonstrate anticipate any change in the total instrument timely, as prescribed in proper ability to service loans annual reporting and recordkeeping § 36.4807. burden. In that regard, VA’s proposed adequately, to exercise proper credit In § 36.4806, VA would require the revisions to this existing information judgment, or has willfully or negligently veteran, and all co-borrowers on the collection merely expand the engaged in practices otherwise guaranteed loan, to execute a note and documentation/information that detrimental to the interest of veterans or security instrument in favor of ‘‘the servicers must keep in their records in of the Government. In § 36.4810, VA Secretary of Veterans Affairs, an Officer regard to existing VA-guaranteed loans would extend that authority to a partial of the United States’’. VA would require and loss-mitigation activities associated claim payment. specific terms in the note and security with those loans, the cost of which falls Description of need for information instrument. Specifically, VA would within customary and usual business and proposed use of information: The require the note and security instrument practices. Moreover, VA would request information collected as a result of to include the amount to be repaid to such records for the purpose of revisions associated with this the Secretary, by the veteran, to be the conducting oversight of VA’s proposed rulemaking will be used by VA to amount calculated under § 36.4805(e). COVID–VAPCP under existing audit conduct servicer oversight, including The interest rate on the loan created by and oversight programs with no the COVID–19 Veteran Assistance the note and security instrument would anticipated impact in the number of Partial Claim Payment program. be required to be fixed at 1.00 percent loans for which servicers will have to Description of likely respondents: The per annum. VA would automatically provide VA with additional respondent population under the defer monthly payments for the first 60 information. current information collection is Estimated cost to respondents per months of the loan, meaning that there comprised of holders and lenders, year: VA anticipates no additional costs would be no payment due to the particularly, the individuals with to respondents based on proposed Secretary during the period of oversight roles in the company, such as revisions associated with this deferment. A borrower could, without a compliance officer. There is no change rulemaking. premium or fee, make payments during to this section as a result of this The collections of information such deferment for the entire rulemaking. contained in 38 CFR 36.4803, 36.4805, indebtedness, or any portion thereof, Estimated number of respondents: 36.4806, and 36.4807 are described provided that such portion is not less Under the current information immediately following this paragraph, than what would be due for one collection, VA estimates an ongoing under its respective title. monthly payment as calculated based hour burden associated with holders Title: Application for a COVID–19 on a 60-month term. VA would require and lenders submitting files to VA in Veterans Assistance Partial Claim the term of the loan to be 120 months. association with normal audit activities. Payment (COVID–VAPCP). The loan would be amortized fully VA also estimates an hour burden OMB Control No.: 2900–XXXX within the term of the loan in associated with lenders who may (NEW). accordance with any generally voluntarily submit loan records to VA in CFR Provisions: 38 CFR 36.4803, recognized plan of amortization a computable data format as it begins to 36.4805, 36.4806, and 36.4807. requiring approximately equal monthly pilot that technology. VA does not Summary of collection of information: payments. VA would require repayment anticipate additional submissions as a The new collection of information in in full immediately upon the veteran’s result of the proposed revisions to proposed 38 CFR 36.4803 would require transfer of title to the property, the §§ 36.4333, 36.4336, and 36.4810. the veteran to certify that the veteran refinancing, or payment in full

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00015 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79157

otherwise, of the guaranteed loan with nature of the current national respondents (23,539), VA estimates a which the partial claim payment is emergency and the novelty of VA’s total annual reporting and associated. partial claim payment program, there is recordkeeping burden of 58,847 hours In § 36.4807, VA would require the some uncertainty as to how many (23,539 hours for veterans; 35,308 hours veteran and the servicer to complete an respondents would be impacted by this for servicers). application form prescribed by the proposed rulemaking. As discussed in Estimated cost to respondents per Secretary. VA would also state that VA’s regulatory impact analysis, VA has year: VA estimates the annual cost to along with the completed form, the estimated a lower/upper bound of respondents falls between $1,357,198 servicer must provide VA with the estimated partial claim payments and $2,441,053. Using VA’s average original note required by § 36.4805. Not associated with this temporary program annual number of respondents, VA later than 180 days following the date that corresponds directly to those who estimates the total cost to all the security instrument, required by would be subject to the paperwork respondents to be $1,899,108 per year.54 § 36.4805, is fully executed, the servicer requirements associated with this (23,539 burden hours for veterans × would be required to provide VA with rulemaking. VA has further estimated a $25.72 per hour) + (35,308 burden for the original security instrument and distribution of these partial claim servicers × $36.64 per hour). evidence that the servicer recorded such payments (or respondents) over fiscal Title: VA Loan Electronic Reporting instrument. If the recording authority years 2021 and 2022. Given that this Interface (VALERI) System. causes a delay, VA would allow the proposed temporary program is limited OMB Control No.: 2900–0021. servicer to request an extension of time, to help veterans recover financially from CFR provisions: 38 CFR part 36, in writing, from VA. The servicer would the COVID–19 national emergency, VA subpart B, and 38 CFR 36.4807. also be required to report information does not anticipate any partial claim Summary of collection of information: related to the partial claim application payments (or applications) will be The information collection requirements to VA electronically. received in FY 2023 and beyond. To under 38 CFR part 36, subpart B, which VA proposes to collect information for ensure that VA’s paperwork burden include reporting requirements for the partial claim payment application, estimate coincides with its regulatory servicers, are currently assigned OMB including the certifications outlined in impact analysis, VA has presented a control number 2900–0021 and set to 36.4803, through use of a new range of paperwork burden estimates. expire on November 30, 2020. In standardized form. Proposed VA form However, for purposes of calculating proposed § 36.4807, VA would require 26–10213, Application for a COVID–19 annual reporting and recordkeeping servicers to report a partial claim event Veterans Assistance Partial Claim costs, VA will utilize the average of to VA through its existing electronic Payment (COVID–VAPCP), would these estimates, annualized over two loan servicing system. This new collect basic information necessary to years (FY 2021 and 2022). reporting requirement therefore requires identify the borrower(s), the servicer, Using the lower/upper bound from revisions to the existing information and the VA loan number for the VA’s regulatory impact analysis, VA collection under control number 2900– guaranteed loan for which partial claim estimates the total number of 0021. VA therefore seeks to renew and payment is being requested. This form respondents would fall between 33,644 revise this information collection, to would also collect information and 60,512. Over the two-year period of include proposed revisions to § 36.4807. regarding the date the veteran entered this information collection, the annual The servicer is already required to into a CARES Act forbearance, along number of respondents is therefore report information associated with with the unpaid principal balance on estimated to fall between 16,822 and reinstating the loan as current, as that date, the latter of which is 30,256, with an average annual number outlined at 38 CFR 36.4317(c)(15), and necessary to determine the maximum of respondents equal to 23,539. covered by the existing information amount of the partial claim payment Estimated frequency of responses: collection. VA proposes to revise its under § 36.4805. VA proposes on this One time per application for partial information collection to collect new form that the servicer must indicate, on claim payment. data elements specific to the servicer the proposed form, the date on which Estimated average burden per executing a partial claim. This new the borrower will resume monthly response: 60 minutes for veterans information would be transmitted guaranteed loan payments to the (includes 15 minutes to complete VA through a VALERI Events Bulk Upload servicer, along with the amount of those form 26–10213, 15 minutes to gather template. monthly payments. The servicer would and submit any additional financial Description of need for information then provide the amount of partial claim information needed to enable the and proposed use of information: payment being requested, along with the servicer to make an assessment under 38 Regarding the information requested date the note and security instrument CFR 36.4340(e), and 30 minutes to under proposed 38 CFR 36.4807, the information will be used by VA to were executed, as required under understand and execute the original determine if the veteran qualifies for a § 36.4805. Finally, both the borrower note and security instrument). 90 partial claim option and, if qualified, to and servicer would sign statements minutes for servicers (includes 15 administer the payment to the servicer certifying to those elements required minutes to complete VA form 26–10213, on behalf of the veteran. It will also under § 36.4803. 15 minutes to review additional Description of need for information financial information provided by the serve as a way for VA to track the and proposed use of information: The veteran to assess residual income under occurrence of the partial claim home information will be used by VA to 38 CFR 36.4340(e), and 1 hour to retention event. determine if the veteran qualifies for a prepare and execute the original note 54 To estimate costs associated with servicer partial claim payment and, if qualified, and security instrument). respondent burden, VA used the Bureau of Labor to administer the payment. Estimated total annual reporting and Statistics (BLS) median hourly wage for loan Description of likely respondents: recordkeeping burden: VA estimates the officers (occupation code 13–2072) of $36.64 per Veterans and servicers pursuing a total annual reporting and hour. To estimate costs associated with veteran respondent burden, VA used the median hourly partial claim payment. recordkeeping burden falls between wage for all occupations of $25.72 per hour. This Estimated number of respondents: VA 42,055 and 75,640 burden hours. Using information is available at https://www.bls.gov/oes/ notes that due to the unprecedented VA’s average annual number of current/oes_nat.htm#13-0000.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00016 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79158 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

Description of likely respondents: The already utilize VALERI and the Events claim payment under the COVID–19 renewal encompasses all servicers Bulk Upload template format to report Veterans Assistance Partial Claim reporting servicing activity on loans to all servicing activity to VA. Payment program, the date the veteran’s VA. The revisions encompass a subset guaranteed loan is made current under Catalog of Federal Domestic Assistance of this group; specifically, servicers such program, whichever is later, and requesting a partial claim payment on The Catalog of Federal Domestic shall include, but not be limited to, behalf of a veteran. Assistance number and title for the credit reports, verifications of income, Estimated number of respondents: VA program affected by this document is employment, assets, liabilities, and does not anticipate any change in the 64.114, Veterans Housing—Guaranteed other factors affecting the obligor’s estimated number of respondents based and Insured Loans. credit worthiness, work sheets, and on VA’s renewal request or proposed List of Subjects in 38 CFR Part 36 other documents supporting the revisions to this information collection holder’s decision. Condominiums, Housing, Individuals requirement. The current estimated * * * * * number of respondents reflects the with disabilities, Loan programs— (The Office of Management and Budget has estimated number of VA servicers housing and community development, approved the information collection required to submit loan servicing Loan programs—veterans, Manufactured requirements in this section under control information to VA annually. As such, homes, Mortgage insurance, Reporting number XXXX–XXXX) the servicers who will submit and recordkeeping requirements, (Authority: 38 U.S.C. 3703(c)(1), 3704(d)) information in conjunction with the Veterans. partial claim payment option are ■ 3. Add § 36.4336 to read as follows: Signing Authority contemplated in the current estimated § 36.4336 Oversight of servicing. respondent population. The Secretary of Veterans Affairs, or Estimated frequency of responses: VA designee, approved this document and (a) Subject to notice and opportunity does not anticipate any change in the authorized the undersigned to sign and for a hearing, whenever the Secretary estimated frequency of responses based submit the document to the Office of the finds that any servicer has failed to on VA’s renewal request or proposed Federal Register for publication maintain adequate loan accounting revisions to this information collection electronically as an official document of records, or to demonstrate proper ability as servicers are required to report the Department of Veterans Affairs. to service loans adequately or to activity on every VA-guaranteed loan in Brooks D. Tucker, Assistant Secretary exercise proper credit judgment or has their servicing portfolio, regardless of for Congressional and Legislative willfully or negligently engaged in the home retention options pursued. Affairs, Performing the Delegable Duties practices otherwise detrimental to the Estimated average burden per of the Chief of Staff, Department of interest of veterans or of the response: VA does not anticipate any Veterans Affairs, approved this Government, the Secretary may refuse change in the average burden per document on October 15, 2020, for either temporarily or permanently to response based on VA’s renewal request publication. guarantee or insure any loans made by or proposed revisions to this such servicer and may bar such servicer information collection. Under the Jeffrey M. Martin, from servicing or acquiring guaranteed existing information collection, VA Assistant Director, Office of Regulation Policy loans. estimates a one-minute respondent & Management, Office of the Secretary, (b) Notwithstanding paragraph (a) of burden as the information reported Department of Veterans Affairs. this section, but subject to § 36.4328, the through VALERI is automated. For the reasons stated in the Secretary will not refuse to pay a Estimated total annual reporting and preamble, the Department of Veterans guaranty or insurance claim on recordkeeping burden: VA does not Affairs proposes to amend 38 CFR part guaranteed loans theretofore entered anticipate any change in the total 36 as set forth below: into in good faith between a veteran and annual reporting and recordkeeping such servicer. burden currently associated with this PART 36—LOAN GUARANTY (c) The Secretary may also refuse information collection. VA’s proposed ■ either temporarily or permanently to revisions to this existing information 1. The authority citation for part 36 guarantee or insure any loans made by collection merely expand the list of continues to read as follows: a lender or holder refused the benefits possible home retention events to be Authority: 38 U.S.C. 501 and 3720. of participation under the National reported by servicers to include the ■ 2. Amend § 36.4333 by revising Housing Act pursuant to a partial claim option. paragraph (a)(2) and the two determination of the Secretary of Estimated cost to respondents per parenthetical sentences at the end of the Housing and Urban Development. year: There are no new or increased section to read as follows: (The Office of Management and Budget has costs to respondents based on this approved the information collection renewal request or proposed revisions to § 36.4333 Maintenance of records. requirements in this section under control this information collection. As noted (a) * * * number 2900–0515) above, there is no change in the (2) The holder shall maintain records (Authority: 38 U.S.C. 3703, 3704(d), 3720) estimated average number of supporting their decision to approve respondents and average burden per any loss mitigation option. The holder ■ 4. Add subpart F to read as follows: response for reporting activities shall maintain records supporting their associated with this information decision to pursue a partial claim Subpart F—COVID–19 Recovery collection. VA acknowledges that payment under the COVID–19 Veterans Measures servicers will be required to incorporate Assistance Partial Claim Payment Sec. new information into the VALERI program established under subpart F of 36.4800 Applicability. Events Bulk Upload template within this part. Such records shall be retained 36.4801 Definitions. their current servicing platforms. a minimum of 3 years from the date of 36.4802 General purpose of the COVID–19 However, VA estimates a de minimis any incentive paid in accordance with Veterans Assistance Partial Claim cost for servicers because servicers § 36.4319(a) or, in the case of a partial Payment program.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00017 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79159

36.4803 General requirements of the § 36.4802 General purpose of the COVID– § 36.4804 Partial claim payment as last COVID–19 Veterans Assistance Partial 19 Veterans Assistance Partial Claim resort. Claim Payment program. Payment program. (a) The Veterans Assistance Partial 36.4804 Partial claim payment as last resort. The COVID–19 Veterans Assistance Claim Payment program is designed to 36.4805 Terms of the partial claim Partial Claim Payment program is a address the financial hardships due, payment. temporary program to help veterans directly or indirectly, to the COVID–19 36.4806 Terms of the assistance to the who have suffered a COVID–19 veteran. national emergency. Servicers must 36.4807 Application for partial claim financial hardship. Notwithstanding the consider all possible loss-mitigation payment. requirements elsewhere in this part options. VA expects that the partial 36.4808 No effect on the servicing of the regarding payment of a guaranty claim claim payment option will be guaranteed loan. or refunding a loan, VA may assist a considered only as a last resort, after a 36.4809 Expiration of the COVID–19 veteran exiting a CARES Act servicer has evaluated loss-mitigation Veterans Assistance Partial Claim forbearance by purchasing from the options for feasibility. Payment program. servicer the veteran’s CARES Act (b) If the veteran notifies the servicer 36.4810 Oversight of the COVID–19 indebtedness. Such a purchase is called that the veteran does not want to retain Veterans Assistance Partial Claim a partial claim payment. In exchange for Payment program. ownership of the property securing the VA’s partial claim payment on behalf of guaranteed loan, the servicer may § 36.4800 Applicability. the veteran, the veteran must agree to immediately proceed to offering an repay the Secretary, in the amount of alternative to foreclosure. This subpart applies to all loans such partial claim payment, upon loan (Authority: 38 U.S.C. 3703(c), 3720, 3732) guaranteed by VA, to the extent such terms established by the Secretary. loans are affected by the COVID–19 (Authority: 38 U.S.C. 3703(c), 3720, 3732) § 36.4805 Terms of the partial claim national emergency. payment. (Authority: 38 U.S.C. 3703(c), 3720, 3732) § 36.4803 General requirements of the (a) In order for a partial claim COVID–19 Veterans Assistance Partial § 36.4801 Definitions. payment to be payable, the servicer Claim Payment program. must submit to the Secretary, not later The following definitions of terms The following general requirements than 90 days after the date the veteran apply to this subpart: must be met before the Secretary will exits the CARES Act forbearance, a allow for participation in the COVID–19 Alternative to foreclosure means an request for such payment, as prescribed Veterans Assistance Partial Claim in § 36.4807. alternative to foreclosure for which the Payment program: Secretary may pay an incentive under (b) The amount of the partial claim (a) The loan for which a partial claim payment that VA will pay to the § 36.4319. These alternatives include payment is requested must be a compromise sale (sometimes called a servicer, as calculated under paragraph guaranteed loan that was, on March 1, (e) of this section, shall not exceed 15 short sale) and deed-in-lieu of 2020, either current or less than 30 days foreclosure. percent of the unpaid principal balance past due; of the guaranteed loan. For the purposes CARES Act forbearance means (b) The veteran on whose behalf VA of this paragraph (b), the unpaid forbearance of scheduled monthly will pay a partial claim payment both principal balance of the guaranteed loan guaranteed loan payments, as granted to received a CARES Act forbearance and means such balance as of the date the a veteran under section 4022 of the missed at least one scheduled monthly veteran entered into a CARES Act Coronavirus Aid, Relief, and Economic payment; forbearance. Security Act (Pub. L. 116–136). (c) There remains unpaid at least one (c) VA will pay only one partial claim CARES Act indebtedness means the scheduled monthly payment that the payment per guaranteed loan. dollar amount the veteran is obligated to veteran did not make while under a (d) VA will pay only one partial claim pay under the guaranteed loan terms, CARES Act forbearance; payment per veteran. (d) The veteran certifies that the but that is not collected during a CARES (e)(1) Because VA will pay only one veteran can resume making scheduled Act forbearance. partial claim payment per guaranteed monthly payments, on time and in full, loan, and only one partial claim Guaranteed loan means a loan and that the veteran occupies, as the payment per veteran, a servicer must, guaranteed under chapter 37 of title 38, veteran’s residence, the property when calculating the amount of partial United States Code. securing the guaranteed loan for which claim payment to be paid by VA to the Loss-mitigation option means a loss- the partial claim payment is requested; servicer, include the full amount of mitigation option for which the (e) The servicer determines and indebtedness that is necessary to bring Secretary may pay an incentive under certifies that the veteran’s monthly the guaranteed loan current. § 36.4319. These options include a residual income, as described in (2) To bring the guaranteed loan repayment plan, special forbearance, § 36.4340(e), will be adequate to meet current, servicers must include the full and loan modification. living expenses after estimated monthly CARES Act indebtedness, comprising— shelter expenses have been paid and Secretary means the Secretary of (i) All scheduled but missed monthly other monthly obligations have been Veterans Affairs, or any employee of the payments of principal and interest; and met; and Department of Veterans Affairs (VA) (ii) As applicable, all scheduled but (f) The veteran executes, in a timely missed monthly escrow payments for authorized to act in the Secretary’s manner, all loan documents necessary stead. real estate taxes and insurance to establish an obligation to repay the premiums, or where the guaranteed loan Servicer means, for the purposes of Secretary for the partial claim payment. documents do not provide for monthly this subpart, the holder, servicer, or (The Office of Management and Budget has escrowing, all payments the servicer servicing agent, as defined in § 36.4301. approved the information collection made to real estate tax authorities and The terms can apply jointly or severally, requirements in this section under control insurance providers, on the veteran’s or jointly and severally. number XXXX–XXXX) behalf, during the CARES Act (Authority: 38 U.S.C. 3703(c), 3720, 3732) (Authority: 38 U.S.C. 3703(c), 3720, 3732) forbearance.

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00018 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79160 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

(3) Also in bringing the guaranteed interest in the property securing the (ii) The refinancing, or payment in loan current, servicers must include— guaranteed loan. full otherwise, of the guaranteed loan (i) All scheduled monthly payments (g) Subject to paragraph (a) of this with which the partial claim payment is (comprising principal, interest, and section, all loan documents must be associated. escrow payments for real estate taxes fully executed not later than 90 days (The Office of Management and Budget has and insurance premiums) due within 31 after the veteran exits the CARES Act approved the information collection days of the date the veteran executes the forbearance. requirements in this section under control note and security instrument described (h) The servicer must record the number XXXX–XXXX) in § 36.4806; security instrument timely, as (Authority: 38 U.S.C. 3703(c), 3720, 3732) (ii) If applicable, all scheduled prescribed in § 36.4807. monthly payments (comprising (i) The servicer must not charge, or § 36.4807 Application for partial claim principal, interest, and escrow allow to be charged, to the veteran any payment. payments for real estate taxes and fee in connection with the COVID–19 (a) The veteran and the servicer must insurance premiums) that were missed Veterans Assistance Partial Claim complete an application form prescribed after March 1, 2020, but before the Payment program. by the Secretary. veteran was granted the CARES Act (b) Along with a complete application (The Office of Management and Budget has form, the servicer must provide VA with forbearance; and approved the information collection (iii) The actual amount of recording requirements in this section under control the original note required by § 36.4805. fees, recording taxes, or other charges number XXXX–XXXX) Not later than 180 days following the levied by the recording authority, that date the security instrument, required must be paid in order to record the (Authority: 38 U.S.C. 3703(c), 3720, 3732) by § 36.4805, is fully executed, the security instrument described in § 36.4806 Terms of the assistance to the servicer must provide VA with the § 36.4806. veteran. original security instrument and (4) Except for amounts identified in (a) If a veteran chooses to accept VA’s evidence that the servicer recorded such paragraphs (e)(2) and (3) of this section, assistance (i.e., a partial claim payment instrument. If the recording authority servicers shall not include any amounts to the servicer, on the veteran’s behalf), causes a delay, the servicer may request (e.g., fees, penalties, or interest) beyond the veteran, and all co-borrowers on the an extension of time, in writing, from the amounts scheduled or calculated as guaranteed loan, must execute a note VA. if the borrower made all contractual and security instrument in favor of ‘‘the (c) Servicers must report a partial payments on time and in full under the Secretary of Veterans Affairs, an Officer claim event to VA through VA’s existing terms of the guaranteed loan. of the United States’’. electronic loan servicing system within (5) Nothing in this section shall (b) Specific terms of the note and seven days of the borrower’s execution preclude a veteran from making an security instrument shall include the of the note required by § 36.4805. optional payment or a servicer from following: (The Office of Management and Budget has waiving a veteran’s indebtedness, such (1) The amount to be repaid to the approved the information collection that the amount of partial claim Secretary, by the veteran, is the amount requirements in this section under control payment would not exceed the 15 calculated under § 36.4805(e); numbers XXXX–XXXX and XXXX–XXXX) percent cap described in paragraph (b) (2) The interest rate on the loan (Authority: 38 U.S.C. 3703(c), 3720, 3732) of this section. (6) If the servicer miscalculates the created by the note and security § 36.4808 No effect on the servicing of the partial claim amount, resulting in an instrument must be fixed at 1.00 percent guaranteed loan. overpayment to the servicer, the amount per annum; (a) Servicers must continue to service of such overpayment shall constitute a (3)(i) Monthly payments are the guaranteed loan in accordance with liability of the servicer to the United automatically deferred for the first 60 subpart B of this part. States. The servicer must remit the months of the loan, meaning that there (b) The liability of the United States overpaid amount immediately to VA. is no payment due to the Secretary for any guaranteed loan shall decrease (7) If the servicer miscalculates the during the period of deferment; or increase pro rata with any decrease partial claim amount, resulting in (ii) Interest will accrue on the loan or increase of the amount of the unpaid underpayment (i.e., an amount during such deferment; and portion of the guaranteed loan. A partial insufficient to bring the guaranteed loan (iii) A borrower may, without claim payment does not affect the current), the servicer must waive the premium or fee, make payments during guaranty percentage established at the difference. such deferment for the entire time the guaranteed loan was made. (8) Servicers shall not include any indebtedness, or any portion thereof (c) Receipt of a partial claim payment amounts for a monthly payment that is provided that such portion is not less shall not eliminate a servicer’s option scheduled to be paid on a date that is than what would be due for one under 38 U.S.C. 3732 to convey to the more than 31 days after the veteran monthly payment as calculated based Secretary the security for the guaranteed executes the note and security on a 60-month term; loan. (4) The term of the loan must be 120 instrument described in § 36.4806. (Authority: 38 U.S.C. 3703(c), 3720, 3732) (f) The servicer must prepare a note months; and security instrument in favor of ‘‘the (5) The loan shall be amortized fully § 36.4809 Expiration of the COVID–19 Secretary of Veterans Affairs, an Officer within the term of the loan in Veterans Assistance Partial Claim Payment of the United States’’. accordance with any generally program. (1) The note must be consistent with recognized plan of amortization (a) Subject to paragraph (b) of this the terms described in § 36.4806 and requiring approximately equal monthly section, the Secretary will not accept a include all borrowers who are obligated payments; and request for a partial claim payment after on the guaranteed loan; and (6) Repayment in full is required the date that is 180 days after the date (2) The security instrument must immediately upon— the COVID–19 national emergency ends include all persons (borrowers, as well (i) The veteran’s transfer of title to the (as provided under the National as non-borrowers) who hold a title property; or Emergencies Act).

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00019 Fmt 4702 Sfmt 4702 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79161

(b) If a veteran’s CARES Act finds with respect to a partial claim guaranteed loans theretofore entered forbearance does not end until after the payment that any servicer has failed to into in good faith between a veteran and date described in paragraph (a) of this maintain adequate loan accounting such servicer. section, the Secretary may still accept a records, or to demonstrate proper ability (c) The Secretary may also refuse request for a partial claim payment, to service loans adequately or to either temporarily or permanently to provided that such request is submitted exercise proper credit judgment or has guarantee or insure any loans made by to the Secretary not later than 90 days willfully or negligently engaged in a lender or holder refused the benefits after the date the veteran exits the practices otherwise detrimental to the CARES Act forbearance. of participation under the National interest of veterans or of the Housing Act pursuant to a (c) Notwithstanding paragraphs (a) Government, the Secretary may refuse and (b) of this section, the Secretary will determination of the Secretary of either temporarily or permanently to Housing and Urban Development. not accept a request for a partial claim guarantee or insure any loans made by payment after September 9, 2021. such servicer and may bar such servicer (The Office of Management and Budget has (Authority: 38 U.S.C. 3703(c), 3720, 3732) from servicing or acquiring guaranteed approved the information collection loans. requirements in this section under control § 36.4810 Oversight of the COVID–19 number XXXX–XXXX) Veterans Assistance Partial Claim Payment (b) Notwithstanding paragraph (a) of program. this section, but subject to § 36.4328, the (Authority: 38 U.S.C. 3703, 3704(d), 3720) (a) Subject to notice and opportunity Secretary will not refuse to pay a [FR Doc. 2020–26964 Filed 12–8–20; 8:45 am] for a hearing, whenever the Secretary guaranty or insurance claim on BILLING CODE 8320–01–P

VerDate Sep<11>2014 15:54 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00020 Fmt 4702 Sfmt 9990 E:\FR\FM\09DEP1.SGM 09DEP1 jbell on DSKJLSW7X2PROD with PROPOSALS 79162

Notices Federal Register Vol. 85, No. 237

Wednesday, December 9, 2020

This section of the FEDERAL REGISTER Form Number(s): There are 91 greatly improves the quality of the contains documents other than rules or individual forms, too numerous to list intermediate inputs and value-added proposed rules that are applicable to the here. estimates in the annual input-output public. Notices of hearings and investigations, Type of Request: Regular submission, and GDP by industry accounts produced committee meetings, agency decisions and Request for a Revision of a Currently by the Bureau of Economic Analysis rulings, delegations of authority, filing of petitions and applications and agency Approved Collection. (BEA). statements of organization and functions are Number of Respondents: 93,722. Beginning in survey year 2020, the examples of documents appearing in this Average Hours per Response: 1.5305. operating expenses content on all SAS section. Burden Hours: 143,437. questionnaires will change to a version Needs and Uses: Over 50 percent of that will be used in Economic Census all economic activity is generated by years and non-Economic Census years. DEPARTMENT OF AGRICULTURE businesses in the services sectors, This change will aid in creating a defined to exclude retail and wholesale consistent survey experience for Virtual Public Listening Session; trade. The U.S. Census Bureau currently respondents from year to year and better Natural Resources Conservation measures the total output of most of the meet the needs of our data users. The Service Programs and Western Water service industries annually in the proposed expense questions are shown Quantity Service Annual Survey (SAS). This in Attachment 2. This spreadsheet Correction survey currently covers all or portions shows the different versions of the of: Utilities; Transportation and expense questions that will appear on In notice document 2020–26525 Warehousing; Information; Finance and each SAS form variation. appearing on pages 78114–78115 in the Insurance; Real Estate and Rental and Minor changes will also be made to issue of December 3, 2020, make the Leasing; Professional, Scientific, and various forms to increase clarity of what following correction: Technical Services; Administrative and is being asked of respondents (e.g., On page 78114, in the third column, Support and Waste Management and improving instructions or removing under the DATES heading, in the 9th Remediation Services; Educational parts of a question), improve the quality line, ‘‘December 18, 2020’’ should read Services; Health Care and Social of data the Census Bureau receives, and ‘‘December 8, 2020.’’ Assistance; Arts, Entertainment, and further reduce respondent burden. [FR Doc. C1–2020–26525 Filed 12–7–20; 11:15 am] Recreation; Accommodation and Food To improve data quality, harmonize BILLING CODE 1301–00–D Services; and Other Services (except survey content, and reduce respondent Public Administration) as defined by burden, the Service Annual Survey will the North American Industry alter a question asking about DEPARTMENT OF COMMERCE Classification System (NAICS). The SAS organizational change within a provides the only official source of company. This question appears as Census Bureau annual revenue estimates for the service question 3 for respondents in all industries. industries SAS covers. The question Agency Information Collection Estimates from the SAS are essential inquires about any organizational Activities; Submission to the Office of to measurement of economic growth, changes a company experienced during Management and Budget (OMB) for real output, prices, and productivity for the given year and currently refers to Review and Approval; Comment our nation’s economy. A broad acquisitions, mergers, sales, and Request; Service Annual Survey spectrum of government and private divestitures. The revision will alter the The Department of Commerce will stakeholders use these estimates in question text to include instances where submit the following information analyzing economic activity; forecasting a company ceased operations and would collection request to the Office of economic growth; and compiling data add ‘‘ceased operation’’ as an answer Management and Budget (OMB) for on productivity, prices and the gross choice. This change would provide review and clearance in accordance domestic product (GDP). In addition, additional information about a with the Paperwork Reduction Act of trade and professional organizations use company’s activity in a given year, 1995, on or after the date of publication these estimates to analyze industry having the potential to improve data of this notice. We invite the general trends, benchmark their own statistical quality. Additionally, the revision public and other Federal agencies to products and develop forecasts. Private would synchronize SAS content with comment on proposed, and continuing businesses use these estimates to the relevant questions on the Annual information collections, which helps us measure market share, analyze business Retail Trade Survey (ARTS) and the assess the impact of our information potential, and plan investments. Annual Wholesale Trade Survey collection requirements and minimize Collected data include operating (AWTS), making the surveys more the public’s reporting burden. Public revenue for both taxable and tax-exempt consistent for respondents. comments were previously requested firms and organizations, sources of In addition, with the increased use of via the Federal Register on September revenue and expenses by type for telemedicine services during this public 21, 2020 during a 60-day comment selected industries, operating expenses, health emergency, the Service Annual period. This notice allows for an and selected industry-specific items. In Survey proposes expanding the scope of additional 30 days for public comments. addition, e-commerce data is collected questions on telemedicine beyond Agency: U.S. Census Bureau. for all industries, and export and ambulatory health care providers to Title: Service Annual Survey. inventory data are collected for selected include hospitals and nursing homes. OMB Control Number: 0607–0422. industries. The availability of these data Telemedicine is an important mode of

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79163

service delivery for the healthcare DEPARTMENT OF COMMERCE days.2 On July 21, 2020, Commerce industry, and its importance has tolled the due date for these final results increased during the current pandemic. International Trade Administration an additional 60 days.3 On September 25, 2020, Commerce extended the Expanding the collection of data on [C–570–980] telemedicine use will support deadline for issuing the final results of measurement on changes in its adoption Crystalline Silicon Photovoltaic Cells, this review by 60 days, until November 4 during this unprecedented public health Whether or Not Assembled Into 27, 2020. emergency. SAS currently asks Modules, From the People’s Republic Scope of the Order of China: Final Results of ambulatory health care providers The products covered by the order are Countervailing Duty Administrative (NAICS 621) about telemedicine solar cells from China. A full Review; 2017 services in relation to patient visits. description of the scope of the order is This proposal will add a question about AGENCY: Enforcement and Compliance, contained in the Issues and Decision revenues from telemedicine services for International Trade Administration, Memorandum.5 hospitals (NAICS 622) and nursing Department of Commerce. homes (NAICS 623). Furthermore, to Analysis of Comments Received SUMMARY: The Department of Commerce standardize content across industries All issues raised in interested parties’ (Commerce) determines that and provide consistency for briefs are addressed in the Issues and countervailable subsidies are being respondents, the current telemedicine Decision Memorandum accompanying provided to producers/exporters of this notice. A list of the issues raised by question asked of the ambulatory health crystalline silicon photovoltaic cells, care providers would be revised to interested parties and to which whether or not assembled into modules Commerce responded in the Issues and match the question being added to the (solar cells), from the People’s Republic other industries. Decision Memorandum is provided in of China (China) during the period of Appendix I to this notice. The Issues Affected Public: Business or other for- review (POR) January 1, 2017 through and Decision Memorandum is a public profit organizations. December 31, 2017. document and is on file electronically Frequency: Annually. DATES: Applicable December 9, 2020. via Enforcement and Compliance’s Respondent’s Obligation: Mandatory. FOR FURTHER INFORMATION CONTACT: Antidumping and Countervailing Duty Gene H. Calvert, AD/CVD Operations, Centralized Electronic Service System Legal Authority: Title 13, United Office VII, Enforcement and (ACCESS). ACCESS is available to States Code, Sections 131 and 182 Compliance, International Trade registered users at https:// authorize the collection. Sections 224 Administration, U.S. Department of access.trade.gov. In addition, a complete and 225 make reporting mandatory. Commerce, 1401 Constitution Avenue version of the Issues and Decision This information collection request NW, Washington, DC 20230; telephone Memorandum can be accessed directly may be viewed at www.reginfo.gov. (202) 482–3586. at http://enforcement.trade.gov/frn/. Follow the instructions to view the SUPPLEMENTARY INFORMATION: The signed and electronic versions of Department of Commerce collections the Issues and Decision Memorandum Background currently under review by OMB. are identical in content. Commerce published the Preliminary Written comments and Changes Since the Preliminary Results Results of this administrative review in recommendations for the proposed the Federal Register on February 11, Based on comments in case briefs and information collection should be 2020.1 We invited interested parties to record evidence, Commerce made submitted within 30 days of the comment on the Preliminary Results. certain changes from the Preliminary publication of this notice on the Between March 12, 2020 and October Results, with regard to the ocean freight following website www.reginfo.gov/ 26, 2020, we received timely case briefs benchmark used to measure the public/do/PRAMain. Find this from the following interested parties: remuneration of inputs for less than particular information collection by Trina Solar Co., Ltd. (formerly known as adequate remuneration, and corrected selecting ‘‘Currently under 30-day Changzhou Trina Solar Energy Co., various ministerial errors for the Review—Open for Public Comments’’ or Ltd.); the Government of China (GOC); respondent companies, JA Solar and by using the search function and BYD Shangluo Industrial Co., Ltd. and entering either the title of the collection Shanghai BYD Co., Ltd. (the BYD 2 See Memorandum, ‘‘Tolling of Deadlines for Antidumping and Countervailing Duty or the OMB Control Number 0607–0422. Companies); JA Solar Technology Administrative Reviews in Response to Operational Yangzhou, Co., Ltd. (JA Solar); Risen Adjustments Due to COVID–19,’’ dated April 24, Sheleen Dumas, Energy Co., Ltd. (Risen Energy); and 2020. Department PRA Clearance Officer, Office of SunPower Manufacturing Oregon LLC. 3 See Memorandum, ‘‘Tolling of Deadlines for the Chief Information Officer, Commerce On November 2, 2020, we received Antidumping and Countervailing Duty Department. Administrative Reviews,’’ dated July 21, 2020. timely rebuttal briefs from the following 4 See Memorandum, ‘‘Administrative Review of [FR Doc. 2020–27041 Filed 12–8–20; 8:45 am] companies: JA Solar; the BYD the Countervailing Duty Order on Crystalline BILLING CODE 3510–07–P Companies; and Risen Energy. Silicon Photovoltaic Cells, Whether or Not On April 24, 2020, Commerce tolled Assembled Into Modules, from the People’s Republic of China: Extension of Deadline for the the due date for these final results by 50 Final Results of the Administrative Review,’’ dated September 25, 2020. 1 See Crystalline Silicon Photovoltaic Cells, 5 See Memorandum, ‘‘Issues and Decision Whether or Not Assembled Into Modules, from the Memorandum for the Final Results of the People’s Republic of China: Preliminary Results of Administrative Review of the Countervailing Duty Countervailing Duty Administrative Review and Order on Crystalline Silicon Photovoltaic Cells, Rescission of Review, in Part; 2017, 85 FR 7727 Whether or Not Assembled Into Modules, from the (February 11, 2020) (Preliminary Results), and People’s Republic of China; 2017,’’ dated accompanying Preliminary Decision Memorandum concurrently with, and hereby adopted by, this (PDM). notice (Issues and Decision Memorandum).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79164 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Risen Energy. These changes are Disclosure shall remain in effect until further explained in the Issues and Decision Commerce will disclose to the parties notice. Memorandum. in this proceeding the calculations Administrative Protective Order Methodology performed for these final results within This notice also serves as a reminder five days of the date of publication of to parties subject to administrative Commerce conducted this 12 this notice in the Federal Register. protective order (APO) of their administrative review in accordance responsibility concerning the with section 751(a)(1)(A) of the Tariff Assessment Rates destruction of proprietary information Consistent with 19 CFR 351.212(b)(2), Act of 1930, as amended (the Act). For disclosed under APO in accordance Commerce intends to issue assessment each subsidy program found to be with 19 CFR 351.305(a)(3). Timely instructions to U.S. Customs and Border countervailable, Commerce finds that written notification of the return or Protection (CBP) 15 days after the there is a subsidy, i.e., a financial destruction of APO materials or publication of these final results of contribution from a government or conversion to judicial protective order is review, to liquidate shipments of subject public entity that gives rise to a benefit hereby requested. Failure to comply merchandise entered, or withdrawn to the recipient, and that the subsidy is with the regulations and terms of an 6 from warehouse, for consumption, on or specific. For a full description of the APO is a sanctionable violation. methodology underlying all of after January 1, 2017 through December Commerce’s conclusions, including any 31, 2017, at the ad valorem rates listed Notification to Interested Parties determination that relied upon the use above. Commerce is issuing and publishing of adverse facts available pursuant to Cash Deposit Instructions these results in accordance with section 776(a) and (b) of the Act, see the sections 751(a)(1) and 777(i)(1) of the Issues and Decision Memorandum. In accordance with section 751(a)(1) Act. of the Act, Commerce intends to instruct Final Results of Administrative Review CBP to collect cash deposits of Dated: November 27, 2020. Jeffrey I. Kessler, In accordance with 19 CFR estimated countervailing duties in the amounts shown for each of the Assistant Secretary for Enforcement and 351.221(b)(5), Commerce calculated a Compliance. countervailable subsidy rate for the respective companies listed above. mandatory company respondents, JA These cash deposits, when imposed, Appendix I Solar and Risen Energy. For the non- 9 List of Topics Discussed in the Issues and selected companies subject to this As discussed in the Preliminary Results PDM, Decision Memorandum JA Solar is cross-owned with JA (Hefei) Renewable 7 review, Commerce followed its Energy Co., Ltd.; Hefei JA Solar Technology Co., I. Summary practice, which is to base the subsidy Ltd.; JA Solar Investment China Co., Ltd.; JA Solar II. Background rates on a weighted average of the Technology Yangzhou Co., Ltd.; Jing Hai Yang III. List of Comments from Interested Parties subsidy rates calculated for those Semiconductor Material (Donghai) Co., Ltd.; IV. Scope of the Order Donghai JingAo The Solar Energy Science and companies selected for individual V. Changes Since the Preliminary Results Technology Co., Ltd.; Solar Silicon Valley VI. Subsidies Valuation Information examination, excluding rates of zero, de Electronic Science and Technology Co., Ltd.; Jingwei Electronic Materials Co., Ltd.; Hebei Yujing A. Allocation Period minimis, or rates determined entirely B. Cross-Ownership and Attribution of based on adverse facts available.8 To Electronic Science and Technology Co., Ltd.; Solar Silicon Peak Electronic Science and Technology Subsidies this end, Commerce calculated a rate by Co., Ltd.; Beijing Jinfeng Investment Co., Ltd.; C. Denominators weight-averaging the calculated subsidy Jinglong Technology Holdings Co., Ltd.; JingAo D. Benchmarks and Discount Rates rates of JA Solar and Risen Energy using Solar Co., Ltd.; Ningjin Songgong Electronic VII. Use of Facts Available and Adverse their publicly-available sales data for Materials Co., Ltd.; Jinglong Industry and Inferences Commerce Group Co., Ltd.; Ningjin Guiguang exports of subject merchandise to the VIII. Programs Determined to be Electronic Investment Co., Ltd.; Ningjin County Countervailable United States during the POR. Jingyuan New Energy Investment Co., Ltd.; Hebei IX. Programs Determined to be Not Used or Jinglong Fine Chemicals Co., Ltd.; Ningjin Sunshine Commerce finds the countervailable Not To Confer a Measurable Benefit subsidy rates for the producers/ New Energy Co., Ltd.; Hebei Jinglong Sunshine Equipment Co., Ltd.; Hebei Jingle Optoelectronic During the POR exporters under review to be as follows: Technology Co., Ltd.; Hebei Ningjin Songgong X. Ad Valorem Rate for Non-Selected Semiconductor Co., Ltd.; Ningjin Jingxing Companies Under Review Subsidy rate Electronic Material Co., Ltd.; Ningjin Jingfeng XI. Analysis of Comments Company (ad valorem) Electronic Materials Co., Ltd.; Ningjin Saimei (percent) Comment 1: Whether Commerce Ganglong Electronic Materials Co., Ltd.; Hebei Appropriately Applied the Use of Adverse Ningtong Electronic Materials Co., Ltd.; Ningjin Facts Available (AFA) Regarding JA Solar Technology Yangzhou, Changlong Electronic Materials Manufacturing Co. 9 Responses from the GOC Co., Ltd. (JA Solar) ...... 14.86 Ltd.; JA Solar (Xingtai) Co., Ltd.; Xingtai Jinglong Risen Energy Co., Ltd. (Risen En- Electronic Material Co., Ltd.; Xingtai Jinglong PV Comment 2: Whether Input Suppliers That 10 ergy) ...... 11.68 Materials Co., Ltd.; Taicang Juren PV Material Co., Are Wholly Owned by Individuals Are Non-Selected Companies Under Ltd.; JA PV Technology Co., Ltd.; Ningjin Longxin ‘‘Government Authorities’’ Review 11 ...... 12.67 Investment Co., Ltd.; and Ningjin Jinglong PV Comment 3: Whether Commerce Should Industry Investment Co., Ltd. Apply AFA to the Export Buyer’s Credit 10 As discussed in the Preliminary Results PDM, Program (EBCP) 6 See sections 771(5)(B) and (D) of the Act Risen Energy is cross-owned with Changzhou Sveck Comment 4: The Provision of Electricity regarding financial contribution; section 771(5)(E) Photovoltaic New Material Co., Ltd.; Changzhou Comment 5: Whether the Income Tax of the Act regarding benefit; and section 771(5A) of Sveck New Material Technology Co., Ltd.; JiuJiang Deduction for Research and Development the Act regarding specificity. Shengchao Xinye Technology Co., Ltd.; Jiangsu (R&D) Expenses is Specific 7 Sveck New Material Co., Ltd.; Ninghai Risen Energy See Appendix II. Comment 6: Whether Commerce Should 8 Power Development Co., Ltd.; Risen (Luoyang) New See, e.g., Certain Pasta from Italy: Preliminary Revise the Benchmark for the Provision of Results of the 13th (2008) Countervailing Duty Energy Co., Ltd.; Risen (Ningbo) Electric Power Administrative Review, 75 FR 18806, 18811 (April Development Co., Ltd.; Risen (Wuhai) New Energy Aluminum Extrusions 13, 2010), unchanged in Certain Pasta from Italy: Co., Ltd.; Zhejiang Boxin Investment Co., Ltd.; and Comment 7: The Benchmark for the Final Results of the 13th (2008) Countervailing Duty Zhejiang Twinsel Electronic Technology Co., Ltd. Provision of Solar Glass Administrative Review, 75 FR 37386 (June 29, 11 See Appendix II. Comment 8: The Benchmark for the 2010). 12 See 19 CFR 351.224(b). Provision of Land

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79165

Comment 9: The Benchmark for Ocean 48. Tianneng Yingli New Energy Resources 2020, one company claiming that it had Freight Co., Ltd. no shipments under review contended Comment 10: Commerce’s Use of ‘‘Zeroing’’ 49. Toenergy Technology Hangzhou Co., Ltd. that in the Final Results Commerce in Benefit Calculations 50. Trina Solar (Changzhou) Science & Comment 11: Whether Commerce Should Technology Co., Ltd. incorrectly identified it as ‘‘LERRI Solar Correct Errors to Sales Denominators and 51. Trina Solar Energy Co., Ltd. (formerly Technology Co., Ltd’’ (LERRI) and that the Attribution of Subsidies known as Changzhou Trina Solar Energy its correct name is ‘‘LONGi Solar XII. Recommendation Co., Ltd.) Technology Co. Ltd. (a.k.a. LERRI Solar 52. Turpan Trina Solar Energy Co., Ltd. 2 Appendix II Technology Co., Ltd.).’’ On October 6, 53. Wuxi Suntech Power Co., Ltd. 2020, Trina 3 and Risen 4 submitted Non-Selected Companies Under Review 54. Wuxi Tianran Photovoltaic Co., Ltd. 5 55. Yancheng Trina Solar Energy Technology timely ministerial error comments. 1. Anji DaSol Solar Energy Science & Co., Ltd. Specifically, Trina and Risen allege that Technology Co., Ltd. 56. Yingli Energy (China) Co., Ltd. we applied the incorrect amount in 2. Baoding Jiasheng Photovoltaic Technology Co., Ltd. 57. Yingli Green Energy Holding Company valuing their tempered glass inputs. 3. Baoding Tianwei Yingli New Energy Limited Risen also alleges that we incorrectly Resources Co., Ltd. 58. Yingli Green Energy International valued its junction box inputs and 4. Beijing Tianneng Yingli New Energy Trading Company Limited incorrectly calculated the surrogate Resources Co., Ltd. 59. Zhejiang ERA Solar Technology Co., Ltd. 60. Zhejiang Jinko Solar Co., Ltd. financial ratios. On October 12, 2020, 5. BYD (Shangluo) Industrial Co., Ltd. SunPower Manufacturing Oregon LLC 6. Canadian Solar (USA) Inc. [FR Doc. 2020–27037 Filed 12–8–20; 8:45 am] (the petitioner) submitted a timely 7. Canadian Solar Inc. BILLING CODE 3510–DS–P 8. Canadian Solar International Ltd. rebuttal proposing an alternative to 9. Canadian Solar Manufacturing (Changshu) Trina and Risen’s suggest valuation of Inc. DEPARTMENT OF COMMERCE tempered glass, arguing that there was 10. Canadian Solar Manufacturing (Luoyang) no ministerial error in the valuation of Inc. International Trade Administration Risen junction boxes, and asserting that 11. Changzhou Trina Solar Yabang Energy Co., Ltd. [A–570–979] labor was omitted from the calculation 6 12. CSI Cells Co., Ltd. of surrogate financial ratios. 13. CSI–GCL Solar Manufacturing Crystalline Silicon Photovoltaic Cells, Scope of the Order (Yancheng) Co., Ltd. Whether or Not Assembled Into 14. De-Tech Trading Limited HK Modules, From the People’s Republic The merchandise covered by the order 15. Dongguan Sunworth Solar Energy Co., of China: Notice of Correction to the Ltd. is crystalline silicon photovoltaic cells, 16. Eoplly New Energy Technology Co., Ltd. Final Results of the 2017–2018 and modules, laminates, and panels, 17. ERA Solar Co., Ltd. Antidumping Duty Administrative consisting of crystalline silicon 18. ET Solar Energy Limited Review photovoltaic cells, whether or not 19. Hainan Yingli New Energy Resources Co., AGENCY: Enforcement and Compliance, partially or fully assembled into other Ltd. products, including, but not limited to, 20. Hangzhou Sunny Energy Science and International Trade Administration, Technology Co., Ltd. Department of Commerce. modules, laminates, panels and building 21. Hengdian Group DMEGC Magnetics Co., SUMMARY: The Department of Commerce Ltd. People’s Republic of China: Final Results of (Commerce) is correcting its notice of Antidumping Duty Administrative Review and 22. Hengshui Yingli New Energy Resources the final results of the sixth Co., Ltd. Final Determination of No Shipments; 2017–2018, 23. Hubei Trina Solar Energy Co., Ltd. administrative review of the 85 FR 62275 (October 2, 2020) (Final Results), and antidumping duty (AD) order on accompanying Issues and Decision Memorandum 24. JA Technology Yangzhou Co., Ltd. (IDM). 25. Jiangsu High Hope Int’l Group crystalline silicon photovoltaic cells, 2 See LERRI’s Letter, ‘‘LONGi Request for 26. Jiawei Solarchina (Shenzhen) Co., Ltd. whether or not assembled into modules Correction of Clerical Error in the Final Results 27. Jiawei Solarchina Co., Ltd. (solar cells), from the People’s Republic including Customs Instructions,’’ dated September 28. Jinko Solar (U.S.) Inc. of China (China). The period of review 30, 2020. 29. Jinko Solar Co., Ltd. (POR) is December 1, 2017 through 3 As noted in the Final Results, we are treating 30. Jinko Solar Import and Export Co., Ltd. November 30, 2018. Trina Solar Co., Ltd.; Trina Solar (Changzhou) 31. Jinko Solar International Limited Science and Technology Co., Ltd.; Yancheng Trina 32. LERRI Solar Technology Co., Ltd. DATES: Applicable December 9, 2020. Guoneng Photovoltaic Technology Co., Ltd 33. Lightway Green New Energy Co., Ltd. FOR FURTHER INFORMATION CONTACT: (formerly, Yancheng Trina Solar Energy Technology Jeff Co., Ltd.); Changzhou Trina Solar Yabang Energy 34. Lixian Yingli New Energy Resources Co., Pedersen, AD/CVD Operations, Office Ltd. Co., Ltd.; Turpan Trina Solar Energy Co., Ltd.; IV, Enforcement & Compliance, Hubei Trina Solar Energy Co., Ltd.; Trina Solar 35. Luoyang Suntech Power Co., Ltd. International Trade Administration, (Hefei) Science and Technology Co., Ltd.; and 36. Nice Sun PV Co., Ltd. Changzhou Trina Hezhong Photoelectric Co., Ltd. 37. Ningbo ETDZ Holdings, Ltd. Department of Commerce, 1401 (collectively Trina) as a single entity. 38. Ningbo Qixin Solar Electrical Appliance Constitution Avenue NW, Washington, 4 As noted in the Final Results, we are treating Co., Ltd. DC 20230; telephone: (202) 482–2769. Risen Energy Co., Ltd.; Risen (Wuhai) New Energy 39. Shanghai BYD Co., Ltd. SUPPLEMENTARY INFORMATION: Co., Ltd.; Zhejiang Twinsel Electronic Technology 40. Shenzhen Sungold Solar Co., Ltd. Co., Ltd.; Risen (Luoyang) New Energy Co., Ltd.; 41. Shenzhen Yingli New Energy Resources Background Jiujiang Shengchao Xinye Technology Co., Ltd.; Co., Ltd. Jiujiang Shengzhao Xinye Trade Co., Ltd. Ruichang 42. Sumec Hardware & Tools Co., Ltd. On October 2, 2020, Commerce Branch, and Risen Energy (HongKong) Co., Ltd. (collectively Risen) as a single entity. 43. Sunpreme Solar Technology (Jiaxing) Co., published the final results of the 2017– Barcode. Ltd. 2018 administrative review of the AD 5 See Risen’s Letter, ‘‘Risen Ministerial Error 44. Systemes Versilis, Inc. order on solar cells from China in the Comments,’’ dated October 6, 2020; see also Trina’s 1 45. Taizhou BD Trade Co., Ltd. Federal Register. On September 30, Letter, ‘‘Ministerial Error Allegation,’’ dated 46. TenKsolar (Shanghai) Co., Ltd. October 6, 2020. 47. Tianjin Yingli New Energy Resources Co., 1 See Crystalline Silicon Photovoltaic Cells, 6 See Petitioner’s Letter ‘‘Response to Ministerial Ltd. Whether or Not Assembled Into Modules, from the Error Allegations,’’ dated October 12, 2020.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00004 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79166 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

integrated materials.7 Merchandise 7007.19.80 to be 1.87 euros per kg, and the name that we used to identify covered by the order is classifiable we have corrected for this error in our LERRI. Because a review was requested under subheading 8501.61.0000, calculation by valuing tempered glass and initiated under the name LERRI,11 8507.20.80, 8541.40.6020, 8541.40.6030, using the 1.87 euros per kg amount. our no shipments determination applies and 8501.31.8000 of the Harmonized (2) As accurately noted by Risen, we with respect to that name and we used Tariff Schedule of the United States determined in the Final Results that that name in the Final Results. Thus, (HTSUS). Although the HTSUS ‘‘Malaysian HTS 8544.42.9400 and HTS our omission of the other company subheadings are provided for 8544.60.1100 most closely correspond name was correct. convenience and customs purposes, our with the various junction boxes used by written description of the scope of the Risen.’’ 10 However, we stated that data We also disagree with Risen’s order is dispositive. for Malaysian imports of HTS contention that we committed a 8544.42.9400 were not on the record ministerial error by incorrectly Ministerial Errors and so it was not possible to average the classifying certain expenses in Section 351.224(e) of Commerce’s values under Malaysian HTS calculating the surrogate financial regulations provides that Commerce 8544.42.9400 with the values under ratios. Risen’s argument is will analyze any comments received Malaysian HTS 8544.60.1100. We thus methodological in nature. and, if appropriate, correct any relied solely on Malaysian imports of ministerial error by amending the final HTS 8544.60.1100 to value Risen’s Separate Rates determination or the final results of the junction box consumption. However, In the Final Results we found that review. Section 751(h) of the Tariff Act data for Malaysian imports of HTS Trina, Risen, and 16 other companies/ of 1930, as amended (the Act), and 19 8544.42.9400 were in fact on the record company groups were eligible for a CFR 351.224(f) define a ‘‘ministerial and so we have corrected this error by error’’ as an error ‘‘in addition, relying on an simple average of separate rate. Commerce assigned a subtraction, or other arithmetic Malaysian imports of HTS 8544.42.9400 dumping margin to the separate rate function, clerical error resulting from and HTS 8544.60.1100 to value Risen’s companies that it did not individually inaccurate copying, duplication, or the consumption of junction boxes. examine, but which demonstrated their like, and any other similar type of (3) We failed to identify that the Risen eligibility for a separate rate, based on unintentional error which the Secretary collapsed entity included Risen Energy the mandatory respondents’ dumping considers ministerial.’’ (Changzhou) Co., Ltd. in the rate section margins.12 Because Trina’s and Risen’s We analyzed the ministerial error of the Final Results. We have corrected margins have changed due to the comments and determined, in for this by adding Risen Energy correction of ministerial errors, we have accordance with section 751(h) of the (Changzhou) Co., Ltd. to the Risen recalculated the rate assigned to the Act and 19 CFR 351.224(e) and (f), that collapsed entity in the rate section. non-individually examined separate rate we made the following ministerial (4) We failed to include, in the companies.13 errors: 8 calculation of Trina’s normal value, the (1) In the Final Results, we stated our cost of the silver paste consumed by Amended Final Results of Review intention to value tempered glass using Trina. We have corrected for this error Romanian imports of HTS 7007.19.80.9 by including this cost in the calculation As a result of correcting the four However, we incorrectly applied a value of Trina’s normal value. ministerial errors discussed above, we of 2.19 euros per kilogram (kg). Record We found that we did not commit a determine that the following weighted- evidence demonstrates the average unit ministerial error by not including average dumping margins exist for the value of Romanian imports of HTS ‘‘LONGi Solar Technology Co. Ltd.’’ in POR:

Weighted- average Producers/exporters dumping margin (percent)

Trina Solar Co., Ltd./Trina Solar (Changzhou) Science and Technology Co., Ltd./Yancheng Trina Guoneng Photovoltaic Technology Co., Ltd./Changzhou Trina Solar Yabang Energy Co., Ltd./Turpan Trina Solar Energy Co., Ltd./Hubei Trina Solar Energy Co., Ltd./Trina Solar (Hefei) Science and Technology Co., Ltd./Changzhou Trina Hezhong Photoelectric Co., Ltd ...... 92.52 Risen Energy Co. Ltd./Risen (Wuhai) New Energy Co., Ltd./Zhejiang Twinsel Electronic Technology Co., Ltd./Risen (Luoyang) New Energy Co., Ltd./Jiujiang Shengchao Xinye Technology Co., Ltd./Jiujiang Shengzhao Xinye Trade Co., Ltd./Ruichang Branch, Risen Energy (HongKong) Co., Ltd./Risen Energy (Changzhou) Co., Ltd ...... 100.79 Review-Specific Average Rate Applicable to the Following Companies: Anji DaSol Solar Energy Science & Technology Co., Ltd ...... 95.50 Canadian Solar International Limited/Canadian Solar Manufacturing (Changshu), Inc./Canadian Solar Manufacturing (Luoyang) Inc./ CSI Cells Co., Ltd./CSI–GCL Solar Manufacturing (YanCheng) Co., Ltd./CSI Solar Power (China) Inc. (Canadian Solar) ...... 95.50 JA Solar Technology Yangzhou Co., Ltd ...... 95.50 Jiawei Solarchina Co., Ltd ...... 95.50 JingAo Solar Co., Ltd ...... 95.50 Jinko Solar Co., Ltd. (Jinko) ...... 95.50 Jinko Solar Import and Export Co., Ltd. (Jinko I&E) ...... 95.50

7 For a complete description of the scope of the 11 See Initiation of Antidumping and or based entirely on facts available. See section order, see Final Results IDM. Countervailing Duty Administrative Reviews, 84 FR 735(c)(5)(A) of the Act. See Memorandum, 8 See Memorandum, ‘‘Allegations of Ministerial 9297 (March 14, 2019). ‘‘Amended Calculation of the Cash Deposit Rate for Errors in the Final Results,’’ dated concurrently 12 See Final Results, 85 at 62276. Non-Reviewed Companies,’’ dated concurrently with this notice. 13 This rate is based on the rates for the with this notice. 9 See Final Results IDM at Comment 3. respondents that were selected for individual 10 See Final Results IDM at Comment 8. review, excluding rates that are zero, de minimis,

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00005 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79167

Weighted- average Producers/exporters dumping margin (percent)

Jinko Solar International Limited (Jinko Int’l) ...... 95.50 Shanghai BYD Co., Ltd ...... 95.50 Shanghai JA Solar Technology Co., Ltd ...... 95.50 Shenzhen Portable Electronic Technology Co., Ltd ...... 95.50 Shenzhen Sungold Solar Co., Ltd ...... 95.50 Wuxi Tianran Photovoltaic Co., Ltd ...... 95.50 Yingli Energy (China) Company Limited/Baoding Tianwei Yingli New Energy Resources Co., Ltd./Tianjin Yingli New Energy Re- sources Co., Ltd./Hengshui Yingli New Energy Resources Co., Ltd./Lixian Yingli New Energy Resources Co., Ltd./Baoding Jiasheng Photovoltaic Technology Co., Ltd./Beijing Tianneng Yingli New Energy Resources Co., Ltd./Hainan Yingli New Energy Resources Co., Ltd./Shenzhen Yingli New Energy Resources Co., Ltd ...... 95.50 Zhejiang Jinko Solar Co., Ltd ...... 95.50 Zhejiang Sunflower Light Energy Science & Technology Limited Liability Company ...... 95.50

Commerce’s policy regarding importer or customer and dividing this Cash Deposit Requirements conditional review of the China-wide amount by the total entered value of the The following cash deposit 16 entity applies to this administrative sales to the importer or customer. requirements will be effective upon 14 review. Under this policy, the China- Where we calculated an importer- or publication of the amended final results wide entity will not be under review customer-specific weighted-average of this administrative review for unless a party specifically requests, or dumping margin by dividing the total shipments of the subject merchandise Commerce self-initiates, a review of the amount of dumping for reviewed sales from China entered, or withdrawn from entity. Because no party requested a to the importer or customer by the total warehouse, for consumption on or after review of the China-wide entity, and we sales quantity associated with those the publication date of this notice in the did not self-initiate a review of the transactions, we will direct CBP to Federal Register, as provided by section entity, the entity is not under review, assess importer- or customer-specific 751(a)(2)(C) of the Act: (1) For the and the entity’s dumping margin (i.e., assessment rates based on the resulting 17 exporters listed in the table in the 238.95 percent) is not subject to change per-unit rates. Where an importer- or ‘‘Amended Final Results of Review’’ as a result of this review.15 customer- specific ad valorem or per- section above, the cash deposit rate will unit rate is greater than de minimis, we Assessment be the rate listed for each exporter in the will instruct CBP to collect the table, except if the rate is zero or de We will determine, and U.S. Customs appropriate duties at the time of minimis (i.e., less than 0.5 percent), then and Border Protection (CBP) shall liquidation. Where either the the cash deposit rate will be zero; (2) for respondent’s weighted average dumping assess, antidumping duties on all previously investigated Chinese and margin is zero or de minimis, or an appropriate entries covered by this non-Chinese exporters that received a importer or customer-specific ad review. We intend to issue assessment separate rate in a prior segment of this valorem or per-unit rate is zero or de instructions to CBP 15 days after the proceeding, the cash deposit rate will minimis, we will instruct CBP to publication date of these amended final continue to be the existing exporter- liquidate appropriate entries without results of review. In accordance with 19 specific rate; (3) for all Chinese regard to antidumping duties.18 CFR 351.212(b)(1), we are calculating exporters of subject merchandise that importer- or customer-specific For merchandise whose sale/entry was not reported in the U.S. sales have not been found to be entitled to a assessment rates for the merchandise separate rate, the cash deposit rate will subject to this review. For any database submitted by an exporter individually examined during this be the rate previously established for the individually examined respondent China-wide entity (i.e., 238.95 percent); whose weighted-average dumping review, but that entered under the case number of that exporter (i.e., at the and (4) for all non-China exporters of margin is above de minimis (i.e., 0.50 subject merchandise which have not percent), we will calculate importer- or individually-examined exporter’s cash deposit rate), we will instruct CBP to received their own rate, the cash deposit customer-specific assessment rates for rate will be the rate applicable to the merchandise subject to this review. liquidate such entries at the China-wide rate. Additionally, if we determine that Chinese exporter that supplied the non- Where the respondent reported reliable Chinese exporter. These deposit entered values, we calculated importer- an exporter under review had no shipments of the subject merchandise, requirements, when imposed, shall or customer-specific ad valorem rates by remain in effect until further notice. aggregating the dumping margins any suspended entries that entered calculated for all U.S. sales to the under that exporter’s case number will Disclosure 19 be liquidated at the China-wide rate. We intend to disclose the calculations 14 See Antidumping Proceedings: Announcement performed for these amended final 16 See 19 CFR 351.212(b)(1). of Change in Department Practice for Respondent results within five days of publication of Selection in Antidumping Duty Proceedings and 17 Id. Conditional Review of the Nonmarket Economy 18 See Antidumping Proceedings: Calculation of this notice in the Federal Register in Entity in NME Antidumping Duty Proceedings, 78 the Weighted-Average Dumping Margin and accordance with 19 CFR 351.224(b). FR 65963, 65969–70 (November 4, 2013). Assessment Rate in Certain Antidumping Duty 15 See Crystalline Silicon Photovoltaic Cells, Proceedings; Final Modification, 77 FR 8101, 8103 Notification to Importers Whether or Not Assembled Into Modules, from the (February 14, 2012). This notice also serves as a reminder People’s Republic of China: Final Results of 19 See Non-Market Economy Antidumping Antidumping Duty Administrative Review and Proceedings: Assessment of Antidumping Duties, 76 to importers of their responsibility Final Determination of No Shipments; 2015–2016, FR 65694 (October 24, 2011), for a full discussion under 19 CFR 351.402(f)(2) to file a 83 FR 35616 (July 27, 2018). of this practice. certificate regarding the reimbursement

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00006 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79168 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

of antidumping duties prior to NW, Washington, DC 20230; telephone: Assessment liquidation of the relevant entries (202) 482–5166. during this POR. Failure to comply with SUPPLEMENTARY INFORMATION: Commerce will instruct U.S. Customs this requirement could result in and Border Protection (CBP) to assess Commerce’s presumption that Background antidumping duties on all appropriate reimbursement of antidumping duties On August 4, 2020, Commerce entries of PRCBs from China during the occurred and the subsequent assessment published a notice of opportunity to POR at rates equal to the cash deposit of double antidumping duties. request an administrative review of the rate of estimated antidumping duties antidumping duty order on PRCBs from required at the time of entry, or Administrative Protective Orders China for the POR August 1, 2019, withdrawal from warehouse, for This notice also serves as a reminder through July 31, 2020.1 On August 31, consumption, in accordance with 19 to parties subject to administrative 2020, the petitioners 2 timely requested CFR 351.212(c)(1)(i). Commerce intends protective order (APO) of their an administrative review of the to issue appropriate assessment responsibility concerning the return or antidumping duty order with respect to instructions to CBP 15 days after destruction of proprietary information Dongguan Nozawa Plastics Products publication of this notice in the Federal disclosed under APO in accordance Co., Ltd. and United Power Packaging, Register. with 19 CFR 351.305, which continues Ltd. (collectively, Nozawa), and Crown to govern business proprietary Polyethylene Products (International) Notification to Importers information in this segment of the Ltd. (Crown).3 Commerce received no proceeding. Timely written notification other requests for an administrative This notice serves as a final reminder of the return or destruction of APO review of the antidumping duty order. to importers of their responsibility materials, or conversion to judicial On October 6, 2020, pursuant to section under 19 CFR 351.402(f)(2) to file a protective order, is hereby requested. 751(a) of the Tariff Act of 1930, as certificate regarding the reimbursement Failure to comply with the regulations amended (the Act), and 19 CFR of antidumping duties prior to and terms of an APO is a violation 351.221(c)(1)(i), we published in the liquidation of the relevant entries which is subject to sanction. Federal Register a notice of initiation of during this review period. Failure to These corrections to the final results an administrative review of the comply with this requirement could and notice are issued and published in antidumping duty order on PRCBs from result in Commerce’s presumption that accordance with sections 751(a) and China with respect to Nozawa and reimbursement of antidumping duties 777(i) of the Act. Crown (the respondents).4 On occurred and the subsequent assessment Dated: November 2, 2020. November 16, 2020, the petitioners of doubled antidumping duties. timely withdrew their administrative Jeffrey I. Kessler, review request for Nozawa and Crown.5 Notification Regarding Administrative Assistant Secretary for Enforcement and Protective Order Compliance. Rescission of Administrative Review [FR Doc. 2020–27030 Filed 12–8–20; 8:45 am] Pursuant to 19 CFR 351.213(d)(1), This notice also serves as a reminder BILLING CODE 3510–DS–P Commerce will rescind an to parties subject to administrative administrative review, in whole or in protective order (APO) of their part, if a party that requested a review responsibility concerning the DEPARTMENT OF COMMERCE withdraws the request within 90 days of disposition of proprietary information the date of publication of notice of International Trade Administration disclosed under APO in accordance initiation of the requested review. The with 19 CFR 351.305(a)(3). Timely [A–570–886] petitioners withdrew their request for written notification of the return or review within 90 days of the publication destruction of APO materials or Polyethylene Retail Carrier Bags From date of the Initiation Notice. No other conversion to judicial protective order is the People’s Republic of China: parties requested an administrative hereby requested. Failure to comply Rescission of Antidumping Duty review of the antidumping duty order. with the regulations and the terms of an Administrative Review; 2019–2020 Therefore, in accordance with 19 CFR APO is a sanctionable violation. 351.213(d)(1), we are rescinding the AGENCY: Enforcement and Compliance, administrative review of the International Trade Administration, Notification to Interested Parties antidumping order on PRCBs from Department of Commerce. China for the period August 1, 2019, This notice is issued and published in SUMMARY: The Department of Commerce through July 31, 2020, in its entirety. accordance with sections 751(a)(1) and (Commerce) is rescinding the 777(i)(1) of the Act, and 19 CFR administrative review of the 1 See Antidumping or Countervailing Duty Order, 351.213(d)(4). antidumping duty order on Finding, or Suspended Investigation; Opportunity polyethylene retail carrier bags (PRCBs) to Request Administrative Review, 85 FR 47167 Dated: December 4, 2020. from the People’s Republic of China (August 4, 2020). James Maeder, 2 The petitioners are the Polyethylene Retail (China) covering the period of review Carrier Bag Committee and its individual members, Deputy Assistant Secretary for Antidumping (POR) August 1, 2019, through July 31, Hilex Poly Co., LLC and Superbag Corporation. and Countervailing Duty Operations. 2020, based on the timely withdrawal of 3 See Petitioners’ Letter, ‘‘Polyethylene Retail [FR Doc. 2020–27026 Filed 12–8–20; 8:45 am] Carrier Bags from the People’s Republic of China: the request for review. BILLING CODE 3510–DS–P Request for Administrative Review,’’ dated August DATES : Applicable December 9, 2020. 31, 2020. FOR FURTHER INFORMATION CONTACT: 4 See Initiation of Antidumping and Christopher Williams, AD/CVD Countervailing Duty Administrative Reviews, 85 FR Operations, Office I, Enforcement and 63081 (October 6, 2020) (Initiation Notice). 5 See Petitioners’ Letter, ‘‘Polyethylene Retail Compliance, International Trade Carrier Bags from the People’s Republic of China: Administration, U.S. Department of Withdrawal of Request for Administrative Review,’’ Commerce, 1401 Constitution Avenue dated November 16,2020.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00007 Fmt 4703 Sfmt 9990 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79169

DEPARTMENT OF COMMERCE SUMMARY: Notice is hereby given that SUPPLEMENTARY INFORMATION: Notices permits and permit amendments have were published in the Federal Register National Oceanic and Atmospheric been issued to the following entities on the dates listed below that requests Administration under the Marine Mammal Protection for a permit or permit amendment had [RTID 0648–XA702] Act (MMPA) and the Endangered been submitted by the below-named Species Act (ESA), as applicable. applicants. To locate the Federal Marine Mammals and Endangered ADDRESSES: The permits and related Register notice that announced our Species documents are available for review receipt of the application and a upon written request via email to AGENCY: National Marine Fisheries complete description of the research, go [email protected]. Service (NMFS), National Oceanic and to www.federalregister.gov and search Atmospheric Administration (NOAA), FOR FURTHER INFORMATION CONTACT: on the permit number provided in Table Commerce. Shasta McClenahan (Permit No. 21045– 1 below. 01, 21476–01 and 23802) and Erin ACTION: Notice; issuance of permits and Markin (Permit No. 23807–01); at (301) permit amendments. 427–8401.

TABLE 1—ISSUED PERMITS AND PERMIT AMENDMENTS

Permit No. RTID Applicant Previous Federal Register notice Issuance date

21045–01 ... 0648–XA560 .. Matson Laboratory, LLC, 135 Wooden Shoe Lane, 85 FR 65029; October 14, 2020 .... November 18, 2020. Manhattan, MT 59741 (Responsible Party: Carolyn Nistler). 21476–01 ... 0648–XA442 .. Lars Bejder, Ph.D., University of Hawaii at Manoa, 85 FR 53797; August 31, 2020 ...... November 6, 2020. 46–007 Lilipuna Road, Kaneohe, HI 96744. 23802 ...... 0648–XA539 .. University of Florida, Aquatic Animal Health Pro- 85 FR 63104; October 6, 2020 ...... November 16, 2020. gram, College of Veterinary Medicine, 2015 SW 16th Avenue, Gainesville, FL 32608 (Respon- sible Party: Michael Walsh, DVM). 23807–01 ... 0648–XA500 .. Plimsoll Productions Limited, 51–55 Whiteladies 85 FR 60767; September 28, 2020 November 5, 2020. Road, Bristol, BS8 2LY, United Kingdom (Re- sponsible Party: Anuschka Schofield).

In compliance with the National DEPARTMENT OF EDUCATION [email protected]. Please include the Environmental Policy Act of 1969 (42 docket ID number and the title of the U.S.C. 4321 et seq.), a final [Docket No.: ED–2020–SCC–0183] information collection request when determination has been made that the Agency Information Collection requesting documents or submitting activities proposed are categorically Activities; Comment Request; comments. Please note that comments excluded from the requirement to Application for the U.S. Presidential submitted by fax or email and those prepare an environmental assessment or Scholars Program submitted after the comment period will environmental impact statement. not be accepted. Written requests for As required by the ESA, as applicable, AGENCY: Office of Communications and information or comments submitted by issuance of these permit was based on Outreach (OCO), Department of postal mail or delivery should be a finding that such permits: (1) Were Education (ED). addressed to the PRA Coordinator of the applied for in good faith; (2) will not ACTION: Notice. Strategic Collections and Clearance operate to the disadvantage of such Governance and Strategy Division, U.S. endangered species; and (3) are SUMMARY: In accordance with the Department of Education, 400 Maryland consistent with the purposes and Paperwork Reduction Act of 1995, ED is Ave. SW, LBJ, Room 6W208B, policies set forth in Section 2 of the proposing an extension of a currently Washington, DC 20202–8240. ESA. approved collection. FOR FURTHER INFORMATION CONTACT: For Authority: The requested permits DATES: Interested persons are invited to specific questions related to collection have been issued under the MMPA of submit comments on or before February activities, please contact Simone Olson, 1972, as amended (16 U.S.C. 1361 et 8, 2021. 202–205–8719. seq.), the regulations governing the ADDRESSES: To access and review all the SUPPLEMENTARY INFORMATION: The taking and importing of marine documents related to the information Department of Education (ED), in mammals (50 CFR part 216), the ESA of collection listed in this notice, please accordance with the Paperwork 1973, as amended (16 U.S.C. 1531 et use http://www.regulations.gov by Reduction Act of 1995 (PRA) (44 U.S.C. seq.), and the regulations governing the searching the Docket ID number ED– 3506(c)(2)(A)), provides the general taking, importing, and exporting of 2020–SCC–0183. Comments submitted public and Federal agencies with an endangered and threatened species (50 in response to this notice should be opportunity to comment on proposed, CFR parts 222–226), as applicable. submitted electronically through the revised, and continuing collections of Dated: December 3, 2020. Federal eRulemaking Portal at http:// information. This helps the Department Julia Marie Harrison, www.regulations.gov by selecting the assess the impact of its information Chief, Permits and Conservation Division, Docket ID number or via postal mail, collection requirements and minimize Office of Protected Resources, National commercial delivery, or hand delivery. the public’s reporting burden. It also Marine Fisheries Service. If the regulations.gov site is not helps the public understand the [FR Doc. 2020–26979 Filed 12–8–20; 8:45 am] available to the public for any reason, Department’s information collection BILLING CODE 3510–22–P ED will temporarily accept comments at requirements and provide the requested

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00008 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79170 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

data in the desired format. ED is DEPARTMENT OF EDUCATION helps the public understand the soliciting comments on the proposed Department’s information collection [Docket No. ED–2020–SCC–0182] information collection request (ICR) that requirements and provide the requested is described below. The Department of Agency Information Collection data in the desired format. ED is Education is especially interested in Activities; Comment Request; Higher soliciting comments on the proposed public comment addressing the Education Act (HEA) Title II Report information collection request (ICR) that following issues: (1) Is this collection Cards on State Teacher Credentialing is described below. The Department of necessary to the proper functions of the and Preparation Education is especially interested in Department; (2) will this information be public comment addressing the AGENCY: Office of Postsecondary following issues: (1) Is this collection processed and used in a timely manner; Education (OPE), Department of necessary to the proper functions of the (3) is the estimate of burden accurate; Education (ED). Department; (2) will this information be (4) how might the Department enhance ACTION: Notice. processed and used in a timely manner; the quality, utility, and clarity of the (3) is the estimate of burden accurate; information to be collected; and (5) how SUMMARY: In accordance with the (4) how might the Department enhance might the Department minimize the Paperwork Reduction Act of 1995, ED is the quality, utility, and clarity of the burden of this collection on the proposing a revision of a currently information to be collected; and (5) how respondents, including through the use approved collection. might the Department minimize the of information technology. Please note DATES: Interested persons are invited to burden of this collection on the that written comments received in submit comments on or before February respondents, including through the use response to this notice will be 8, 2021. of information technology. Please note considered public records. ADDRESSES: To access and review all the that written comments received in Title of Collection: Application for the documents related to the information response to this notice will be U.S. Presidential Scholars Program. collection listed in this notice, please considered public records. use http://www.regulations.gov by Title of Collection: Higher Education OMB Control Number: 1860–0504. searching the Docket ID number ED– Act (HEA) Title II Report Cards on State Type of Review: A revision of a 2020–SCC–0182. Comments submitted Teacher Credentialing and Preparation. currently approved collection. in response to this notice should be OMB Control Number: 1840–0744. Type of Review: Revision of a Respondents/Affected Public: submitted electronically through the Federal eRulemaking Portal at http:// currently approved collection. Individuals and Households. Respondents/Affected Public: State, www.regulations.gov by selecting the Local, and Tribal Governments; Private Total Estimated Number of Annual Docket ID number or via postal mail, Responses: 3,300. Sector. commercial delivery, or hand delivery. Total Estimated Number of Annual Total Estimated Number of Annual If the regulations.gov site is not Responses: 1,794. Burden Hours: 52,800. available to the public for any reason, Total Estimated Number of Annual Abstract: The United States ED will temporarily accept comments at Burden Hours: 267,588. Presidential Scholars Program is a [email protected]. Please include the Abstract: This request is a revision national recognition program to honor docket ID number and the title of the that includes COVID–19 guidance and information collection request when outstanding graduating high school to approve the state report card and requesting documents or submitting seniors. Candidates are invited to apply institution and program report cards comments. Please note that comments based on academic achievements on the required by the Higher Education Act of submitted by fax or email and those 1965, as amended in 2008 by the Higher SAT or ACT assessments, through submitted after the comment period will nomination from Chief State School Education Opportunity Act (HEOA). not be accepted. Written requests for States must report annually on criteria Officers, other recognition program information or comments submitted by partner organizations, on artistic merits and assessments required for initial postal mail or delivery should be teacher credentials using a State Report based on participation in a national addressed to the PRA Coordinator of the Card (SRC), and institutions of higher talent program and achievement in Strategic Collections and Clearance education (IHEs) with teacher career and technical education Governance and Strategy Division, U.S. preparation programs (TPP), and TPPs programs. This program was established Department of Education, 400 Maryland outside of IHEs, must report on key by Presidential Executive Orders 11155, Ave. SW, LBJ, Room 6W208D, program elements on an Institution and 12158 and 13697. Washington, DC 20202–8240. Program Report Card (IPRC). IHEs and Dated: December 4, 2020. FOR FURTHER INFORMATION CONTACT: For TPPs outside of IHEs report annually to Stephanie Valentine, specific questions related to collection their states on program elements, activities, please contact Freddie Cross, PRA Coordinator, Strategic Collections and including program numbers, type, (202) 453–7224. Clearance Governance and Strategy Division, enrollment figures, demographics, Office of Chief Data Officer, Office of SUPPLEMENTARY INFORMATION: The completion rates, goals and assurances Planning, Evaluation and Policy Department of Education (ED), in to the state. States, in turn, must report Development. accordance with the Paperwork on TPP elements to the Secretary of [FR Doc. 2020–27056 Filed 12–8–20; 8:45 am] Reduction Act of 1995 (PRA) (44 U.S.C. Education in addition to information on 3506(c)(2)(A)), provides the general assessment pass rates, state standards, BILLING CODE 4000–01–P public and Federal agencies with an initial credential types and opportunity to comment on proposed, requirements, numbers of credentials revised, and continuing collections of issued, TPP classification as at-risk or information. This helps the Department low-performing. The information from assess the impact of its information states, institutions, and programs is collection requirements and minimize published annually in The Secretary’s the public’s reporting burden. It also Report to Congress on Teacher Quality.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00009 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79171

The Department plans to use the SRC FOR FURTHER INFORMATION CONTACT: Ms. energy and water consumption on a and IPRC current instruments, Lucy deButts, U.S. Department of basis representative of its true energy unchanged, for the FY21 through FY23 Energy, Office of Energy Efficiency and and water consumption characteristics. data collections, in order to maintain Renewable Energy, Building DOE has determined that the alternate continuity in the information available. Technologies Office, EE–5B, 1000 test procedure granted in the interim There is no change in burden due to the Independence Avenue SW, Washington, waiver, with additional clarifying addition of Institutions with Teacher DC 20585–0121. Email: AS_Waiver_ modifications, will allow for the Preparation Programs. The Department [email protected]. accurate measurement of the energy and has included additional instruction to Ms. Elizabeth Kohl, U.S. Department water use of the product while aid institutions in reporting data that of Energy, Office of the General Counsel, alleviating the problems CNA identified may differ from usual data due to Mail Stop GC–33, Forrestal Building, regarding testing the specified basic COVID restrictions. 1000 Independence Avenue SW, model according to DOE’s applicable dishwashers test procedure. Dated: December 4, 2020. Washington, DC 20585–0103. In accordance with Title 10 of the Kate Mullan, Telephone: (202) 586–7796. Email: [email protected]. Code of Federal Regulations (10 CFR PRA Coordinator, Strategic Collections and 430.27(f)(2)), DOE gives notice of the Clearance, Governance and Strategy Division, SUPPLEMENTARY INFORMATION: By letter dated June 30, 2020, CNA filed a issuance of its Decision and Order as set Office of Chief Data Officer, Office of forth below. The Decision and Order Planning, Evaluation and Policy petition for waiver and a petition for grants CNA a waiver from the applicable Development. interim waiver from the DOE test test procedure at 10 CFR part 430, [FR Doc. 2020–27013 Filed 12–8–20; 8:45 am] procedure applicable to dishwashers set subpart B, appendix C1 for a specified BILLING CODE 4000–01–P forth in Appendix C1. CNA sought a basic model of dishwashers, and waiver for a non-soil-sensing, compact provides that CNA must test and rate (countertop) dishwasher because CNA such products using the alternate test asserted that the product contains a DEPARTMENT OF ENERGY procedure specified in the Decision and design characteristic that prevents Order. CNA’s representations [Case Number 2020–008; EERE–2020–BT– testing according to the prescribed test WAV–0024] concerning the energy and water procedure. In its petition for waiver, consumption of the specified basic Energy Conservation Program: CNA stated that the subject dishwasher models must be based on testing Decision and Order Granting a Waiver does not have a water hookup but that according to the provisions and to CNA International, Inc. From the water is provided by manually pouring restrictions in the alternate test Department of Energy Dishwashers 5 liters of tap water into a built-in tank. procedure set forth in the Decision and Test Procedure CNA requested DOE waive sections of Order, and the representations must the dishwasher test procedure requiring fairly disclose the test results. AGENCY: Office of Energy Efficiency and water inflow and water pressure criteria Distributors, retailers, and private Renewable Energy, Department of based on a water hookup that allows labelers are held to the same Energy. automatic water inflow into the requirements when making ACTION: Notification of decision and machine during the test cycle. Instead, representations regarding the energy order. CNA suggested an alternate test and water consumption of these procedure in which the water tank is products. (42 U.S.C. 6293(c)) SUMMARY: The U.S. Department of manually filled before the test is run Consistent with 10 CFR 430.27(j), not Energy (‘‘DOE’’) gives notice of a and water consumption is stipulated. later than February 8, 2021, any Decision and Order (Case Number On September 4, 2020, DOE manufacturer currently distributing in 2020–008) that grants to CNA published a notice that announced its commerce in the United States products International, Inc. (‘‘CNA’’) a waiver receipt of the petition for waiver and employing a technology or characteristic from specified portions of the DOE test granted CNA an interim waiver. 85 FR that results in the same need for a procedure for determining the energy 55268 (‘‘Notice of Petition for Waiver’’). waiver from the applicable test and water consumption of specified In the Notice of Petition for Waiver, procedure must submit a petition for dishwashers. Under the Decision and DOE stated that, based on review of waiver. Manufacturers not currently Order CNA is required to test and rate CNA’s petition, certain requirements in distributing such products in commerce the specified basic model of its Appendix C1 are not applicable to the in the United States must petition for dishwasher in accordance with the basic model for which CNA sought a and be granted a waiver prior to the alternate test procedure specified in the waiver and DOE granted CNA an distribution in commerce of those Decision and Order. interim waiver that specified an products in the United States. 10 CFR DATES: The Decision and Order is alternate test procedure that would be 430.27(j). Manufacturers may also effective on December 9, 2020. The appropriate for testing the subject basic submit a request for interim waiver Decision and Order will terminate upon model. 85 FR 55268, 55270–55271. pursuant to the requirements of 10 CFR the compliance date of any future In the Notice of Petition for Waiver, 430.27. amendment to the test procedure for DOE also solicited comments from dishwashers located at title 10 of the interested parties on all aspects of the Signing Authority Code of Federal Regulations (‘‘CFR’’), petition and the specified alternate test This document of the Department of part 430, subpart B, appendix C1 that procedure. 85 FR 55268. DOE received Energy was signed on December 4, 2020, addresses the issues presented in this two comments in response to the Notice by Daniel R Simmons, Assistant waiver. At such time, CNA must use the of Petition for Waiver, and an additional Secretary for Energy Efficiency and relevant test procedure for this product comment response on behalf of CNA. Renewable Energy, pursuant to for any testing to demonstrate After reviewing these comments, DOE delegated authority from the Secretary compliance with the applicable has concluded that absent a waiver, the of Energy. That document with the standards, and any other representations basic model identified by CNA in its original signature and date is of energy use. petition cannot be tested and rated for maintained by DOE. For administrative

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00010 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79172 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

purposes only, and in compliance with Under 42 U.S.C. 6293, EPCA sets forth receipt of the petition for waiver and requirements of the Office of the Federal the criteria and procedures DOE is granted CNA an interim waiver. 85 FR Register, the undersigned DOE Federal required to follow when prescribing or 55268 (‘‘Notice of Petition for Waiver’’). Register Liaison Officer has been amending test procedures for covered In the Notice of Petition for Waiver, authorized to sign and submit the products. EPCA requires that any test DOE reviewed CNA’s application for an document in electronic format for procedures prescribed or amended interim waiver and the alternate test publication, as an official document of under this section must be reasonably procedure requested by CNA. DOE the Department of Energy. This designed to produce test results which stated that, based on review of CNA’s administrative process in no way alters reflect energy efficiency, energy use or petition, the requirements for automatic the legal effect of this document upon estimated annual operating cost of a filling of water into the dishwasher tub publication in the Federal Register. covered product during a representative that are currently specified in Appendix Signed in Washington, DC, on December 4, average use cycle or period of use and C1 are not applicable to the basic model 2020. requires that test procedures not be for which CNA sought a waiver and Treena V. Garrett, unduly burdensome to conduct. (42 instead specified requirements for Federal Register Liaison Officer, U.S. U.S.C.6293(b)(3)) The test procedure for manually filling the water. 85 FR 55268, Department of Energy. dishwashers is contained at 10 CFR part 55270. In particular, DOE stated that the 430, subpart B, appendix C1, ‘‘Uniform water pressure, water meter, water Case #2020–008 Decision and Order Test Method for Measuring the Energy pressure gauge, and water consumption I. Background and Authority Consumption of Dishwashers’’ requirements specified in sections 2.4, (‘‘Appendix C1’’). 3.3, 3.4, and 4.1.3 of Appendix C1 are The Energy Policy and Conservation Any interested person may submit a not applicable because these Act, as amended (‘‘EPCA’’),1 authorizes petition for waiver from DOE’s test requirements are for automatic filling of the U.S. Department of Energy (‘‘DOE’’) procedure requirements. 10 CFR water into the dishwasher. Id. to regulate the energy efficiency of a 430.27(a)(1). DOE will grant a waiver Additionally, DOE prescribed an number of consumer products and from the test procedure requirements if alternate test procedure specifying that certain industrial equipment. (42 U.S.C. DOE determines either that the basic 2 for the basic model of compact 6291–6317) Title III, Part B of EPCA model for which the waiver was dishwasher for which CNA sought a established the Energy Conservation requested contains a design waiver, which does not have a direct Program for Consumer Products Other characteristic that prevents testing of the water line, the built-in reservoir must be Than Automobiles, which sets forth a basic model according to the prescribed manually filled to the full 5-liter variety of provisions designed to test procedures, or that the prescribed reservoir capacity stated by the improve energy efficiency for certain test procedures evaluate the basic model manufacturer using water at a types of consumer products. These in a manner so unrepresentative of its temperature in accordance with section products include dishwashers, the focus true energy consumption characteristics 2.3.3 of Appendix C1. 85 FR 55268, of this document. (42 U.S.C. 6292(a)(6)) as to provide materially inaccurate 55271. DOE also specified modifications The energy conservation program comparative data. 10 CFR 430.27(f)(2). to the detergent requirements in section under EPCA consists essentially of four DOE may grant the waiver subject to 2.9 and 2.10.2 of Appendix C1; for parts: (1) Testing, (2) labeling, (3) conditions, including adherence to section 2.9 of Appendix C1, the Federal energy conservation standards, alternate test procedures. Id. alternate test procedure provides that and (4) certification and enforcement the measurement of the prewash and procedures. Relevant provisions of II. CNA’s Petition for Waiver: Assertions and Determinations main wash fill water volumes need not EPCA include definitions (42 U.S.C. be taken, and for section 2.10.2 of 6291), test procedures (42 U.S.C. 6293), By letter dated June 30, 2020, CNA Appendix C1, DOE specified that the labeling provisions (42 U.S.C. 6294), filed a petition for waiver and a petition main wash water volume for detergent energy conservation standards (42 for interim waiver from the DOE test dose measurement is 0.396 gallons. Id. U.S.C. 6295), and the authority to procedure applicable to dishwashers set Finally, in section 5.4.1 of Appendix C1, require information and reports from forth in Appendix C1. CNA sought a DOE specified that for the compact manufacturers (42 U.S.C. 6296). waiver for a non-soil-sensing, compact dishwasher basic model that is the The Federal testing requirements (countertop) dishwasher because CNA subject of the waiver that does not have consist of test procedures that asserted that the product contains a a direct water line, the water manufacturers of covered products must design characteristic that prevents consumption is equal to 4.8 liters, use as the basis for: (1) Certifying to testing according to the prescribed test which is the volume of water used in DOE that their products comply with procedure. In its petition for waiver, the test cycle. Id. the applicable energy conservation CNA stated that the subject dishwasher In the Notice of Petition for Waiver, standards adopted pursuant to EPCA (42 does not have a water hookup but that DOE also solicited comments from U.S.C. 6295(s)), and (2) making water is provided by manually pouring interested parties on all aspects of the representations about the efficiency of 5 liters of tap water into a built-in tank. petition and the specified alternate test that product (42 U.S.C. 6293(c)). CNA requested DOE waive sections of procedure. 85 FR 55268. DOE received Similarly, DOE must use these test the dishwasher test procedure requiring comments in response to the Notice of procedures to determine whether the water inflow and water pressure criteria Petition for Waiver, one from Whirlpool product complies with relevant based on a water hookup that allows Corporation (‘‘Whirlpool’’) and one from standards promulgated under EPCA. (42 automatic water inflow into the Pacific Gas and Electric Company, San U.S.C. 6295(s)) machine during the test cycle. Instead, Diego Gas and Electric, and Southern CNA suggested an alternate test California Edison, collectively known as 1 All references to EPCA in this document refer procedure in which the water tank is to the statute as amended through America’s Water the California Investor-Owned Utilities manually filled before the test is run 3 Infrastructure Act of 2018, Public Law 115–270 (‘‘CA IOUs’’). (Oct. 23, 2018). and water consumption is stipulated. 2 For editorial reasons, upon codification in the On September 4, 2020, DOE 3 Whirlpool’s comment can be accessed at: U.S. Code, Part B was redesignated as Part A. published a notice that announced its https://beta.regulations.gov/comment/EERE-2020-

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79173

Whirlpool questioned the of the unit under the Appendix C1 test introducing potential variability specification in the Notice of Petition procedure conditions. Id. On October between tests. The additional burden of for Waiver to fill the built-in water 15, 2020, Harris, Wiltshire & Grannis removing the remaining water from the reservoir to the full 5-liter reservoir LLP submitted a letter to DOE providing reservoir would not ensure any more capacity stated by the manufacturer. CNA’s response to the CA IOUs’ accurate of a result than that specified (Whirlpool, No. 0003, at p. 1).4 Instead, comments. CNA noted that the in the Notice of Petition for Waiver and Whirlpool recommended that the proposed test procedure in the Notice of specified in this Decision and Order. alternate test procedure state, ‘‘manually Petition for Waiver requires the supply In response to the comments from the fill the built-in water reservoir to the water to be introduced and maintained CA IOUs and CNA regarding full reservoir capacity stated by the at 50 °F ± 2 °F, in accordance with maintaining water temperature over the manufacturer.’’ Whirlpool commented section 2.3.3 of Appendix C1. (CNA, No. duration of the test, the referenced test that using the manufacturer-stated 0005 at p. 1) CNA stated that the test procedure provision requires reservoir capacity (as opposed to the procedure proposed in the Notice of maintaining the water temperature of specific, 5-liter volume) would address Petition for Waiver would therefore not the input water. See section 2.3.3. of any future variation in reservoir allow the manually filled water in the Appendix C1. This test condition capacity and would also ensure that built-in reservoir to warm up to the reflects the typical installation for future manually filled dishwashers with extent that its temperature exceeds the dishwashers connected to a water reservoirs are not bound to a 5-liter prescribed tolerance of Appendix C1. Id. source that remains at a constant capacity. Id. Whirlpool additionally CNA did not describe the type of temperature during operation. In the commented that the Notice of Petition equipment or methods that would be present case, as during actual consumer for Waiver should not stipulate that the used to maintain the temperature within use, the water is introduced to the built- water consumption is equal to 4.8 liters the specified tolerance over the course in reservoir at the supply temperature for manually filled compact of the test cycle. and then held briefly in the internal dishwashers. (Whirlpool, No. 0003, at p. In response to Whirlpool’s comments, reservoir subject to ambient conditions 2) Instead, Whirlpool recommended DOE notes that the waiver granted in prior to initiation of a usage cycle. measuring the actual water this Decision and Order is for the Requiring during testing that the water consumption as the difference, in terms specific basic model specified by CNA, in the reservoir maintain a constant of water volume or weight, between which has a built-in reservoir capacity temperature of 50° ±2 °F throughout the water in the reservoir before the test of 5 liters and consumes 4.8 liters cycle would not be representative of the cycle and after the test cycle. Id. during a test cycle. If there were to be average use of the dishwasher in actual The CA IOUs commented that they any future variation in reservoir use. generally agree with the alternate test capacity, or if in the future other While DOE does not have data to procedure provided in the Notice of manually-filled dishwashers with support any particular length of time Petition for Waiver but that the test reservoirs are available on the market, during which the water in the reservoir procedure would allow water in the this Decision and Order would not be would warm up beyond the ±2 °F tank to deviate from Appendix C1 applicable to those basic models and a specified in the test procedure, DOE temperature tolerances, possibly new waiver petition would need to be notes that the user manual 5 for this resulting in a more efficient measured submitted to DOE. See 10 CFR 430.27(g) basic model provides a sequence of wash cycle than would exist under and (j). Therefore, DOE is maintaining operations for initiating a wash cycle as standard test tolerances. (CA IOUs, No. the specific water volumes in this follows: 0004, at p. 1, 2) The CA IOUs further Decision and Order for the specific basic (1) Press the power button; stated that the interim waiver test model to which this waiver is (2) Open the tank lid on the top of the procedure only requires that water at 50 applicable, and clarifying that the dishwasher and pour 5 liters of water degrees Fahrenheit (‘‘°F’’) ± 2 °F be filled manual fill volume applies to each into the water tank; in the tank at the start of the test, but preconditioning cycle as well as the test (3) Select the desired function using does not include any provisions to cycle. As soon as practicable after the the Wash Mode buttons, and then push maintain the water temperature over the granting of any waiver, DOE will the Start/Pause button; if the [Start/ duration of the test. (CA IOUs, No. 0004, publish in the Federal Register a notice Pause button] is not pressed, the unit at p. 2) The CA IOUs commented that of proposed rulemaking to amend its will start the wash cycle automatically if the temperature is not maintained regulations so as to eliminate any need after 10 seconds. over the duration of the test, the worst- for the continuation of such waiver. 10 NOTE: If no buttons are pressed after the case scenario would be that the water in CFR 430.27(l). As soon thereafter as power is turned on, the unit will the built-in reservoir could warm up by practicable, DOE will publish in the automatically go back to Standby mode after potentially 20 °F, to the room Federal Register a final rule. Id. At such 2 minutes. temperature in the test lab. Id. The CA time, DOE will consider specifying Given these user manual IOUs recommended using a direct generally applicable requirements specifications, DOE is including in the water-cooling system to keep the water regarding water volume capacity. alternate test procedure a 2-minute in the reservoir at 50 °F ± 2 °F for the Additionally, DOE is not requiring the maximum duration for starting the test duration of the test to ensure that the measurement of the actual water cycle after preparing the unit for testing, energy consumption results are consumption as suggested by Whirlpool, including filling the built-in reservoir. comparable to those of other compact because a procedure to weigh the The specified 2-minute duration from dishwashers and reflect the performance remaining water in the reservoir may be powering on the dishwasher to reverting unduly burdensome. As indicated by to standby mode shows that users BT-WAV-0024-0003 and CA IOU’s comment can be the materials reviewed, the water would start a wash cycle within this accessed at: https://beta.regulations.gov/comment/ reservoir of the basic model specified in time period during typical use. Starting EERE-2020-BT-WAV-0024-0004. CNA’s petition is integrated into the 4 The parenthetical reference provides a reference a test cycle within this 2-minute period for the comment as follows (commenter name, dishwasher (i.e., it cannot be removed). comment docket ID number, page of that DOE is unaware of a method to remove 5 Available online at https://mcappliance.com/ document). the remaining water completely without media/manuals/MCSCD3W.pdf.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79174 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

would produce results that are basic models’ true energy consumption 2.6.2.1 For compact dishwashers that do representative of actual use. characteristics. 10 CFR 430.27(k)(1). not have a direct water line, power on the Therefore, the alternate test procedure Likewise, CNA may request that DOE dishwasher and then manually fill the built- specified in this Decision and Order rescind or modify the waiver if the in water reservoir to the full 5-liter reservoir requires that the test cycle must begin capacity stated by the manufacturer, using company discovers an error in the water at a temperature in accordance with within two minutes after powering on information provided to DOE as part of section 2.3.3 of this appendix. Begin the test the dishwasher, as specified in the its petition, determines that the waiver cycle within two minutes after powering on manufacturer instructions. This time is no longer needed, or for other the dishwasher, as specified in the period includes filling water in the appropriate reasons. 10 CFR manufacturer instructions. built-in reservoir, consistent with the 430.27(k)(2). In section 2.9, Preconditioning manufacturer instructions. As set forth above, the test procedure For the reasons explained here and in requirements, add at the end of the specified in this Decision and Order is section: the Notice of Petition for Waiver, absent not the same as the test procedure a waiver the basic model identified by offered by CNA. If CNA believes that the For compact dishwashers that do not have CNA in its petition cannot be tested and alternate test method it suggested a direct water line, for each preconditioning rated for energy and water consumption cycle as defined in section 1.15 of this provides representative results and is appendix, manually fill the built-in water on a basis representative of its true less burdensome than the test method energy and water consumption reservoir to the full 5-liter reservoir capacity required by this Decision and Order, stated by the manufacturer, using water at a characteristics. DOE has reviewed the CNA may submit a request for temperature in accordance with section 2.3.3 recommended procedure suggested by modification under 10 CFR 430.27(k)(2)/ of this appendix. Measurement of the CNA and concludes that, as modified in 431.401(k)(2) that addresses the prewash fill water volume, Vpw, if any, and this Decision and Order, it will allow for concerns that DOE has specified with measurement of the main wash fill water the accurate measurement of the energy that procedure. CNA may also submit volume, Vmw, are not taken. and water use of the product, while another less burdensome alternative test In section 2.10.2, Main Wash alleviating the testing problems procedure not expressly considered in Detergent Dosing, add at the end of the associated with CNA’s implementation this notice under the same provision. section: of DOE’s applicable dishwashers test procedure for the specified basic model. III. Consultations With Other Agencies For compact dishwashers that do not have DOE specifies a minor modification to a direct water line, the Vmw is equal to 0.396 In accordance with 10 CFR gallons (1.5 liters), which is the water CNA’s recommended test procedure, 430.27(f)(2), DOE consulted with the capacity used in the main wash stage of the which is to begin the test cycle within Federal Trade Commission staff test cycle. two minutes after powering on the concerning the CNA petition for waiver. dishwasher and filling water in the In section 3.3, Water meter, add at the built-in reservoir. This update is IV. Order end of the section: expected to produce a representative After careful consideration of all the For compact dishwashers that do not have measure of energy efficiency. material that was submitted by CNA, a direct water line, these water meter Thus, DOE is requiring that CNA test and comments received, in this matter, conditions do not apply. Water is added and rate the specified dishwasher basic it is ORDERED that: manually pursuant to section 2.6.2.1 of this model according to the alternate test (1) CNA must, as of the date of appendix. procedure specified in this Decision and publication of this Order in the Federal In section 3.4, Water pressure gauge, Order, which is similar to the procedure Register, test and rate the following add at the end of the section: provided in the interim waiver, but dishwasher basic model with the For compact dishwashers that do not have includes minor modifications following alternate test procedure as set forth in a direct water line, these water pressure consideration of stakeholder comments. paragraph (2): gauge conditions do not apply. Water is This Decision and Order is applicable added manually pursuant to section 2.6.2.1 only to the basic model listed and does Brand Basic model of this appendix. not extend to any other basic models. In section 4.1.3, Water consumption, Magic Chef ...... MCSCD3W DOE evaluates and grants waivers for add at the end of the section: only those basic models specifically set out in the petition, not future models (2) The alternate test procedure for the For compact dishwashers that do not have that may be manufactured by the CNA basic model listed in paragraph (1) a direct water line, these water consumption measurement requirements do not apply. petitioner. CNA may request that DOE of this Order is the test procedure for dishwashers prescribed by DOE at 10 Water is added manually pursuant to section extend the scope of this waiver to 2.6.2.1 of this appendix. include additional basic models that CFR part 430, subpart B, appendix C1, employ the same technology as those with the modifications provided below. In section 5.4.1, Water consumption listed in this waiver. 10 CFR 430.27(g). All other requirements of Appendix C1 for non-soil-sensing electric dishwashers CNA may also submit another petition and DOE’s other relevant regulations using electrically heated, gas-heated, or for waiver from the test procedure for remain applicable. oil-heated water, add at the end of the additional basic models that employ a In section 2.4, Water pressure, add at section: different technology and meet the the end of the section: For compact dishwashers that do not have criteria for test procedure waivers. 10 For compact dishwashers that do not have a direct water line, the water consumption is CFR 430.27(a)(1). a direct water line, these water pressure equal to 4.8 liters, which is the volume of DOE notes that it may modify or conditions do not apply because the water water used in the test cycle. rescind the waiver at any time upon will be added manually according to section (3) Representations. CNA may not DOE’s determination that the factual 2.6.2.1. make representations about the energy basis underlying the petition for waiver Following section 2.6.2, Non-soil- and water use of the basic model listed is incorrect, or upon a determination sensing dishwashers to be tested at a in paragraph (1) of this Order for that the results from the alternate test nominal inlet temperature of 50 °F or compliance or marketing, unless the procedure are unrepresentative of the 120 °F, add section 2.6.2.1 to read: basic model has been tested in

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00013 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79175

accordance with the provisions set forth (TO2021) of Southern California Edison Docket Numbers: ER21–543–000. above and such representations fairly Company. Applicants: Southwest Power Pool, disclose the results of such testing. Filed Date: 11/20/20. Inc. (4) This waiver shall remain in effect Accession Number: 20201120–5217. Description: § 205(d) Rate Filing: according to the provisions of 10 CFR Comments Due: 5 p.m. ET 12/11/20. 2066R9 Evergy Kansas Central, Inc. 430.27. Docket Numbers: ER20–391–001; NITSA NOA—Muscotah to be effective (5) DOE issues this waiver on the ER20–391–002; ER20–391–003. 9/1/2020. condition that the statements, Applicants: J. Aron & Company LLC. Filed Date: 12/3/20. representations, and information Description: Supplement to Updated Accession Number: 20201203–5022. provided by CNA are valid. If CNA Market Power Analysis for the Comments Due: 5 p.m. ET 12/24/20. makes any modifications to the controls Northwest Region and Notices of Non- Docket Numbers: ER21–544–000. or configurations of the basic model, Material Change in Status of J. Aron & Applicants: Southwest Power Pool, such modifications will render the Company LLC. Inc. waiver invalid with respect to that basic Filed Date: 12/2/20. Description: § 205(d) Rate Filing: model, and CNA will either be required Accession Number: 20201202–5281. 2491R8 Evergy Kansas Central, Inc. to use the current Federal test method Comments Due: 5 p.m. ET 12/23/20. NITSA NOA—Scranton to be effective or submit a new application for a test Docket Numbers: ER20–2654–000. 9/1/2020. procedure waiver. DOE may rescind or Applicants: Clear Power LLC. Filed Date: 12/3/20. modify this waiver at any time if it Description: Supplement to August Accession Number: 20201203–5026. determines the factual basis underlying 12, 2020 Clear Power LLC tariff filing. Comments Due: 5 p.m. ET 12/24/20. the petition for waiver is incorrect, or Filed Date: 12/2/20. Docket Numbers: ER21–545–000. the results from the alternate test Accession Number: 20201202–5278. Applicants: PJM Interconnection, procedure are unrepresentative of a Comments Due: 5 p.m. ET 12/23/20. L.L.C. basic model’s true energy consumption Description: Tariff Cancellation: characteristics. 10 CFR 430.27(k)(1). Docket Numbers: ER20–3008–001. Applicants: Southwest Power Pool, Notice of Cancellation of ISA, Service Likewise, CNA may request that DOE Agreement No. 4756; Queue No. W4– rescind or modify the waiver if CNA Inc. Description: Tariff Amendment: 005 to be effective 12/21/2020. discovers an error in the information Filed Date: 12/3/20. Amended Filing—Revisions to Modify provided to DOE as part of its petition, Accession Number: 20201203–5049. Schedule 1–A and Formula Rate determines that the waiver is no longer Comments Due: 5 p.m. ET 12/24/20. Template to be effective 1/1/2021. needed, or for other appropriate reasons. Filed Date: 12/3/20. Docket Numbers: ER21–546–000. 10 CFR 430.27(k)(2). Applicants: PJM Interconnection, (6) CNA remains obligated to fulfill Accession Number: 20201203–5079. Comments Due: 5 p.m. ET 12/14/20. L.L.C. any certification requirements set forth Description: Tariff Cancellation: at 10 CFR part 429. Docket Numbers: ER21–539–000. Notice of Cancellation of ISA, SA No. Applicants: Southwest Power Pool, Signed in Washington, DC, on December 4, 5744; Queue No. AF1–324 to be Inc. 2020. effective 12/3/2020. Description: § 205(d) Rate Filing: Daniel R Simmons, Filed Date: 12/3/20. 1895R9 Evergy Kansas Central, Inc. Accession Number: 20201203–5050. Assistant Secretary for Energy Efficiency and NITSA NOA—Wathena to be effective Renewable Energy. Comments Due: 5 p.m. ET 12/24/20. 9/1/2020. Docket Numbers: ER21–547–000. [FR Doc. 2020–27039 Filed 12–8–20; 8:45 am] Filed Date: 12/3/20. Applicants: Southwest Power Pool, BILLING CODE 6450–01–P Accession Number: 20201203–5009. Inc., Tri-State Generation and Comments Due: 5 p.m. ET 12/24/20. Transmission Association, Inc. DEPARTMENT OF ENERGY Docket Numbers: ER21–540–000. Description: § 205(d) Rate Filing: Tri- Applicants: Techren Solar III LLC. State Generation and Transmission Federal Energy Regulatory Description: Baseline eTariff Filing: Association, Inc. Formula Rate to be Commission Certificate of Concurrence Filing to be effective 2/1/2021. effective 12/4/2020. Filed Date: 12/3/20. Combined Notice of Filings #1 Filed Date: 12/3/20. Accession Number: 20201203–5052. Accession Number: 20201203–5012. Take notice that the Commission Comments Due: 5 p.m. ET 12/24/20. Comments Due: 5 p.m. ET 12/24/20. received the following electric rate Docket Numbers: ER21–548–000. filings: Docket Numbers: ER21–541–000. Applicants: PJM Interconnection, Docket Numbers: ER15–2028–009. Applicants: Techren Solar IV LLC. L.L.C. Applicants: Southwest Power Pool, Description: Baseline eTariff Filing: Description: Tariff Cancellation: Inc. Certificate of Concurrence Filing to be Notice of Cancellation of ISA, SA No. Description: Compliance filing: effective 12/4/2020. 5736; Queue No. AF1–326 to be Compliance Filing in Response to Order Filed Date: 12/3/20. effective 12/3/2020. issued in ER15–2028–005 (NIMECA) to Accession Number: 20201203–5015. Filed Date: 12/3/20. be effective N/A. Comments Due: 5 p.m. ET 12/24/20. Accession Number: 20201203–5107. Filed Date: 12/3/20. Docket Numbers: ER21–542–000. Comments Due: 5 p.m. ET 12/24/20. Accession Number: 20201203–5046. Applicants: Techren Solar V LLC. Docket Numbers: ER21–550–000. Comments Due: 5 p.m. ET 12/24/20. Description: Baseline eTariff Filing: Applicants: PJM Interconnection, Docket Numbers: ER19–1553–000. Certificate of Concurrence Filing to be L.L.C. Applicants: Southern California effective 12/4/2020. Description: Tariff Cancellation: Edison Company. Filed Date: 12/3/20. Notice of Cancellation of ISA, SA No. Description: Annual Formula Accession Number: 20201203–5017. 5738; Queue No. AF1–327 to be Transmission Rate Update Filing Comments Due: 5 p.m. ET 12/24/20. effective 12/3/2020.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00014 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79176 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Filed Date: 12/3/20. Description: Tariff Cancellation: with the Commission and is available Accession Number: 20201203–5109. Notice of Electric Tariff Cancellation to for public inspection: Comments Due: 5 p.m. ET 12/24/20. be effective 12/31/2020. a. Application Type: Non-capacity Docket Numbers: ER21–551–000. Filed Date: 12/3/20. Amendment of Exemption. Applicants: Brunswick Cellulose LLC. Accession Number: 20201203–5131. b. Project No: 5912–003. Description: Tariff Cancellation: Comments Due: 5 p.m. ET 12/24/20. c. Date Filed: November 23, 2020. Notice of Electric Tariff Cancellation to Docket Numbers: ER21–559–000. d. Applicant: Town of Dover-Foxcroft. be effective 12/31/2020. Applicants: Georgia-Pacific Consumer e. Name of Project: Moosehead Filed Date: 12/3/20. Operations LLC, Green Bay. Hydroelectric Project. Accession Number: 20201203–5110. Description: Tariff Cancellation: f. Location: The project is located on Comments Due: 5 p.m. ET 12/24/20. Notice of Electric Tariff Cancellation to the Piscataquis River in Piscataquis be effective 12/31/2020. County, Maine. Docket Numbers: ER21–552–000. g. Filed Pursuant to: Public Utility Filed Date: 12/3/20. Applicants: GP Big Island, LLC. Regulatory Policies Act of 1978, 16 Description: Tariff Cancellation: Accession Number: 20201203–5132. Comments Due: 5 p.m. ET 12/24/20. U.S.C. 2705, 2708. Notice of Electric Tariff Cancellation to h. Applicant Contact: Jack Clukey, be effective 12/31/2020. Docket Numbers: ER21–560–000. Town of Dover-Foxcroft, 43 Morton Filed Date: 12/3/20. Applicants: Georgia-Pacific Consumer Avenue, Suite A, Dover-Foxcroft, ME Accession Number: 20201203–5111. Operations LLC, Green Bay. 04426; phone: (207) 564–3318; email Comments Due: 5 p.m. ET 12/24/20. Description: Tariff Cancellation: [email protected]. Docket Numbers: ER21–553–000. Notice of Electric Tariff Cancellation to i. FERC Contact: Elizabeth Moats, Applicants: Georgia-Pacific Brewton be effective 12/31/2020. (202) 502–6632, elizabeth.osiermoats@ LLC. Filed Date: 12/3/20. ferc.gov. Description: Tariff Cancellation: Accession Number: 20201203–5134. j. Deadline for filing comments, Notice of Electric Tariff Cancellation to Comments Due: 5 p.m. ET 12/24/20. motions to intervene, and protests: be effective 12/31/2020. The filings are accessible in the January 4, 2021. Filed Date: 12/3/20. Commission’s eLibrary system (https:// The Commission strongly encourages Accession Number: 20201203–5112. elibrary.ferc.gov/idmws/search/ electronic filing. Please file comments, Comments Due: 5 p.m. ET 12/24/20. fercgensearch.asp) by querying the motions to intervene, and protests using Docket Numbers: ER21–554–000. docket number. the Commission’s eFiling system at Applicants: Ameren Illinois Any person desiring to intervene or http://www.ferc.gov/docs-filing/ Company. protest in any of the above proceedings efiling.asp. Commenters can submit Description: § 205(d) Rate Filing: must file in accordance with Rules 211 brief comments up to 6,000 characters, Reimbursement Agreement, RS 153, and 214 of the Commission’s without prior registration, using the Prairie Power Shelbyville to be effective Regulations (18 CFR 385.211 and eComment system at http:// 2/2/2021. 385.214) on or before 5:00 p.m. Eastern www.ferc.gov/docs-filing/ Filed Date: 12/3/20 time on the specified comment date. ecomment.asp. You must include your Accession Number: 20201203–5115. Protests may be considered, but name and contact information at the end Comments Due: 5 p.m. ET 12/24/20. intervention is necessary to become a of your comments. For assistance, Docket Numbers: ER21–555–000. party to the proceeding. please contact FERC Online Support at Applicants: Georgia-Pacific Cedar eFiling is encouraged. More detailed [email protected], (866) Springs LLC. information relating to filing 208–3676 (toll free), or (202) 502–8659 Description: Tariff Cancellation: requirements, interventions, protests, (TTY). In lieu of electronic filing, you Notice of Electric Tariff Cancellation to service, and qualifying facilities filings may submit a paper copy. Submissions be effective 12/31/2020. can be found at: http://www.ferc.gov/ sent via the U.S. Postal Service must be Filed Date: 12/3/20. docs-filing/efiling/filing-req.pdf. For addressed to: Kimberly D. Bose, Accession Number: 20201203–5117. other information, call (866) 208–3676 Secretary, Federal Energy Regulatory Comments Due: 5 p.m. ET 12/24/20. (toll free). For TTY, call (202) 502–8659. Commission, 888 First Street NE, Room Docket Numbers: ER21–556–000. Dated: December 3, 2020. 1A, Washington, DC 20426. Applicants: Georgia-Pacific Consumer Kimberly D. Bose, Submissions sent via any other carrier Operations LLC, Green Bay. Secretary. must be addressed to: Kimberly D. Bose, Description: Tariff Cancellation: Secretary, Federal Energy Regulatory [FR Doc. 2020–27036 Filed 12–8–20; 8:45 am] Notice of Electric Tariff Cancellation to Commission, 12225 Wilkins Avenue, be effective 12/31/2020. BILLING CODE 6717–01–P Rockville, Maryland 20852. The first Filed Date: 12/3/20. page of any filing should include the Accession Number: 20201203–5120. DEPARTMENT OF ENERGY docket number P–5912–003. Comments Comments Due: 5 p.m. ET 12/24/20. emailed to Commission staff are not Docket Numbers: ER21–557–000. Federal Energy Regulatory considered part of the Commission Applicants: Georgia-Pacific Commission record. Monticello LLC. The Commission’s Rules of Practice Description: Tariff Cancellation: [Project No. 5912–003] and Procedure require all intervenors Notice of Electric Tariff Cancellation to Town of Dover-Foxcroft; Notice of filing documents with the Commission be effective 12/31/2020. Application for Amendment of to serve a copy of that document on Filed Date: 12/3/20. Exemption Accepted for Filing and each person whose name appears on the Accession Number: 20201203–5122. Soliciting Comments, Motions To official service list for the project. Comments Due: 5 p.m. ET 12/24/20. Intervene, and Protests Further, if an intervenor files comments Docket Numbers: ER21–558–000. or documents with the Commission Applicants: Georgia-Pacific Consumer Take notice that the following relating to the merits of an issue that Operations LLC, Green Bay. hydroelectric application has been filed may affect the responsibilities of a

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00015 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79177

particular resource agency, they must number of the person commenting, Applicants: Northwest Pipeline LLC. also serve a copy of the document on protesting or intervening; and (4) Description: § 4(d) Rate Filing: Non that resource agency. otherwise comply with the requirements Conforming Service Agreements—XTO, k. Description of Request: The of 18 CFR 385.2001 through 385.2005. Citadel, Cascade to be effective 1/2/ exemptee requests to amend its All comments, motions to intervene, or 2021. exemption by replacing the two protests must set forth their evidentiary Filed Date: 12/2/20. authorized, non-operational units (total basis. Any filing made by an intervenor Accession Number: 20201202–5073. capacity of 300 kilowatt) with a single must be accompanied by proof of Comments Due: 5 p.m. ET 12/14/20. unit of the same capacity. The exemptee service on all persons listed in the Docket Numbers: RP21–290–000. also proposes to replace and upgrade service list prepared by the Commission Applicants: Algonquin Gas powerhouse equipment and in this proceeding, in accordance with Transmission, LLC. infrastructure, repair the existing dam 18 CFR 385.2010. Description: § 4(d) Rate Filing: and fish ladder, and add a new intake Negotiated Rate—Yankee Gas 510802 eff Dated: December 3, 2020. structure with movable fish screens and 12–3–2020 to be effective 12/3/2020. bypass channel for downstream fish Kimberly D. Bose, Filed Date: 12/2/20. passage. The proposal will not change Secretary. Accession Number: 20201202–5100. the nameplate capacity or discharge at [FR Doc. 2020–27035 Filed 12–8–20; 8:45 am] Comments Due: 5 p.m. ET 12/14/20. the project. The exemptee has consulted BILLING CODE 6717–01–P Docket Numbers: RP21–291–000. with the resource agencies on the Applicants: Iroquois Gas proposed amendment. The work would Transmission System, L.P. require a drawdown of the reservoir and DEPARTMENT OF ENERGY Description: § 4(d) Rate Filing: 120220 would begin in July 2021. Negotiated Rates—Castleton l. Locations of the Application: This Federal Energy Regulatory Commodities Merchant Trading R– filing may be viewed on the Commission 4010–28 to be effective 12/3/2020. Commission’s website at http:// Filed Date: 12/2/20. Combined Notice of Filings www.ferc.gov using the eLibrary link. Accession Number: 20201202–5111. Enter the docket number excluding the Take notice that the Commission has Comments Due: 5 p.m. ET 12/14/20. last three digits in the docket number received the following Natural Gas Docket Numbers: RP21–292–000. field to access the document. You may Pipeline Rate and Refund Report filings: Applicants: Iroquois Gas also register online at http:// Docket Numbers: RP20–1111–002. Transmission System, L.P. www.ferc.gov/docs-filing/ Applicants: Transcontinental Gas Description: § 4(d) Rate Filing: 120220 esubscription.asp to be notified via Pipe Line Company. Negotiated Rates—Castleton email of new filings and issuances Description: Compliance filing GT&C Commodities Merchant Trading R– related to this or other pending projects. Section 49—Bid Evaluation— 4010–27 to be effective 12/3/2020. For assistance, call 1–866–208–3676 or Compliance Filing to be effective 1/2/ Filed Date: 12/2/20. email [email protected], for Accession Number: 20201202–5113. 2021. Comments Due: 5 p.m. ET 12/14/20. TTY, call (202) 502–8659. Agencies may Filed Date: 12/2/20. obtain copies of the application directly Accession Number: 20201202–5097. Docket Numbers: RP21–293–000. from the applicant. Comments Due: 5 p.m. ET 12/14/20. Applicants: Rockies Express Pipeline m. Individuals desiring to be included LLC. on the Commission’s mailing list should Docket Numbers: RP21–241–001. Description: § 4(d) Rate Filing: REX so indicate by writing to the Secretary Applicants: Southern Star Central Gas 2020–12–02 Negotiated Rate of the Commission. Pipeline, Inc. Agreements to be effective 12/2/2020. n. Comments, Protests, or Motions to Description: Compliance filing Filed Date: 12/2/20. Intervene: Anyone may submit Annual Cash-Out Activity Report Accession Number: 20201202–5176. comments, a protest, or a motion to 2020—Correction to be effective N/A. Comments Due: 5 p.m. ET 12/14/20. intervene in accordance with the Filed Date: 12/2/20. The filings are accessible in the requirements of Rules of Practice and Accession Number: 20201202–5129. Commission’s eLibrary system (https:// Procedure, 18 CFR 385.210, .211, .214, Comments Due: 5 p.m. ET 12/14/20. elibrary.ferc.gov/idmws/search/ respectively. In determining the Docket Numbers: RP21–287–000. fercgensearch.asp) by querying the appropriate action to take, the Applicants: Southern Natural Gas docket number. Commission will consider all protests or Company, L.L.C. Any person desiring to intervene or other comments filed, but only those Description: Compliance filing protest in any of the above proceedings who file a motion to intervene in Abandon Tenneco X-Rate Schedules must file in accordance with Rules 211 accordance with the Commission’s Compliance Filing to be effective 2/1/ and 214 of the Commission’s Rules may become a party to the 2021. Regulations (18 CFR 385.211 and proceeding. Any comments, protests, or Filed Date: 12/2/20. 385.214) on or before 5:00 p.m. Eastern motions to intervene must be received Accession Number: 20201202–5013. time on the specified comment date. on or before the specified comment date Comments Due: 5 p.m. ET 12/14/20. Protests may be considered, but for the particular application. Docket Numbers: RP21–288–000. intervention is necessary to become a o. Filing and Service of Documents: Applicants: Rover Pipeline LLC. party to the proceeding. Any filing must: (1) Bear in all capital Description: § 4(d) Rate Filing: eFiling is encouraged. More detailed letters the title COMMENTS, PROTEST, Summary of Negotiated Rate Capacity information relating to filing or MOTION TO INTERVENE as Release Agreements on 12–2–20 to be requirements, interventions, protests, applicable; (2) set forth in the heading effective 12/1/2020. service, and qualifying facilities filings the name of the applicant and the Filed Date: 12/2/20. can be found at: http://www.ferc.gov/ project number of the application to Accession Number: 20201202–5044. docs-filing/efiling/filing-req.pdf. For which the filing responds; (3) furnish Comments Due: 5 p.m. ET 12/14/20. other information, call (866) 208–3676 the name, address, and telephone Docket Numbers: RP21–289–000. (toll free). For TTY, call (202) 502–8659.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00016 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79178 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Dated: December 3, 2020. sent via the U.S. Postal Service must be yard, largely to incorporate a new Kimberly D. Bose, addressed to: Kimberly D. Bose, transformer, so that the 115-kV Grizzly Secretary. Secretary, Federal Energy Regulatory Tap may be stepped up to 230-kV and [FR Doc. 2020–27033 Filed 12–8–20; 8:45 am] Commission, 888 First Street NE, Room connected to the existing Bucks Creek- BILLING CODE 6717–01–P 1A, Washington, DC 20426. Cresta 230-kV line. The applicants state Submissions sent via any other carrier that all activities associated with its must be addressed to: Kimberly D. Bose, non-capacity amendment application DEPARTMENT OF ENERGY Secretary, Federal Energy Regulatory would occur within the existing Commission, 12225 Wilkins Avenue, footprint of the previously disturbed Federal Energy Regulatory Rockville, Maryland 20852. The first areas of the substation yard, the adjacent Commission page of any filing should include docket parking areas and roads, and the Grizzly number P–619–171. Comments emailed Tap transmission right of way, and [P–619–171] to Commission staff are not considered included an Exhibit E (environmental Pacific Gas and Electric Company, City part of the Commission record. assessment) along with the application. of Santa Clara, California; Notice of The Commission’s Rules of Practice l. Locations of the Applications: The Application Accepted for Filing and require all intervenors filing documents Commission provides all interested Soliciting Comments, Motions To with the Commission to serve a copy of persons an opportunity to view and/or Intervene, and Protests that document on each person on the print the contents of this document via official service list for the project. the internet through the Commission’s Take notice that the following Further, if an intervenor files comments website at http://www.ferc.gov/docs- hydroelectric application has been filed or documents with the Commission filing/elibrary.asp. Enter the docket with the Commission and is available relating to the merits of an issue that number excluding the last three digits in for public inspection. may affect the responsibilities of a the docket number field to access the a. Type of Application: Non-capacity particular resource agency, they must document. You may also register online amendment of license.. also serve a copy of the document on at http://www.ferc.gov/docs-filing/ b. Project No.: 619–171. that resource agency. esubscription.asp to be notified via c. Date Filed: November 24, 2020. k. Description of Request: The email of new filings and issuances d. Applicants: Pacific Gas and Electric applicants propose to reconnect the related to this or other pending projects. Company, and City of Santa Clara, Grizzly Powerhouse to the grid. The Agencies may obtain copies of the California. Grizzly Powerhouse connects to the grid application directly from the applicants. e. Name of Project: Bucks Creek at Pacific Gas and Electric Company’s At this time, the Commission has Hydroelectric Project. (PG&E) Caribou-Palermo transmission suspended access to the Commission’s f. Location: The project is located on line, via the project’s 115-kV Public Reference Room due to the the North Fork Feather River and Bucks transmission line referred to as the proclamation declaring a National and Grizzly creeks in Plumas County, Grizzly Tap. In November 2018, the Emergency concerning the Novel California. Caribou-Palermo transmission line was Coronavirus Disease (COVID–19), issued g. Filed Pursuant to: Federal Power de-energized as a result of damage from by the President on March 13, 2020. For Act, 16 U.S.C. 791 (a)–825(r). the Camp Fire, forcing the Grizzly assistance, contact FERC at h. Applicant Contacts: Ms. Elisabeth Powerhouse out of service. Following [email protected] or call Rossi, Pacific Gas & Electric Company, the Camp Fire, PG&E committed to toll free, (866) 208–3676 or TTY, (202) 245 Market Street, San Francisco, CA permanently de-energizing the Caribou- 502–8659. 94105, (415) 531–5186, Mr. Chris Palermo line. The applicants propose to m. Individuals desiring to be included Karwick, Silicon Valley Power/City of reconnect the Grizzly Powerhouse to the on the Commission’s mailing list should Santa Clara, 1705 Martin Avenue, Santa grid by removing the connection from so indicate by writing to the Secretary Clara, CA 95054, (408) 615–6554. the Caribou-Palermo line and of the Commission. i. FERC Contact: Mr. Korede Olagbegi, interconnecting the Grizzly Tap at the n. Comments, Motions to Intervene, or (202) 502–6268, Korede.Olagbegi@ 230-kV Bucks Creek-Cresta transmission Protests: Anyone may submit ferc.gov. line instead, which begins in the Bucks comments, a motion to intervene, or a j. Deadline for filing comments, Creek substation yard (substation yard), protest in accordance with the motions to intervene, and protests is 30 and is part of the project. requirements of Rules of Practice and days from the issuance of this notice. The applicants propose a 3-phase Procedure, 18 CFR 385.210, .211, .214. The Commission strongly encourages process in order to facilitate the In determining the appropriate action to electronic filing. Please file comments, reconnection to the grid. In the first take, the Commission will consider all motions to intervene, and protests using phase, which it has already completed, protests or other comments filed, but the Commission’s eFiling system at the applicants removed a 900-foot-long only those who file a motion to http://www.ferc.gov/docs-filing/ section of the Grizzly Tap, spanning intervene in accordance with the efiling.asp. Commenters can submit from the substation yard to the Caribou- Commission’s Rules may become a brief comments up to 6,000 characters, Palermo line. The applicants report that party to the proceeding. Any comments, without prior registration, using the they did not engage in any ground- motions to intervene, or protests must eComment system at http:// disturbing activity to remove the be received on or before the specified www.ferc.gov/doc-sfiling/ section. The applicants state that they comment date for the particular ecomment.asp. You must include your are currently finalizing the design of the application. name and contact information at the end reconnection, but propose in the second o. Filing and Service of Responsive of your comments. For assistance, and third phase to reinforce an existing Documents: Any filing must (1) bear in please contact FERC Online Support at access bridge with steel plates to all capital letters the title COMMENTS, [email protected], (866) support the weight of vehicles MOTION TO INTERVENE, or PROTEST 208–3676 (toll free), or (202) 502–8659 transporting new electrical equipment, as applicable; (2) set forth in the (TTY). In lieu of electronic filing, you remove a lattice tower in the substation heading the name of the applicant and may send a paper copy. Submissions yard, and to reconfigure the substation the project number of the application to

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79179

which the filing responds; (3) furnish to provide independent scientific and affects a relevant area of science/ the name, address, and telephone technical advice to the EPA technology. number of the person protesting or Administrator on the scientific and • Honorable Mention awards intervening; and (4) otherwise comply technical basis for agency positions and acknowledge research efforts that are with the requirements of 18 CFR regulations. The SAB is a Federal noteworthy but do not warrant a Level 385.2001 through 385.2005. Advisory Committee chartered under I, II or III award. Honorable Mention All comments, motions to intervene, the Federal Advisory Committee Act applies to research that: (1) May not or protests must set forth their (FACA), 5 U.S.C., App. 2. The SAB will quite reach the level described for a evidentiary basis. A copy of all other comply with the provisions of FACA Level III award; (2) show a promising filings in reference to this application and all appropriate SAB Staff Office area of research that the Subcommittee must be accompanied by proof of procedural policies. Pursuant to FACA wants to encourage; or (3) show an area service on all persons listed in the and EPA policy, notice is hereby given of research that the Subcommittees feels service list prepared by the Commission that the Science Advisory Board is too preliminary to warrant an award in this proceeding, in accordance with Scientific and Technological recommendation at this time. 18 CFR 385.2010. Achievement Awards (STAA) The SAB reviews the STAA Committee, will hold a closed meeting Dated: December 3, 2020. nomination packages according to the to review the 2020 STAA nominations following five evaluation factors: Kimberly D. Bose, and to make recommendations for • Secretary. The extent to which the work awards and recommendations for reported in the nominated [FR Doc. 2020–27034 Filed 12–8–20; 8:45 am] improvement of the Agency’s STAA publication(s) resulted in either new or BILLING CODE 6717–01–P program. significantly revised knowledge. The The STAA awards are established to accomplishment is expected to honor and recognize EPA employees represent an important advancement of ENVIRONMENTAL PROTECTION who have made outstanding scientific knowledge or technology AGENCY contributions in the advancement of relevant to environmental issues and science and technology through their [FRL–10017–41–OA] EPA’s mission. research and development activities, as • The extent to which environmental exhibited in publication of their results Notification of a Closed Meeting of the protection has been strengthened or in peer reviewed journals. In conducting Science Advisory Board 2020 improved, whether of local, national, or its review, the SAB considers each Scientific and Technological international importance. nomination in relation to the following Achievement Awards Committee • The degree to which the research is four award levels: a product of the originality, AGENCY: Environmental Protection • Level I awards are for those who creativeness, initiative, and problem- Agency (EPA). have accomplished an exceptionally solving ability of the researchers, as well ACTION: Notice. high-quality research or technological effort. The awards recognize the as the level of effort required to produce the results. SUMMARY: The Environmental Protection creation or general revision of a • Agency (EPA) Science Advisory Board scientific or technological principle or The extent of the beneficial impact (SAB) Staff Office announces a meeting procedure, or a highly significant of the research and the degree to which of the Scientific and Technological improvement in the value of a device, the research has been favorably activity, program, or service to the recognized from outside EPA. Achievement Awards (STAA) • Committee. The purpose of the meeting public. Awarded research is of national The nature and extent of peer is to review the 2020 STAA significance or has high impact on a review, including stature and quality of nominations and to make broad area of science/technology. The the peer-reviewed journal or the recommendations for awards. The research has far reaching consequences publisher of a book for a review chapter meeting is closed to the public. and is recognizable as a major scientific/ published therein. technological achievement within its I have determined that the meetings of DATES: The meeting of the SAB STAA the STAA Committee and Chartered Committee will be held on Monday, discipline or field of study. • Level II awards are for those who SAB will be closed to the public January 11, 2021 and Tuesday, January have accomplished a notably excellent because they are concerned with 12, 2021, from 11 a.m. to 6 p.m. (Eastern research or technological effort that has selecting employees deserving of Time) each day. qualities and values similar to, but to a awards. In making these FOR FURTHER INFORMATION CONTACT: lesser degree, than those described recommendations, the Agency requires Members of the public who wish to under Level I. Awarded research has full and frank advice from the SAB. This obtain further information concerning timely consequences and contributes as advice will involve professional this notice may contact Dr. Zaida an important scientific/technological judgments on the relative merits of Figueroa, Designated Federal Officer achievement within its discipline or various employees and their respective (DFO), via email at figueroa.zaida@ field of study. work. Such personnel matters involve epa.gov. General information about the • Level III awards are for those who the discussion of information that is of SAB as well as any updates concerning have accomplished an unusually a personal nature and the disclosure of the meetings announced in this notice notable research or technological effort. which would be a clearly unwarranted can be found on the SAB website at The awards are for a substantial revision invasion of personal privacy and, http://www.epa.gov/sab. or modification of a scientific/ therefore, are protected from disclosure SUPPLEMENTARY INFORMATION: technological principle or procedure, or by section 10(d) of the Federal Advisory Background: The SAB was an important improvement to the value Committee Act (FACA), 5 U.S.C. App. 2, established pursuant to the of a device, activity, program, or service and sections (c)(2) and (c)(6) of the Environmental Research, Development, to the public. Awarded research relates Government in the Sunshine Act, 5 and Demonstration Authorization Act to a mission or organizational U.S.C. 552b(c)(2) and (6). Minutes of the (ERDDAA), codified at 42 U.S.C. 4365, component of the EPA, or significantly meetings of the STAA Committee and

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79180 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

the Chartered SAB will be kept and ‘‘Currently Under Review,’’ (3) click on Frequency of Response: certified by the chair of those meetings. the downward-pointing arrow in the Recordkeeping requirement; on ‘‘Select Agency’’ box below the occasion reporting requirement; third Andrew Wheeler, ‘‘Currently Under Review’’ heading, (4) party disclosure requirement. Administrator. select ‘‘Federal Communications Obligation to Respond: Required to [FR Doc. 2020–26996 Filed 12–8–20; 8:45 am] Commission’’ from the list of agencies obtain or retain benefits. The statutory BILLING CODE 6560–50–P presented in the ‘‘Select Agency’’ box, authority for this collection of (5) click the ‘‘Submit’’ button to the information is contained in sections 1, right of the ‘‘Select Agency’’ box, (6) 2, 4(i), 4(j), 5(c), 201, 302, 303, 304, FEDERAL COMMUNICATIONS when the list of FCC ICRs currently 307(e), 309, and 316 of the COMMISSION under review appears, look for the Title Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), [OMB 3060–XXXX; FRS 17285] of this ICR and then click on the ICR Reference Number. A copy of the FCC 154(j), 155(c), 201, 302, 303, 304, 307(e), Information Collection Being submission to OMB will be displayed. 309, and 316. Submitted for Review and Approval to SUPPLEMENTARY INFORMATION: The Total Annual Burden: 120 hours. Annual Cost Burden: No cost. Office of Management and Budget Commission may not conduct or sponsor a collection of information Privacy Act Impact Assessment: No AGENCY: Federal Communications unless it displays a currently valid impact(s). Nature and Extent of Confidentiality: Commission. Office of Management and Budget The information collected under this ACTION: Notice and request for (OMB) control number. No person shall collection will be made publicly comments. be subject to any penalty for failing to available. However, to the extent comply with a collection of information information submitted pursuant to this SUMMARY: As part of its continuing effort subject to the PRA that does not display information collection is determined to to reduce paperwork burdens, as a valid OMB control number. required by the Paperwork Reduction As part of its continuing effort to be confidential, it will be protected by Act (PRA) of 1995, the Federal reduce paperwork burdens, as required the Commission. If a respondent seeks Communications Commission (FCC or by the Paperwork Reduction Act (PRA) to have information collected pursuant the Commission) invites the general of 1995 (44 U.S.C. 3501–3520), the FCC to this information collection withheld public and other Federal Agencies to invited the general public and other from public inspection, the respondent take this opportunity to comment on the Federal Agencies to take this may request confidential treatment following information collection. opportunity to comment on the pursuant to section 0.459 of the Pursuant to the Small Business following information collection. Commission’s rules for such Paperwork Relief Act of 2002, the FCC Comments are requested concerning: (a) information. Needs and Uses: On February 28, seeks specific comment on how it can Whether the proposed collection of 2020, in furtherance of the goal of further reduce the information information is necessary for the proper releasing more mid-band spectrum into collection burden for small business performance of the functions of the the market to support and enabling concerns with fewer than 25 employees. Commission, including whether the next-generation wireless networks, the DATES: Written comments and information shall have practical utility; Commission adopted a Report and recommendations for the proposed (b) the accuracy of the Commission’s Order, FCC 20–22, (3.7 GHz Report and information collection should be burden estimates; (c) ways to enhance Order), in which it reformed the use of submitted on or before January 8, 2021. the quality, utility, and clarity of the the 3.7–4.2 GHz band, also known as the information collected; and (d) ways to ADDRESSES: Comments should be sent to C-band. Currently, the 3.7–4.2 GHz band minimize the burden of the collection of www.reginfo.gov/public/do/PRAMain. is allocated in the United States information on the respondents, Find this particular information exclusively for non-Federal use on a including the use of automated collection by selecting ‘‘Currently under primary basis for Fixed Satellite Service collection techniques or other forms of 30-day Review—Open for Public (FSS) and Fixed Service. The 3.7 GHz information technology. Pursuant to the Comments’’ or by using the search Report and Order calls for the relocation Small Business Paperwork Relief Act of function. Your comment must be of existing FSS operations in the band 2002, Public Law 107–198, see 44 U.S.C. submitted into www.reginfo.gov per the into the upper 200 megahertz of the 3506(c)(4), the FCC seeks specific above instructions for it to be band (4.0–4.2 GHz) and making the comment on how it might ‘‘further considered. In addition to submitting in lower 280 megahertz (3.7–3.98 GHz) reduce the information collection www.reginfo.gov also send a copy of available for flexible use throughout the burden for small business concerns with your comment on the proposed contiguous United States through a information collection to Cathy fewer than 25 employees.’’ OMB Control No.: 3060–XXXX. Commission-administered public Williams, FCC, via email to PRA@ auction of overlay licenses that is fcc.gov and to [email protected]. Title: 3.7 GHz Service Licensee and Earth Station Operator Agreements; 3.7 scheduled to occur later this year. Include in the comments the OMB The Commission concluded in the 3.7 control number as shown in the GHz Service Licensee Engineering Analysis. GHz Report and Order that, once this SUPPLEMENTARY INFORMATION below. Form No.: N/A. transition is complete, coordination FOR FURTHER INFORMATION CONTACT: For Type of Review: New collection. measures are needed to protect additional information or copies of the Respondents: Business or other for- incumbent C-band operations in the information collection, contact Cathy profit entities; not-for-profit institutions; upper portion of the 3.7–4.2 GHz band. Williams at (202) 418–2918. To view a State, Local or Tribal Government. 3.7 GHz Service licensees are required copy of this information collection Number of Respondents and to comply with certain technical rules request (ICR) submitted to OMB: (1) Go Responses: 30 Respondents and 30 and coordination practices designed to to the web page http://www.reginfo.gov/ responses. reduce the risk of interference to public/do/PRAMain, (2) look for the Estimated Time per Response: 2 incumbent operations. Specifically, 3.7 section of the web page called hours–5 hours. GHz Service licensees are required to

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79181

comply with specific power flux density FEDERAL COMMUNICATIONS Title: Implementation of the Local (PFD) limits to protect incumbent earth COMMISSION Exchange Carrier Tariff Streamlining stations from out-of-band emissions and Provisions in the Telecommunications blocking and to coordinate frequency [OMB 3060–0745; FRS 17292] Act of 1996, CC Docket No. 96–187. usage with incumbent Telemetry, Form Number: N/A. Tracking, and Command (TT&C) earth Information Collection Being Reviewed Type of Review: Extension of a stations. The 3.7 GHz Report and Order by the Federal Communications currently approved collection. allows 3.7 GHz Service licensees and Commission Under Delegated Respondents: Business or other for- C-Band earth station operators to modify Authority profit. these PFD limits, but it requires a 3.7 AGENCY: Federal Communications Number of Respondents and GHz Service licensee that is a party to Commission. Responses: 50 respondents; 1,536 such an agreement to maintain a copy responses. ACTION: Notice and request for of the agreement in its station files and Estimated Time per Response: 0.25–6 comments. disclose it, upon request, to prospective hours. license assignees, transferees, or SUMMARY: As part of its continuing effort Frequency of Response: On occasion spectrum lessees, and to the to reduce paperwork burdens, and as reporting requirement, recordkeeping Commission. The Commission also required by the Paperwork Reduction requirement, and third-party disclosure required any 3.7 GHz Service licensee Act (PRA) of 1995, the Federal requirement. with base stations located within the Communications Commission (FCC or Obligation to Respond: Required to appropriate coordination distance to the Commission) invites the general obtain or retain benefits. Statutory provide upon request an engineering public and other Federal agencies to authority for this collection of analysis to the TT&C operator to take this opportunity to comment on the information is contained in sections 1, demonstrate their ability to comply with following information collection. 4(i), and 204(a)(3) of the the applicable ¥6 dB I/N criteria. Comments are requested concerning: Communications Act of 1934, as The information that will be collected Whether the proposed collection of amended, 47 U.S.C. 151, 154(i), and under this new information collection is information is necessary for the proper 204(a)(3). designed to ensure that 3.7 GHz Service performance of the functions of the Total Annual Burden: 4,054 hours. licensees operate in a manner that Commission, including whether the Total Annual Cost: $727,800. ensures incumbent C-band operations in information shall have practical utility; Privacy Act Impact Assessment: No the upper portion of the 3.7–4.2 GHz the accuracy of the Commission’s impact. band and TT&C operations in the 3700– burden estimate; ways to enhance the Nature and Extent of Confidentiality: 3980 MHz band are protected. By quality, utility, and clarity of the The Commission is not requesting that requiring 3.7 GHz Service licensees to information collected; ways to minimize the respondents submit confidential provide a copy of any private agreement the burden of the collection of information to the FCC. Respondents with 3.7 GHz earth station operators to information on the respondents, may, however, request confidential prospective license assignees, including the use of automated treatment for information they believe to transferees, or spectrum lessees, and to collection techniques or other forms of be confidential under 47 CFR 0.459 of the Commission, the Commission information technology; and ways to the Commission’s rules. ensures that such agreements continue further reduce the information Needs and Uses: This collection will to protect incumbent C-band operations collection burden on small business be submitted as an extension to the in the event a 3.7 GHz service license concerns with fewer than 25 employees. Office of Management and Budget is subsequently transferred to a new The FCC may not conduct or sponsor a (OMB) in order to obtain the full three- licensee. This collection promotes the collection of information unless it year clearance. safety of operations in the band and displays a currently valid control In CC Docket 96–187, the Commission reduces the risk of harmful interference number. No person shall be subject to adopted measures to streamline tariff to incumbents. It also ensures that any penalty for failing to comply with filing requirements for local exchange relevant stakeholders have access to a collection of information subject to the carriers (LECs) pursuant to the coordination agreements between 3.7 PRA that does not display a valid Office Telecommunications Act of 1996. In GHz Service licensees and entities of Management and Budget (OMB) order to achieve a streamlined and operating earth stations or TT&C control number. deregulatory environment for LEC tariff operations. DATES: Written PRA comments should filings, LECs are required to file tariffs be submitted on or before February 8, electronically. The information The information provided by the 3.7 2021. If you anticipate that you will be collected under the electronic filing GHz Service licensee to the TT&C submitting comments, but find it program will facilitate access to tariffs operator ensures the protection of TT&C difficult to do so within the period of and associated documents by the public, operations. The information collection time allowed by this notice, you should as well as by state and federal will facilitate an efficient and safe advise the contact listed below as soon regulators. Ready electronic access to transition by requiring 3.7 GHz Service as possible. carrier tariffs will also facilitate the licensees to demonstrate their ability to ¥ ADDRESSES: Direct all PRA comments to compilation of aggregate data for comply with the 6 dB I/N criteria, industry analysis purposes without thereby minimizing the risk of Nicole Ongele, FCC, via email PRA@ fcc.gov and to [email protected]. imposing new reporting requirements interference. on carriers. FOR FURTHER INFORMATION CONTACT: For Federal Communications Commission. additional information about the Federal Communications Commission. Marlene Dortch, information collection, contact Nicole Marlene Dortch, Secretary, Office of the Secretary. Ongele at (202) 418–2991. Secretary, Office of the Secretary. [FR Doc. 2020–26984 Filed 12–8–20; 8:45 am] SUPPLEMENTARY INFORMATION: [FR Doc. 2020–26985 Filed 12–8–20; 8:45 am] BILLING CODE 6712–01–P OMB Control Number: 3060–0745. BILLING CODE 6712–01–P

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00020 Fmt 4703 Sfmt 9990 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79182 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

FEDERAL COMMUNICATIONS Title: Preparation of Annual Reports implementation of 911 or enhanced 911 COMMISSION to Congress for the Collection and services, including data regarding Expenditure of Fees or Charges for whether their respective state collects [OMB 3060–1122; FRS 17264] Enhanced 911 (E911) Services under the and distributes such fees or charges, the NET 911 Improvement Act of 2008. nature (e.g., amount and method of Information Collection Being Reviewed Form Number: Not applicable. assessment or collection) and the by the Federal Communications Type of Review: Extension of a amount of revenues obligated or Commission Under Delegated currently approved collection. expended for any purpose other than Authority Respondents: State, local and tribal the purpose for which any such 911 or governments. enhanced 911 service fees or charges are AGENCY: Federal Communications Number of Respondents and specified. Consistent with Sections 6(f) Commission. Responses: 56 Respondents; 56 of the NET 911 Act, the Commission ACTION: Notice and request for Responses. will request that state officials report comments. Estimated Time per Response: 55 this information with respect to the fees hours. and charges in connection with SUMMARY: As part of its continuing effort Frequency of Response: Annual implementation of 911 or E–911 to reduce paperwork burdens, and as reporting requirement. required by the Paperwork Reduction services within their state, including Obligation to Respond: Voluntary. any political subdivision, Indian tribe Act (PRA) of 1995, the Federal Statutory authority for this information Communications Commission (FCC or and/or village and regional corporation collection is contained in New and serving any region established pursuant the Commission) invites the general Emerging Technologies 911 public and other Federal agencies to to the Alaska Native Claims Settlement Improvement Act of 2008, Public Law Act that otherwise lie within their state take this opportunity to comment on the 110–283, 122 Stat. 2620 (2008) (NET following information collection. boundaries. In addition, consistent with 911 Act). the definition of ‘‘State’’ set out in Comments are requested concerning: Total Annual Burden: 3,080 hours. Whether the proposed collection of Total Annual Cost: No Cost. Section 3(40) of the Communications information is necessary for the proper Privacy Act Impact Assessment: No Act, the Commission will collect this performance of the functions of the Impact(s). information from, states as well as the Commission, including whether the Nature and Extent of Confidentiality: District of Columbia and the inhabited information shall have practical utility; There is no need for confidentiality. U.S. Territories and possessions. the accuracy of the Commission’s Needs and Uses: The Federal Federal Communications Commission. burden estimate; ways to enhance the Communications Commission Marlene Dortch, quality, utility, and clarity of the (Commission) is directed by statute Secretary, Office of the Secretary. information collected; ways to minimize (New and Emerging Technologies 911 [FR Doc. 2020–26982 Filed 12–8–20; 8:45 am] Improvement Act of 2008, Public Law the burden of the collection of BILLING CODE 6712–01–P information on the respondents, 110–283, 122 Stat. 2620 (2008) (NET including the use of automated 911 Act)) to submit an annual ‘‘Fee collection techniques or other forms of Accountability Report’’ to the FEDERAL COMMUNICATIONS information technology; and ways to Committee on Commerce, Science, and COMMISSION further reduce the information Transportation of the Senate and the collection burden on small business Committee on Energy and Commerce of [OMB 3060–1030; FRS 17271] the House of Representative ‘‘detailing concerns with fewer than 25 employees. Information Collection Being Reviewed the status in each State of the collection The FCC may not conduct or sponsor a by the Federal Communications and distribution [of] fees or charges’’ for collection of information unless it Commission displays a currently valid control ‘‘the support or implementation of 911 number. No person shall be subject to or enhanced 911 services,’’ including AGENCY: Federal Communications any penalty for failing to comply with ‘‘findings on the amount of revenues Commission. a collection of information subject to the obligated or expended by each State or ACTION: Notice and request for PRA that does not display a valid Office political subdivision thereof for any comments. of Management and Budget (OMB) purpose other than the purpose for control number. which any such fees or charges are SUMMARY: As part of its continuing effort DATES: Written PRA comments should specified.’’ (NET 911 Act, 122 Stat. at to reduce paperwork burdens, and as be submitted on or before February 8, 2622). The statute directs the required by the Paperwork Reduction 2021. If you anticipate that you will be Commission to submit its first annual Act of 1995 (PRA), the Federal submitting comments, but find it report within one year after the date of Communications Commission (FCC or difficult to do so within the period of enactment of the NET 911 Act. Given Commission) invites the general public time allowed by this notice, you should that the NET 911 Act was enacted on and other Federal agencies to take this advise the contact listed below as soon July 23, 2008, the first annual report was opportunity to comment on the as possible. due to Congress on July 22, 2009. following information collections. Description of Information Collection: Comments are requested concerning: ADDRESSES: Direct all PRA comments to The Commission will collect Whether the proposed collection of Nicole Ongele, FCC, via email PRA@ information for the annual preparation information is necessary for the proper fcc.gov and to [email protected]. of the Fee Accountability Report via a performance of the functions of the FOR FURTHER INFORMATION CONTACT: For web-based survey that appropriate State Commission, including whether the additional information about the officials (e.g., State 911 Administrators information shall have practical utility; information collection, contact Nicole and Budget Officials) will be able to the accuracy of the Commission’s Ongele at (202) 418–2991. access to submit data pertaining to the burden estimate; ways to enhance the SUPPLEMENTARY INFORMATION: collection and distribution of fees or quality, utility, and clarity of the OMB Control Number: 3060–1122. charges for the support or information collected; ways to minimize

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00021 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79183

the burden of the collection of Total Annual Cost: $782,618. immediate inspection at the Federal information on the respondents, Privacy Impact Assessment: No Reserve Bank(s) indicated below and at including the use of automated impact(s). the offices of the Board of Governors. collection techniques or other forms of Nature and Extent of Confidentiality: This information may also be obtained information technology; and ways to There is no need for confidentiality with on an expedited basis, upon request, by further reduce the information this collection of information. contacting the appropriate Federal collection burden on small business Needs and Uses: The currently Reserve Bank and from the Board’s concerns with fewer than 25 employees. approved information collections under Freedom of Information Office at The FCC may not conduct or sponsor Control No. 3060–1030 relate to three https://www.federalreserve.gov/foia/ a collection of information unless it groups of Advanced Wireless Service request.htm. Interested persons may displays a currently valid Office of (‘‘AWS’’) spectrum, commonly referred express their views in writing on the Management and Budget (OMB) control to as AWS–1, AWS–3, and AWS–4. The standards enumerated in paragraph 7 of number. No person shall be subject to FCC’s policies and rules apply to the Act. any penalty for failing to comply with application, licensing, operating and Comments regarding each of these a collection of information subject to the technical rules for this spectrum. The applications must be received at the PRA that does not display a valid OMB respondents are AWS licensees, Reserve Bank indicated or the offices of control number. incumbent Fixed Microwave Service the Board of Governors, Ann E. DATES: Written PRA comments should (FS) and Broadband Radio Service (BRS) Misback, Secretary of the Board, 20th be submitted on or before February 8, licensees that relocate out of the AWS Street and Constitution Avenue NW, 2021. If you anticipate that you will be bands, and AWS Clearinghouses that Washington, DC 20551–0001, not later submitting comments but find it keep track of cost sharing obligations. than December 23, 2020. difficult to do so within the period of AWS licensees also have coordination A. Federal Reserve Bank of Kansas time allowed by this notice, you should requirements with certain Federal City (Dennis Denney, Assistant Vice advise the contact listed below as soon Government incumbents. President) 1 Memorial Drive, Kansas as possible. Recordkeeping, reporting, and third- City, Missouri 64198–0001: 1. Trudy M. Durfee Revocable Trust, ADDRESSES: Direct all PRA comments to party disclosure requirements Trudy M. Durfee, as trustee, both of Cathy Williams, FCC, via email to PRA@ associated with the FCC items listed in Sundance, Wyoming; to acquire voting fcc.gov and to [email protected]. item 1 will be used by incumbent licensees and new entrants to negotiate shares of Sundance Bankshares, Inc., FOR FURTHER INFORMATION CONTACT: For and thereby indirectly acquire voting additional information about the relocation agreements and to coordinate operations to avoid interference. The shares of Sundance State Bank, both in information collection, contact Cathy Sundance, Wyoming. Williams at (202) 418–2918. information also will be used by the clearinghouses to maintain a national In addition, The Danny K. Hopson SUPPLEMENTARY INFORMATION: database, determine reimbursement and Janice Dee Hopson Family Trust, OMB Control Number: 3060–1030. obligations of entrants pursuant to the Danny K. Hopson and Janice Dee Title: Service Rules for Advanced Commission’s rules, and notify such Hopson, as co-trustees, all of San Tan Wireless Services (AWS) in the 1.7 GHz entrants of their reimbursement Valley, Arizona; to become members of and 2.1 GHz Bands. obligations. Additionally, the the Richard Durfee Family Group, a Form Number: N/A. information will be used to facilitate group acting in concert, and to retain Type of Review: Extension of a voting shares of Sundance Bankshares, currently approved collection. dispute resolution and for FCC oversight of the clearinghouses and the cost- Inc., and indirectly retain voting shares Respondents: Business or other for- of Sundance State Bank. profit entities; state, local, or tribal sharing plan. government; Federal Government and Federal Communications Commission. Board of Governors of the Federal Reserve System, December 3, 2020. not for profit institutions. Marlene Dortch, Michele Taylor Fennell, Number of Respondents: 232 Secretary, Office of the Secretary. Deputy Associate Secretary of the Board. Respondents; 6,812 responses. [FR Doc. 2020–26983 Filed 12–8–20; 8:45 am] [FR Doc. 2020–26980 Filed 12–8–20; 8:45 am] Estimated Time per Response: 0.25 to BILLING CODE 6712–01–P 5 hours. BILLING CODE P Frequency of Response: Annual, semi- annual, one time, and on occasion FEDERAL RESERVE SYSTEM reporting requirements, recordkeeping DEPARTMENT OF HEALTH AND requirement, third-party disclosure Change in Bank Control Notices; HUMAN SERVICES requirements, and every ten years Acquisitions of Shares of a Bank or Centers for Disease Control and reporting requirements. Bank Holding Company Obligation to Respond: Required to Prevention obtain or retain benefits. The statutory The notificants listed below have authority for this collection is contained applied under the Change in Bank Centers for Disease Control and in sections 1, 2, 4(i), 201, 301, 302, 303, Control Act (Act) (12 U.S.C. 1817(j)) and Prevention Sexually Transmitted 307, 308, 309, 310, 316, 319, 324, 332, § 225.41 of the Board’s Regulation Y (12 Infection Treatment Guidelines Update; and 333 of the Communications Act of CFR 225.41) to acquire shares of a bank Webinar 1934, as amended, and sections 6003, or bank holding company. The factors AGENCY: Centers for Disease Control and 6004, and 6401 of the Middle Class Tax that are considered in acting on the Prevention (CDC), Department of Health Relief Act of 2012, Public Law 112–96, applications are set forth in paragraph 7 and Human Services (HHS). 126 Stat. 156, 47 U.S.C. 151, 152, 154(i), of the Act (12 U.S.C. 1817(j)(7)). ACTION: Notice of public webinar. 201, 301, 302(a), 303, 307, 308, 309, 310, The public portions of the 316, 319, 324, 332, 333, 1403, 1404, and applications listed below, as well as SUMMARY: The Centers for Disease 1451. other related filings required by the Control and Prevention (CDC), located Total Annual Burden: 13,866 hours. Board, if any, are available for within the Department of Health and

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00022 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79184 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Human Services (HHS), announces a only event and there will be no on-site access to the docket to read background webinar entitled, ‘‘CDC STI Treatment participation at the CDC broadcast documents or comments received, go to Guidelines Update’’. The purpose of the facility. https://www.regulations.gov. webinar is for CDC to receive comments Sandra Cashman, FOR FURTHER INFORMATION CONTACT: from potential users on the proposed Stephanie Thomas, ACIP Committee updated guidelines. This webinar is an Executive Secretary, Centers for Disease Control and Prevention. Management Specialist, Centers for opportunity for all interested parties to Disease Control and Prevention, [FR Doc. 2020–26974 Filed 12–8–20; 8:45 am] ask questions and provide feedback, but National Center for Immunization and is specifically directed toward BILLING CODE 4163–18–P Respiratory Diseases, 1600 Clifton Road clinicians, such as medical doctors, NE, MS–H24–8, Atlanta, GA 30329– nurse practitioners, and physician’s DEPARTMENT OF HEALTH AND 4027; Telephone: 404–639–8367; Email: assistants. CDC will consider comments [email protected]. made during the webinar prior to HUMAN SERVICES SUPPLEMENTARY INFORMATION: In finalizing the updated STI Treatment Centers for Disease Control and accordance with 41 CFR 102–3.150(b), Guidelines for publication. Prevention less than 15 calendar days’ notice is DATES: The webinar will be held on [Docket No. CDC–2020–0122] being given for this meeting due to the December 18, 2020 from 2 p.m. to 4 p.m. exceptional circumstances of the EST. Registration instructions can be Advisory Committee on Immunization COVID–19 pandemic and rapidly found on the website, https:// Practices (ACIP) evolving COVID–19 vaccine www.cdc.gov/std/treatment/default.htm. development and regulatory processes. ADDRESSES: The webinar will be AGENCY: Centers for Disease Control and The Secretary of Health and Human broadcast from the Centers for Disease Prevention (CDC), Department of Health Services has determined that COVID–19 Control and Prevention, 1600 Clifton and Human Services (HHS). is a Public Health Emergency. A notice Road NE, Atlanta, Georgia 30329. ACTION: Notice of meeting and request of this ACIP meeting has also been FOR FURTHER INFORMATION CONTACT: for comment. posted on CDC’s ACIP website at: http:// Quinn Haaga, Public Health Advisor, www.cdc.gov/vaccines/acip/index.html. CDC, 1600 Clifton Road NE, MS–US 12– SUMMARY: In accordance with the In addition, CDC has sent notice of this 2, Atlanta, GA 30329, stdtxguidelines@ Federal Advisory Committee Act, the ACIP meeting by email to those who cdc.gov. Centers for Disease Control and subscribe to receive email updates about SUPPLEMENTARY INFORMATION: The CDC’s Prevention (CDC), announces the ACIP. STI Treatment Guidelines Webinar is a following meeting of the Advisory Purpose: The committee is charged public presentation of proposed updates Committee on Immunization Practices with advising the Director, CDC, on the to the CDC’s 2015 STD Treatment (ACIP). This meeting is open to the use of immunizing agents. In addition, Guidelines. The webinar will include public. The meeting will be webcast live under 42 U.S.C. 1396s, the committee is discussions of proposed changes to via the World Wide Web. mandated to establish and periodically CDC’s 2015 STD Treatment Guidelines DATES: The meeting will be held on review and, as appropriate, revise the focusing on (1) changes to testing, December 11, 2020 from 12:00 p.m. to list of vaccines for administration to management, and/or treatment 5:00 p.m. EST and December 13, 2020 vaccine-eligible children through the recommendations for Neisseria from 12:00 p.m. to 4:00 p.m. EST (times Vaccines for Children (VFC) program, gonorrhoeae, Chlamydia trachomatis, subject to change, see the ACIP website along with schedules regarding dosing Trichomonas vaginalis treatment; (2) for any updates: http://www.cdc.gov/ interval, dosage, and contraindications role of metronidazole in pelvic vaccines/acip/index.html). to administration of vaccines. Further, inflammatory disease treatment; (3) Written comments must be received under provisions of the Affordable Care alternative treatment options for on or before December 14, 2020. Act, section 2713 of the Public Health bacterial vaginosis; (4) management of ADDRESSES: For more information on Service Act, immunization Mycoplasma genitalium; and (5) two ACIP please visit the ACIP website: recommendations of the ACIP that have step testing for serologic diagnosis of http://www.cdc.gov/vaccines/acip/ been approved by the Director of the genital HSV2. Physicians and other index.html. Centers for Disease Control and health-care providers can use these You may submit comments, identified Prevention and appear on CDC guidelines to assist in the prevention by Docket No. CDC–2020–0122 by any immunization schedules must be and treatment of STIs. Comments and of the following methods: covered by applicable health plans. questions on the proposed changes may • Federal eRulemaking Portal: Matters To Be Considered: The agenda be made during the webinar only. https://www.regulations.gov. Follow the will include discussions on COVID–19 Please refer to the posted agenda for instructions for submitting comments. vaccine. A recommendation vote(s) is updates about the webinar one week • Mail: Docket No. CDC–2020–0122, scheduled. Agenda items are subject to prior to the meeting. Information will be c/o Attn: December 11 and 13, 2020 change as priorities dictate. For more provided on the following website when ACIP Meeting, Centers for Disease information on the meeting agenda visit it becomes available. https:// Control and Prevention, 1600 Clifton https://www.cdc.gov/vaccines/acip/ www.cdc.gov/std/treatment/default.htm. Road NE, MS H24–8, Atlanta, GA meetings/meetings-info.html. A recording of the webinar and 30329–4027. Meeting Information: The meeting accompanying transcripts will be Instructions: All submissions received will be webcast live via the World Wide available by January 17, 2021 on the must include the Agency name and Web; for more information on ACIP website listed above. In addition, CDC’s Docket Number. All relevant comments please visit the ACIP website: http:// responses to questions from the webinar received in conformance with the www.cdc.gov/vaccines/acip/index.html. will also be available February 15, 2021 https://www.regulations.gov suitability Public Participation on this website. policy will be posted without change to Participants must register by https://www.regulations.gov, including Interested persons or organizations December 17, 2020. This is a webinar- any personal information provided. For are invited to participate by submitting

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00023 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79185

written views, recommendations, and Operating Officer, Centers for Disease Administration for Children and data. Please note that comments Control and Prevention, has been Families, Office of Planning, Research, received, including attachments and delegated the authority to sign Federal and Evaluation (OPRE), 330 C Street other supporting materials are part of Register notices pertaining to SW, Washington, DC 20201, Attn: ACF the public record and are subject to announcements of meetings and other Reports Clearance Officer. All requests, public disclosure. Do not include any committee management activities, for emailed or written, should be identified information in your comment or both the Centers for Disease Control and by the title of the information collection. supporting materials that you consider Prevention and the Agency for Toxic confidential or inappropriate for public Substances and Disease Registry. SUPPLEMENTARY INFORMATION: disclosure. If you include your name, Description: On an annual basis, Kalwant Smagh, contact information, or other states and territories are required to information that identifies you in the Director, Strategic Business Initiatives Unit, submit the following reports: (1) An body of your comments, that Office of the Chief Operating Officer, Centers for Disease Control and Prevention. Intended Use Plan that provides data information will be on public display. and narrative descriptions related to the [FR Doc. 2020–27133 Filed 12–7–20; 4:15 pm] CDC will review all submissions and state’s SSBG program. The Intended Use BILLING CODE 4163–18–P may choose to redact, or withhold, Plan includes details about the delivery submissions containing private or of SSBG services and the state agency proprietary information such as Social DEPARTMENT OF HEALTH AND administering the SSBG Program. ACF Security numbers, medical information, HUMAN SERVICES is proposing to expand the currently inappropriate language, or duplicate/ approved information collection to near duplicate examples of a mass-mail Administration for Children and include collection of states’ Intended campaign. CDC will carefully consider Families Use Plans. Grantees are required to all comments submitted into the docket. [OMB No. 0970–0234] submit their Intended Use Plans no less CDC does not accept comment by email. than 30 days prior to the start of the Written Public Comment: Written budget period covered by the report. (2) comments must be received on or before Proposed Information Collection A Pre-Expenditure Report that December 14, 2020. Oral Public Activity; Social Services Block Grant Comment: This meeting will include (SSBG) Post-Expenditure Report, Pre- demonstrates the state’s anticipated time for members of the public to make Expenditure Report, and Intended Use allocation of SSBG funding among the an oral comment. Oral public comment Plan 29 pre-defined SSBG service categories. Historically, states have submitted this will occur before any scheduled votes AGENCY: Office of Community Services, including all votes relevant to the report using the Post-Expenditure Administration for Children and Report Form, and the associated burden ACIP’s Affordable Care Act and Families, HHS. Vaccines for Children Program roles. is included in the currently approved ACTION: Request for Public Comment. Priority will be given to individuals information collection. Grantees are who submit a request to make an oral SUMMARY: The Administration for required to submit their Pre- public comment before the meeting Children and Families (ACF) is Expenditure Report no less than 30 days according to the procedures below. requesting a revision to the Social prior to the start of the budget period Procedure for Oral Public Comment: Services Block Grant (SSBG) Post- covered by the report. (3) A Post- All persons interested in making an oral Expenditure Report, Pre-Expenditure Expenditure Report that details the public comment at the December 13, Report, and Intended Use Plan (OMB state’s actual use of SSBG funding 2020 ACIP meeting must submit a #0970–0234), previously titled, ‘‘Social among each of the 29 service categories. request at http://www.cdc.gov/vaccines/ Services Block Grant (SSBG) Post- Grantees are required to submit their acip/meetings/ no later than 11:59 p.m., Expenditure Report’’). ACF is proposing Post-Expenditure Report within 6 EST, December 11, 2020 according to to expand the information collection to months of the end of the period covered the instructions provided. include the collection of states’ by the report. If the number of persons requesting to Intended Use Plans and retitle the Respondents: Agencies that speak is greater than can be reasonably information collection to clarify the role administer the SSBG at the state or accommodated during the scheduled of the Pre-Expenditure Report. territory level, including the 50 states; time, CDC will conduct a lottery to DATES: Comments due within 60 days of District of Columbia; Puerto Rico; and determine the speakers for the the territories of American Samoa, scheduled public comment session. publication. In compliance with the Guam, the Virgin Islands, and the CDC staff will notify individuals requirements of Section 3506(c)(2)(A) of Commonwealth of Northern Mariana regarding their request to speak by email the Paperwork Reduction Act of 1995, Islands. by 12:00 p.m., EST, December 12, 2020. ACF is soliciting public comment on the specific aspects of the information To accommodate the significant interest Annual Burden Estimates in participation in the oral public collection described above. comment session of ACIP meetings, ADDRESSES: Copies of the proposed This request is specific to the each speaker will be limited to 3 collection of information can be Intended Use Plan. Currently approved minutes, and each speaker may only obtained and comments may be materials and associated burden can be speak once per meeting. forwarded by emailing infocollection@ found at: https://www.reginfo.gov/ The Director, Strategic Business acf.hhs.gov. Alternatively, copies can public/do/PRAViewICR?ref_nbr= Initiatives Unit, Office of the Chief also be obtained by writing to the 202011-0970-006.

Annual number Average burden Instrument Annual number of responses hours per Total/annual of respondents per respondent response burden hours

Intended Use Plan ...... 56 1 40 2,240

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00024 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79186 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Estimated Total Annual Burden ADDRESSES: You may submit comments Resolution: Scientific and Technical Hours: 2,240. as follows. Please note that late, Issues Related to Pharmaceutical Comments: The Department untimely filed comments will not be Current Good Manufacturing Practice.’’ specifically requests comments on (a) considered. Electronic comments must Received comments, those filed in a Whether the proposed collection of be submitted on or before February 8, timely manner (see ADDRESSES), will be information is necessary for the proper 2021. The https://www.regulations.gov placed in the docket and, except for performance of the functions of the electronic filing system will accept those submitted as ‘‘Confidential agency, including whether the comments until 11:59 p.m. Eastern Time Submissions,’’ publicly viewable at information shall have practical utility; at the end of February 8, 2021. https://www.regulations.gov or at the (b) the accuracy of the agency’s estimate Comments received by mail/hand Dockets Management Staff between 9 of the burden of the proposed collection delivery/courier (for written/paper a.m. and 4 p.m., Monday through of information; (c) the quality, utility, submissions) will be considered timely Friday, 240–402–7500. and clarity of the information to be if they are postmarked or the delivery • Confidential Submissions—To collected; and (d) ways to minimize the service acceptance receipt is on or submit a comment with confidential burden of the collection of information before that date. information that you do not wish to be on respondents, including through the made publicly available, submit your Electronic Submissions use of automated collection techniques comments only as a written/paper or other forms of information Submit electronic comments in the submission. You should submit two technology. Consideration will be given following way: copies total. One copy will include the • to comments and suggestions submitted Federal eRulemaking Portal: information you claim to be confidential within 60 days of this publication. https://www.regulations.gov. Follow the with a heading or cover note that states instructions for submitting comments. ‘‘THIS DOCUMENT CONTAINS Authority: 42 U.S.C. 1397 through 1397e. Comments submitted electronically, CONFIDENTIAL INFORMATION.’’ The Mary B. Jones, including attachments, to https:// Agency will review this copy, including ACF/OPRE Certifying Officer. www.regulations.gov will be posted to the claimed confidential information, in [FR Doc. 2020–27015 Filed 12–8–20; 8:45 am] the docket unchanged. Because your its consideration of comments. The BILLING CODE 4184–24–P comment will be made public, you are second copy, which will have the solely responsible for ensuring that your claimed confidential information comment does not include any redacted/blacked out, will be available DEPARTMENT OF HEALTH AND confidential information that you or a for public viewing and posted on HUMAN SERVICES third party may not wish to be posted, https://www.regulations.gov. Submit such as medical information, your or both copies to the Dockets Management Food and Drug Administration anyone else’s Social Security number, or Staff. If you do not wish your name and confidential business information, such contact information to be made publicly [Docket No. FDA–2014–N–1076] as a manufacturing process. Please note available, you can provide this that if you include your name, contact information on the cover sheet and not Agency Information Collection information, or other information that in the body of your comments and you Activities; Proposed Collection; identifies you in the body of your must identify this information as Comment Request; Formal Dispute comments, that information will be ‘‘confidential.’’ Any information marked Resolution: Scientific and Technical posted on https://www.regulations.gov. as ‘‘confidential’’ will not be disclosed Issues Related to Pharmaceutical • If you want to submit a comment except in accordance with 21 CFR 10.20 Current Good Manufacturing Practice with confidential information that you and other applicable disclosure law. For do not wish to be made available to the AGENCY: Food and Drug Administration, more information about FDA’s posting HHS. public, submit the comment as a of comments to public dockets, see 80 written/paper submission and in the FR 56469, September 18, 2015, or access ACTION: Notice. manner detailed (see ‘‘Written/Paper the information at https:// SUMMARY: The Food and Drug Submissions’’ and ‘‘Instructions’’). www.govinfo.gov/content/pkg/FR-2015- Administration (FDA, Agency, or we) is Written/Paper Submissions 09-18/pdf/2015-23389.pdf. announcing an opportunity for public Docket: For access to the docket to Submit written/paper submissions as read background documents or the comment on the proposed collection of follows: certain information by the Agency. • electronic and written/paper comments Mail/Hand Delivery/Courier (for received, go to https:// Under the Paperwork Reduction Act of written/paper submissions): Dockets 1995 (PRA), Federal Agencies are www.regulations.gov and insert the Management Staff (HFA–305), Food and docket number, found in brackets in the required to publish notice in the Drug Administration, 5630 Fishers Federal Register concerning each heading of this document, into the Lane, Rm. 1061, Rockville, MD 20852. ‘‘Search’’ box and follow the prompts proposed collection of information, • For written/paper comments and/or go to the Dockets Management including each proposed extension of an submitted to the Dockets Management Staff, 5630 Fishers Lane, Rm. 1061, existing collection of information, and Staff, FDA will post your comment, as Rockville, MD 20852, 240–402–7500. to allow 60 days for public comment in well as any attachments, except for response to the notice. This notice information submitted, marked and FOR FURTHER INFORMATION CONTACT: solicits comments on the information identified, as confidential, if submitted Domini Bean, Office of Operations, collection pertaining to Formal Dispute as detailed in ‘‘Instructions.’’ Food and Drug Administration, Three Resolution: Scientific and Technical Instructions: All submissions received White Flint North, 10A–12M, 11601 Issues Related to Pharmaceutical must include the Docket No. FDA– Landsdown St., North Bethesda, MD Current Good Manufacturing Practice. 2014–N–1076 for ‘‘Agency Information 20852, 301–796–5733, PRAStaff@ DATES: Submit either electronic or Collection Activities; Proposed fda.hhs.gov. written comments on the collection of Collection; Comment Request; Guidance SUPPLEMENTARY INFORMATION: Under the information by February 8, 2021. for Industry on Formal Dispute PRA (44 U.S.C. 3501–3521), Federal

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00025 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79187

Agencies must obtain approval from the respondents, including through the use drugs, including human biological drug Office of Management and Budget of automated collection techniques, products, on how to resolve disputes (OMB) for each collection of when appropriate, and other forms of about scientific and technical issues information they conduct or sponsor. information technology. relating to current good manufacturing practice (CGMP). ‘‘Collection of information’’ is defined Formal Dispute Resolution: Scientific in 44 U.S.C. 3502(3) and 5 CFR and Technical Issues Related to Disputes related to scientific and 1320.3(c) and includes Agency requests Pharmaceutical Current Good technical issues may arise during FDA or requirements that members of the Manufacturing Practice OMB Control inspections of pharmaceutical public submit reports, keep records, or Number 0910–0563—Extension manufacturers to determine compliance provide information to a third party. with CGMP requirements or during Section 3506(c)(2)(A) of the PRA (44 Section 562 of the Federal Food, Drug, FDA’s assessment of corrective actions U.S.C. 3506(c)(2)(A)) requires Federal and Cosmetic Act (FD&C Act) (21 U.S.C. undertaken as a result of such Agencies to provide a 60-day notice in 360bbb–1) directs FDA to establish inspections. The guidance recommends the Federal Register concerning each adequate dispute resolution (DR) procedures that we believe encourage procedures to ensure appropriate review proposed collection of information, open and prompt discussion of disputes of scientific controversies between FDA including each proposed extension of an and lead to their resolution. The and members of regulated industry, existing collection of information, guidance describes procedures for including possible review by a scientific before submitting the collection to OMB raising such disputes to the Office of advisory committee. To implement this for approval. To comply with this Regulatory Affairs and Center levels and provision, we amended the general requirement, FDA is publishing notice procedures for requesting review by the appeal regulation applicable across all of the proposed collection of DR panel. The guidance is available on FDA components (21 CFR 10.75), information set forth in this document. our website at https://www.fda.gov/ Internal agency review of decisions) to regulatory-information/search-fda- With respect to the following provide for advisory committee review collection of information, FDA invites (§ 10.75(b)(2)). At the same time and guidance-documents, along with comments on these topics: (1) Whether consistent with the mandates of section additional information regarding the the proposed collection of information 562 of the FD&C Act, we adopted an resolution of scientific disputes at FDA. is necessary for the proper performance approach whereby specific We estimate only a nominal burden of FDA’s functions, including whether implementation procedures regarding for the information collection and the information will have practical scientific controversy associated with assume that one manufacturer will utility; (2) the accuracy of FDA’s review of certain FDA decisions are submit one request annually for tier-one estimate of the burden of the proposed detailed in center-issued guidance. DR and that it will take manufacturers collection of information, including the Accordingly, we developed the approximately 30 hours to prepare and validity of the methodology and guidance for industry ‘‘Formal Dispute submit each tier-one DR request. Since assumptions used; (3) ways to enhance Resolution: Scientific and Technical our last request for OMB approval of the the quality, utility, and clarity of the Issues Related to Pharmaceutical information collection, we have information to be collected; and (4) Current Good Manufacturing Practice.’’ received no tier-two DRs. ways to minimize the burden of the We intend that the guidance inform We estimate the burden of this collection of information on manufacturers of veterinary and human collection of information as follows:

TABLE 1—ESTIMATED ANNUAL REPORTING BURDEN 1

Number of Average Activity Number of responses per Total annual burden per Total hours respondents respondent responses response

Requests for tier-one DR ...... 1 1 1 30 30 1 There are no capital costs or operating and maintenance costs associated with this collection of information.

Our estimated burden for the DEPARTMENT OF HEALTH AND Names for Human Nonprescription Drug information collection reflects a HUMAN SERVICES Products.’’ FDA is issuing this draft decrease of 38 hours and a decrease of guidance to help sponsors develop 1 request. This adjustment corresponds Food and Drug Administration human nonprescription drug product to a decrease in the number of [Docket No. FDA–2020–D–0770] proprietary names. This draft guidance submissions we have received over the describes best practices to help last few years. Best Practices in Developing minimize medication errors and Proprietary Names for Human Dated: December 2, 2020. otherwise avoid adoption of proprietary Nonprescription Drug Products; Draft names that contribute to violations of Lauren K. Roth, Guidance for Industry; Availability the Federal Food, Drug, and Cosmetic Acting Principal Associate Commissioner for Act (FD&C Act) and its implementing Policy. AGENCY: Food and Drug Administration, HHS. regulations. The draft guidance also [FR Doc. 2020–27060 Filed 12–8–20; 8:45 am] describes the framework FDA uses in ACTION: Notice of availability. BILLING CODE 4164–01–P evaluating proposed proprietary names SUMMARY: The Food and Drug for nonprescription drug products, Administration (FDA or Agency) is which is available to sponsors to use announcing the availability of a draft before marketing a nonprescription drug guidance for industry entitled ‘‘Best product bearing a particular proprietary Practices in Developing Proprietary name. This draft guidance is issued in

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00026 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79188 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

response to industry stakeholders’ Products.’’ Received comments will be one self-addressed adhesive label to requests to specifically address the placed in the docket and, except for assist that office in processing your approaches for naming of human those submitted as ‘‘Confidential requests. See the SUPPLEMENTARY nonprescription drug products. Submissions,’’ publicly viewable at INFORMATION section for electronic DATES: Although you can comment on https://www.regulations.gov or at the access to the draft guidance document. Dockets Management Staff between 9 any guidance at any time (see 21 CFR FOR FURTHER INFORMATION CONTACT: a.m. and 4 p.m., Monday through 10.115(g)(5)), to ensure that the Agency Danielle Harris, Center for Drug Friday, 240–402–7500. considers your comment on this draft • Evaluation and Research, Food and guidance before it begins work on the Confidential Submissions—To submit a comment with confidential Drug Administration, 10903 New final version of the guidance, submit Hampshire Ave., Bldg. 22, Rm. 4461, either electronic or written comments information that you do not wish to be made publicly available, submit your Silver Spring, MD 20993–0002, 301– on the draft guidance by February 8, 796–4590; or Stephen Ripley, Center for 2021. comments only as a written/paper submission. You should submit two Biologics Evaluation and Research, ADDRESSES: You may submit comments copies total. One copy will include the Food and Drug Administration, 10903 as follows: information you claim to be confidential New Hampshire Ave., Bldg. 71, Rm. 7301, Silver Spring, MD 20993–0002, Electronic Submissions with a heading or cover note that states ‘‘THIS DOCUMENT CONTAINS 240–402–7911. Submit electronic comments in the CONFIDENTIAL INFORMATION.’’ The SUPPLEMENTARY INFORMATION: following way: • Agency will review this copy, including Federal eRulemaking Portal: the claimed confidential information, in I. Background https://www.regulations.gov. Follow the its consideration of comments. The FDA is announcing the availability of instructions for submitting comments. second copy, which will have the Comments submitted electronically, a draft guidance for industry entitled claimed confidential information ‘‘Best Practices in Developing including attachments, to https:// redacted/blacked out, will be available www.regulations.gov will be posted to Proprietary Names for Human for public viewing and posted on Nonprescription Drug Products.’’ FDA the docket unchanged. Because your https://www.regulations.gov. Submit comment will be made public, you are has long recognized the importance of both copies to the Dockets Management proprietary name confusion as a solely responsible for ensuring that your Staff. If you do not wish your name and comment does not include any potential cause of medication errors, contact information to be made publicly and has addressed this issue repeatedly confidential information that you or a available, you can provide this third party may not wish to be posted, in recent decades. Our focus has been to information on the cover sheet and not develop and communicate to sponsors a such as medical information, your or in the body of your comments and you anyone else’s Social Security number, or systematic, standardized, and must identify this information as transparent approach to proprietary confidential business information, such ‘‘confidential.’’ Any information marked as a manufacturing process. Please note name evaluation within the product as ‘‘confidential’’ will not be disclosed development, review and approval that if you include your name, contact except in accordance with 21 CFR 10.20 information, or other information that process. FDA issued the draft guidance and other applicable disclosure law. For for industry ‘‘Best Practices in identifies you in the body of your more information about FDA’s posting comments, that information will be Developing Proprietary Names for of comments to public dockets, see 80 Drugs’’ published in the Federal posted on https://www.regulations.gov. FR 56469, September 18, 2015, or access Register of May 29, 2014 (79 FR 30852). • If you want to submit a comment the information at: https:// The 2014 draft guidance focused on the with confidential information that you www.govinfo.gov/content/pkg/FR-2015- safety aspects in the development and do not wish to be made available to the 09-18/pdf/2015-23389.pdf. public, submit the comment as a Docket: For access to the docket to selection of proposed proprietary names written/paper submission and in the read background documents or the for all prescription and nonprescription manner detailed (see ‘‘Written/Paper electronic and written/paper comments human drug products. In the comments Submissions’’ and ‘‘Instructions’’). received, go to https:// we received in response to the 2014 www.regulations.gov and insert the draft guidance on proprietary naming, Written/Paper Submissions docket number, found in brackets in the industry stakeholders urged FDA to Submit written/paper submissions as heading of this document, into the separate the content pertaining to follows: ‘‘Search’’ box and follow the prompts nonprescription drug product • Mail/Hand delivery/Courier (for and/or go to the Dockets Management proprietary names from that pertaining written/paper submissions): Dockets Staff, 5630 Fishers Lane, Rm. 1061, to prescription drug product proprietary Management Staff (HFA–305), Food and Rockville, MD 20852, 240–402–7500. names and issue a separate guidance to Drug Administration, 5630 Fishers Submit written requests for single address the name development process Lane, Rm. 1061, Rockville, MD 20852. copies of the draft guidance to the for nonprescription drugs. Thus, to • For written/paper comments Division of Drug Information, Center for provide greater clarity on the submitted to the Dockets Management Drug Evaluation and Research, Food considerations applicable to the Staff, FDA will post your comment, as and Drug Administration, 10001 New products regulated as nonprescription, well as any attachments, except for Hampshire Ave., Hillandale Building, this draft guidance ‘‘Best Practices in information submitted, marked and 4th Floor, Silver Spring, MD 20993– Developing Proprietary Names for identified, as confidential, if submitted 0002; or to the Office of Human Nonprescription Drug Products’’ as detailed in ‘‘Instructions.’’ Communication, Outreach and was developed as a separate draft Instructions: All submissions received Development, Center for Biologics guidance. must include the Docket No. FDA– Evaluation and Research, Food and FDA is separately announcing the 2020–D–0770 for ‘‘Best Practices in Drug Administration, 10903 New availability of a final guidance entitled Developing Proprietary Names for Hampshire Ave., Bldg. 71, Rm. 3128, ‘‘Best Practices in Developing Human Nonprescription Drug Silver Spring, MD 20993–0002. Send Proprietary Names for Human

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00027 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79189

Prescription Drug Products,’’ which SUMMARY: The Food and Drug • Mail/Hand delivery/Courier (for addresses prescription drug products. Administration (FDA or Agency) is written/paper submissions): Dockets This draft guidance is being issued announcing the availability of a final Management Staff (HFA–305), Food and consistent with FDA’s good guidance guidance for industry entitled ‘‘Best Drug Administration, 5630 Fishers practices regulation (21 CFR 10.115). Practices in Developing Proprietary Lane, Rm. 1061, Rockville, MD 20852. The draft guidance, when finalized, will Names for Human Prescription Drug • For written/paper comments represent the Agency’s current thinking Products.’’ This document provides submitted to the Dockets Management on ‘‘Best Practices in Developing guidance to sponsors on the Staff, FDA will post your comment, as Proprietary Names for Human development and selection of proposed well as any attachments, except for Nonprescription Drug Products.’’ It does proprietary names. This guidance information submitted, marked and not establish any rights for any person describes best practices to help identified, as confidential, if submitted and is not binding on FDA or the public. minimize medication errors and as detailed in ‘‘Instructions.’’ You can use an alternative approach if otherwise avoid adoption of proprietary Instructions: All submissions received it satisfies the requirements of the names that contribute to violations of must include the Docket No. FDA– applicable statutes and regulations. the Federal Food, Drug, and Cosmetic 2014–D–0622 for ‘‘Best Practices in Developing Proprietary Names for II. Paperwork Reduction Act of 1995 Act (FD&C Act) and its implementing regulations and provides a voluntary Human Prescription Drug Products.’’ While this guidance contains no framework for evaluating proposed Received comments will be placed in collection of information, it does refer to proprietary names before submitting the docket and, except for those previously approved FDA collections of them for FDA review. This guidance submitted as ‘‘Confidential information. Therefore, clearance by the finalizes the draft guidance issued in Submissions,’’ publicly viewable at Office of Management and Budget May 2014 entitled ‘‘Best Practices in https://www.regulations.gov or at the (OMB) under the Paperwork Reduction Developing Proprietary Names for the Dockets Management Staff between 9 Act of 1995 (PRA) (44 U.S.C. 3501– Drugs.’’ a.m. and 4 p.m., Monday through 3521) is not required for this guidance. Friday, 240–402–7500. The previously approved collections of DATES: The announcement of the • Confidential Submissions—To information are subject to review by guidance is published in the Federal submit a comment with confidential OMB under the PRA. The collections of Register on December 9, 2020 information that you do not wish to be information in 21 CFR part 314 have ADDRESSES: You may submit either made publicly available, submit your been approved under OMB control electronic or written comments on comments only as a written/paper number 0910–0001 and the collections Agency guidances at any time as submission. You should submit two of information in 21 CFR part 601 have follows: copies total. One copy will include the been approved under OMB control information you claim to be confidential number 0910–0338. Electronic Submissions with a heading or cover note that states ‘‘THIS DOCUMENT CONTAINS Submit electronic comments in the III. Electronic Access CONFIDENTIAL INFORMATION.’’ The following way: Persons with access to the internet Agency will review this copy, including • Federal eRulemaking Portal: may obtain the draft guidance at either the claimed confidential information, in https://www.regulations.gov. Follow the https://www.fda.gov/Drugs/Guidance its consideration of comments. The instructions for submitting comments. ComplianceRegulatoryInformation/ second copy, which will have the Comments submitted electronically, Guidances/default.htm, https:// claimed confidential information including attachments, to https:// www.fda.gov/vaccines-blood-biologics/ redacted/blacked out, will be available www.regulations.gov will be posted to guidance-compliance-regulatory- for public viewing and posted on the docket unchanged. Because your information-biologics/biologics- https://www.regulations.gov. Submit comment will be made public, you are guidances, or https:// both copies to the Dockets Management solely responsible for ensuring that your www.regulations.gov. Staff. If you do not wish your name and comment does not include any contact information to be made publicly Dated: December 4, 2020. confidential information that you or a available, you can provide this Lauren K. Roth, third party may not wish to be posted, information on the cover sheet and not Acting Principal Associate Commissioner for such as medical information, your or in the body of your comments and you Policy. anyone else’s Social Security number, or must identify this information as [FR Doc. 2020–27057 Filed 12–8–20; 8:45 am] confidential business information, such ‘‘confidential.’’ Any information marked BILLING CODE 4164–01–P as a manufacturing process. Please note as ‘‘confidential’’ will not be disclosed that if you include your name, contact except in accordance with 21 CFR 10.20 information, or other information that and other applicable disclosure law. For DEPARTMENT OF HEALTH AND identifies you in the body of your more information about FDA’s posting HUMAN SERVICES comments, that information will be of comments to public dockets, see 80 posted on https://www.regulations.gov. FR 56469, September 18, 2015, or access Food and Drug Administration • If you want to submit a comment the information at: https:// [Docket No. FDA–2014–D–0622] with confidential information that you www.govinfo.gov/content/pkg/FR-2015- do not wish to be made available to the 09-18/pdf/2015-23389.pdf. Best Practices in Developing public, submit the comment as a Docket: For access to the docket to Proprietary Names for Human written/paper submission and in the read background documents or the Prescription Drug Products; Guidance manner detailed (see ‘‘Written/Paper electronic and written/paper comments for Industry; Availability Submissions’’ and ‘‘Instructions’’). received, go to https:// www.regulations.gov and insert the AGENCY: Food and Drug Administration, Written/Paper Submissions HHS. docket number, found in brackets in the Submit written/paper submissions as heading of this document, into the ACTION: Notice of availability. follows: ‘‘Search’’ box and follow the prompts

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00028 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79190 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

and/or go to the Dockets Management it received in developing this final previously approved FDA collections of Staff, 5630 Fishers Lane, Rm. 1061, version of the guidance. information. Therefore, clearance by the Rockville, MD 20852, 240–402–7500. FDA received several comments on Office of Management and Budget You may submit comments on any the guidance and revised the guidance (OMB) under the Paperwork Reduction guidance at any time (see 21 CFR in response to these comments. The Act of 1995 (PRA) (44 U.S.C. 3501– 10.115(g)(5)). revisions include (a) adding a note in 3521) is not required for this guidance. Submit written requests for single the section discussing the United States The previously approved collections of copies of this guidance to the Division Adopted Name (USAN) stating that FDA information are subject to review by of Drug Information, Center for Drug will no longer object to the use of two- OMB under the PRA. The collections of Evaluation and Research, Food and letter USAN stems in names for information in 21 CFR part 314 have Drug Administration, 10001 New products that do not share any been approved under OMB control Hampshire Ave., Hillandale Building, association with the stem in question; number 0910–0001, and the collections 4th Floor, Silver Spring, MD 20993– (b) streamlining the name simulation of information in 21 CFR part 601 have 0002. Send one self-addressed adhesive study section based on the feedback been approved under OMB control label to assist that office in processing received; (c) providing clarifications to number 0910–0338. your requests. See the SUPPLEMENTARY the section that discusses medical III. Electronic Access INFORMATION section for electronic abbreviations, modifiers, and access to the guidance document. computational methods; (d) separating Persons with access to the internet FOR FURTHER INFORMATION CONTACT: the content pertaining to may obtain the document at https:// Lubna Merchant, Center for Drug nonprescription proprietary names and www.fda.gov/Drugs/ Evaluation and Research, Food and issuing separate guidance to address the GuidanceCompliance Drug Administration, 10903 New name development process for RegulatoryInformation/Guidances/ Hampshire Ave., Bldg. 22, Rm. 4418, nonprescription drugs; (e) revising the default.htm, https://www.fda.gov/ Silver Spring, MD 20993–0002, 301– misbranding discussion for greater vaccines-blood-biologics/guidance- clarity and included information on one 796–5162, or Stephen Ripley, Center for compliance-regulatory-information- possible study methodology that Biologics Evaluation and Research, biologics/biologics-guidances, or https:// sponsors may consider to test proposed Food and Drug Administration, 10903 www.regulations.gov. names for misbranding concerns; and (f) New Hampshire Ave., Bldg. 71, Rm. adding certain definitions and specific Dated: December 4, 2020. 7301, Silver Spring, MD 20993–0002, criteria for prescreening proprietary Lauren K. Roth, 240–402–7911. name candidates and updating Acting Principal Associate Commissioner for SUPPLEMENTARY INFORMATION: definitions in the glossary and clarified Policy. I. Background terminology where needed. FDA also [FR Doc. 2020–27058 Filed 12–8–20; 8:45 am] revised the document throughout to BILLING CODE 4164–01–P FDA is announcing the availability of ensure consistency in terminology, a guidance for industry entitled ‘‘Best clarified section headings, and Practices in Developing Proprietary reordered information for clarity where DEPARTMENT OF HEALTH AND Names for Human Prescription Drug applicable. HUMAN SERVICES Products.’’ This guidance describes best Elsewhere in this issue of the Federal practices to help minimize proprietary Register, FDA is announcing the Office of the Secretary name-related medication errors and availability of a draft guidance entitled Fourth Amendment to the Declaration otherwise avoid adoption of proprietary ‘‘Best Practices in Developing Under the Public Readiness and names that contribute to violations of Proprietary Names for Human Emergency Preparedness Act for the FD&C Act and its implementing Nonprescription Drug Products.’’ That Medical Countermeasures Against regulations. This guidance also draft guidance is issued in response to COVID–19 and Republication of the describes the framework FDA uses in industry stakeholders’ requests to Declaration evaluating proprietary names that specifically address the approaches for sponsors could use before submitting naming of human nonprescription drug names for FDA review if they wish. ACTION: Notice of Amendment and products. The draft guidance is being Republished Declaration. FDA has long recognized the issued to provide greater clarity on the importance of proprietary name considerations applicable to SUMMARY: The Secretary issues this confusion as a potential cause of nonprescription drug products. amendment pursuant to section 319F–3 medication errors and has addressed The guidance announced in this of the Public Health Service Act to this issue repeatedly in recent decades. notice is being issued consistent with amend his March 10, 2020 Declaration Our focus has been to develop and FDA’s good guidance practices Under the Public Readiness and communicate to sponsors a systematic, regulation (21 CFR 10.115). The Emergency Preparedness Act for standardized, and transparent approach guidance represents the current thinking Medical Countermeasures Against to proprietary name evaluation within of FDA on ‘‘Best Practices in Developing COVID–19. the product development, review, and Proprietary Names for Human DATES: The amendments to the approval process. Prescription Drug Products.’’ It does not Declaration are applicable as of In the Federal Register of May 29, establish any rights for any person and February 4, 2020, except as otherwise 2014 (79 FR 30852), FDA announced the is not binding on FDA or the public. specified in Section XII. availability of a draft guidance entitled You can use an alternative approach if ‘‘Best Practices in Developing it satisfies the requirements of the FOR FURTHER INFORMATION CONTACT: Proprietary Names for Drugs.’’ The applicable statutes and regulations. Robert P. Kadlec, MD, MTM&H, MS, guidance announced in this notice Assistant Secretary for Preparedness finalizes the draft guidance issued in II. Paperwork Reduction Act of 1995 and Response, Office of the Secretary, May 2014. The Agency has carefully While this guidance contains no Department of Health and Human reviewed and considered the comments collection of information, it does refer to Services, 200 Independence Avenue

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00029 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79191

SW, Washington, DC 20201; Telephone: cause.3 On August 19, the Secretary (c) Adds an additional category of 202–205–2882. amended the Declaration to add Qualified Persons under Section V of SUPPLEMENTARY INFORMATION: The additional categories of Qualified the Declaration and 42 U.S.C. 247d– Public Readiness and Emergency Persons and to amend the category of 6d(i)(8)(B), i.e., healthcare personnel Preparedness (PREP) Act, 42 U.S.C. disease, health condition, or threat for using telehealth to order or administer 247d–6d et. seq., authorizes the which he recommends the Covered Countermeasures for patients Secretary of Health and Human Services administration or use of Covered in a state other than the state where the (the Secretary) to issue a declaration to Countermeasures.4 healthcare personnel are permitted to provide liability protections to certain The Secretary now further amends the practice.7 individuals and entities (Covered Declaration pursuant to section 319F–3 (d) Modifies and clarifies the training Persons) against any claim of loss of the Public Health Service Act. This requirements for certain licensed caused by, arising out of, relating to, or Fourth Amendment to the Declaration: pharmacists and pharmacy interns to resulting from, the manufacture, (a) Clarifies that the Declaration must administer certain routine childhood or distribution, administration, or use of be construed in accordance with the COVID–19 vaccinations. Department of Health and Human certain medical countermeasures (e) Makes explicit that Section VI (Covered Countermeasures), except for Services (HHS) Office of the General Counsel (OGC) Advisory Opinions on covers all qualified pandemic and claims involving ‘‘willful misconduct,’’ epidemic products under the PREP Act. as defined in the PREP Act. Such the Public Readiness and Emergency declarations are subject to amendment Preparedness Act and the Declaration (f) Adds a third method of as circumstances warrant. (Advisory Opinions).5 The Declaration distribution under Section VII of the The PREP Act was enacted on incorporates the Advisory Opinions for Declaration and 42 U.S.C. 247d–6d(a)(5) December 30, 2005, as Public Law 109– that purpose. that would provide liability protections 148, Division C, Section 2. It amended (b) Incorporates authorizations that for, among other things, additional the Public Health Service (PHS) Act, the HHS Office of the Assistant private-distribution channels. adding Section 319F–3, which Secretary for Health (OASH) has issued (g) Makes explicit in Section IX that addresses liability immunity, and as an Authority Having Jurisdiction.6 there can be situations where not Section 319F–4, which creates a administering a covered countermeasure compensation program. These sections 3 85 FR 35100 (June 8, 2020). to a particular individual can fall within 4 are codified at 42 U.S.C. 247d–6d and 85 FR 52136 (Aug. 24, 2020). the PREP Act and this Declaration’s 5 See, e.g., Advisory Opinion on the Public 42 U.S.C. 247d–6e, respectively. Section Readiness and Emergency Preparedness Act and the liability protections. 319F–3 of the PHS Act has been March 10, 2020 Declaration under the Act, Apr. 17, (h) Makes explicit in Section XI that amended by the Pandemic and All- 2020, as Modified on May 19, 2020, available at there are substantial federal legal and Hazards Preparedness Reauthorization https://www.hhs.gov/guidance/sites/default/files/ hhs-guidance-documents/prep-act-advisory- policy issues, and substantial federal Act (PAHPRA), Public Law 113–5, opinion-hhs-ogc.pdf (last visited Dec. 1, 2020); legal and policy interests, in having a enacted on March 13, 2013, and the Advisory Opinion 20–02 on the Public Readiness unified, whole-of-nation response to the Coronavirus Aid, Relief, and Economic and Emergency Preparedness Act and the COVID–19 pandemic among federal, Security (CARES) Act, Public Law 116– Secretary’s Declaration under the Act, May 19, 2020, available at https://www.hhs.gov/guidance/ state, local, and private-sector entities. 136, enacted on March 27, 2020, to sites/default/files/hhs-guidance-documents/ The world is facing an unprecedented expand Covered Countermeasures under advisory-opinion-20-02-hhs-ogc-prep-act.pdf (last pandemic. To effectively respond, there the PREP Act. visited Dec. 1, 2020); Advisory Opinion 20–03 on must be a more consistent pathway for On January 31, 2020, the Secretary the Public Readiness and Emergency Preparedness Act and the Secretary’s Declaration under the Act, Covered Persons to manufacture, declared a public health emergency Oct. 22, 2020, as Modified on Oct. 23, 2020, distribute, administer or use Covered pursuant to section 319 of the PHS Act, available at https://www.hhs.gov/guidance/sites/ Countermeasures across the nation and 42 U.S.C. 247d, effective January 27, default/files/hhs-guidance-documents/AO3.1.2_ the world. 2020, for the entire United States to aid Updated_FINAL_SIGNED_10.23.20.pdf (last visited Dec. 1, 2020); Advisory Opinion 20–04 on the in the response to the Coronavirus Public Readiness and Emergency Preparedness Act immunity.pdf (last visited Dec. 1, 2020); Guidance Disease 2019 (COVID–19) outbreak, and the Secretary’s Declaration under the Act, Oct. for PREP Act Coverage for Qualified Pharmacy which subsequently became a global 22, 2020, as Modified on Oct. 23, 2020, available Technicians and State-Authorized Pharmacy pandemic. Pursuant to section 319 of at https://www.hhs.gov/guidance/sites/default/files/ Interns for Childhood Vaccines, COVID–19 hhs-guidance-documents/AO%204.2_Updated_ Vaccines, and COVID–19 Testing, OASH, Oct. 20, the PHS Act, the Secretary renewed that FINAL_SIGNED_10.23.20.pdf (last visited Dec. 1, 2020, available at https://www.hhs.gov/sites/ declaration on April 21, 2020, July 23, 2020). default/files/prep-act-guidance.pdf (last visited 2020, and October 2, 2020. On March 6 See, e.g., Guidance for Licensed Pharmacists, Dec. 1, 2020); PREP Act Authorization for 10, 2020, the Secretary issued a COVID–19 Testing, and Immunity Under the PREP Pharmacies Distributing and Administering Certain Act, OASH, Apr. 8, 2020, available at https:// Covered Countermeasures, Oct. 29, 2020, available declaration under the PREP Act for www.hhs.gov/guidance/sites/default/files/hhs- at https://www.hhs.gov/guidance/sites/default/files/ medical countermeasures against guidance-documents//authorizing-licensed- hhs-guidance-documents//prep-act-authorization- COVID–19.1 On April 10, the Secretary pharmacists-to-order-and-administer-covid-19- pharmacies-administering-covered- amended the Declaration to extend tests.pdf (last visited Dec. 1, 2020); Guidance for countermeasures.pdf (last visited Dec. 1, 2020) PREP Act Coverage for COVID–19 Screening Tests (collectively, OASH PREP Act Authorizations). liability protections to Covered at Nursing Homes, Assisted-Living Facilities, Long- 7 ‘‘Telehealth, telemedicine, and related terms Countermeasures authorized under the Term-Care Facilities, and other Congregate generally refer to the exchange of medical CARES Act.2 On June 4, the Secretary Facilities, OASH, Aug. 31, 2020, available at information from one site to another through amended the Declaration to clarify that https://www.hhs.gov/guidance/sites/default/files/ electronic communication to improve a patient’s hhs-guidance-documents//prep-act-coverage-for- health.’’ Medicare Telemedicine Health Care Covered Countermeasures under the screening-in-congregate-settings.pdf (last visited Provider Fact Sheet, Mar. 17, 2020, available at Declaration include qualified pandemic Dec. 1, 2020); Guidance for Licensed Pharmacists https://www.cms.gov/newsroom/fact-sheets/ and epidemic products that limit the and Pharmacy Interns Regarding COVID–19 medicare-telemedicine-health-care-provider-fact- harm that COVID–19 might otherwise Vaccines and Immunity under the PREP Act, sheet (last visited on Dec. 2, 2020). For the OASH, Sept. 3, 2020, available at https:// Declaration and the Fourth Amendment, the term www.hhs.gov/guidance/sites/default/files/hhs- ‘‘telehealth’’ includes telehealth, telemedicine, and 1 85 FR 15198 (Mar. 17, 2020). guidance-documents//licensed-pharmacists-and- related terms as described by the Centers for 2 85 FR 21012 (Apr. 15, 2020). pharmacy-interns-regarding-covid-19-vaccines- Medicare & Medicaid (CMS).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00030 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79192 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

(i) Revises the effective time period of during this pandemic. According to the Telehealth, telemedicine, and related terms the Declaration in light of the Centers for Disease Control and generally refer to the exchange of medical amendments to the Declaration.8 Prevention (CDC), information from one site to another through The Secretary republishes the electronic communication to improve a Telehealth services can facilitate public patient’s health. Innovative uses of this kind Declaration, as amended, in full. Unless health mitigation strategies during this of technology in the provision of healthcare otherwise noted, all statutory citations pandemic by increasing social distancing. is increasing. And with the emergence of the are to the U.S. Code. These services can be a safer option for virus causing the disease COVID–19, there is Description of This Amendment [healthcare personnel (HCP)] and patients by an urgency to expand the use of technology reducing potential infectious exposures. to help people who need routine care, and Declaration They can reduce the strain on healthcare keep vulnerable beneficiaries and systems by minimizing the surge of patient beneficiaries with mild symptoms in their The Declaration has fifteen sections demand on facilities and reduce the use of homes while maintaining access to the care describing PREP Act coverage for [personal protective equipment (PPE)] by they need. Limiting community spread of the medical countermeasures against healthcare providers. virus, as well as limiting the exposure to COVID–19. OGC has issued Advisory Maintaining continuity of care to the extent other patients and staff members will slow Opinions interpreting the PREP Act and possible can avoid additional negative viral spread.11 reflecting the Secretary’s interpretation consequences from delayed preventive, Accordingly, CMS and other HHS of the Declaration.9 The Secretary now chronic, or routine care. Remote access to components has substantially expanded amends the Declaration to clarify that healthcare services may increase participation for those who are medically or the scope of services paid under the Declaration must be construed in Medicare when furnished using accordance with the Advisory Opinions. socially vulnerable or who do not have ready access to providers. Remote access can also telehealth technologies during this The Secretary expressly incorporates the help preserve the patient-provider pandemic. Advisory Opinions for that purpose. relationship at times when an in-person visit Other HHS components have also Section V. Covered Persons is not practical or feasible. Telehealth taken steps to expand the use of services can be used to: telehealth during the pandemic.12 Section V of the Declaration describes • Screen patients who may have symptoms Moreover, to expand the use of Covered Persons, including additional of COVID–19 and refer as appropriate telehealth during this pandemic, the • qualified persons identified by the Provide low-risk urgent care for non- Office for Civil Rights (OCR) at HHS is Secretary, as required under the PREP COVID–19 conditions, identify those persons exercising enforcement discretion and who may need additional medical Act. The Secretary amends Section V to will not impose penalties for specify an additional category of consultation or assessment, and refer as appropriate noncompliance with the regulatory qualified persons. Specifically, • requirements under the Health healthcare personnel who are permitted Access primary care providers and specialists, including mental and behavioral Insurance Portability and to order and administer a Covered health, for chronic health conditions and Accountability Act (HIPAA) Rules Countermeasure through telehealth in a medication management against covered healthcare providers state may do so for patients in another • Provide coaching and support for that serve patients through everyday state so long as the healthcare personnel patients managing chronic health conditions, communications technologies during comply with the legal requirements of including weight management and nutrition the COVID–19 nationwide public health counseling the state in which the healthcare emergency.13 This exercise of discretion personnel are permitted to order and • Participate in physical therapy, occupational therapy, and other modalities as administer the Covered Countermeasure 11 Medicare Telemedicine Health Care Provider by means of telehealth. a hybrid approach to in-person care for optimal health Fact Sheet, Mar. 17, 2020, available at https:// Telehealth is widely recognized as a www.cms.gov/newsroom/fact-sheets/medicare- • Monitor clinical signs of certain chronic valuable tool to promote public health telemedicine-health-care-provider-fact-sheet (last medical conditions (e.g., blood pressure, visited Dec. 1, 2020). blood glucose, other remote assessments) 12 See, e.g., Trump Administration Drives 8 In addition, the Fourth Amendment makes • Engage in case management for patients Telehealth Services in Medicaid and Medicare, certain non-substantive changes. Those should not who have difficulty accessing care (e.g., those CMS, Oct. 14, 2020, available at https:// be interpreted to change any substantive provisions. www.cms.gov/newsroom/press-releases/trump- 9 See, e.g., Advisory Opinion on the Public who live in very rural settings, older adults, those with limited mobility) administration-drives-telehealth-services-medicaid- Readiness and Emergency Preparedness Act and the and-medicare (last visited Dec. 1, 2020); Secretary March 10, 2020 Declaration under the Act, Apr. 17, • Follow up with patients after Azar Announces Historic Expansion of Telehealth 2020, as Modified on May 19, 2020, available at hospitalization Access to Combat COVID–19, Mar. 17, 2020, https://www.hhs.gov/guidance/sites/default/files/ • Deliver advance care planning and available at https://www.hhs.gov/about/news/2020/ hhs-guidance-documents/prep-act-advisory- counseling to patients and caregivers to 03/17/secretary-azar-announces-historic- opinion-hhs-ogc.pdf (last visited Dec. 1, 2020); document preferences if a life-threatening Advisory Opinion 20–02 on the Public Readiness expansion-of-telehealth-access-to-combat-covid- event or medical crisis occurs 19.html (last visited Nov. 30, 2020); OIG Policy and Emergency Preparedness Act and the • Secretary’s Declaration under the Act, May 19, Provide non-emergent care to residents Statement Regarding Physicians and Other 2020, available at https://www.hhs.gov/guidance/ in long-term care facilities Practitioners That Reduce or Waive Amounts Owed sites/default/files/hhs-guidance-documents/ • Provide education and training for HCP by Federal Health Care Program Beneficiaries for advisory-opinion-20-02-hhs-ogc-prep-act.pdf (last through peer-to-peer professional medical Telehealth Services During the 2019 Novel Coronavirus (COVID–19) Outbreak, Mar. 17, 2020, visited Dec. 1, 2020); Advisory Opinion 20–03 on consultations (inpatient or outpatient) that the Public Readiness and Emergency Preparedness available at https://oig.hhs.gov/fraud/docs/ are not locally available, particularly in rural alertsandbulletins/2020/policy-telehealth-2020.pdf Act and the Secretary’s Declaration under the Act, 10 Oct. 22, 2020, as Modified on Oct. 23, 2020, areas. (last visited Nov. 30, 2020). available at https://www.hhs.gov/guidance/sites/ 13 OCR Announces Notification of Enforcement default/files/hhs-guidance-documents/AO3.1.2_ Similarly, CMS has stressed the Discretion for Telehealth Remote Communications Updated_FINAL_SIGNED_10.23.20.pdf (last visited importance of telehealth during this During the COVID–19 Nationwide Public Health Dec. 1, 2020); Advisory Opinion 20–04 on the pandemic: Emergency, Mar. 17, 2020, available at https:// Public Readiness and Emergency Preparedness Act www.hhs.gov/about/news/2020/03/17/ocr- and the Secretary’s Declaration under the Act, Oct. announces-notification-of-enforcement-discretion- 22, 2020, as Modified on Oct. 23, 2020, available 10 Using Telehealth to Expand Access to Essential for-telehealth-remote-communications-during-the- at https://www.hhs.gov/guidance/sites/default/files/ Health Services during the COVID–19 Pandemic, covid-19.html (last visited Dec. 1, 2020). The PREP hhs-guidance-documents/AO%204.2_Updated_ CDC, updated June 10, 2020, available at https:// Act does not provide immunity against federal FINAL_SIGNED_10.23.20.pdf (last visited Dec. 1, www.cdc.gov/coronavirus/2019-ncov/hcp/ enforcement actions brought by the federal 2020). telehealth.html (last visited Dec. 1, 2020). government. We refer to this exercise of

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00031 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79193

applies to widely available U.S.C. 247d–6d(i)(8)(B) includes examples are not an exclusive or communications apps, such as healthcare personnel using telehealth to exhaustive list of persons who are FaceTime or Skype, when used in good order or administer Covered qualified persons identified by the faith for any telehealth treatment or Countermeasures for patients in a state Secretary in Section V. diagnostic purpose, regardless of other than the state where the The Secretary also amends Section V whether the telehealth service is healthcare personnel are permitted to 14 to make explicit that the requirement in directly related to COVID–19. practice. When ordering and that section for certain qualified persons Many states have authorized out-of- administering Covered Countermeasures to have a current certificate in basic state healthcare personnel to deliver through telehealth to patients in a state cardiopulmonary resuscitation is telehealth services to in-state patients, where the healthcare personnel are not satisfied by, among other things, a either generally or in the context of already permitted to do so, the certification in basic cardiopulmonary COVID–19.15 healthcare personnel must comply with resuscitation by an online program that To help maximize the utility of all requirements for ordering and has received accreditation from the telehealth, the Secretary declares that administering Covered Countermeasures the term ‘‘qualified person’’ under 42 to patients through telehealth in the American Nurses Credentialing Center, state where the healthcare personnel are the Accreditation Council for Pharmacy enforcement discretion as another example of the licensed or otherwise permitted to Education (ACPE), or the Accreditation Department’s desire to support the expanded use of practice. Any state law that prohibits or Council for Continuing Medical telehealth during this pandemic. Education. 14 Id. effectively prohibits such a qualified 15 See, e.g., 2020 Alaska Laws Ch. 10 (S.B. 241) person from ordering and administering The Secretary also amends Section Sec. 7 (healthcare provider can perform telehealth Covered Countermeasures through V’s training requirements for licensed if, among other things, ‘‘the health care provider is telehealth is preempted.16 Nothing in pharmacists to order and administer licensed, permitted, or certified to provide healthcare services in another jurisdiction and is in this Declaration shall preempt state laws certain childhood or COVID–19 good standing in the jurisdiction that issued the that permit additional persons to deliver vaccines. To order and administer license, permit, or certification’’); CT Exec. Order telehealth services. vaccines, the licensed pharmacist must No. 7G, Sec. 5(b), Mar. 19, 2020, available at https:// The Secretary also amends Section V have completed the immunization portal.ct.gov/-/media/Office-of-the-Governor/ Executive-Orders/Lamont-Executive-Orders/ to include several examples of Covered training that the licensing State requires Executive-Order-No-7G.pdf (last visited Dec. 1, Persons who are Qualified Persons, in order for pharmacists to administer 2020) (‘‘Subsection (a)(12)’s requirements for the because they are authorized in vaccines. If the State does not specify licensure, certification or registration of telehealth accordance with the public health and training requirements for the licensed providers shall be suspended for such telehealth providers that are Medicaid enrolled providers or medical emergency response of the pharmacist to order and administer in-network providers for commercial fully insured Authority Having Jurisdiction to vaccines, the licensed pharmacist must health insurance providing telehealth services to prescribe, administer, deliver, distribute complete a vaccination training program patients’’); Fl. Emerg. Order, DOH No. 20–002, In or dispense the Covered Re: Suspension of Statutes, Rules, and Orders, of at least 20 hours that is approved by Made Necessary by COVID–19, Mar. 16, 2020, Countermeasures. Those examples the Accreditation Council for Pharmacy available at http://www.flhealthsource.gov/pdf/ include certain pharmacists, pharmacy Education (ACPE) to order and emergencyorder-20-002.pdf?inf_contact_ interns, and pharmacy technicians who administer vaccines. This training key=c1be7c474d297aa416752a23d269 order or administer certain COVID–19 program must include hands-on 4901680f8914173f9191b1c0223e68310bb1 (last 17 visited Dec. 1, 2020) (‘‘For purposes of preparing tests and certain vaccines. These injection technique, clinical evaluation for, responding to, and mitigating any effect of of indications and contraindications of 16 COVID–19, health care professionals not licensed in Advisory Opinion 20–02 on the Public vaccines, and the recognition and this state may provide health care services to a Readiness and Emergency Preparedness Act and the patient licensed in this state using telehealth, Secretary’s Declaration under the Act, May 19, treatment of emergency reactions to notwithstanding the requirements of section 2020, available at https://www.hhs.gov/guidance/ vaccines. 456.47(4)(a) through (c), (h), and (i), Florida Statutes sites/default/files/hhs-guidance-documents/ .... This exemption shall apply only to the advisory-opinion-20-02-hhs-ogc-prep-act.pdf (last Other than the basic cardiopulmonary following out of state health care professionals visited Dec. 1, 2020). resuscitation requirement and the holding a valid, clear, and unrestricted license in 17 See, e.g., Guidance for Licensed Pharmacists, practical training program requirement, another state or territory in the United States who COVID–19 Testing, and Immunity Under the PREP this Amendment does not change the are not currently under investigation or prosecution Act, OASH, Apr. 8, 2020, available at https:// in any disciplinary proceeding in any of the states www.hhs.gov/guidance/sites/default/files/hhs- requirements for a pharmacist, in which they hold a license: physicians, guidance-documents//authorizing-licensed- pharmacy intern, or pharmacy osteopathic physicians, physician assistants, and pharmacists-to-order-and-administer-covid-19- technician to be a ‘‘qualified person’’ advanced practice registered nurses.’’); IA Emer. tests.pdf (last visited Dec. 1, 2020); Guidance for Dec., Sec. 39 (Nov. 10, 2020), available at https:// PREP Act Coverage for COVID–19 Screening Tests under 42 U.S.C. 247d–6d(i)(8)(B) who governor.iowa.gov/sites/default/files/documents/ at Nursing Homes, Assisted-Living Facilities, Long- can order or administer childhood or Public%20Health%20Proclamation%20- Term-Care Facilities, and other Congregate COVID–19 vaccines pursuant to the %202020.11.10.pdf (last visited Dec. 1, 2020) Facilities, OASH, Aug. 31, 2020, available at Declaration. (temporarily suspending any statute or rule defining https://www.hhs.gov/guidance/sites/default/files/ a doctor or medical staff as ‘‘requiring all doctors hhs-guidance-documents//prep-act-coverage-for- Section VI. Covered Countermeasures and medical staff be licensed to practice in this screening-in-congregate-settings.pdf (last visited state, to the extent that individual is licensed to Dec. 1, 2020); Guidance for Licensed Pharmacists practice in another state’’); NH Emer. Order # 15 and Pharmacy Interns Regarding COVID–19 The Secretary amends Section VI to Pursuant to Exec. Order 2020–4, Sec. 1, Mar. 23, Vaccines and Immunity under the PREP Act, make explicit that Section VI covers all 2020, available at https://www.governor.nh.gov/ OASH, Sept. 3, 2020, available at https:// qualified pandemic and epidemic sites/g/files/ehbemt336/files/documents/ www.hhs.gov/guidance/sites/default/files/hhs- products under the PREP Act. emergency-order-15.pdf (last visited Dec. 1, 2020) guidance-documents//licensed-pharmacists-and- (‘‘any out-of-state medical provider whose pharmacy-interns-regarding-covid-19-vaccines- profession is licensed within this State shall be immunity.pdf (last visited Dec. 1, 2020); Guidance Dec. 1, 2020); PREP Act Authorization for allowed to perform any medically necessary service for PREP Act Coverage for Qualified Pharmacy Pharmacies Distributing and Administering Certain as if the medical provider were licensed to perform Technicians and State-Authorized Pharmacy Covered Countermeasures, Oct. 29, 2020, available such service within the state of New Hampshire Interns for Childhood Vaccines, COVID–19 at https://www.hhs.gov/guidance/sites/default/files/ subject to,’’ among other things, the medical Vaccines, and COVID–19 Testing, OASH, Oct. 20, hhs-guidance-documents//prep-act-authorization- provider being ‘‘licensed and in good standing in 2020, available at https://www.hhs.gov/sites/ pharmacies-administering-covered- another United States jurisdiction’’). default/files/prep-act-guidance.pdf (last visited countermeasures.pdf (last visited Dec. 1, 2020).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00032 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79194 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Section VII. Limitations on Distribution to the FDA licensure, approval, a Covered Person for death or serious The Secretary may specify that clearance, or authorization (or pursuant physical injury proximately caused by liability protections are in effect only for to an Investigational New Drug willful misconduct by such Covered Covered Countermeasures obtained Application or Investigational Device Person. In all other cases, an injured through a particular means of Exemption), or the NIOSH approval. party’s exclusive remedy is an This third distribution channel may distribution. The Declaration previously administrative remedy under section extend PREP Act coverage when there is stated that liability immunity is afforded 319F–4 of the PHS Act. Through the no federal agreement or authorization in to Covered Persons only for PREP Act, Congress delegated to me the accordance with the public health and Recommended Activities related to (a) authority to strike the appropriate medical response of the Authority present or future federal contracts, Federal-state balance with respect to Having Jurisdiction to prescribe, cooperative agreements, grants, other particular Covered Countermeasures administer, deliver, distribute or through PREP Act declarations. transactions, interagency agreements, or dispense the Covered Countermeasures memoranda of understanding or other following a declaration of an emergency. Section XII. Effective Time Period federal agreements; or (b) activities For example, a manufacturer, The Secretary amends Section XII to authorized in accordance with the distributor, program planner, or provide that liability protections for all public health and medical response of qualified person engages in Covered Countermeasures administered the Authority Having Jurisdiction to manufacturing, testing, development, and used in accordance with the public prescribe, administer, deliver, distribution, administration, or use of a health and medical response of the distribute, or dispense the Covered COVID–19 test pursuant to an FDA Authority Having Jurisdiction, as Countermeasures following a Emergency Use Authorization for that identified in Section VII(b) of this declaration of an emergency. COVID–19 test. If the Covered Person Declaration, begins with a ‘‘Declaration COVID–19 is an unprecedented global satisfies all other requirements of the of Emergency,’’ as defined in Section VII challenge that requires a whole-of- PREP Act and Declaration, there will be (except that, with respect to qualified nation response that utilizes federal-, PREP Act coverage even if there is no persons who order or administer a state-, and local- distribution channels federal agreement to cover those routine childhood vaccination that ACIP as well as private-distribution channels. activities and those activities are not recommends to persons ages three Given the broad scale of this pandemic, part of the authorized activity of an through 18 according to ACIP’s standard the Secretary amends the Declaration to Authority Having Jurisdiction. immunization schedule, PREP Act extend PREP Act coverage to additional coverage began on August 24, 2020), private-distribution channels, as set Section IX. Administration of Covered Countermeasures and lasts through (a) the final day the forth below. Declaration of Emergency is in effect, or The amended Section VII adds that The Secretary amends Section IX to (b) October 1, 2024, whichever occurs PREP Act liability protections also make explicit that there can be first. This change is to conform the text extend to Covered Persons for situations where not administering a of the Declaration to the Third Recommended Activities that are covered countermeasure to a particular Amendment.18 related to any Covered Countermeasure individual can fall within the PREP Act The Secretary also amends Section XII that is: and this Declaration’s liability to provide that liability protections for (a) Licensed, approved, cleared, or protections. all Covered Countermeasures identified authorized by the Food and Drug Section XI. Geographic Area in Section VII(c) of this Declaration Administration (FDA) (or that is begins on the date of this amended The Secretary makes explicit in permitted to be used under an Declaration and lasts through (a) the Section XI that there are substantial Investigational New Drug Application or final day the Declaration of Emergency federal legal and policy issues, and an Investigational Device Exemption) is in effect, or (b) October 1, 2024, substantial federal legal and policy under the Federal Food, Drug, and whichever occurs first. Because the interests within the meaning of Grable Cosmetic (FD&C) Act or Public Health Secretary is adding Section VII(c) to the & Sons Metal Products, Inc. v. Darue Service (PHS) Act to treat, diagnose, Declaration in this Amendment, Section Eng’g. & Mf’g., 545 U.S. 308 (2005), in cure, prevent, mitigate or limit the harm XII provides that Section VII(c) is having a unified, whole-of-nation from COVID–19, or the transmission of effective as of the date this amended response to the COVID–19 pandemic SARS–CoV–2 or a virus mutating Declaration is published. therefrom; or among federal, state, local, and private- (b) a respiratory protective device sector entities. The world is facing an Additional Amendments approved by the National Institute for unprecedented global pandemic. To The Secretary also makes other, non- Occupational Safety and Health effectively respond, there must be a substantive amendments. (NIOSH) under 42 CFR part 84, or any more consistent pathway for Covered successor regulations, that the Secretary Persons to manufacture, distribute, Declaration, as Amended, for Public determines to be a priority for use administer or use Covered Readiness and Emergency during a public health emergency Countermeasures across the nation and Preparedness Act Coverage for Medical declared under section 319 of the PHS the world. Thus, there are substantial Countermeasures Against COVID–19 Act to prevent, mitigate, or limit the federal legal and policy issues, and To the extent any term previously in harm from, COVID–19, or the substantial federal legal and policy the Declaration, including its transmission of SARS–CoV–2 or a virus interests within the meaning of Grable amendments, is inconsistent with any mutating therefrom. & Sons Metal Products, Inc. v. Darue provision of this Republished To qualify for this third distribution Eng’g. & Mf’g., 545 U.S. 308 (2005), in Declaration, the terms of this channel (but not necessarily to qualify having a uniform interpretation of the Republished Declaration are controlling. for the other distribution channels), a PREP Act. Under the PREP Act, the sole This Declaration must be construed in Covered Person must manufacture, test, exception to the immunity from suit and accordance with the Advisory Opinions develop, distribute, administer, or use liability of covered persons is an the Covered Countermeasure pursuant exclusive Federal cause of action against 18 See 85 FR 52136 (Aug. 24, 2020).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00033 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79195

of the Office of the General Counsel distribution, administration, and use of (b) any person authorized to (Advisory Opinions). I incorporate those the Covered Countermeasures. prescribe, administer, or dispense the Advisory Opinions as part of this Covered Countermeasures or who is IV. Liability Protections Declaration.19 This Declaration is a otherwise authorized to perform an ‘‘requirement’’ under the PREP Act. 42 U.S.C. 247d–6d(a), 247d–6d(b)(1) activity under an Emergency Use Authorization in accordance with I. Determination of Public Health Liability protections as prescribed in the PREP Act and conditions stated in Section 564 of the FD&C Act; Emergency (c) any person authorized to prescribe, this Declaration are in effect for the administer, or dispense Covered 42 U.S.C. 247d–6d(b)(1) Recommended Activities described in Countermeasures in accordance with Section III. I have determined that the spread of Section 564A of the FD&C Act; SARS–CoV–2 or a virus mutating V. Covered Persons (d) a State-licensed pharmacist who therefrom and the resulting disease orders and administers, and pharmacy COVID–19 constitutes a public health 42 U.S.C. 247d–6d(i)(2), (3), (4), (6), interns who administer (if the pharmacy emergency. I further determine that use (8)(A) and (B) intern acts under the supervision of of any respiratory protective device Covered Persons who are afforded such pharmacist and the pharmacy approved by NIOSH under 42 CFR part liability protections under this intern is licensed or registered by his or 84, or any successor regulations, is a Declaration are ‘‘manufacturers,’’ her State board of pharmacy), 21 (1) priority for use during the public health ‘‘distributors,’’ ‘‘program planners,’’ and vaccines that the Advisory Committee emergency that I declared on January ‘‘qualified persons,’’ as those terms are on Immunization Practices (ACIP) 31, 2020 under section 319 of the PHS defined in the PREP Act; their officials, recommends to persons ages three Act for the entire United States to aid in agents, and employees; and the United through 18 according to ACIP’s standard the response of the nation’s healthcare States. immunization schedule or (2) FDA- community to the COVID–19 outbreak. In addition, I have determined that authorized or FDA-licensed COVID–19 II. Factors Considered the following additional persons are vaccines to persons ages three or older. qualified persons: Such State-licensed pharmacists and the 42 U.S.C. 247d–6d(b)(6) (a) Any person authorized in State-licensed or registered interns I have considered the desirability of accordance with the public health and under their supervision are qualified encouraging the design, development, medical emergency response of the persons only if the following clinical testing, or investigation, Authority Having Jurisdiction, as requirements are met: manufacture, labeling, distribution, described in Section VII below, to i. The vaccine must be authorized, formulation, packaging, marketing, prescribe, administer, deliver, distribute approved, or licensed by the FDA; promotion, sale, purchase, donation, or dispense the Covered ii. In the case of a COVID–19 vaccine, dispensing, prescribing, administration, Countermeasures, and their officials, the vaccination must be ordered and licensing, and use of the Covered agents, employees, contractors and administered according to ACIP’s Countermeasures. volunteers, following a Declaration of COVID–19 vaccine recommendation(s). Emergency, as that term is defined in iii. In the case of a childhood vaccine, III. Recommended Activities Section VII of this Declaration; 20 the vaccination must be ordered and administered according to ACIP’s 42 U.S.C. 247d–6d(b)(1) 20 See, e.g., Guidance for Licensed Pharmacists, standard immunization schedule; I recommend, under the conditions COVID–19 Testing, and Immunity Under the PREP iv. The licensed pharmacist must stated in this Declaration, the Act, OASH, Apr. 8, 2020, available at https:// have completed the immunization www.hhs.gov/guidance/sites/default/files/hhs- training that the licensing State requires manufacture, testing, development, guidance-documents//authorizing-licensed- pharmacists-to-order-and-administer-covid-19- in order for pharmacists to order and 19 See, e.g., Advisory Opinion on the Public tests.pdf (last visited Dec. 1, 2020); Guidance for administer vaccines. If the State does Readiness and Emergency Preparedness Act and the PREP Act Coverage for COVID–19 Screening Tests not specify training requirements for the March 10, 2020 Declaration under the Act, Apr. 17, at Nursing Homes, Assisted-Living Facilities, Long- licensed pharmacist to order and 2020, as Modified on May 19, 2020, available at Term-Care Facilities, and other Congregate https://www.hhs.gov/guidance/sites/default/files/ Facilities, OASH, Aug. 31, 2020, available at administer vaccines, the licensed hhs-guidance-documents/prep-act-advisory- https://www.hhs.gov/guidance/sites/default/files/ pharmacist must complete a vaccination opinion-hhs-ogc.pdf (last visited Dec. 1, 2020); hhs-guidance-documents//prep-act-coverage-for- training program of at least 20 hours Advisory Opinion 20–02 on the Public Readiness screening-in-congregate-settings.pdf (last visited that is approved by the Accreditation and Emergency Preparedness Act and the Dec. 1, 2020); Guidance for Licensed Pharmacists Secretary’s Declaration under the Act, May 19, and Pharmacy Interns Regarding COVID–19 2020, available at https://www.hhs.gov/guidance/ Vaccines and Immunity under the PREP Act, the Declaration, the foregoing are the only persons sites/default/files/hhs-guidance-documents/ OASH, Sept. 3, 2020, available at https:// authorized in accordance with the public health advisory-opinion-20-02-hhs-ogc-prep-act.pdf (last www.hhs.gov/guidance/sites/default/files/hhs- and medical emergency response of the Authority visited Dec. 1, 2020); Advisory Opinion 20–03 on guidance-documents//licensed-pharmacists-and- Having Jurisdiction. the Public Readiness and Emergency Preparedness pharmacy-interns-regarding-covid-19-vaccines- 21 Some states do not require pharmacy interns to Act and the Secretary’s Declaration under the Act, immunity.pdf (last visited Dec. 1, 2020); Guidance be licensed or registered by the state board of Oct. 22, 2020, as Modified on Oct. 23, 2020, for PREP Act Coverage for Qualified Pharmacy pharmacy. As used herein, ‘‘State-licensed or available at https://www.hhs.gov/guidance/sites/ Technicians and State-Authorized Pharmacy registered intern’’ (or equivalent phrases) refers to default/files/hhs-guidance-documents/AO3.1.2_ Interns for Childhood Vaccines, COVID–19 pharmacy interns authorized by the state or board Updated_FINAL_SIGNED_10.23.20.pdf (last visited Vaccines, and COVID–19 Testing, OASH, Oct. 20, of pharmacy in the state in which the practical Dec. 1, 2020); Advisory Opinion 20–04 on the 2020, available at https://www.hhs.gov/sites/ pharmacy internship occurs. The authorization can, Public Readiness and Emergency Preparedness Act default/files/prep-act-guidance.pdf (last visited but need not, take the form of a license from, or and the Secretary’s Declaration under the Act, Oct. Dec. 1, 2020); PREP Act Authorization for registration with, the State board of pharmacy. See 22, 2020, as Modified on Oct. 23, 2020, available Pharmacies Distributing and Administering Certain Guidance for PREP Act Coverage for Qualified at https://www.hhs.gov/guidance/sites/default/files/ Covered Countermeasures, Oct. 29, 2020, available Pharmacy Technicians and State-Authorized hhs-guidance-documents/AO%204.2_Updated_ at https://www.hhs.gov/guidance/sites/default/files/ Pharmacy Interns for Childhood Vaccines, COVID– FINAL_SIGNED_10.23.20.pdf (last visited Dec. 1, hhs-guidance-documents//prep-act-authorization- 19 Vaccines, and COVID–19 Testing, OASH, Oct. 2020). This is not to suggest that other PREP Act pharmacies-administering-covered- 20, 2020 at 2, available at https://www.hhs.gov/ declarations should be construed in a manner countermeasures.pdf (last visited Dec. 1, 2020) guidance/sites/default/files/hhs-guidance- contrary to the interpretation provided in the (collectively, OASH PREP Act Authorizations). documents//prep-act-guidance.pdf (last visited Dec. Advisory Opinions. Nothing herein shall suggest that, for purposes of 1, 2020).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00034 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79196 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Council for Pharmacy Education (ACPE) importance of a well-child visit with a (a) Any antiviral, any drug, any to order and administer vaccines. Such pediatrician or other licensed primary biologic, any diagnostic, any other a training program must include hands- care provider and refer patients as device, any respiratory protective on injection technique, clinical appropriate. device, or any vaccine manufactured, evaluation of indications and x. The licensed pharmacist and the used, designed, developed, modified, contraindications of vaccines, and the licensed or registered pharmacy intern licensed, or procured: recognition and treatment of emergency must comply with any applicable i. To diagnose, mitigate, prevent, treat, reactions to vaccines; requirements (or conditions of use) as or cure COVID–19, or the transmission v. The licensed or registered set forth in the Centers for Disease of SARS–CoV–2 or a virus mutating pharmacy intern must complete a Control and Prevention (CDC) COVID– therefrom; or practical training program that is 19 vaccination provider agreement and ii. to limit the harm that COVID–19, approved by the ACPE. This training any other federal requirements that or the transmission of SARS–CoV–2 or program must include hands-on apply to the administration of COVID– a virus mutating therefrom, might injection technique, clinical evaluation 19 vaccine(s). otherwise cause; of indications and contraindications of (e) Healthcare personnel using (b) a product manufactured, used, vaccines, and the recognition and telehealth to order or administer designed, developed, modified, treatment of emergency reactions to Covered Countermeasures for patients licensed, or procured to diagnose, vaccines; in a state other than the state where the mitigate, prevent, treat, or cure a serious vi. The licensed pharmacist and healthcare personnel are licensed or or life-threatening disease or condition licensed or registered pharmacy intern otherwise permitted to practice. When caused by a product described in must have a current certificate in basic ordering and administering Covered paragraph (a) above; cardiopulmonary resuscitation; 22 Countermeasures by means of telehealth (c) a product or technology intended vii. The licensed pharmacist must to patients in a state where the to enhance the use or effect of a product complete a minimum of two hours of healthcare personnel are not already described in paragraph (a) or (b) above; ACPE-approved, immunization-related permitted to practice, the healthcare or continuing pharmacy education during personnel must comply with all (d) any device used in the each State licensing period; requirements for ordering and administration of any such product, and viii. The licensed pharmacist must administering Covered Countermeasures all components and constituent comply with recordkeeping and to patients by means of telehealth in the materials of any such product. reporting requirements of the state where the healthcare personnel are To be a Covered Countermeasure jurisdiction in which he or she permitted to practice. Any state law that under the Declaration, a product must administers vaccines, including prohibits or effectively prohibits such a also meet 42 U.S.C. 247d–6d(i)(1)’s informing the patient’s primary-care qualified person from ordering and definition of ‘‘Covered provider when available, submitting the administering Covered Countermeasures Countermeasure.’’ required immunization information to 23 by means of telehealth is preempted. VII. Limitations on Distribution the State or local immunization Nothing in this Declaration shall information system (vaccine registry), preempt state laws that permit 42 U.S.C. 247d–6d(a)(5) and (b)(2)(E) complying with requirements with additional persons to deliver telehealth I have determined that liability respect to reporting adverse events, and services. protections are afforded to Covered complying with requirements whereby Nothing in this Declaration shall be Persons only for Recommended the person administering a vaccine must construed to affect the National Vaccine Activities involving: review the vaccine registry or other Injury Compensation Program, (a) Covered Countermeasures that are vaccination records prior to including an injured party’s ability to related to present or future federal administering a vaccine; and obtain compensation under that contracts, cooperative agreements, ix. The licensed pharmacist must program. Covered Countermeasures that grants, other transactions, interagency inform his or her childhood-vaccination are subject to the National Vaccine agreements, memoranda of patients and the adult caregiver Injury Compensation Program understanding, or other federal accompanying the child of the authorized under 42 U.S.C. 300aa–10 et agreements; seq. are covered under this Declaration (b) Covered Countermeasures that are 22 This requirement is satisfied by, among other for the purposes of liability immunity things, a certification in basic cardiopulmonary related to activities authorized in resuscitation by an online program that has and injury compensation only to the accordance with the public health and received accreditation from the American Nurses extent that injury compensation is not medical response of the Authority Credentialing Center, the ACPE, or the provided under that Program. All other Having Jurisdiction to prescribe, Accreditation Council for Continuing Medical terms and conditions of the Declaration Education. The phrase ‘‘current certificate in basic administer, deliver, distribute or cardiopulmonary resuscitation,’’ when used in the apply to such Covered dispense the Covered Countermeasures September 3, 2020 or October 20, 2020 OASH Countermeasures. following a Declaration of Emergency; authorizations, shall be interpreted the same way. or See Guidance for Licensed Pharmacists and VI. Covered Countermeasures Pharmacy Interns Regarding COVID–19 Vaccines (c) Covered Countermeasures that are: and Immunity under the PREP Act, OASH, Sept. 3, 42 U.S.C. 247d–6b(c)(1)(B), 42 U.S.C. i. Licensed, approved, cleared, or 2020, available at https://www.hhs.gov/guidance/ 247d–6d(i)(1) and (7) authorized by the FDA (or that are sites/default/files/hhs-guidance-documents// permitted to be used under an licensed-pharmacists-and-pharmacy-interns- Covered Countermeasures are: regarding-covid-19-vaccines-immunity.pdf (last Investigational New Drug Application or visited Dec. 1, 2020); Guidance for PREP Act 23 See, e.g., Advisory Opinion 20–02 on the an Investigational Device Exemption) Coverage for Qualified Pharmacy Technicians and Public Readiness and Emergency Preparedness Act under the FD&C Act or PHS Act to treat, State-Authorized Pharmacy Interns for Childhood and the Secretary’s Declaration under the Act, May diagnose, cure, prevent, mitigate, or Vaccines, COVID–19 Vaccines, and COVID–19 19, 2020, available at https://www.hhs.gov/ Testing, OASH, Oct. 20, 2020, available at https:// guidance/sites/default/files/hhs-guidance- limit the harm from COVID–19, or the www.hhs.gov/sites/default/files/prep-act- documents/advisory-opinion-20-02-hhs-ogc-prep- transmission of SARS–CoV–2 or a virus guidance.pdf (last visited Dec. 1, 2020). act.pdf (last visited Dec. 1, 2020). mutating therefrom; or

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00035 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79197

ii. a respiratory protective device threats that may have been caused by Liability protections are afforded to approved by NIOSH under 42 CFR part COVID–19, SARS–CoV–2, or a virus manufacturers and distributors without 84, or any successor regulations, that the mutating therefrom, including the regard to whether the countermeasure is Secretary determines to be a priority for decrease in the rate of childhood used by or administered to this use during a public health emergency immunizations, which will lead to an population; liability protections are declared under section 319 of the PHS increase in the rate of infectious afforded to program planners and Act to prevent, mitigate, or limit the diseases. qualified persons when the harm from COVID–19, or the IX. Administration of Covered countermeasure is used by or transmission of SARS–CoV–2 or a virus Countermeasures administered to this population, or the mutating therefrom. program planner or qualified person To qualify for this third distribution 42 U.S.C. 247d–6d(a)(2)(B) reasonably could have believed the channel, a Covered Person must Administration of the Covered recipient was in this population. manufacture, test, develop, distribute, Countermeasure means physical XI. Geographic Area administer, or use the Covered provision of the countermeasures to Countermeasure pursuant to the FDA recipients, or activities and decisions 42 U.S.C. 247d–6d(a)(4), 247d– licensure, approval, clearance, or directly relating to public and private 6d(b)(2)(D) authorization (or pursuant to an delivery, distribution and dispensing of Liability protections are afforded for Investigational New Drug Application or the countermeasures to recipients, the administration or use of a Covered Investigational Device Exemption), or management and operation of Countermeasure without geographic the NIOSH approval. countermeasure programs, or limitation. As used in this Declaration, the terms management and operation of locations Liability protections are afforded to ‘‘Authority Having Jurisdiction’’ and for the purpose of distributing and manufacturers and distributors without ‘‘Declaration of Emergency’’ have the dispensing countermeasures. regard to whether the Covered following meanings: Where there are limited Covered Countermeasure is used by or (a) The Authority Having Jurisdiction Countermeasures, not administering a administered in any designated means the public agency or its delegate Covered Countermeasure to one geographic area; liability protections are that has legal responsibility and individual in order to administer it to afforded to program planners and authority for responding to an incident, another individual can constitute qualified persons when the based on political or geographical (e.g., ‘‘relating to . . . the administration to countermeasure is used by or city, county, tribal, state, or federal . . . an individual’’ under 42 U.S.C. administered in any designated boundary lines) or functional (e.g., law 247d–6d. For example, consider a geographic area, or the program planner enforcement, public health) range or situation where there is only one dose 24 or qualified person reasonably could sphere of authority. of a COVID–19 vaccine, and a person in have believed the recipient was in that (b) A Declaration of Emergency means a vulnerable population and a person in geographic area. any declaration by any authorized local, a less vulnerable population both COVID–19 is a global challenge that regional, state, or federal official of an request it from a healthcare requires a whole-of-nation response. emergency specific to events that professional. In that situation, the There are substantial federal legal and indicate an immediate need to healthcare professional administers the policy issues, and substantial federal administer and use the Covered one dose to the person who is more legal and policy interests within the Countermeasures, with the exception of vulnerable to COVID–19. In that meaning of Grable & Sons Metal a federal declaration in support of an circumstance, the failure to administer Products, Inc. v. Darue Eng’g. & Mf’g., Emergency Use Authorization under the COVID–19 vaccine to the person in 545 U.S. 308 (2005), in having a unified, Section 564 of the FD&C Act unless a less-vulnerable population ‘‘relat[es] whole-of-nation response to the COVID– such declaration specifies otherwise. to . . . the administration to’’ the 19 pandemic among federal, state, local, I have also determined that, for person in a vulnerable population. The and private-sector entities. The world is governmental program planners only, person in the vulnerable population was facing an unprecedented pandemic. To liability protections are afforded only to able to receive the vaccine only because effectively respond, there must be a the extent such program planners obtain it was not administered to the person in more consistent pathway for Covered Covered Countermeasures through the less-vulnerable population. Persons to manufacture, distribute, voluntary means, such as (a) donation; Prioritization or purposeful allocation of administer or use Covered (b) commercial sale; (c) deployment of a Covered Countermeasure, particularly Countermeasures across the nation and Covered Countermeasures from federal if done in accordance with a public the world. Thus, there are substantial stockpiles; or (d) deployment of health authority’s directive, can fall federal legal and policy issues, and donated, purchased, or otherwise within the PREP Act and this substantial federal legal and policy voluntarily obtained Covered Declaration’s liability protections. interests within the meaning of Grable Countermeasures from state, local, or & Sons Metal Products, Inc. v. Darue X. Population private stockpiles. Eng’g. & Mf’g., 545 U.S. 308 (2005), in VIII. Category of Disease, Health 42 U.S.C. 247d–6d(a)(4), 247d– having a uniform interpretation of the Condition, or Threat 6d(b)(2)(C) PREP Act. Under the PREP Act, the sole exception to the immunity from suit and 42 U.S.C. 247d–6d(b)(2)(A) The populations of individuals to whom the liability protections of this liability of covered persons under the The category of disease, health Declaration extend include any PREP Act is an exclusive Federal cause condition, or threat for which I individual who uses or is administered of action against a covered person for recommend the administration or use of the Covered Countermeasures in death or serious physical injury the Covered Countermeasures is not accordance with this Declaration. proximately caused by willful only COVID–19 caused by SARS–CoV– misconduct by such covered person. In 2, or a virus mutating therefrom, but 24 For simplicity, this example assumes a patient all other cases, an injured party’s also other diseases, health conditions, or only requires one dose of the vaccine. exclusive remedy is an administrative

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00036 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79198 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

remedy under section 319F–4 of the manufacturer, and for Covered Persons related to countermeasures against PHS Act. Through the PREP Act, to take such other actions as are marburgvirus and/or Marburg disease. Congress delegated to me the authority appropriate to limit the administration DATES: The Declaration is effective as of to strike the appropriate Federal-state or use of the Covered Countermeasures. November 25, 2020. balance with respect to particular Covered Countermeasures obtained FOR FURTHER INFORMATION CONTACT: Covered Countermeasures through PREP for the SNS during the effective period Robert P. Kadlec, MD, MTM&H, MS, 25 Act declarations. of this Declaration are covered through Assistant Secretary for Preparedness XII. Effective Time Period the date of administration or use and Response, Office of the Secretary, pursuant to a distribution or release Department of Health and Human 42 U.S.C. 247d–6d(b)(2)(B) from the SNS. Services, 200 Independence Avenue Liability protections for any XIV. Countermeasures Injury SW, Washington, DC 20201; Telephone: respiratory protective device approved Compensation Program 202–205–2882. by NIOSH under 42 CFR part 84, or any SUPPLEMENTARY INFORMATION: The successor regulations, through the 42 U.S.C 247d–6e Public Readiness and Emergency means of distribution identified in The PREP Act authorizes the Preparedness Act (PREP Act) authorizes Section VII(a) of this Declaration, begin Countermeasures Injury Compensation the Secretary of Health and Human on March 27, 2020 and extend through Program (CICP) to provide benefits to Services (the Secretary) to issue a October 1, 2024. certain individuals or estates of Declaration to provide liability Liability protections for all other individuals who sustain a covered immunity to certain individuals and Covered Countermeasures identified in serious physical injury as the direct entities (Covered Persons) against any Section VI of this Declaration, through result of the administration or use of the claim of loss caused by, arising out of, means of distribution identified in relating to, or resulting from the Section VII(a) of this Declaration, begin Covered Countermeasures, and benefits to certain survivors of individuals who manufacture, distribution, on February 4, 2020 and extend through administration, or use of medical October 1, 2024. die as a direct result of the administration or use of the Covered countermeasures (Covered Liability protections for all Covered Countermeasures), except for claims Countermeasures administered and Countermeasures. The causal connection between the countermeasure involving ‘‘willful misconduct’’ as used in accordance with the public defined in the PREP Act. This health and medical response of the and the serious physical injury must be Declaration is subject to amendment as Authority Having Jurisdiction, as supported by compelling, reliable, valid, medical and scientific evidence in order circumstances warrant. identified in Section VII(b) of this The PREP Act was enacted on Declaration, begin with a Declaration of for the individual to be considered for compensation. The CICP is December 30, 2005, as Public Law 109– Emergency as that term is defined in 148, Division C, Section 2. It amended Section VII (except that, with respect to administered by the Health Resources and Services Administration, within the the Public Health Service (PHS) Act, qualified persons who order or adding Section 319F–3, which administer a routine childhood Department of Health and Human Services. Information about the CICP is addresses liability immunity, and vaccination that ACIP recommends to Section 319F–4, which creates a persons ages three through 18 according available at the toll-free number 1–855– 266–2427 or http://www.hrsa.gov/cicp/. compensation program. These sections to ACIP’s standard immunization are codified at 42 U.S.C. 247d–6d and schedule, liability protections began on XV. Amendments 42 U.S.C. 247d–6e, respectively. August 24, 2020), and last through (a) 42 U.S.C. 247d–6d(b)(4) The Pandemic and All-Hazards the final day the Declaration of Preparedness Reauthorization Act Emergency is in effect, or (b) October 1, Amendments to this Declaration will (PAHPRA), Public Law 113–5, was 2024, whichever occurs first. be published in the Federal Register, as enacted on March 13, 2013. Among Liability protections for all Covered warranted. other things, PAHPRA added sections Countermeasures identified in Section Authority: 42 U.S.C. 247d–6d. 564A and 564B to the Federal Food, VII(c) of this Declaration begin on the Drug, and Cosmetic (FD&C) Act to Dated: December 3, 2020. date of this amended Declaration and provide new authorities for the last through (a) the final day the Alex M. Azar II, emergency use of approved products in Declaration of Emergency is in effect, or Secretary of Health and Human Services. emergencies and products held for (b) October 1, 2024, whichever occurs [FR Doc. 2020–26977 Filed 12–8–20; 8:45 am] emergency use. PAHPRA accordingly first. BILLING CODE 4150–37–P amended the definitions of ‘‘Covered XIII. Additional Time Period of Countermeasures’’ and ‘‘qualified Coverage pandemic and epidemic products’’ in DEPARTMENT OF HEALTH AND Section 319F–3 of the Public Health 42 U.S.C. 247d–6d(b)(3)(B) and (C) HUMAN SERVICES Service Act (PREP Act provisions), so I have determined that an additional that products made available under Office of the Secretary 12 months of liability protection is these new FD&C Act authorities could reasonable to allow for the Notice of Declaration Under the Public be covered under PREP Act manufacturer(s) to arrange for Readiness and Emergency Declarations. PAHPRA also extended disposition of the Covered Preparedness Act for the definition of qualified pandemic and Countermeasure, including return of the Countermeasures Against epidemic products that may be covered Covered Countermeasures to the Marburgvirus and/or Marburg Disease under a PREP Act Declaration to include products or technologies intended to 25 42 U.S.C. 247d–6d(b)(7) provides that ‘‘[n]o SUMMARY: The Secretary is issuing this enhance the use or effect of a drug, court of the United States, or of any State, shall have subject matter jurisdiction to review, whether Declaration pursuant to section 319F–3 biological product, or device used by mandamus or otherwise, any action by the of the Public Health Service Act to against the pandemic or epidemic or Secretary under this subsection.’’ provide limited immunity for activities against adverse events from these

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00037 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79199

products. The Coronavirus Aid, Relief, marburgviruses a threat to the public distribution, administration, or use of and Economic Security (CARES) Act, health security of the American people, one or more Covered Countermeasures Public Law 116–136, enacted on March requiring vigilance and a continuing (Recommended Activities). In Section 27, 2020, amended section 319F– need for development of medical III of the Declaration, the Secretary sets 3(i)(1)(D) of the PHS Act, to create a new countermeasures. Similar to out the activities for which the category of covered countermeasures to determinations and experiences with immunity is in effect. the PREP Act, namely, respiratory Ebola virus outbreaks, marburgvirus has Section IV. Limited Immunity protective devices approved by the been determined to have the potential to National Institute for Occupational be a threat to US public health security. The Secretary must also state that Safety and Health (NIOSH) under 42 liability protections available under the CFR part 84, or any successor Description of This Declaration by PREP Act are in effect with respect to regulations, that the Secretary Section the Recommended Activities. These determines to be a priority for use Section I. Determination of Public liability protections provide that, during a public health emergency Health Emergency or Credible Risk of ‘‘[s]ubject to other provisions of [the declared under section 319 of the PHS Future Public Health Emergency PREP Act], a covered person shall be Act. immune from suit and liability under Marburg disease is a severe and often Before issuing a Declaration under the federal and state law with respect to all fatal illness in humans caused by PREP Act, the Secretary is required to claims for loss caused by, arising out of, marburgviruses, a group of filoviruses of determine that a disease or other health relating to, or resulting from the the same family as ebolaviruses. condition or threat to health constitutes administration to or use by an Marburg disease is a highly virulent a public health emergency or that there individual of a covered countermeasure disease that causes hemorrhagic fever, is a credible risk that the disease, if a Declaration has been issued with with a case fatality rate of condition, or threat may constitute such respect to such countermeasure.’’ In approximately 88 percent. Humans can an emergency. Section IV of the Declaration, the become infected with marburgviruses, This determination is separate and Secretary states that liability protections but it is largely unknown how apart from the Declaration issued by the are in effect with respect to the marburgvirus transmits from its animal Secretary under Section 319 of the PHS Recommended Activities. host to humans. For previous cases, Act that a disease or disorder presents Section V. Covered Persons unprotected contact with infected bat a public health emergency or that a feces or aerosols was deemed the most public health emergency, including The PREP Act’s liability immunity likely route of infection. After the initial significant outbreaks of infectious applies to ‘‘Covered Persons’’ with crossover of the virus from host animal diseases or bioterrorist attacks, respect to administration or use of a to humans, transmission can occur otherwise exists, or other Declarations Covered Countermeasure. The term through person-to-person contact. This or determinations made under other ‘‘Covered Persons’’ has a specific may happen in several ways: Direct authorities of the Secretary. meaning and is defined in the PREP Act contact to droplets of body fluids from Accordingly, in Section I of the to include manufacturers, distributors, infected persons, or contact with Declaration, the Secretary determines program planners, and qualified equipment and other objects that marburgviruses and Marburg persons, and their officials, agents, and contaminated with infectious blood or disease are a credible risk such that employees, and the United States. The tissues. The virus can spread between Marburg disease or marburgviruses may PREP Act further defines the terms humans in close environments and in the future constitute a public health ‘‘manufacturer,’’ ‘‘distributor,’’ through direct contact. A common route emergency. ‘‘program planner,’’ and ‘‘qualified person’’ as described below. of infection is through nosocomial Section II. Factors Considered by the A manufacturer includes a contractor transmission. Secretary Marburgvirus was first recognized in or subcontractor of a manufacturer; a 1967, when outbreaks of hemorrhagic In deciding whether and under what supplier or licenser of any product, fever occurred simultaneously in circumstances to issue a Declaration intellectual property, service, research laboratories in Marburg and Frankfurt, with respect to a Covered tool or component or other article used Germany and in Belgrade, Yugoslavia Countermeasure, the Secretary must in the design, development, clinical (now Serbia). Thirty-one people became consider the desirability of encouraging testing, investigation or manufacturing ill, initially laboratory workers followed the design, development, clinical testing of a Covered Countermeasure; and any by several medical personnel and family or investigation, manufacture, labeling, or all the parents, subsidiaries, affiliates, members who had cared for them; seven distribution, formulation, packaging, successors, and assigns of a deaths were reported. The first people marketing, promotion, sale, purchase, manufacturer. infected had been exposed to imported donation, dispensing, prescribing, A distributor means a person or entity African green monkeys or their tissues administration, licensing, and use of the engaged in the distribution of drugs, while conducting research. countermeasure. In Section II of the biologics, or devices, including but not From 1975–2014, there have been 10 Declaration, the Secretary states that he limited to: Manufacturers; re-packers; reported outbreaks of Marburg disease, has considered these factors. common carriers; contract carriers; air and all but one of these outbreaks had carriers; own-label distributors; private- Section III. Activities Covered by This an apparent or suspected origin in label distributors; jobbers; brokers; Declaration Under the PREP Act’s Africa. These outbreaks have resulted in warehouses and wholesale drug Liability Immunity a total of 435 reported human cases of warehouses; independent wholesale Marburg disease and 366 deaths among The Secretary must delineate the drug traders; and retail pharmacies. those reported cases; a case fatality rate activities for which the PREP Act’s A program planner means a state or of approximately of 84%. The recurrent liability immunity is in effect. These local government, including an Indian but unpredictable and variable nature of activities may include, under conditions tribe; a person employed by the state or Marburg disease outbreaks and the as the Secretary may specify, the local government; or other person who transmission profile makes manufacture, testing, development, supervises or administers a program

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00038 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79200 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

with respect to the administration, A qualified pandemic or epidemic reasonably be determined to qualify for dispensing, distribution, provision, or product means a drug or device, as approval or licensing within 10 years use of a Covered Countermeasure, defined in the FD&C Act or a biological after the Department’s determination including a person who establishes product, as defined in the PHS Act that that procurement of the countermeasure requirements, provides policy guidance, is (i) Manufactured, used, designed, is appropriate. or supplies technical or scientific advice developed, modified, licensed or Section VI lists countermeasures or assistance or provides a facility to procured to diagnose, mitigate, prevent, against marburgvirus and/or Marburg administer or use a Covered treat, or cure a pandemic or epidemic or disease that are Covered Countermeasure in accordance with the limit the harm such a pandemic or Countermeasures under this declaration. Secretary’s Declaration. Under this epidemic might otherwise cause; (ii) Section VI also refers to the statutory definition, a private sector employer or manufactured, used, designed, definitions of Covered Countermeasures community group or other ‘‘person’’ can developed, modified, licensed, or to make clear that these statutory be a program planner when it carries out procured to diagnose, mitigate, prevent, definitions limit the scope of Covered the described activities. treat, or cure a serious or life- Countermeasures. Specifically, the A qualified person means a licensed threatening disease or condition caused Declaration notes that Covered health professional or other individual by such a drug, biological product, or Countermeasures must be ‘‘qualified authorized to prescribe, administer, or device; (iii) or a product or technology pandemic or epidemic products,’’ or dispense Covered Countermeasures intended to enhance the use or effect of ‘‘security countermeasures,’’ or drugs, under the law of the state in which the such a drug, biological product, or biological products, respiratory Covered Countermeasure was device. protective devices, or devices prescribed, administered, or dispensed; A security countermeasure is a drug authorized for investigational or or a person within a category of persons or device, as defined in the FD&C Act emergency use, as those terms are identified as qualified in the Secretary’s or a biological product, as defined in the defined in the PREP Act, the FD&C Act, Declaration. Under this definition, the PHS Act that (i)(a) The Secretary and the Public Health Service Act. Secretary can describe in the determines to be a priority to diagnose, Section VII. Limitations on Distribution Declaration other qualified persons, mitigate, prevent, or treat harm from any such as volunteers, who are Covered biological, chemical, radiological, or The Secretary may specify that Persons. Section V describes other nuclear agent identified as a material liability immunity is in effect only to qualified persons covered by this threat by the Secretary of Homeland Covered Countermeasures obtained Declaration. The PREP Act also defines Security, or (b) to diagnose, mitigate, through a particular means of the word ‘‘person’’ as used in the Act: prevent, or treat harm from a condition distribution. The Declaration states that A person includes an individual, that may result in adverse health liability immunity is afforded to partnership, corporation, association, consequences or death and may be Covered Persons for Recommended entity, or public or private corporation, caused by administering a drug, Activities related to (a) Present or future including a federal, state, or local biological product, or device against federal contracts, cooperative government agency or department. such an agent; and (ii) is determined by agreements, grants, other transactions, Section V of the Declaration describes the Secretary of Health and Human interagency agreements, or memoranda Covered Persons, including Qualified Services to be a necessary of understanding or other federal Persons. The Declaration includes all countermeasure to protect public health. agreements; or (b) Activities authorized persons and entities defined as Covered To be a Covered Countermeasure, in accordance with the public health Persons under the PREP Act. qualified pandemic or epidemic and medical response of the Authority products or security countermeasures Having Jurisdiction to prescribe, Section VI. Covered Countermeasures also must be approved or cleared under administer, deliver, distribute, or As noted above, Section III of the the FD&C Act; approved by the National dispense the Covered Countermeasures Declaration describes the activities Institute for Occupational Safety and following a Declaration of an (referred to as ‘‘Recommended Health (NIOSH) under 42 CFR part 84, emergency. Activities’’) for which liability or any successor regulations, that the Section VII defines the terms immunity is in effect. Section VI of the Secretary determines to be a priority for ‘‘Authority Having Jurisdiction’’ and Declaration identifies the Covered use during a public health emergency ‘‘Declaration of an emergency.’’ We have Countermeasures for which the declared under section 319 of the PHS specified in the definition that Secretary has recommended such Act; licensed under the PHS Act; or Authorities having jurisdiction include activities. The PREP Act states that a authorized for emergency use under federal, state, local, and tribal ‘‘Covered Countermeasure’’ must be a Sections 564, 564A, or 564B of the authorities and institutions or ‘‘qualified pandemic or epidemic FD&C Act. organizations acting on behalf of those product,’’ or a ‘‘security A qualified pandemic or epidemic governmental entities. countermeasure,’’ as described product also may be a Covered For governmental program planners immediately below; a drug, biological Countermeasure when it is subject to an only, liability immunity is afforded only product or device authorized for exemption (that is, it is permitted to be to the extent they obtain Covered emergency use in accordance with used under an Investigational Drug Countermeasures through voluntary Sections 564, 564A, or 564B of the Application or an Investigational Device means, such as (1) donation; (2) FD&C Act; or respiratory protective Exemption) under the FD&C Act and is commercial sale; (3) deployment of devices approved by the National the object of research for possible use Covered Countermeasures from federal Institute for Occupational Safety and for diagnosis, mitigation, prevention, stockpiles; or (4) deployment of Health (NIOSH) under 42 CFR part 84, treatment, or cure, or to limit harm of donated, purchased, or otherwise or any successor regulations, that the a pandemic or epidemic or serious or voluntarily obtained Covered Secretary determines to be a priority for life-threatening condition caused by Countermeasures from state, local, or use during a public health emergency such a drug or device. private stockpiles. This last limitation declared under section 319 of the PHS A security countermeasure also may on distribution is intended to deter Act. be a Covered Countermeasure if it may program planners that are government

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00039 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79201

entities from seizing privately held countermeasure programs at Section XI. Geographic Area stockpiles of Covered Countermeasures. distribution and dispensing sites. The Secretary must identify, for each It does not apply to any other Covered Thus, it is the Secretary’s Covered Countermeasure specified in Persons, including other program interpretation that, when a Declaration the Declaration, the geographic area or planners who are not government is in effect, the Act precludes, for areas for which liability immunity is in entities. example, liability claims alleging effect, including, as appropriate, Section VIII. Category of Disease, Health negligence by a manufacturer in creating whether the Declaration applies only to Condition, or Threat a vaccine, or negligence by a health care individuals physically present in the The Secretary must identify in the provider in prescribing the wrong dose, area or, in addition, applies to Declaration, for each Covered absent willful misconduct. Likewise, the individuals who have a described Countermeasure, the categories of Act precludes a liability claim relating connection to the area. Section XI of the diseases, health conditions, or threats to to the management and operation of a Declaration provides that liability health for which the Secretary countermeasure distribution program or immunity is afforded for the recommends the administration or use site, such as a slip-and-fall injury or administration or use of a Covered of the countermeasure. In Section VIII of vehicle collision by a recipient receiving Countermeasure without geographic the Declaration, the Secretary states that a countermeasure at a retail store limitation. This could include claims the disease threat for which he serving as an administration or related to administration or use in recommends administration or use of dispensing location that alleges, for countries outside the U.S. It is possible the Covered Countermeasures is example, lax security or chaotic crowd that claims may arise in regard to Marburg disease caused by control. However, a liability claim administration or use of the Covered marburgviruses or virus mutating alleging an injury occurring at the site Countermeasures outside the U.S. that therefrom. that was not directly related to the may be resolved under U.S. law. countermeasure activities is not In addition, the PREP Act specifies Section IX. Administration of Covered covered, such as a slip and fall with no that liability immunity is afforded (1) to Countermeasures manufacturers and distributors without direct connection to the regard to whether the countermeasure is The PREP Act does not explicitly countermeasure’s administration or use. used by or administered to individuals define the term ‘‘administration’’ but In each case, whether immunity is in the geographic areas, and (2) to does assign the Secretary the applicable will depend on the particular program planners and qualified persons responsibility to provide relevant facts and circumstances. conditions in the Declaration. In Section when the countermeasure is either used IX of the Declaration, the Secretary Section X. Population or administered in the geographic areas defines ‘‘Administration of a Covered or the program planner or qualified Countermeasure,’’ as follows: The Secretary must identify, for each person reasonably could have believed Covered Countermeasure specified in a the countermeasure was used or Administration of a Covered Declaration, the population or Countermeasure means physical provision of administered in the areas. Section XI of the countermeasures to recipients, or populations of individuals for which the Declaration includes these statutory activities and decisions directly relating to liability immunity is in effect with conditions in the Declaration for clarity. respect to administration or use of the public and private delivery, distribution, and Section XII. Effective Time Period dispensing of the countermeasures to countermeasure. Section X of the recipients; management and operation of Declaration identifies which individuals The Secretary must identify, for each countermeasure programs; or management should use the countermeasure or to Covered Countermeasure, the period or and operation of locations for purpose of whom the countermeasure should be periods during which liability immunity distributing and dispensing countermeasures. administered—in short, those who is in effect, designated by dates, The definition of ‘‘administration’’ should be vaccinated or take a drug or milestones, or other description of extends only to physical provision of a other countermeasure. Section X events, including factors specified in the countermeasure to a recipient, such as provides that the population includes PREP Act. Section XII of the Declaration vaccination or handing drugs to ‘‘any individual who uses or who is extends the effective period for different patients, and to activities related to administered a Covered Countermeasure means of distribution of Covered management and operation of programs in accordance with the Declaration.’’ Countermeasures through August 1, and locations for providing 2025. countermeasures to recipients, such as It should be noted that under the decisions and actions involving security PREP Act, liability protection extends Section XIII. Additional Time Period of and queuing, but only insofar as those beyond the Population specified in the Coverage activities directly relate to the Declaration. Specifically, liability The Secretary must specify a date countermeasure activities. Claims for immunity is afforded (1) To after the ending date of the effective which Covered Persons are provided manufacturers and distributors without time period of the Declaration that is immunity under the Act are losses regard to whether the countermeasure is reasonable for manufacturers to arrange caused by, arising out of, relating to, or used by or administered to this for disposition of the Covered resulting from the administration to or population, and (2) to program planners Countermeasure, including accepting use by an individual of a Covered and qualified persons when the returns of Covered Countermeasures, Countermeasure consistent with the countermeasure is either used by or and for other Covered Persons to take terms of a Declaration issued under the administered to this population or the appropriate actions to limit Act. Under the definition, these liability program planner or qualified person administration or use of the Covered claims are precluded if they allege an reasonably could have believed the Countermeasure. In addition, the PREP injury caused by a countermeasure, or if recipient was in this population. Act specifies that, for Covered the claims are due to manufacture, Section X of the Declaration includes Countermeasures that are subject to a delivery, distribution, dispensing, or these statutory conditions in the Declaration at the time they are obtained management and operation of Declaration for clarity. for the Strategic National Stockpile

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00040 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79202 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

(SNS) under 42 U.S.C. 247d–6b(a), the considered for CICP benefits. Other III. Recommended Activities effective period of the Declaration individuals outside the United States 42 U.S.C. 247d–6d(b)(1) extends through the time the may not be eligible for CICP benefits. countermeasure is used or administered. I recommend, under the conditions Section XV. Amendments Liability immunity under the provisions stated in this Declaration, the of the PREP Act and the conditions of Section XV of the Declaration manufacture, testing, development, the Declaration continue during these confirms that the Secretary may amend distribution, administration, and use of additional time periods. Thus, liability any portion of this Declaration through the Covered Countermeasures. immunity is afforded during the publication in the Federal Register. IV. Liability Immunity ‘‘Effective Time Period,’’ described Declaration under Section XII of the Declaration, 42 U.S.C. 247d–6d(a), 247d–6d(b)(1) plus the ‘‘Additional Time Period’’ Declaration for Public Readiness and Liability immunity as prescribed in described under Section XIII of the Emergency Preparedness Act Coverage the PREP Act and conditions stated in Declaration. for Countermeasures Against Section XIII of the Declaration Marburgvirus and/or Marburg Disease this Declaration is in effect for the provides for 12 months as the Recommended Activities described in I. Determination of Public Health Section III. Additional Time Period of coverage Emergency after expiration of the Declaration. V. Covered Persons Section XIII also explains the extended 42 U.S.C. 247d–6d(b)(1) 42 U.S.C. 247d–6d(i)(2), (3), (4), (6), coverage that applies to any product I have determined that Marburg (8)(A) and (B) obtained for the SNS during the disease and marburgviruses are a effective period of the Declaration. credible risk such that Marburg disease Covered Persons who are afforded Section XIV. Countermeasures Injury or marburgviruses may in the future liability immunity under this Compensation Program constitute a public health emergency. Declaration are ‘‘manufacturers,’’ This Declaration must be construed in ‘‘distributors,’’ ‘‘program planners,’’ Section 319F–4 of the PHS Act, 42 accordance with the Advisory Opinions ‘‘qualified persons,’’ and their officials, U.S.C. 247d–6e, authorizes the of the Office of the General Counsel agents, and employees, as those terms Countermeasures Injury Compensation (Advisory Opinions). I incorporate those are defined in the PREP Act, and the Program (CICP) to provide benefits to Advisory Opinions as part of this United States. In addition, I have eligible individuals who sustain a Declaration.1 This Declaration is a determined that the following serious physical injury or die as a direct ‘‘requirement’’ under the PREP Act. additional persons are qualified result of the administration or use of a II. Factors Considered persons: (a) Any person authorized in Covered Countermeasure. accordance with the public health and Compensation under the CICP for an 42 U.S.C. 247d–6d(b)(6) medical emergency response of the injury directly caused by a Covered I have considered the desirability of Authority Having Jurisdiction, as Countermeasure is based on the described in Section VII below, to requirements set forth in this encouraging the design, development, clinical testing, or investigation, prescribe, administer, deliver, distribute Declaration, the administrative rules for or dispense the Covered the Program, and the statute. To show manufacture, labeling, distribution, formulation, packaging, marketing, Countermeasures, and their officials, direct causation between a Covered agents, employees, contractors and Countermeasure and a serious physical promotion, sale, purchase, donation, dispensing, prescribing, administration, volunteers, following a Declaration of an injury, the statute requires ‘‘compelling, emergency; (b) any person authorized to reliable, valid, medical and scientific licensing, and use of the Covered Countermeasures. prescribe, administer, or dispense the evidence.’’ The administrative rules for Covered Countermeasures or who is the Program further explain the 1 See, e.g., Advisory Opinion on the Public otherwise authorized to perform an necessary requirements for eligibility Readiness and Emergency Preparedness Act and the activity under an Emergency Use under the CICP. Please note that, by March 10, 2020 Declaration under the Act, Apr. 17, Authorization in accordance with statute, requirements for compensation 2020, as Modified on May 19, 2020, available at Section 564 of the FD&C Act; and (c) under the CICP may not align with the https://www.hhs.gov/guidance/sites/default/files/ hhs-guidance-documents/prep-act-advisory- any person authorized to prescribe, requirements for liability immunity opinion-hhs-ogc.pdf (last visited Nov. 24, 2020); administer, or dispense Covered provided under the PREP Act. Section Advisory Opinion 20–02 on the Public Readiness Countermeasures in accordance with XIV of the Declaration, and Emergency Preparedness Act and the Secretary’s Declaration under the Act, May 19, Section 564A of the FD&C Act. ‘‘Countermeasures Injury Compensation 2020, available at https://www.hhs.gov/guidance/ Program,’’ explains the types of injury sites/default/files/hhs-guidance-documents/ VI. Covered Countermeasures and standard of evidence needed to be advisory-opinion-20-02-hhs-ogc-prep-act.pdf (last 42 U.S.C. 247d–6b(c)(1)(B), 42 U.S.C. considered for compensation under the visited Nov. 24, 2020); Advisory Opinion 20–03 on the Public Readiness and Emergency Preparedness 247d–6d(i)(1) and (7) CICP. Act and the Secretary’s Declaration under the Act, Further, the administrative rules for Oct. 22, 2020, as Modified on Oct. 23, 2020, Covered Countermeasures are any the CICP specify that if countermeasures available at https://www.hhs.gov/guidance/sites/ antiviral, any other drug, any biologic, _ are administered or used outside the default/files/hhs-guidance-documents/AO3.1.2 any diagnostic, any other device, or any Updated_FINAL_SIGNED_10.23.20.pdf (last visited United States, only otherwise eligible Nov. 24, 2020); Advisory Opinion 20–04 on the vaccine, used to treat, diagnose, cure, individuals at United States embassies, Public Readiness and Emergency Preparedness Act prevent, or mitigate Marburg disease, or military installations abroad (such as and the Secretary’s Declaration under the Act, Oct. the transmission of marburgviruses or a 22, 2020, as Modified on Oct. 23, 2020, available military bases, ships, and camps) or at at https://www.hhs.gov/guidance/sites/default/files/ virus mutating therefrom, or any device North Atlantic Treaty Organization hhs-guidance-documents/AO%204.2_Updated_ used in the administration of any such (NATO) installations (subject to the FINAL_SIGNED_10.23.20.pdf (last visited Nov. 24, product, and all components and NATO Status of Forces Agreement) 2020). This is not to suggest that other PREP Act constituent materials of any such declarations should be construed in a manner where American servicemen and contrary to the interpretation provided in the product, or countermeasures for adverse servicewomen are stationed may be Advisory Opinions. effects of these countermeasures, and

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00041 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79203

countermeasures that otherwise limit VIII. Category of Disease, Health have believed the recipient was in that the harm caused by the health threat. Condition, or Threat geographic area. Covered Countermeasures must be ‘‘qualified pandemic or epidemic 42 U.S.C. 247d–6d(b)(2)(A) XII. Effective Time Period products,’’ or ‘‘security The category of disease, health 42 U.S.C. 247d–6d(b)(2)(B) countermeasures,’’ or drugs, biological condition, or threat for which I Liability immunity for Covered products, respiratory protective devices recommend the administration or use of Countermeasures through means of or devices authorized for investigational the Covered Countermeasures is distribution, as identified in Section or emergency use, as those terms are Marburg disease caused by VII(a) of this Declaration, other than in defined in the PREP Act, the FD&C Act, marburgviruses or virus mutating accordance with the public health and and the Public Health Service Act. therefrom. medical response of the Authority VII. Limitations on Distribution IX. Administration of Covered Having Jurisdiction and extends through 42 U.S.C. 247d–6d(a)(5) and (b)(2)(E) Countermeasures August 1, 2025. Liability immunity for Covered 42 U.S.C. 247d–6d(a)(2)(B) I have determined that liability Countermeasures administered and immunity is afforded to Covered Administration of the Covered used in accordance with the public Persons only for Recommended Countermeasure means physical health and medical response of the Activities involving Covered provision of the countermeasures to Authority Having Jurisdiction begins Countermeasures that are related to: recipients, or activities and decisions with a Declaration and lasts through (1) (a) Present or future federal contracts, directly relating to public and private the final day the emergency Declaration cooperative agreements, grants, other delivery, distribution and dispensing of is in effect, or (2) August 1, 2025, transactions, interagency agreements, the countermeasures to recipients, whichever occurs first. memoranda of understanding, or other management and operation of federal agreements; or countermeasure programs, or XIII. Additional Time Period of (b) Activities authorized in management and operation of locations Coverage accordance with the public health and for purpose of distributing and 42 U.S.C. 247d–6d(b)(3)(B) and (C) medical response of the Authority dispensing countermeasures. Having Jurisdiction to prescribe, I have determined that an additional administer, deliver, distribute or X. Population 12 months of liability protection is dispense the Covered Countermeasures reasonable to allow for the 42 U.S.C. 247d–6d(a)(4), 247d– following a Declaration of an manufacturer(s) to arrange for 6d(b)(2)(C) emergency. disposition of the Covered As used in this Declaration, the terms The populations of individuals Countermeasure, including return of the Authority Having Jurisdiction and include any individual who uses or is Covered Countermeasures to the Declaration of Emergency have the administered the Covered manufacturer, and for Covered Persons following meanings: Countermeasures in accordance with to take such other actions as are i. The Authority Having Jurisdiction this Declaration. appropriate to limit the administration means the public agency or its delegate Liability immunity is afforded to or use of the Covered Countermeasures. that has legal responsibility and manufacturers and distributors without Covered Countermeasures obtained authority for responding to an incident, regard to whether the countermeasure is for the SNS during the effective period based on political or geographical (e.g., used by or administered to this of this Declaration are covered through city, county, tribal, state, or federal population; liability immunity is the date of administration or use boundary lines) or functional (e.g., law afforded to program planners and pursuant to a distribution or release enforcement, public health) range or qualified persons when the from the SNS. sphere of authority. countermeasure is used by or XIV. Countermeasures Injury ii. A Declaration of Emergency means administered to this population, or the Compensation Program any Declaration by any authorized local, program planner or qualified person regional, state, or federal official of an reasonably could have believed the 42 U.S.C. 247d–6e emergency specific to events that recipient was in this population. indicate an immediate need to The PREP Act authorizes the administer and use the Covered XI. Geographic Area Countermeasures Injury Compensation Countermeasures, with the exception of Program (CICP) to provide benefits to 42 U.S.C. 247d–6d(a)(4), 247d– certain individuals or estates of a federal Declaration in support of an 6d(b)(2)(D) Emergency Use Authorization under individuals who sustain a covered Section 564 of the FD&C Act unless Liability immunity is afforded for the serious physical injury as the direct such Declaration specifies otherwise; administration or use of a Covered result of the administration or use of the I have also determined that, for Countermeasure without geographic Covered Countermeasures, and benefits governmental program planners only, limitation. to certain survivors of individuals who liability immunity is afforded only to Liability immunity is afforded to die as a direct result of the the extent such program planners obtain manufacturers and distributors without administration or use of the Covered Covered Countermeasures through regard to whether the countermeasure is Countermeasures. The causal voluntary means, such as (1) donation; used by or administered in any connection between the countermeasure (2) commercial sale; (3) deployment of designated geographic area; liability and the serious physical injury must be Covered Countermeasures from federal immunity is afforded to program supported by compelling, reliable, valid, stockpiles; or (4) deployment of planners and qualified persons when medical and scientific evidence in order donated, purchased, or otherwise the countermeasure is used by or for the individual to be considered for voluntarily obtained Covered administered in any designated compensation. The CICP is Countermeasures from state, local, or geographic area, or the program planner administered by the Health Resources private stockpiles. or qualified person reasonably could and Services Administration, within the

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00042 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79204 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Department of Health and Human Protection (CBP) has issued a final purposes of U.S. Government Services. Information about the CICP is determination concerning the country of procurement. available at the toll-free number 1–855– origin of three vehicle tracking devices, Section 177.29, CBP Regulations (19 266–2427 or http://www.hrsa.gov/cicp/. a satellite device, a near field CFR 177.29), provides that a notice of communication (NFC) reader, and an final determination shall be published XV. Amendments NFC keyring fob. Based upon the facts in the Federal Register within 60 days 42 U.S.C. 247d–6d(b)(4) presented, CBP has concluded that the of the date the final determination is Amendments to this Declaration will country of origin of the three vehicle issued. Section 177.30, CBP Regulations be published in the Federal Register, as tracking devices, the satellite device, (19 CFR 177.30), provides that any warranted. and the NFC reader is Canada for party-at-interest, as defined in 19 CFR purposes of U.S. Government 177.22(d), may seek judicial review of a Authority: 42 U.S.C. 247d–6d procurement. The country of origin of final determination within 30 days of Dated: December 2, 2020. the NFC keyring fob will be determined publication of such determination in the Alex M. Azar II, by the country of origin of the Federal Register. Secretary, Department of Health and Human contactless integrated circuit (IC), which Dated: November 25, 2020. Services. is usually Taiwan, but if unavailable, Alice A. Kipel, [FR Doc. 2020–26972 Filed 12–8–20; 8:45 am] then either Thailand or Singapore will Executive Director, Regulations and Rulings, BILLING CODE 4150–37–P be the source country and the country Office of Trade. of origin for purposes of U.S. Government procurement. HQ H309128 DEPARTMENT OF HEALTH AND November 25, 2020 HUMAN SERVICES DATES: The final determination was issued on November 25, 2020. A copy OT:RR:CTF:VS H309128 EGJ of the final determination is attached. National Institutes of Health CATEGORY: Origin Any party-at-interest, as defined in 19 Office of the Director, National CFR 177.22(d), may seek judicial review Mr. James Lay Institutes of Health; Amended Notice of this final determination within Geotab USA, Inc. of Meeting January 8, 2021. 770 E Pilot Rd., Suite A Notice is hereby given of a change in FOR FURTHER INFORMATION CONTACT: Beth the meeting of the Advisory Committee Jenior, Valuation and Special Programs Las Vegas, NV 89119 to the Director, National Institutes of Branch, Regulations and Rulings, Office Re: U.S. Government Procurement; Health, December 10, 12:00 p.m. to of Trade, at (202) 325–0347. Country of Origin of Three Vehicle December 11, 05:00 p.m. National SUPPLEMENTARY INFORMATION: Notice is Tracking Devices, Satellite Device, NFC Institutes of Health, Building 1, Wilson hereby given that on November 25, Reader, and NFC Keyring Fob; Hall, 1 Center Drive, Bethesda, MD, 2020, pursuant to subpart B of part 177, Substantial Transformation 20892 (Virtual Meeting) which was U.S. Customs and Border Protection Dear Mr. Lay published in the Federal Register on Regulations (19 CFR part 177, subpart This is in response to your ruling 11/30/2020, 85 FR 76590. B), CBP issued a final determination request, dated February 6, 2020, The meeting notice is amended to concerning the country of origin of three requesting a final determination on change the meeting start time on vehicle tracking devices, one satellite behalf of Geotab USA, Inc. (‘‘Geotab’’) December 10, 2020 from 12:00 p.m. to device, one NFC reader, and one NFC pursuant to subpart B of Part 177 of the 12:30 p.m. The meeting is open to the keyring fob imported by Geotab USA, U.S. Customs and Border Protection public. Inc. (Geotab), which may be offered to Dated: December 4, 2020. (‘‘CBP’’) Regulations (19 CFR part 177). the U.S. Government under an This final determination concerns the Natasha M. Copeland, undesignated government procurement country of origin of three vehicle Deputy Director, Office of Federal Advisory contract. This final determination, tracking devices, one satellite device, Committee Policy. Headquarters Ruling Letter H309128, one near field communication (‘‘NFC’’) [FR Doc. 2020–27055 Filed 12–8–20; 8:45 am] was issued under procedures set forth at reader, and one NFC identification BILLING CODE 4140–01–P 19 CFR part 177, subpart B, which keyring fob. As a U.S. importer, Geotab implements Title III of the Trade is a party-at-interest within the meaning Agreements Act of 1979, as amended of 19 CFR 177.22(d)(1) and is entitled to DEPARTMENT OF HOMELAND (19 U.S.C. 2511–18). In the final request this final determination. SECURITY determination, CBP concluded that the country of origin of the three vehicle Facts U.S. Customs and Border Protection tracking devices, the satellite device, Geotab is a technology company and the NFC reader is Canada for which designs and imports vehicle Notice of Issuance of Final purposes of U.S. Government tracking systems, and has submitted six Determination Concerning Three procurement. Regarding the NFC different products for our review. The Vehicle Tracking Devices, a Satellite keyring fob, CBP concluded that the products’ descriptions, pictures, and Device, an NFC Reader, and an NFC country of origin will be the country manufacturing processes are set forth Keyring FOB where the contactless integrated circuit below. AGENCY: is manufactured. In most cases, this will U.S. Customs and Border Product Descriptions Protection, Department of Homeland be Taiwan, but if the contactless Security. integrated circuit cannot be sourced The first three products are telematics ACTION: Notice of final determination. there, then it will be sourced from either devices, which are designed to transmit Thailand or Singapore, and the vehicle tracking information over long SUMMARY: This document provides corresponding sourcing country would distances. Specifically, the three notice that U.S. Customs and Border then be the country of origin for products are:

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00043 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79205

• The GO9 device and its component harnesses; • The GO9–NOGPSF, which is a GO9 device with the GPS permanently disabled, and its component harness; and • The GR8 (ATT–GRLTEA1), which is a rugged version of the GO8 device that can be used for harsh conditions Finally, you have also requested a and installed on the exterior of a determination regarding an NFC reader Three Vehicle Tracking Devices vehicle, for example on a truck trailer or and an NFC keyring fob, described as on heavy equipment, and its component follows: You state that the GO9, the GO9– harness. • An IOX NFC reader (IOX–NFC– NOGPSF, and the GR8 vehicle tracking You state that the three vehicle READERA), which allows dispatchers or devices all have a similar manufacturing tracking devices are very similar in managers to easily view where each process. Each device consists of both design. When each end product is driver is at any point in time and to Canadian and non-Canadian packaged, it includes the tracking monitor each driver as s/he operates a components, and two main components device with one or more harnesses vehicle; and of each product are a printed circuit (communications and data cables), and • board assembly (‘‘PCBA’’) and other minor components, such as zip An NFC identification keyring fob proprietary software. The PCBAs for ties, mounting brackets, decals or (GEO–NFC FOB BLUE20), used in each of these products are manufactured stickers, and screws. A harness may be conjunction with the NFC reader to in Canada. Additionally, all of the an external component that is plugged identify the individual driver operating PCBAs for these three devices are into the device or it may be a a vehicle. loaded with software developed in component built into the item. You have NFC technology allows two devices Canada. You have provided us with the provided the following picture of the placed within a few centimeters of each details of the manufacturing process for GO9 device, which does not have a other to exchange data. In order for this the GO9 device as a representative built-in harness: to work, both devices must be equipped example. with an NFC chip and an antenna.1 For the GO9 and other two devices, According to your website, the NFC most of the components are imported reader plugs into the Geotab vehicle into Canada from China. At a facility in tracking device. Each authorized vehicle Canada, the PCBAs are assembled from driver has an assigned NFC keyring fob two major components: A main card with a specific serial number assigned and a daughter card. To produce these to that driver. The driver swipes the two boards, blank printed circuit boards NFC keyring fob across the NFC reader are run through surface mount You have also provided the following before beginning the trip so that the technology (‘‘SMT’’) machines and are picture of the GR8 device, which does vehicle tracking device can register who populated with different components. have a built-in harness: is driving the vehicle. See ‘‘NFC Driver The GPS device is surface mounted to ID Technology: How to Use and Install,’’ the main board and an antenna is (April 5, 2018) available at https:// attached to the daughter board. Next, the two boards are combined together www.geotab.com/blog/driver-id/. into a single PCBA. You state that the NFC reader is a The inert PCBAs are shipped from the single unit featuring a black rectangular manufacturing facility to Geotab’s casing and a long connecting wire. It is facility which is also in Ontario, pictured below with the NFC keyring Canada. At Geotab’s facility, the In addition, you have asked for a fob (the blue item with an attached key following six processes are performed: determination of the country of origin of ring, second from the right) and other (1) Programming and testing, (2) closing, a satellite device, which is an auxiliary minor components, such as the (3) scanning, (4) packaging, (5) labeling, item that plugs into a GO9 or GO8 mounting bracket and screws, double and (6) debugging. During the first device and that allows the GO9 or GO8 sided tape for installation (the red item), programming and testing phase, Geotab device to communicate over the satellite the NFC sticker (the item on the far loads the final firmware and network when cellular connectivity is right), and a zip tie. You note that the configurations onto the PCBA’s lost. The satellite add-on is a single NFC keyring fob and the sticker are sold subassembly. This firmware was also device with two external components. separately. developed in Canada. Then a SIM card Pictured below, it consists of the is placed into the subassembly and the satellite device (the silver box on the unit is tested. Various labels are affixed lower left side), an IOX integrated to parts of the unit, including the casing. receiver/decoder (IRD) (the rectangular The subassembly is inserted into the casing, then the unit is tested, unit at the bottom of the image), and an inspected, and finally the casing is external antenna (the black square unit 1 See ‘‘Everything you need to know about NFC closed. Then the light pipe, labels, and on the top right of the image), which are decals are added. The device is placed delivered connected together with a zip and mobile payments,’’ CNET (September 9, 2014) available at https://www.cnet.com/how-to/how-nfc- in a box with its product literature and tie: works-and-mobile-payments/. zip tie.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00044 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES EN09DE20.000 EN09DE20.001 EN09DE20.002 EN09DE20.003 79206 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

You note that the harness is a boards are combined together into a a new and different article of commerce communication and data cable that is single assembly. The new PCBA with a name, character, or use distinct either hard-wired into the device or subassembly is loaded with Geotab from that of the article or articles from plugs into the device. The harness firmware developed in Canada. In which it was so transformed. allows interaction between the device addition, the NFC reader’s harness from See also 19 CFR 177.22(a). and the vehicle; it also provides China is wired into the PCBA at this The test for determining whether a connectivity to facilitate the facility. substantial transformation will occur is transmission and collection of data. In Next, the PCBA subassembly is whether an article emerges from a many instances, an external harness is shipped to Geotab’s Ontario facility, process with a new name, character or not necessary because the device can be where it is inserted between two plastic use, different from that possessed by the plugged directly into the vehicle’s On- pieces which will form the outer casing. article prior to processing. See Texas Board Diagnostics (‘‘OBD’’) port. You The unit is tested, labelled, and Instruments Inc. v. United States, 69 state the harnesses are subsidiary items, packaged with a mounting bracket and C.C.P.A. 151 (1982). In order to and that all of harnesses for these a zip tie for delivery to customers. determine whether a substantial devices are currently sourced from transformation has occurred, CBP NFC Fobs China. You state that the devices are considers the totality of the packaged together with their harnesses With regard to the NFC fobs, they are circumstances and makes such when they are shipped to the final manufactured in Taiwan. Each fob is determinations on a case-by-case basis. customer in the United States. made up of the following parts, sourced CBP has stated that a new and different in Taiwan: (1) Plastic casing, (2) an IOX Satellite Add-On article of commerce is an article that has ‘‘Ultralight C—contactless ticket undergone a change in commercial Turning to the satellite device, it is integrated circuit (‘‘IC’’) chip,’’ (3) coil/ designation or identity, fundamental made up of three major components antenna, (4) metal ring, and (5) label character, or commercial use. A which connect to each other via an paint. However, you note that determinative issue is the extent of the electrical cord: The satellite box, an IOX occasionally the manufacturer in operations performed and whether the integrated receiver/decoder (‘‘IRD’’), and Taiwan is unable to source the materials lose their identity and become an external antenna. The satellite box contactless IC in Taiwan. In those an integral part of the new article. This contains a PCBA, an internal antenna, instances, the manufacturer will source determination is based on the totality of and a modem. All of the discrete the IC from either Thailand or the evidence. See National Hand Tool components of the satellite box are Singapore. The fob’s assembly always Corp. v. United States, 16 CIT 308 imported into Canada. The blank board takes place in Taiwan. (1992), aff’d, 989 F.2d 1201 (Fed. Cir. is populated with the discrete After the finished fobs are imported 1993). components, including the modem, into Canada, Geotab programs a serial Three Vehicle Tracking Devices and the using SMT equipment at a facility in number into each fob so that it can be NFC Reader Canada. Then, the PCBA is shipped to uniquely identified. Then, Geotab marks Geotab’s facility in Canada. At Geotab, the fobs and packages them into packs In Data General v. United States, 4 the antenna is attached to the PCBA, of 20 each for export. CIT 182 (1982), the court determined which is then tested and packaged in its that for purposes of determining outer casing. This finished satellite box Issue eligibility under item 807.00, Tariff is the component that provides an What is the country of origin of the Schedules of the United States alternative data connection based on a three vehicle tracking devices, the (predecessor to subheading 9802.00.80, satellite signal when the GO device satellite device, the NFC reader, and the Harmonized Tariff Schedule of the loses its cell tower based signal. NFC keyring fob for purposes of U.S. United States), the programming of a The IRD is the component which Government procurement? foreign PROM (Programmable Read- communicates and facilitates the data Only Memory chip) in the United States flow between the satellite box and the Law and Analysis substantially transformed the PROM vehicle tracking device. The IRD is built CBP issues country of origin advisory into a U.S. article. The court noted that in China, where it is loaded with rulings and final determinations as to the programs were developed by a U.S. proprietary software developed by whether an article is or would be a project engineer with many years of Geotab in Canada. It is shipped to product of a designated country or experience in ‘‘designing and building Canada to be packaged together with the instrumentality for the purposes of hardware.’’ In addition, the court noted satellite box. The final component is the granting waivers of certain ‘‘Buy that while replicating the program external antenna, which is completely American’’ restrictions in U.S. law or pattern from a ‘‘master’’ PROM may be manufactured in China and shipped to practice for products offered for sale to a quick one-step process, the Canada to be packaged together for the U.S. Government, pursuant to development of the pattern and the shipment with the other two subpart B of Part 177, 19 CFR 177.21 et production of the ‘‘master’’ PROM components. seq., which implements Title III of the required much time and expertise. The Trade Agreements Act of 1979, as court noted that it was undisputed that NFC Reader amended (19 U.S.C. 2511 et seq.). programming altered the character of a With regard to the NFC Reader, it Under the rule of origin set forth PROM. contains two PCBAs, a main board, and under 19 U.S.C. 2518(4)(B): Accordingly, in some cases we have an antenna board. Just like the An article is a product of a country or found that programming a device in the components for the vehicle tracking instrumentality only if (i) it is wholly same country where the software was devices, most of the components of the growth, product, or manufacture of developed can constitute a substantial these PCBAs are imported from China. that country or instrumentality, or (ii) in transformation. In HQ 558868, dated At a Canadian facility, the blank the case of an article which consists in February 23, 1995, we determined that imported boards are all populated with whole or in part of materials from blank cards embedded with microchips their components using SMT another country or instrumentality, it were substantially transformed when equipment. The two PCBAs and the two has been substantially transformed into they were imported into the United

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00045 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79207

States and programmed into Secure ID substantial transformation. With regard (1982), aff’d 702 F.2d 1022 (Fed. Cir. cards using software developed in the to the satellite box, we find that 1983). The CIT noted that ‘‘the upper— United States. We took the view that the populating a bare board with a modem, which in its condition as imported is programming changed the blank card an internal antenna, and enclosing it in already a substantially complete shoe— from a card with many potential the finished housing constitutes a is readily recognizable as a distinct item applications into a card that could only substantial transformation. The apart from the outsole to which it is be used to enable the user to log into a individual components lose their attached.’’ Id. at 224. In addition, the secured computer. See also HQ 735027, identities as modems, antennae, CIT cited to Grafton Spools, Ltd. v. dated September 7, 1993 (programming capacitors, and resistors—and have a United States, 45 Cust. Ct. 16 (1960), imported blank media (EEPROM) with new name, character, and use as a another substantial transformation case U.S. software in the United States satellite device box. in which the U.S. Customs Court noted substantially transformed it into media With regard to the remaining two that purchasers of typewriter ribbons which prevented the piracy of software). components, we find that their country were buying the ribbon, and not the We note that all four of these devices of origin is China. Although Canadian spool upon which the ribbon was contain software developed and software is downloaded onto the IRD in wound. The CIT noted that ‘‘in Grafton downloaded onto them in Canada. In China, we note that they are entirely Spools the ribbon and not the spool was addition to the software, these four manufactured in China. In HQ H241177, the essence of the finished article, while devices all contain PCBAs built in dated December 3, 2013, we examined here the upper is the essence of the Canada. The blank boards and the Ethernet switches assembled to completed shoe.’’ Id. at 226–227. In various capacitors, resistors, and other completion in Malaysia and then Uniroyal, the CIT ultimately concluded elements are permanently combined shipped to Singapore, where U.S.-origin that adding the outer soles did not result together using SMT machines at a software was downloaded onto the in a substantial transformation of the facility in Canada. We note that the switches. In that ruling, we noted that: uppers as the uppers were the very PCBAs are made up of a variety of parts We find that the software essence of the finished shoe. from different countries, including non- downloading performed in Singapore In the satellite device system, we find TAA countries such as China. does not amount to programming. that it is the satellite box which is the For the four relevant devices, we note Programming involves writing, testing ‘‘very essence’’ of the finished system, that they are imported into Canada as and implementing code necessary to while the other two devices perform bare boards, PCBA parts, external make a computer function in a certain subsidiary roles. The satellite box housing, and wire harnesses. When the way. See Data General supra. See also communicates with the satellite PCBAs are built in Canada, programmed ‘‘computer program’’, Encyclopedia network when the vehicle tracking with Canadian software in Canada, and Britannica (2013), (9/19/2013) http:// device loses its connection with cellular changed into a finished vehicle tracking www.britannica.com/, which explains, towers. The IRD facilitates the flow of device or NFC reader in Canada, we find in part, that ‘‘a program is prepared by information between the tracking device that they have a different name, first formulating a task and then and the satellite box, while the external character, and use than the imported expressing it in an appropriate antenna boosts connectivity. For all of articles. Therefore, we find that the computer language, presumably one these reasons, we find that the country discrete parts of these four devices are suited to the application.’’ of origin of the complete system will be substantially transformed in Canada. As While the programming occurs in the the country of origin of the satellite box. such, the country of origin for the U.S., the downloading occurs in For government procurement purposes, purposes of government procurement of Singapore. Given these facts, we find the country of origin of the satellite the three vehicle tracking devices and that the country where the last device system will be Canada, where the the NFC reader is Canada. substantial transformation occurs is PCBAs were populated with various Malaysia, that is, where the major components. Satellite Device assembly processes are performed. The Unlike the vehicle tracking devices country of origin for purposes of U.S. NFC Keyring Fob and reader, the satellite device is made Government procurement is Malaysia. With regard to the NFC fobs, each fob up of three different components: The Like the Ethernet switches referenced is made up of the following parts satellite box, the IRD, and the external above, downloading Canadian software sourced in Taiwan: (1) Plastic casing, (2) antenna. The satellite box contains a onto the IRD in China is not sufficient an ‘‘Ultralight C—contactless ticket IC PCBA populated in Canada, which to substantially transform the device. chip,’’ (3) coil/antenna, (4) metal ring, incorporates a modem and an internal However, we note that both the IRD and and (5) label paint. However, you note antenna. The satellite box is the part of the external antenna are packaged that occasionally the manufacturer in the system which connects to the together with the satellite box to form a Taiwan is unable to source the satellite system in the event the vehicle finished satellite device system. All contactless IC in Taiwan. In those tracking device loses its connection to three components of the satellite device instances, the manufacturer will source cellular tower signals. The IRD system operate as a single system when the IC from either Thailand or communicates with the vehicle tracking exported to the United States; therefore, Singapore. The fob’s assembly always device, and the external antenna we must determine the singular country takes place in Taiwan. provides additional connectivity. Both of origin for the entire system. In Headquarters Ruling Letter (‘‘HQ’’) the IRD and the external antenna are In determining the country of origin H303864, dated December 26, 2019, an completely manufactured in China; for the satellite device system, the Court electric motor from China was shipped however, the IRD is loaded with of International Trade’s (‘‘CIT’’) analysis to Mexico for assembly with the proprietary software developed in in Uniroyal, Inc. v. United States impeller, the seal, and the plastic Canada. (‘‘Uniroyal’’) is instructive, wherein the housing to form the finished pump As stated previously in our analysis of CIT examined whether a finished shoe assembly. In that case, we noted that the the tracking devices and NFC reader, we upper was substantially transformed assembly was rather simple—it involved have found that in certain situations, when it was combined with the shoe’s press fitting the parts into each other. manufacturing a PCBA constitutes a outer sole. 3 CIT 220, 542 F. Supp. 1026 Moreover, the electric motor was the

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00046 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79208 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

most expensive and substantive part of Executive Director Regulations & Rulings, automatic extension of the validity of the finished pump assembly. We found Office of Trade. TPS-related Employment Authorization that it imparted the ‘‘very essence’’ of [FR Doc. 2020–27022 Filed 12–8–20; 8:45 am] Documents (EADs); Notices of Action the pump assembly, as it turned the BILLING CODE 9111–14–P (Forms I–797); and Arrival/Departure impeller and moved the fluid through Records (Forms I–94), (collectively the pump. ‘‘TPS-related documentation’’); for those DEPARTMENT OF HOMELAND The question presented is whether the beneficiaries under the TPS SECURITY contactless IC is substantially designations for El Salvador, Haiti, transformed when it is assembled Nicaragua, Sudan, Honduras, and U.S. Citizenship and Immigration Nepal. together with the other components. We Services note that in NFC technology, an NFC DATES: DHS is automatically extending chip and an antenna are combined to [CIS No. 2676–20; DHS Docket No. USCIS– the validity of TPS-related transmit information across short 2019–0020] documentation for beneficiaries under distances. In this case, the driver’s serial RIN 1615–ZB83 the TPS designations for El Salvador, ID number is transmitted to the NFC Haiti, Nicaragua, Sudan, Honduras, and reader for tracking purposes. Therefore, Continuation of Documentation for Nepal for nine months through October the NFC chip is central to the function Beneficiaries of Temporary Protected 4, 2021, from the current expiration date of the finished NFC fob. Status Designations for El Salvador, of January 4, 2021. Haiti, Nicaragua, Sudan, Honduras, FOR FURTHER INFORMATION CONTACT: Similar to the shoe upper in Uniroyal, and Nepal • the ribbon in Grafton Spools, and the You may contact Maureen Dunn, electric motor in HQ H303864, we find AGENCY: U.S. Citizenship and Chief, Humanitarian Affairs Division, that the NFC chip constitutes the ‘‘very Immigration Services, Department of Office of Policy and Strategy, U.S. essence’’ of the finished NFC fob. After Homeland Security. Citizenship and Immigration Services, the chip is assembled into the finished ACTION: Notice. U.S. Department of Homeland Security, fob, its use remains unchanged. by mail at 5900 Capital Gateway Dr, Therefore, we find that the country of SUMMARY: Through this notice, the Camp Springs, MD 20529–2140; or by Department of Homeland Security phone at 800–375–5283. origin of the NFC fob will be the country • where the NFC chip is produced. In (DHS) announces actions to ensure its For further information on TPS, most cases, the country of origin will be continued compliance with the please visit the USCIS TPS web page at Taiwan, but when the Ultralight C— preliminary injunction orders of the www.uscis.gov/tps. • If you have additional questions contactless ticket IC is unavailable from U.S. District Court for the Northern about TPS, please visit uscis.gov/tools. Taiwan, then the country of origin of the District of California in Ramos, et al. v. Our online virtual assistant, Emma, can NFC fob will be where the chip is Nielsen, et. al., No. 18–cv–01554 (N.D. answer many of your questions and sourced, which in this case is either Cal. Oct. 3, 2018) (‘‘Ramos’’) and the point you to additional information on Thailand or Singapore. U.S. District Court for the Eastern District of New York in Saget, et. al., v. our website. If you are unable to find Holding Trump, et. al., No. 18–cv–1599 your answers there, you may also call (E.D.N.Y. Apr. 11, 2019) (‘‘Saget’’), and our U.S. Citizenship and Immigration The country of origin of the three with the order of the U.S. District Court Services (USCIS) Contact Center at 800– telematics devices, the satellite devices, for the Northern District of California to 375–5283 (TTY 800–767–1833). and the NFC reader for purposes of U.S. stay proceedings in Bhattarai v. Nielsen, • Applicants seeking information Government procurement is Canada. No. 19–cv–00731 (N.D. Cal. Mar. 12, about the status of their individual cases The country of origin of the NFC 2019) (‘‘Bhattarai’’). A panel of the U.S. may check Case Status Online, available keyring fob for purposes of U.S. Court of Appeals for the Ninth Circuit on the USCIS website at www.uscis.gov, Government procurement is the country vacated the injunction in Ramos on or visit the USCIS Contact Center at of origin of the contactless IC, which is September 14, 2020. However, because uscis.gov/contactcenter. • usually Taiwan. However, if the the appellate court has not issued its Further information will also be contactless IC is sourced from Thailand directive to the district court to make available at local USCIS offices upon or Singapore, then the country of origin that ruling effective, the injunction publication of this notice. for procurement would be Thailand or remains in place at this time. See SUPPLEMENTARY INFORMATION: Ramos, et al., v. Wolf, et al., No. 18– Singapore as the case may be. Table of Abbreviations Notice of this final determination will 16981 (9th Cir., September 14, 2020). Beneficiaries under the Temporary CFR—Code of Federal Regulations be given in the Federal Register, as DHS—U.S. Department of Homeland required by 19 CFR 177.29. Any party- Protected Status (TPS) designations for El Salvador, Nicaragua, Sudan, Security at-interest other than the party which EAD—Employment Authorization Document Honduras, and Nepal will retain their requested this final determination may EOIR—Executive Office for Immigration request, pursuant to 19 CFR 177.31, that TPS while the preliminary injunction in Review CBP reexamine the matter anew and Ramos and the Bhattarai order remain FNC—Final Nonconfirmation issue a new final determination. in effect, provided that an alien’s TPS is Form I–765—Application for Employment Authorization Pursuant to 19 CFR 177.30, any party- not withdrawn because of individual ineligibility. Beneficiaries under the Form I–797—Notice of Action at-interest may, within 30 days of Form I–821—Application for Temporary publication of the Federal Register TPS designation for Haiti will retain their TPS while either of the Protected Status Notice referenced above, seek judicial Form I–9—Employment Eligibility preliminary injunctions in Ramos or review of this final determination before Verification the Court of International Trade. Saget remain in effect, provided that an Form I–912—Request for Fee Waiver alien’s TPS is not withdrawn because of Form I–94—Arrival/Departure Record Sincerely, individual ineligibility. This notice Government—U.S. Government Alice A. Kipel, further provides information on the INA—Immigration and Nationality Act

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00047 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79209

IER—U.S. Department of Justice, Civil Rights of Appeals for the Ninth Circuit vacated designation for Haiti will remain in Division, Immigrant and Employee Rights the district court’s preliminary effect, as required by the preliminary Section injunction in Ramos on September 14, injunction orders in both Ramos and SAVE—USCIS Systematic Alien Verification 2020, holding that the decision to Saget, so long as either of those for Entitlements Program designate, extend, or terminate TPS is preliminary injunctions remain in Secretary—Secretary of Homeland Security TNC—Tentative Nonconfirmation not subject to judicial review. However, effect. The TPS designations for TPS—Temporary Protected Status the appellate order is not currently Honduras and Nepal will remain in TTY—Text Telephone effective because the Ninth Circuit has effect so long as the Bhattarai order USCIS—U.S. Citizenship and Immigration not issued any directive to carry out the staying proceedings and approving the Services order to the federal district court.2 parties’ stipulated agreements continues Therefore, the Ramos preliminary in effect. Affected TPS beneficiaries Background on TPS injunction remains in effect. In addition, under the TPS designations for El • TPS is a temporary immigration the order of the district court in Salvador, Nicaragua, Sudan, Haiti, status granted to eligible nationals of a Bhattarai staying proceedings and Honduras, and Nepal will retain their country designated for TPS under the approving the parties’ stipulated TPS and their TPS-related Immigration and Nationality Act (INA) agreement to continue TPS and TPS- documentation will continue to be valid or to eligible persons without related documentation for eligible in accordance with the specific orders nationality who last habitually resided beneficiaries from Nepal and Honduras that affect the TPS designations in the designated country. remains in effect. The Saget district regarding their individual countries, • During the TPS designation period, court’s order prohibiting the termination provided that the affected beneficiaries TPS beneficiaries are eligible to remain of TPS for Haiti also remains in effect continue to meet all the individual in the United States, may not be while the decision is on appeal to the requirements for TPS. See INA section removed, and are authorized to obtain U.S. Court of Appeals for the Second 244(c)(3). See also 8 CFR 244.14. DHS EADs so long as they continue to meet Circuit. Affected TPS beneficiaries from will not terminate TPS for any of the the requirements of TPS. the six countries will retain their status, affected countries pending final • TPS beneficiaries may travel abroad provided they continue to meet all the disposition of the Ramos appeal, or for temporarily with the prior consent of individual requirements for TPS Haiti pending both Ramos and Saget DHS. eligibility described in INA section appeals, including through any • The granting of TPS does not result 244(c) and 8 CFR 244. As necessary, additional appellate channels in which in or lead to lawful permanent resident DHS will publish future information in relief may be sought, or by other orders status. the Federal Register to ensure its of the court. • To qualify for TPS, beneficiaries compliance with any relevant court DHS is further announcing it is must meet the eligibility standards at orders that may be issued after the date automatically extending, through INA section 244(c)(1)–(2), 8 U.S.C. of this notice. October 4, 2021, the validity of certain 1254a(c)(1)–(2). DHS has initially published notices to TPS-related documentation, as specified • When the Secretary of Homeland ensure its compliance with the Ramos in this notice, for beneficiaries under Security (the Secretary) terminates a preliminary injunction on October 31, the TPS designations for El Salvador, country’s TPS designation, beneficiaries 2018 and March 1, 2019, and the Haiti, Nicaragua, Sudan, Honduras, and return to one of the following: Bhattarai order to stay proceedings on Nepal provided that the affected Æ The same immigration status or May 10, 2019. See 83 FR 54764; 84 FR beneficiaries remain individually category that they maintained before 7103; and 84 FR 20647. The Department eligible for TPS. TPS, if any (unless that status or last published a notice to ensure its Automatic Extension of EADs Issued category has since expired or been continued compliance with the Under the TPS designations for El terminated); or combined orders in Ramos, Bhattarai, Salvador, Haiti, Nicaragua, Sudan, Æ Any other lawfully obtained and Saget on November 4, 2019. That Honduras, and Nepal immigration status or category they notice automatically extended certain Through this Federal Register notice, received while registered for TPS, as TPS and TPS-related documentation DHS automatically extends the validity long as it is still valid on the date TPS through January 4, 2021 for all eligible of EADs listed in Table 1 below issued terminates. TPS beneficiaries covered by the courts’ to beneficiaries under the TPS orders. See 84 FR 59403. Through this Purpose of this Action designations for El Salvador, Haiti, Federal Register notice, DHS announces Nicaragua, Sudan, Honduras, and This notice ensures DHS’s continued actions to ensure its continued Nepal. Such aliens may show their EAD compliance with various court orders compliance with the district court to employers to demonstrate they have issued by the federal district courts in orders in these three lawsuits while employment authorization and may the Ramos, Bhattarai, and Saget those orders remain in effect. wish to also show employers this lawsuits that require DHS to maintain The TPS designations for El Salvador, Federal Register notice to explain that the TPS designations for El Salvador, Nicaragua, and Sudan will remain in their TPS-Related Documentation has Haiti, Sudan, Nicaragua, Honduras, and effect, as required by the Ramos district been automatically extended through Nepal, as well as the TPS and TPS- court order, so long as the preliminary October 4, 2021. This Notice explains related documentation for eligible injunction remains in effect. The TPS how TPS beneficiaries, their employers, affected beneficiaries.1 The U.S. Court and benefit-granting agencies may Nielsen, et al., No. 19–cv–00731 (N.D. Cal. Mar. 12, 1 See Ramos, et al. v. Nielsen, et. al., No. 18–cv– 2019) (district court stayed proceedings until determine which EADs are 01554 (N.D. Cal. Oct. 3, 2018) (district court granted Ramos appeal decided and approved parties’ automatically extended and how this preliminary injunction against terminations of TPS stipulation for continued TPS and issuance of TPS- affects the Form I–9, Employment for El Salvador, Haiti, Sudan, and Nicaragua) related documentation to eligible, affected Eligibility Verification, E-Verify, and (‘‘Ramos’’); Saget, et. al., v. Trump, et. al., No. 18– beneficiaries of TPS for Honduras and Nepal during cv–1599 (E.D.N.Y. Apr. 11, 2019) (district court the stay and pendency of the appeal) (‘‘Bhattarai’’). USCIS Systematic Alien Verification for granted preliminary injunction against termination 2 See Ramos, et al., v. Wolf, et al., No. 18–16981 Entitlements (SAVE) processes. of TPS for Haiti) (‘‘Saget’’); and Bhattarai, et al. v. (9th Cir., September 14, 2020). Additionally, a beneficiary under the

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00048 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79210 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

TPS designation for any of these TABLE 1—AFFECTED EADS— the TPS designations for El Salvador, countries who has applied for a new Continued Haiti, Nicaragua, Sudan, Honduras, and EAD but who has not yet received his Nepal. These extensions apply only if or her new EAD is covered by this If an EAD has a category Then the validity of the the TPS beneficiary properly filed for re- code of A–12 or C–19 EAD is extended automatic extension, provided that the and an expiration date of: through: registration during either the most EAD he or she possesses contains one of recent DHS-announced registration the expiration dates listed in Table 1 04/02/2019 10/04/2021 period for their country, or any 06/24/2019 10/04/2021 below. 07/22/2019 10/04/2021 applicable previous DHS-announced re- 09/09/2019 10/04/2021 registration periods for the alien’s TABLE 1—AFFECTED EADS 01/02/2020 10/04/2021 country,3 or has a re-registration 01/05/2020 10/04/2021 application that remains pending. This If an EAD has a category Then the validity of the 03/24/2020 10/04/2021 code of A–12 or C–19 EAD is extended 01/04/2021 10/04/2021 notice does not extend the validity and an expiration date of: through: periods of Forms I–94 or Forms I–797 for any TPS beneficiary who failed to 07/22/2017 10/04/2021 Automatic Extension of Forms I–94 and 11/02/2017 10/04/2021 Forms I–797 file for TPS re-registration during one of 01/05/2018 10/04/2021 the applicable previous DHS-announced 01/22/2018 10/04/2021 Also through this Federal Register re-registration periods, or for whom a re- 03/09/2018 10/04/2021 notice, DHS automatically extends the registration request has been finally 06/24/2018 10/04/2021 07/05/2018 10/04/2021 validity periods of the Forms I–94 and denied. In addition, the extensions do 11/02/2018 10/04/2021 Forms I–797 listed in Table 2 below not apply for any beneficiary from 01/05/2019 10/04/2021 previously issued to beneficiaries under whom TPS has been withdrawn.

TABLE 2—AFFECTED FORMS I–94 AND I–797 4

Validity of forms I–94 Country Beginning date of validity: End date of validity: and I–797 extended through:

El Salvador ...... Sept. 10, 2016 ...... Mar. 9, 2018 ...... 10/04/2021 Mar. 10, 2018 ...... Sept. 9, 2019 ...... 10/04/2021 Haiti ...... Jan. 23, 2016 ...... July 22, 2017 ...... 10/04/2021 July 23, 2017 ...... Jan. 22, 2018 ...... 10/04/2021 Jan. 23, 2018 ...... July 22, 2019 ...... 10/04/2021 Honduras ...... July 6, 2016 ...... Jan. 5, 2018 ...... 10/04/2021 Jan. 6, 2018 ...... July 5, 2018 ...... 10/04/2021 July 6, 2018 ...... Jan. 5, 2020 ...... 10/04/2021 Nepal ...... Dec. 25, 2016 ...... June 24, 2018 ...... 10/04/2021 June 25, 2018 ...... June 24, 2019 ...... 10/04/2021 Nicaragua ...... July 6, 2016 ...... Jan. 5, 2018 ...... 10/04/2021 Jan. 6, 2018 ...... Jan. 5, 2019 ...... 10/04/2021 Sudan ...... May 3, 2016 ...... Nov. 2, 2017 ...... 10/04/2021 Nov. 3, 2017 ...... Nov. 2, 2018 ...... 10/04/2021

Application Procedures file an Application for Temporary Possible Future Actions Protected Status (Form I–821), but must Current beneficiaries under the TPS demonstrate ‘‘good cause’’ for failing to In order to comply with statutory designations for El Salvador, Haiti, re-register on time, as required by law. requirements for TPS while the district Honduras, Nepal, Nicaragua, and Sudan courts’ orders or any superseding court See INA section 244(c)(3)(C) (TPS do not need to pay a fee or file any order concerning the beneficiaries under beneficiary’s failure to register without application, including Application for the TPS designations for El Salvador, good cause in form and manner Employment Authorization (Form I– Haiti, Honduras, Nepal, Nicaragua, and 765), to maintain their TPS benefits specified by DHS is ground for TPS Sudan are pending, DHS anticipates through October 4, 2021, provided that withdrawal); 8 CFR 244.17(b) and Form requiring these beneficiaries to re- they have properly re-registered for TPS I–821 instructions. register and will announce the re- during either the most recent DHS- Any currently eligible beneficiary registration procedures in a future announced registration period for their who does not presently have a pending Federal Register notice. DHS has the country, or any applicable previous re- EAD application under the TPS authority to conduct TPS re-registration registration period described in designations for El Salvador, Haiti, in accordance with section 244(c)(3)(C) Footnote 3. Honduras, Nepal, Nicaragua, or Sudan of the INA and 8 CFR 244.17. Through TPS beneficiaries who have failed to may file Form I–765 with appropriate the re-registration process, which is re-register properly for TPS during any fee. generally conducted every 12 to 18 of these re-registration periods may still months while a country is designated

3 El Salvador: July 8–Sept. 6, 2016, or Jan. 18– Nicaragua: May 16–July 15, 2016 or Dec. 15, 2017– here if you were a late initial filer (LIF) at the time Mar. 19, 2018; Haiti: Aug. 25–Oct. 26, 2015, May Feb. 13, 2018; Sudan: Jan. 25–March 25, 2016 or because the forms would have the date of approval 24–July 24, 2017, or Jan. 18–Mar. 19, 2018; Oct. 11, 2017–Dec. 11, 2017. of your LIF application for TPS. As long as they Honduras: May 16–July 16, 2016; Dec. 15, 2017– 4 Your Forms I–94 and I–797 may show a bear an end date of validity listed in this chart, then Feb. 13, 2018 or June 5–Aug. 6, 2018; Nepal: Oct. they are automatically extended by this Notice. 26–Dec. 27, 2016 or May 22–July 23, 2018; different beginning date of validity than those listed

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00049 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79211

for TPS, USCIS determines whether automatically extended TPS-related the order to stay proceedings in each TPS beneficiary is continuing to documentation beyond 120 days from Bhattarai, DHS will not implement or maintain individual eligibility for TPS, the issuance of any appellate mandate to enforce the previously announced including but not limited to, the the District Court, DHS reserves the determinations to terminate the existing requirements related to disqualifying right to issue a subsequent Federal TPS designations for Honduras and criminal or security issues. See id.; INA, Register notice announcing an Nepal 8 unless and until the district section 244(c)(2); 8 CFR 244.2, 244.3, expiration date for the documentation court’s order in Ramos enjoining and 244.4 (describing individual TPS that corresponds to the last day of the implementation and enforcement of the eligibility requirements, including 120-day period. Should the Government determinations to terminate the TPS mandatory criminal and security bars). move to vacate the Bhattarai order to designations for El Salvador, Haiti, The Government has appealed both stay proceedings in light of an appellate Nicaragua, and Sudan is reversed and the Ramos and Saget preliminary decision affirming the preliminary that reversal becomes final for some or injunctions. A 3-judge panel of the U.S. injunction in Ramos that suggests a all of the affected countries, or by other Court of Appeals for the Ninth Circuit basis on which to distinguish the order of the court. Any termination of ruled for the Government and vacated determinations to terminate the TPS TPS-related documentation for the Ramos preliminary injunction on designations for Honduras and Nepal beneficiaries under the TPS September 14, 2020. However, the from the TPS terminations at issue in designations for Haiti, Nicaragua, preliminary injunction remains in effect Ramos, TPS will remain in effect for Sudan, Honduras, and Nepal will go because the appellate court has not Honduras and Nepal for at least 180 into effect no earlier than 120 days, and issued its directive (i.e., the mandate) to days following an order of the District no earlier than 365 days for the district court to implement the Court vacating the stay in proceedings. beneficiaries under the TPS designation panel’s decision. Should the for El Salvador, following the issuance Government ultimately prevail in its Additional Notes of any mandate to the district court, as challenge to the Ramos preliminary Nothing in this notice affects DHS’s described in the ‘‘Possible Future injunction, the Secretary’s ongoing authority to determine on a case-by-case basis whether a TPS Action’’ section of this Federal Register determination to terminate TPS for 9 Nicaragua, Sudan, Honduras, and Nepal beneficiary continues to meet the notice. will take effect no earlier than 120 days eligibility requirements for TPS In further compliance with the still- from the issuance of any appellate described in section 244(c) of the INA valid district court orders, DHS is mandate to the district court. The and the implementing regulations in publishing this notice automatically Secretary’s determination to terminate part 244 of Title 8 of the Code of Federal extending the validity of the TPS-related TPS for El Salvador will take effect no Regulations. documentation specified in the earlier than 365 days from the issuance Notice of Compliance With the ‘‘Order Supplementary Information section of of any appellate mandate to the Ramos Enjoining the Implementation and this notice through October 4, 2021, for district court. DHS provides this Enforcement of Determinations To eligible beneficiaries under the TPS additional time for El Salvador TPS Terminate the TPS Designations for El designations for El Salvador, Haiti, beneficiaries in part because there are Salvador, Haiti, Nicaragua, and Sudan’’ Nicaragua, Sudan, Honduras, and almost 100,000 more such beneficiaries in Ramos, the ‘‘Order Enjoining the Nepal. DHS will continue to issue than in the combined TPS beneficiary Implementation of Enforcement of notices that will automatically extend populations of all the other five TPS-related documentation for all 5 Determination To Terminate the TPS countries covered by this notice. The Designation of Haiti’’ in Saget, and the affected beneficiaries under the TPS additional period of 245 days beyond ‘‘Order To Stay Proceedings and designations for El Salvador, Honduras, 120 days permits an orderly transition Agreement To Stay the Determinations Nicaragua, Nepal, and Sudan, so long as for beneficiaries of TPS from El To Terminate the TPS Designations for the Ramos preliminary injunction and Salvador as they return to their Honduras and Nepal’’ in Bhattarai Bhattarai order to stay proceedings homeland. If the Government prevails in remain in place; for Haiti so long as its appeals, DHS will also continue to The previously announced determinations to terminate the existing either the Ramos or Saget preliminary monitor the circumstances of the injunctions remain in place; or by other affected beneficiaries under the other designations of TPS for El Salvador, Nicaragua, and Sudan 6 will not be order of the court. However, should five TPS country designations covered compliance with the Ramos, Bhattarai, by this notice. See INA, 244(d)(3). implemented or enforced unless and until the district court’s order in Ramos and/or Saget court orders remain TPS for beneficiaries under Haiti’s necessary, DHS may announce periodic designation may continue pursuant to is reversed and that reversal becomes re-registration procedures for eligible the Saget preliminary injunction. final. The previously announced TPS beneficiaries in accordance with However, should the Government determination to terminate the existing the INA and DHS regulations. DHS prevail in its challenges to both the designation of TPS for Haiti will not be Ramos preliminary injunction and the implemented or enforced unless and 8 Saget preliminary injunction, the until the district court’s orders in Ramos See Termination of the Designation of Honduras and Saget are reversed and those for Temporary Protected Status, 83 FR 26074 (June Secretary’s determination to terminate 5, 2018); Termination of the Designation of Nepal 7 TPS for Haiti will take effect no earlier reversals become final. As required by for Temporary Protected Status, 83 FR 23705 (May than 120 days from the issuance of the 22, 2018). later of the two appellate mandates to 6 See Termination of the Designation of El 9 An additional provision in the Bhattarai Order Salvador for Temporary Protected Status, 83 FR to Stay Proceedings states that if the preliminary the District Court. To the extent that a 2654 (Jan. 18, 2018); Termination of the Designation injunction in Ramos is upheld, but the Government Federal Register notice has of Nicaragua for Temporary Protected Status, 82 FR moves to vacate the Bhattarai Order based on 59636 (Dec. 15, 2017); Termination of the reasons for distinguishing the terminations of TPS 5 As of December 31, 2019, the number of TPS Designation of Sudan for Temporary Protected for Honduras and Nepal from those under the beneficiaries covered under the affected Status, 82 FR 47228 (Oct. 11, 2017). injunction in Ramos, TPS will remain in effect for designations were: El Salvador 247,412; Haiti 7 See Termination of the Designation of Haiti for Honduras and Nepal for at least 180 days following 55,218; Nicaragua 4,409; Sudan 771; Honduras Temporary Protected Status, 83 FR 2648 (Jan. 18, an order of the District Court vacating its stay of 79,290; Nepal 14,549. 2018). proceedings order.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00050 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79212 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

further continues its commitment to a Eligibility Verification (Form I–9) When hired, what documentation may transition period, as described above. requirements. A beneficiary granted TPS I show to my employer as evidence of All TPS beneficiaries must continue under a designation for one of these employment authorization and identity to maintain their TPS eligibility by countries may also wish to show an when completing Form I–9? meeting the requirements for TPS in employer this Federal Register notice, INA section 244(c) and 8 CFR part 244. which explains that his or her EAD has You can find the Lists of Acceptable DHS will continue to adjudicate any been automatically extended. Documents on the third page of Form pending TPS re-registration and Æ Alternatively, such a TPS I–9 as well as the Acceptable pending late initial applications for beneficiary may choose to show other Documents web page at www.uscis.gov/ affected beneficiaries under the TPS acceptable documents that are evidence i-9-central/acceptable-documents. designations for El Salvador, Haiti, of identity and employment eligibility Employers must complete Form I–9 to Honduras, Nicaragua, Nepal, and as described in the instructions to Form verify the identity and employment Sudan, and continue to make I–9. authorization of all new employees. Æ appropriate individual TPS withdrawal Finally, such a TPS beneficiary may Within 3 days of hire, employees must decisions in accordance with existing show a copy of this Federal Register present acceptable documents to their procedures if an alien no longer notice, along with his or her EAD that employers as evidence of identity and maintains TPS eligibility. DHS will take has been automatically extended, or employment authorization to satisfy appropriate steps to continue its Form I–94, or Form I–797, as evidence Form I–9 requirements. compliance with the orders, and with of his or her lawful status, to law all statutory requirements. enforcement, Federal, state, and local You may present any document from The Acting Secretary of Homeland government agencies, and private List A (which provides evidence of both Security, Chad F. Wolf, having reviewed entities. your identity and employment and approved this document, has • Employment Authorization authorization) or one document from delegated the authority to electronically Document (EAD) List B (which provides evidence of your sign this document to Ian Brekke, who identity) together with one document is the Deputy General Counsel for DHS, Am I eligible to receive an automatic from List C (which provides evidence of extension of my current EAD using this for purposes of publication in the your employment authorization), or you Federal Register notice? Federal Register. may present an acceptable receipt as Ian Brekke, Yes. Provided that you currently have described in the Form I–9 instructions. Deputy General Counsel, U.S. Department of a TPS-related EAD with the specified Employers may not reject a document Homeland Security. expiration dates below, this notice based on a future expiration date. You automatically extends your EAD as can find additional information about Approved Forms To Demonstrate stated in Table 3 below. Continuation of Lawful Status and TPS- Form I–9 on the I–9 Central web page at www.uscis.gov/I-9Central. Related Employment Authorization TABLE 3—AFFECTED EADS • This Federal Register notice dated An EAD is an acceptable document If your EAD has category Then this Federal under List A. See the section ‘‘How do December 9, 2020 code of A–12 or C–19 Register notice extends Æ Through operation of this notice, and an expiration date of: your EAD through: my employer and I complete Form I–9 certain TPS-related documentation, using my automatically extended 07/22/2017 10/04/2021 employment authorization for a new including EADs, of affected 11/02/2017 10/04/2021 beneficiaries under the TPS 01/05/2018 10/04/2021 job?’’ of this Federal Register notice for designations for El Salvador, Haiti, 01/22/2018 10/04/2021 further information. If you present your Honduras, Nepal, Nicaragua, and Sudan 03/09/2018 10/04/2021 EAD with one of the expiration dates 06/24/2018 10/04/2021 are automatically extended through 07/05/2018 10/04/2021 specified below, you may also provide October 4, 2021. 11/02/2018 10/04/2021 your employer with a copy of this Æ A beneficiary granted TPS under 01/05/2019 10/04/2021 Federal Register notice, which explains the designation for El Salvador, Haiti, 04/02/2019 10/04/2021 06/24/2019 10/04/2021 that your EAD has been automatically Honduras, Nepal, Nicaragua, or Sudan 07/22/2019 10/04/2021 extended for a temporary period of time, may show his or her EAD that has been 09/09/2019 10/04/2021 through October 4, 2021, as follows: automatically extended to his or her 01/02/2020 10/04/2021 employer to demonstrate identity and 01/05/2020 10/04/2021 continued TPS-related employment 03/24/2020 10/04/2021 01/04/2021 10/04/2021 eligibility to meet Employment

TABLE 4—AFFECTED EADS AND FORM I–9

You may show your EAD to complete Form I–9 if your EAD has category code of A–12 or Enter this date in Section 1 of Form I–9: Your employer must reverify your employment C–19 and bears an expiration date of: authorization by:

07/22/2017 10/04/2021 10/05/2021 11/02/2017 10/04/2021 10/05/2021 01/05/2018 10/04/2021 10/05/2021 01/22/2018 10/04/2021 10/05/2021 03/09/2018 10/04/2021 10/05/2021 06/24/2018 10/04/2021 10/05/2021 07/05/2018 10/04/2021 10/05/2021 11/02/2018 10/04/2021 10/05/2021 01/05/2019 10/04/2021 10/05/2021 04/02/2019 10/04/2021 10/05/2021

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00051 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79213

TABLE 4—AFFECTED EADS AND FORM I–9—Continued

You may show your EAD to complete Form I–9 if your EAD has category code of A–12 or Enter this date in Section 1 of Form I–9: Your employer must reverify your employment C–19 and bears an expiration date of: authorization by:

06/24/2019 10/04/2021 10/05/2021 07/22/2019 10/04/2021 10/05/2021 09/09/2019 10/04/2021 10/05/2021 01/02/2020 10/04/2021 10/05/2021 01/05/2020 10/04/2021 10/05/2021 03/24/2020 10/04/2021 10/05/2021 01/04/2021 10/04/2021 10/05/2021

What documentation may I present to obtain a new EAD. However, you do not Can my employer require that I provide my employer for Form I–9 if I am need to apply for a new EAD in order any other documentation to prove my already employed but my current TPS- to benefit from this automatic extension. status, such as proof of my citizenship related EAD is set to expire? If you are a beneficiary under the TPS from El Salvador, Haiti, Honduras, Even though your EAD has been designations for El Salvador, Haiti, Nepal, Nicaragua, or Sudan? automatically extended, your employer Nicaragua, Sudan, Honduras, or Nepal No. When completing Form I–9, may need to re-inspect your and want to obtain a new EAD valid including reverifying employment automatically extended EAD to check through October 4, 2021, then you must authorization, employers must accept the Card Expires date and Category code file Form I–765 and pay the associated any documentation that appears on the if your employer did not keep a copy of fee. If you do not want a new EAD, you Form I–9 Lists of Acceptable Documents your EAD when you initially presented do not have to file Form I–765 or pay that reasonably appears to be genuine it. In this situation, your employer the Form I–765 fee. If you do not want and that relates to you, or an acceptable should update the EAD expiration date to request a new EAD now, you may file List A, List B, or List C receipt. in Section 2 of Form I–9. See the Form I–765 at a later date and pay the Employers need not reverify List B section, ‘‘What corrections should my fee, provided that you still have TPS or identity documents. In addition, current employer make to Form I–9 if a pending TPS application. You may file employers may not request my employment authorization has been the application for a new EAD either documentation that does not appear on automatically extended?’’ of this before or after your current EAD has the Lists of Acceptable Documents. Federal Register notice for further expired. Therefore, employers may not request information. You may show this Federal If you are unable to pay the proof of citizenship or proof of re- Register notice to your employer to application fee and/or biometric registration for TPS when completing explain what to do for Form I–9 and to services fee, you may complete a Form I–9 for new hires or reverifying show that your EAD has been Request for Fee Waiver (Form I–912). the employment authorization of automatically extended through October For more information on the application current employees. If presented with an 4, 2021 as indicated in the above chart. forms and fees for TPS, please visit the EAD that has been automatically The last day of the automatic USCIS TPS web page at www.uscis.gov/ extended, employers should accept such extension for your EAD is October 4, tps. a document as a valid List A document, 2021. Before you start work on October so long as the EAD reasonably appears 5, 2021, your employer is required by If you have a Form I–821 and/or Form to be genuine and relates to the law to reverify your employment I–765 application that is still pending employee. Refer to the ‘‘Note to authorization in Section 3 of Form I–9. for beneficiaries under the TPS Employees’’ section of this Federal At that time, you must present any designations for El Salvador, Haiti, Register notice for important document from List A or any document Honduras, Nepal, Nicaragua, or Sudan, information about your rights if your from List C on Form I–9, Lists of then you should not file either employer rejects lawful documentation, Acceptable Documents, or an acceptable application again. If your pending Form requires additional documentation, or List A or List C receipt described in the I–821 is approved, you will be issued otherwise discriminates against you Form I–9 instructions to reverify Forms I–797 and I–94 through October based on your citizenship or employment authorization. 4, 2021. Similarly, if you have a pending immigration status, or your national If your original Form I–9 was a TPS-related Form I–765 that is origin. previous version, your employer must approved, your new EAD will be valid How do my employer and I complete complete Section 3 of the current through October 4, 2021. Your TPS itself Form I–9 using my automatically version of Form I–9, and attach it to continues as long as the preliminary extended employment authorization for your previously completed Form I–9. injunction impacting your country’s a new job? Your employer can check the I–9 TPS designation remains in effect and in Central web page at www.uscis.gov/I- accordance with any relevant future See the chart in the question above 9Central for the most current version of Federal Register notices that DHS may ‘‘When hired, what documentation may Form I–9. Your employer may not issue respecting your country’s TPS I show to my employer as evidence of specify which List A or List C document designation, or until your TPS is finally employment authorization and identity you must present and cannot reject an withdrawn for individual ineligibility when completing Form I–9?’’ to acceptable receipt. under INA, section 244(c), or the determine if your EAD has been applicable TPS designation is automatically extended. Can I obtain a new EAD? terminated as discussed in the ‘‘Possible For Section 1, you should: Yes, if you remain eligible for TPS Future Action’’ section of this Federal a. Check ‘‘An alien authorized to work and apply for a new EAD, you can Register notice. until’’ and enter October 4, 2021, as the

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79214 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

expiration date indicated in the chart; law to reverify the employee’s numerous languages. Employers may and employment authorization in Section 3. also email IER at [email protected]. b. Enter your USCIS number or A- If your original Form I–9 was a previous Note to Employees Number where indicated (your EAD or version, your employer must complete other document from DHS will have Section 3 of the current version of Form For general questions about the your USCIS number or A-Number I–9 and attach it to your previously employment eligibility verification printed on it; the USCIS number is the completed Form I–9. Your employer can process, employees may call USCIS at same as your A-Number without the A check the I–9 Central web page at 888–897–7781 (TTY 877–875–6028) or prefix). www.uscis.gov/I–9Central for the most email USCIS at [email protected]. For Section 2, your employer should current version of Form I–9. USCIS accepts calls in English, Spanish, also use the chart in the question above If I am an employer enrolled in E- and many other languages. Employees ‘‘When hired, what documentation may Verify, how do I verify a new employee or applicants may also call the IER I show to my employer as evidence of whose EAD has been automatically Worker Hotline at 800–255–7688 (TTY employment authorization and identity extended? 800–237–2515) for information when completing Form I–9?’’ to regarding employment discrimination determine if your EAD has been Employers may create a case in E- based upon citizenship, immigration automatically extended. If it has been Verify for a new employee by providing status, or national origin, including automatically extended, the employer the employee’s A-Number or USCIS discrimination related to Form I–9 and should: number from Form I–9 in the Document E-Verify. The IER Worker Hotline a. Write in the document title; Number field in E-Verify. provides language interpretation in b. Enter the issuing authority; If I am an employer enrolled in E- numerous languages. c. Enter either the employee’s A- Verify, what do I do when I receive a To comply with the law, employers Number or USCIS number from Section ‘‘Work Authorization Documents must accept any document or 1 into Section 2’s Document Number Expiration’’ alert for an automatically combination of documents from the field on Form I–9; and extended EAD? Lists of Acceptable Documents if the d. Write October 4, 2021, as the documentation reasonably appears to be expiration date indicated in the chart. E-Verify has automated the genuine and to relate to the employee, Before the start of work on October 5, verification process for TPS-related or an acceptable List A, List B, or List 2021, employers must reverify the EADs that are automatically extended. If C receipt as described in the Form I–9 employee’s employment authorization you have employees who provided a instructions. Employers may not require in Section 3 of Form I–9. TPS-related EAD when they first started working for you, you will receive a extra or additional documentation What updates should my current ‘‘Work Authorization Documents beyond what is required for Form I–9 employer make to Form I–9 if my Expiring’’ case alert when the auto- completion. Further, employers employment authorization has been extension period for this EAD is about participating in E-Verify who receive an automatically extended? to expire. Before this employee starts E-Verify case result of ‘‘Tentative If you presented a TPS-related EAD work on October 5, 2021 as appropriate, Nonconfirmation’’ (TNC) must promptly that was valid when you first started you must reverify his or her inform employees of the TNC and give your job and your EAD has now been employment authorization in Section 3 such employees an opportunity to automatically extended, your employer of Form I–9. Employers should not use contest the TNC. A TNC case result may need to re-inspect your current E-Verify for reverification. means that the information entered into EAD if they do not have a copy of the E-Verify from an employee’s Form I–9 Note to All Employers EAD on file. See the chart in the differs from records available to DHS. question above ‘‘When hired, what Employers are reminded that the laws Employers may not terminate, documentation may I show to my requiring proper employment eligibility suspend, delay training, withhold pay, employer as evidence of employment verification and prohibiting unfair lower pay, or take any adverse action authorization and identity when immigration-related employment against an employee because of the TNC completing Form I–9?’’ to determine if practices remain in full force. This while the case is still pending with E- your EAD has been automatically Federal Register notice does not Verify. A ‘‘Final Nonconfirmation’’ extended. If your employer determines supersede or in any way limit (FNC) case result is received when E- that your EAD has been automatically applicable employment verification Verify cannot verify an employee’s extended, your employer should update rules and policy guidance, including employment eligibility. An employer Section 2 of your previously completed those rules setting forth reverification may terminate employment based on a Form I–9 as follows: requirements. For general questions case result of FNC. Work-authorized a. Write EAD EXT and October 4, about the employment eligibility employees who receive an FNC may call 2021, as the last day of the automatic verification process, employers may call USCIS for assistance at 888–897–7781 extension in the Additional Information USCIS at 888–464–4218 (TTY 877–875– (TTY 877–875–6028). For more field; and 6028) or email USCIS at I9Central@ information about E-Verify-related b. Initial and date the correction. dhs.gov. USCIS accepts calls and emails discrimination or to report an employer Note: This is not considered a in English and many other languages. for discrimination in the E-Verify reverification. Employers do not need to For questions about avoiding process based on citizenship, complete Section 3 until either this discrimination during the employment immigration status, or national origin, notice’s automatic extension of EADs eligibility verification process (Form I– contact IER’s Worker Hotline at 800– has ended or the employee presents a 9 and E-Verify), employers may call the 255–7688 (TTY 800–237–2515). new document to show continued U.S. Department of Justice’s Civil Rights Additional information about proper employment authorization, whichever is Division, Immigrant and Employee nondiscriminatory Form I–9 and E- sooner. By October 5, 2021, when the Rights Section (IER) Employer Hotline Verify procedures is available on the employee’s automatically extended EAD at 800–255–8155 (TTY 800–237–2515). IER website at www.justice.gov/ier and has expired, employers are required by IER offers language interpretation in on the USCIS and E-Verify websites at

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00053 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79215

www.uscis.gov/i-9-central and www.e- b. Explain that SAVE will be able to Conservation Training Center Training verify.gov. verify the continuation of your TPS Server System, from its existing using this information; and inventory. These systems of records Note Regarding Federal, State, and c. Ask the agency to initiate a SAVE notices have been superseded by a Local Government Agencies (Such as query with your information and follow Department-wide system of records Departments of Motor Vehicles) through with additional verification notice or a FWS system of records While Federal Government agencies steps, if necessary, to get a final SAVE notice. This rescindment will eliminate must follow the guidelines laid out by response showing the validity of your unnecessary duplicate notices and the Federal Government, state and local TPS. promote the overall streamlining and government agencies establish their own You can also ask the agency to look management of DOI Privacy Act systems rules and guidelines when granting for SAVE notices or contact SAVE if of records. certain benefits. Each state may have they have any questions about your DATES: These changes take effect on different laws, requirements, and immigration status or automatic December 9, 2020. extension of TPS-related determinations about what documents ADDRESSES: You may send comments you need to provide to prove eligibility documentation. In most cases, SAVE provides an automated electronic identified by docket number [DOI– for certain benefits. Whether you are 2020–0009] by any of the following applying for a Federal, state, or local response to benefit-granting agencies within seconds, but, occasionally, methods: government benefit, you may need to • Federal eRulemaking Portal: http:// verification can be delayed. You can provide the government agency with www.regulations.gov. Follow the check the status of your SAVE documents that show you are a TPS instructions for sending comments. verification by using CaseCheck at beneficiary, show you are authorized to • Email: [email protected]. save.uscis.gov/casecheck/. CaseCheck is work based on TPS or other status, and/ Include docket number [DOI–2020– a free service that lets you follow the or that may be used by DHS to 0009] in the subject line of the message. determine whether you have TPS or progress of your SAVE verification case • U.S. Mail or Hand-Delivery: Teri other immigration status. Examples of using your date of birth and one Barnett, Departmental Privacy Officer, such documents are: immigration identifier number (A- U.S. Department of the Interior, 1849 C • Number, USCIS number or Form I–94 Street NW, Room 7112, Washington, DC Your current EAD; number) or Verification Case Number. If • 20240. Your automatically extended EAD an agency has denied your application with a copy of this Federal Register Instructions: All submissions received based solely or in part on a SAVE must include the agency name and notice, providing an automatic response, the agency must offer you the extension of your currently expired or docket number [DOI–2020–0009]. All opportunity to appeal the decision in comments received will be posted expiring EAD; accordance with the agency’s • without change to http:// A copy of your Form I–94 or Form procedures. If the agency has received www.regulations.gov, including any I–797 that has been automatically and acted upon or will act upon a SAVE personal information provided. extended by this notice and a copy of verification case and you do not believe Docket: For access to the docket to this notice; the SAVE response is correct, find read background documents or • Any other relevant DHS-issued detailed information on how to make comments received, go to http:// document that indicates your corrections or update your immigration www.regulations.gov. immigration status or authorization to record, make an appointment, or submit You should be aware your entire be in the United States, or that may be a written request to correct records comment including your personal used by DHS to determine whether you under the Freedom of Information Act identifying information, such as your have such status or authorization to on the SAVE website at www.uscis.gov/ address, phone number, email address, remain in the United States. save. or any other personal identifying Check with the government agency [FR Doc. 2020–27154 Filed 12–7–20; 1:30 pm] information in your comment, may be regarding which document(s) the agency BILLING CODE 9111–97–P made publicly available at any time. will accept. Some benefit-granting While you may request to withhold your agencies use the USCIS Systematic personal identifying information from Alien Verification for Entitlements DEPARTMENT OF THE INTERIOR public review, we cannot guarantee we Program (SAVE) program to confirm the will be able to do so. current immigration status of applicants Fish and Wildlife Service FOR FURTHER INFORMATION CONTACT: for public benefits. While SAVE can [DOI–2020–0009; FF10T03000 190 Jennifer Schmidt, Associate Privacy verify when an alien has TPS, each FXGO16601025020] Officer, U.S. Fish and Wildlife Service, agency’s procedures govern whether 5275 Leesburg Pike, MS: IRTM, Falls they will accept a particular document, Privacy Act of 1974; System of Church, VA 22041–3803, FWS_Privacy@ such as an EAD or an I–94. If an agency Records fws.gov or (703) 358–2291. accepts the type of TPS-related AGENCY: Fish and Wildlife Service, SUPPLEMENTARY INFORMATION: Pursuant document you are presenting, such as Interior. to the provisions of the Privacy Act of an EAD or I–94, the agency should ACTION: 1974, as amended, the DOI is rescinding accept your automatically extended Rescindment of a system of records notice. the following two FWS system of TPS-related document. You should: records notices from its system of a. Present the agency with a copy of SUMMARY: The Department of the records inventory. During a routine this Federal Register notice showing the Interior (DOI) is issuing a public notice review, FWS determined these systems extension of TPS-related of its intent to rescind two U.S. Fish and of records notices were superseded by a documentation, in addition to your most Wildlife Service (FWS) Privacy Act published Department-wide or FWS recent TPS-related document with your systems of records, INTERIOR/FWS–19, system of records notice. Therefore, DOI A-Number, USCIS number or I–94 Endangered Species Licensee System, is rescinding these FWS systems of number; and INTERIOR/FWS–34, National records notices to avoid duplication of

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00054 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79216 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

existing systems of records notices in DEPARTMENT OF THE INTERIOR LOUISIANA accordance with the Office of Tangipahoa Parish National Park Service Management and Budget Circular A– Husser School-Husser Community Center, 108, Federal Agency Responsibilities for [NPS–WASO–NRNHL–DTS#–31229; 56280 LA 445, Husser, SG100005986 Review, Reporting, and Publication PPWOCRADI0, PCU00RP14.R50000] under the Privacy Act. MINNESOTA National Register of Historic Places; • INTERIOR/FWS–19, Endangered Lake County Notification of Pending Nominations Kawishiwi Lodge, 3187 Fernberg Rd., Fall Species Licensee System. This system of and Related Actions records notice was superseded by Lake Township, SG100005995 INTERIOR/FWS–21, Permit Systems, 68 AGENCY: National Park Service, Interior. NORTH CAROLINA FR 52610 (September 4, 2003); ACTION: Notice. Burke County modification published 73 FR 31877 SUMMARY: The National Park Service is Southern Railway Freight Station, 630 South (June 4, 2008). Records in the system Green St., Morganton, SG100005993 were migrated to and are maintained soliciting electronic comments on the under the INTERIOR/FWS–21, Permit significance of properties nominated Franklin County Systems, system of records notice. before November 28, 2020, for listing or Pearce-Stallings-Massey House, 4430 Old US related actions in the National Register • 64, Pilot vicinity, SG100005997 INTERIOR/FWS–34, National of Historic Places. Wilkes County Conservation Training Center Training DATES: Comments should be submitted Harmon School, Sheets Gap Rd., .6 mi. west Server System. This system of records electronically by December 24, 2020. notice was superseded by a Department- of jct. with Buckwheat Branch Rd., Laurel ADDRESSES: Comments are encouraged Springs vicinity, SG100005992 wide system of records notice, to be submitted electronically to OHIO INTERIOR/DOI–16, Learning National_Register_Submissions@ Management System, 83 FR 50682 nps.gov with the subject line ‘‘Public Highland County (October 9, 2018), which covers bureau Comment on .’’ If you Roughly bounded by Jefferson, Rescinding these system of records have no access to email you may send Washington, and Mirabeau Sts., Greenfield, notices will have no adverse impacts on them via U.S. Postal Service and all SG100005996 individuals as the records previously other carriers to the National Register of PENNSYLVANIA Historic Places, National Park Service, maintained under INTERIOR/FWS–19 Allegheny County and INTERIOR/FWS–34 are covered 1849 C Street NW, MS 7228, Washington, DC 20240. Hunter Saw & Machine Company, 5648–5688 under the published INTERIOR/FWS– Butler St., Pittsburgh, SG100005985 21 and INTERIOR/DOI–16 systems of SUPPLEMENTARY INFORMATION: The records notices. This rescindment will properties listed in this notice are being Bedford County also promote the overall streamlining considered for listing or related actions Fort Dewart, Address Restricted, Juniata and management of DOI Privacy Act in the National Register of Historic Township vicinity, SG100005989 systems of records. Places. Nominations for their Somerset County consideration were received by the National Park Service before November Fort Dewart, Address Restricted, Allegheny SYSTEM NAME AND NUMBER: Township vicinity, SG100005989 28, 2020. Pursuant to Section 60.13 of 1. INTERIOR/FWS–19, Endangered 36 CFR part 60, comments are being SOUTH CAROLINA Species Licensee System. accepted concerning the significance of Horry County the nominated properties under the 2. INTERIOR/FWS–34, National Noel Court and Apartments (Myrtle Beach Conservation Training Center Training National Register criteria for evaluation. MPS), 312 6th Ave. North, Myrtle Beach, Server System. Before including your address, phone MP100005988 number, email address, or other TEXAS HISTORY: personal identifying information in your comment, you should be aware that Bell County 1. INTERIOR/FWS–19, Endangered your entire comment—including your Species Licensee System, 64 FR 29055 High View, 731 Wolf St., Killeen, personal identifying information—may SG100005990 (May 28, 1999); modification published be made publicly available at any time. 73 FR 31877 (June 4, 2008). While you can ask us in your comment Nomination submitted by Federal to withhold your personal identifying Preservation Officer: 2. INTERIOR/FWS–34, National The State Historic Preservation information from public review, we Conservation Training Center Training Officer reviewed the following cannot guarantee that we will be able to Server System, 67 FR 17711 (April 11, nomination and responded to the do so. 2002); modification published 73 FR Federal Preservation Officer within 45 Nominations submitted by State or 31877 (June 4, 2008). days of receipt of the nomination and Tribal Historic Preservation Officers: Teri Barnett, supports listing the property in the CALIFORNIA National Register of Historic Places. Departmental Privacy Officer, Department of the Interior. Riverside County ARKANSAS [FR Doc. 2020–27156 Filed 12–8–20; 8:45 am] Donaldson Futuro, 52895 Big Rock Rd., Newton County Idyllwild vicinity, SG100005994 BILLING CODE 4333–15–P Flowers Cabin, Buffalo NR, Bench Trail, San Francisco County approx. .2 mi. east of the Hemmed In Mission Cultural Center (Latinos in 20th Hollow Trail, south of the Compton Century California MPS), 2868 Mission St., Trailhead, Compton vicinity, SG100005991 San Francisco, MP100005987 (Authority: Section 60.13 of 36 CFR part 60)

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79217

Dated: December 2, 2020. antidumping and countervailing duty INTERNATIONAL TRADE Sherry A. Frear, investigations. The Secretary will COMMISSION Chief, National Register of Historic Places/ prepare a public service list containing [Investigation No. 337–TA–1118] National Historic Landmarks Program. the names and addresses of all persons, [FR Doc. 2020–27040 Filed 12–8–20; 8:45 am] or their representatives, who are parties Certain Movable Barrier Operator BILLING CODE 4312–52–P to the investigations. Systems and Components Thereof; Final Determination Finding a Violation Background of Section 337; Issuance of a Limited INTERNATIONAL TRADE On September 30, 2020, the Wind Exclusion Order and Cease and Desist COMMISSION Tower Trade Coalition (Arcosa Wind Orders; Termination of the [Investigation Nos. 701–TA–660–661 and Towers Inc. (Dallas, Texas) and Investigation 731–TA–1543–1545 (Preliminary)] Broadwind Towers, Inc. (Manitowoc, AGENCY: U.S. International Trade Wisconsin)) filed petitions with the Commission. Utility Scale Wind Towers From India, Commission and Commerce, alleging Malaysia, and Spain ACTION: Notice. that an industry in the United States is Determinations materially injured or threatened with SUMMARY: Notice is hereby given that On the basis of the record 1 developed material injury by reason of subsidized the U.S. International Trade in the subject investigations, the United imports of utility scale wind towers Commission (the ‘‘Commission’’) has States International Trade Commission from India and Malaysia and LTFV determined to: (1) Find that respondents (‘‘Commission’’) determines, pursuant imports of utility scale wind towers Nortek Security & Control, LLC of to the Tariff Act of 1930 (‘‘the Act’’), from India, Malaysia, and Spain. Carlsbad, California; Nortek, Inc. of that there is a reasonable indication that Accordingly, effective September 30, Providence, Rhode Island; and GTO an industry in the United States is 2020, the Commission instituted Access Systems, LLC of Tallahassee, materially injured by reason of imports countervailing duty investigation Nos. Florida (collectively, ‘‘Nortek’’) have of utility scale wind towers from India, 701–TA–660–661 and antidumping violated Section 337 by way of Malaysia, and Spain, provided for in duty investigation Nos. 731–TA–1543– infringing claims 1 and 21 of U.S. Patent subheadings 7308.20.00 and 8502.31.00 1545 (Preliminary). No. 7,755,223 (‘‘the ’223 patent’’); and of the Harmonized Tariff Schedule of (2) issue a limited exclusion order and Notice of the institution of the cease and desist orders against each the United States, that are alleged to be Commission’s investigations and of a sold in the United States at less than fair Nortek respondent, and set a bond in public conference through video value (‘‘LTFV’’) and to be subsidized by the amount of 100 percent of the entered conferencing to be held in connection the governments of India and Malaysia.2 value of the covered products during the therewith was given by posting copies period of Presidential review. The Commencement of Final Phase of the notice in the Office of the investigation is hereby terminated. Investigations Secretary, U.S. International Trade FOR FURTHER INFORMATION CONTACT: Carl Pursuant to § 207.18 of the Commission, Washington, DC, and by P. Bretscher, Office of the General Commission’s rules, the Commission publishing the notice in the Federal Counsel, U.S. International Trade also gives notice of the commencement Register of October 6, 2020 (85 FR Commission, 500 E Street SW, of the final phase of its investigations. 63137). In light of the restrictions on Washington, DC 20436, telephone (202) The Commission will issue a final phase access to the Commission building due 205–2382. Copies of non-confidential notice of scheduling, which will be to the COVID–19 pandemic, the documents filed in connection with this published in the Federal Register as Commission conducted its conference investigation may be viewed on the provided in § 207.21 of the through written testimony and video Commission’s electronic docket system Commission’s rules, upon notice from conference on October 21, 2020. All (‘‘EDIS’’) at https://edis.usitc.gov. For the U.S. Department of Commerce persons who requested the opportunity help accessing EDIS, please email (‘‘Commerce’’) of affirmative were permitted to participate. [email protected]. General preliminary determinations in the information concerning the Commission The Commission made these investigations under §§ 703(b) or 733(b) may also be obtained by accessing its of the Act, or, if the preliminary determinations pursuant to §§ 703(a) internet server at https://www.usitc.gov. determinations are negative, upon and 733(a) of the Act (19 U.S.C. Hearing-impaired persons are advised notice of affirmative final 1671b(a) and 1673b(a)). It completed that information on this matter can be determinations in those investigations and filed its determinations in these obtained by contacting the under §§ 705(a) or 735(a) of the Act. investigations on December 4, 2020. The Commission’s TDD terminal, telephone Parties that filed entries of appearance views of the Commission are contained (202) 205–1810. in the preliminary phase of the in USITC Publication 5146 (December SUPPLEMENTARY INFORMATION: The investigations need not enter a separate 2020), entitled Utility Scale Wind Commission instituted this investigation appearance for the final phase of the Towers from India, Malaysia, and on June 11, 2018, based on a complaint, investigations. Industrial users, and, if Spain: Investigation Nos. 701–TA–660– as supplemented, filed by The the merchandise under investigation is 661 and 731–TA–1543–1545 Chamberlain Group, Inc. (‘‘CGI’’) of Oak sold at the retail level, representative (Preliminary). Brook, Illinois. 83 FR 27020–21 (June consumer organizations have the right By order of the Commission. 11, 2018). The complaint alleges a to appear as parties in Commission Issued: December 4, 2020. violation of section 337 the Tariff Act, as amended, 19 U.S.C. 1337 (‘‘Section 1 The record is defined in § 207.2(f) of the Lisa Barton, 337’’) in the importation, sale for Commission’s Rules of Practice and Procedure (19 Secretary to the Commission. CFR 207.2(f)). importation, or sale in the United States [FR Doc. 2020–27043 Filed 12–8–20; 8:45 am] 2 85 FR 73019 (November 16, 2020) and 85 FR after importation of certain movable 73023 (November 16, 2020). BILLING CODE 7020–02–P barrier operator (‘‘MBO’’) systems that

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79218 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

purportedly infringe one or more of the and to partially review the Final ID with did not receive any comments from asserted claims of the ’223 patent and respect to certain issues relating to each third parties in response to its notice. U.S. Patent Nos. 8,587,404 (‘‘the ’404 of the three asserted patents. 85 FR Having reviewed the Remand ID, the patent’’) and 6,741,052 (‘‘the ’052 10723–26 (Feb. 25, 2020). The parties’ submissions, and the evidence patent’’). Id. The Commission’s notice of Commission directed the parties to brief of record, the Commission has investigation named Nortek as questions on violation and requested determined to find that Nortek violated respondents. Id. The Office of Unfair briefing from the parties, the public, and Section 337 with respect to the ’223 Import Investigations was not named as any interested government entities on patent. In particular, the Commission a party to this investigation. See id. remedy, the public interest, and finds that Nortek infringed claims 1 and The Commission subsequently bonding. Id. at 10725. The parties 21 of the ’223 patent; CGI practiced at terminated the investigation with submitted initial responses and replies least claim 1 of the patent; and CGI respect to certain patent claims in response to the notice. The satisfied the economic prong of the withdrawn by CGI. See Order No. 16 Commission did not receive any domestic industry requirement with (Feb. 5, 2019), unreviewed by Comm’n comments from third parties in response respect to the ’223 patent under both Notice (March 6, 2019); Order No. 27 to its notice. Sections 337(a)(3)(A) and (B). The (June 7, 2019), unreviewed by Comm’n On April 22, 2020, the Commission Commission has determined to issue a Notice (June 27, 2019); Order No. 31 issued a determination finding no limited exclusion order and cease and (July 30, 2019), unreviewed by Comm’n violation with respect to the ’404 and desist orders against each Nortek Notice (Aug. 19, 2019); Order No. 32 ’052 patents. Comm’n Notice at 3 (April respondent and to impose a bond in the (Sept. 27, 2019), unreviewed by Comm’n 22, 2020). The Commission also vacated amount of 100 percent of the entered Notice (Oct. 17, 2019). Order No. 38 and remanded the value of the covered products during the On June 5, 2019, the presiding economic prong issue to the presiding period of Presidential review. The administrative law judge (‘‘ALJ’’) issued ALJ for further proceedings while the Commission has further determined that a Markman order (Order No. 25) Commission continued to review issues the statutory public interest factors do construing the claim terms in dispute. relating to the ’223 patent. Id.; Order not preclude issuance of a remedy. The On December 12, 2018, CGI filed a Vacating and Remanding Order No. 38 investigation is hereby terminated. motion for summary determination that (April 22, 2020) (‘‘Remand Order’’). The Commission voted to approve it satisfied the economic prong of the On May 15, 2020, the ALJ issued these determinations on December 3, domestic industry requirement. Nortek Order No. 39, seeking additional 2020. opposed the motion. On June 6, 2019, information from the parties in light of The authority for the Commission’s the ALJ issued a notice advising the the Commission’s Remand Order. Order determinations is contained in Section parties that the motion would be No. 39 (May 15, 2020). On July 10, 2020, 337 of the Tariff Act of 1930, as granted and a formal written order the ALJ issued the subject Remand amended (19 U.S.C. 1337), and in part would be issued later. Order No. 26 Initial Determination (‘‘Remand ID’’), 210 of the Commission’s Rules of (June 6, 2019). finding that CGI has made significant Practice and Procedure (19 CFR part The ALJ held an evidentiary hearing investments, both quantitatively and 210). on the issues in dispute on June 10–14, qualitatively, in plant and equipment 2019. and labor and capital, pursuant to By order of the Commission. On November 25, 2019, the ALJ Section 337(a)(3)(A) and (B) (19 U.S.C. Issued: December 3, 2020. issued Order No. 38, finding no issue of 1337(a)(3)(A), (B)), respectively. Lisa Barton, material fact that CGI’s investments in Remand ID (July 10, 2020). The Remand Secretary to the Commission. labor and capital relating to its domestic ID concludes that CGI has satisfied the [FR Doc. 2020–27010 Filed 12–8–20; 8:45 am] industry products were ‘‘significant’’ economic prong of the domestic BILLING CODE 7020–02–P and that CGI has satisfied the economic industry requirement in relation to the prong of the domestic industry ’223 patent, pursuant to Sections requirement pursuant to Section 337(a)(3)(A) and (B). Id. 337(a)(3)(B) (19 U.S.C. 1337(a)(3)(B)). On July 20, 2020, Nortek filed a DEPARTMENT OF JUSTICE Order No. 38 (Nov. 25, 2019). Order No. petition for review of the Remand ID. Antitrust Division 38 also finds that genuine issues of CGI filed its opposition to Nortek’s material fact precluded entry of petition for review on July 27, 2020. On Notice Pursuant to The National summary determination with respect to September 9, 2020, the Commission Cooperative Research and Production CGI’s investments in plant and determined to review the Remand ID Act of 1993—Electrified Vehicle and equipment, under Section 337(a)(3)(A) and directed the parties to brief a Energy Storage Evaluation (19 U.S.C. 1337(a)(3)(A)). Id. number of questions with respect to the On the same date, the ALJ issued the economic prong of the domestic Notice is hereby given that, on final Initial Determination on Violation industry requirement. 85 FR 57249–51 December 1, 2020, pursuant to Section of Section 337 (‘‘Final ID’’) and (Sept. 15, 2020). The Commission also 6(a) of the National Cooperative Recommended Determination on allowed the parties to update their prior Research and Production Act of 1993, Remedy and Bond (‘‘RD’’), finding no submissions on remedy, the public 15 U.S.C. 4301 et seq. (‘‘the Act’’), violation of Section 337 because the interest, and bonding, if necessary, and Electrified Vehicle and Energy Storage asserted claims of the ’223 and ’404 invited interested government entities Evaluation (‘‘EVESE’’) has filed written patents, if valid, are not infringed and and other interested parties to file notifications simultaneously with the the asserted claim of the ’052 patent is written submissions on those issues as Attorney General and the Federal Trade invalid, even if infringed. The RD sets well. Id. at 57251. Commission disclosing changes in its forth the ALJ’s recommendations on The parties filed their initial membership. The notifications were remedy and bond. responses to the Commission’s filed for the purpose of extending the On February 19, 2020, the questions on September 23, 2020. The Act’s provisions limiting the recovery of Commission issued a notice of its parties filed their respective replies on antitrust plaintiffs to actual damages determination to review Order No. 38 September 30, 2020. The Commission under specified circumstances.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00057 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79219

Specifically, ANSYS, Inc., Canonsburg, Vascular, Inc., Lake Forest, CA; Biologics, Morrisville, NC; Hememics PA, has been added as a party to this Altimmune, Inc., Gaithersburg, MD; Biotechnologies Inc, Gaithersburg, MD; venture. Amydis, Inc., San Diego, CA; Aptahem Hough Ear Institute, Oklahoma City, No other changes have been made in AB, Malmo, SWE; Aptive Resources, OK; Humanetics Corporation, Edina, either the membership or planned LLC, Alexandria, VA; ARD Global LLC, MN; Hybrid Plastics Inc., Hattiesburg, activity of the group research project. McLean, VA; Articulate Labs, Dallas, MS; Iacta Pharmaceuticals Inc, Irvine, Membership in this group research TX; Ashvattha Therapeutics, Inc, CA; Ichor Sciences, LLC, Nashville, TN; project remains open, and EVESE Redwood City, CA; Astrocyte ImmunoVation, LLC, Pasadena, CA; intends to file additional written Pharmaceuticals Inc., Cambridge, MA; INCELL Corporation LLC, San Antonio, notifications disclosing all changes in Asymmetric Technologies, LLC, TX; Infectious Disease Research membership. Columbus, OH; Athena GTX, Johnston, Institute, Seattle, WA; Inflammatory On September 24, 2020, EVESE filed IA; Atomo, Inc, West Lake Hills, TX; Response Research Inc., Santa Barbara, its original notification pursuant to Augusta University Resarch lnstitute, CA; Informa Business Intelligence Inc., Section 6(a) of the Act. The Department Inc., Augusta, GA; Augustine New York, NY; Inhalon Biopharma, Inc., of Justice published a notice in the Consulting, Inc. (ACI), Monterrey, CA; Durham, NC; Innovenn, Inc., Madison, Federal Register pursuant to Section Auxocell Laboratories, Inc, Cambridge, WI; Innsightful, Inc., Sunnyvale, CA; 6(b) of the Act on October 15, 2020 (85 MA; Avera Health, Sioux Falls, SD; Integrated Computer Solutions, Inc., FR 65423). Bambu Vault, LLC, Lowell, MA; Berry Waltham, MA; InTouch Technologies, The last notification was filed with Consultants, LLC, Austin, TX; Beyond D/B/A Inc. InTouch Health, Goleta, CA; the Department on October 20, 2020. A Barriers Therapeutics, Inc., Glencoe, IL; J.R. Reingold & Associates, Inc, notice was published in the Federal Bioflight, LLC, Akron, OH; Alexandria, VA; JTEK Data Solutions, Register pursuant to section 6(b) of the BioGenerator, Saint Louis, MO; Biotags LLC, Bethesda, MD; KMASS Act on November 19, 2020 (85 FR LLC, Key Biscayne, FL; Blue Cirrus SOLUTIONS, El Paso, TX; Knowmadics, 73750). Consulting LLC, Greenville, SC; Board Inc., Herndon, VA; Level Ex, Inc., Suzanne Morris, of Trustees of the University of Illinois, Chicago, IL; LifeQ, Inc, Alphaertta, GA; Chief, Premerger and Division Statistics, Champaign, IL; Brainbox Solutions Inc., LMI Consulting, LLC, Tysons, VA; Antitrust Division. Richmond, VA; CAPRICOR LOGGEREX INC., Deland, FL; Lumen [FR Doc. 2020–26975 Filed 12–8–20; 8:45 am] THERAPEUTICS, INC., Beverly, CA; Bioscience, Inc., Seattle, WA; Luna BILLING CODE 4410–11–P Carahsoft Technology Corporation, Innovations Incorporated, Roanoke, VA; Reston, VA; Centivax, Inc., South San MadApparel Ind. DBA Athos, Redwood Francisco; Ceras Health Inc., New York, City, CA; ManTech Advanced Systems DEPARTMENT OF JUSTICE NY; Channel Clinical Solutions, LLC, International, Inc., Herndon, VA; Mantel Raleigh, NC; Chenega Reliable Services, Technologies Inc., Fort Collins, CO; Antitrust Division LLC, San Antonio, TX; Cherish Health, Masimo Corporation, Irvine, CA; Materials Modification Inc., Fairfax, VA; Notice Pursuant to The National Inc., Cambridge, MA; Clarkson Medcura, Inc., Riverdale, MD; Media Cooperative Research and Production University, Potsdam, NY; Coalition for Riders Inc., Pearland, TX; Medical Act of 1993—Medical Technology National Trauma Research, San Center of the Americas Foundation, El Enterprise Consortium Antonio, TX; Computer Technology Associates, Inc., Ridgecrest, CA; Conflict Paso, TX; Medicortex Finland Oy, Notice is hereby given that, on Kinetics Corporation, Sterling, VA; Core Turku, FIN; Medtrade Products Limited, November 18, 2020, pursuant to Section Mobile Networks Inc.; DBA Core Mobile Crew, Cheshire, GBR; MEMBIO INC., 6(a) of the National Cooperative Inc., Campbell, CA; Crimson Kitchener, CAN; Mespere LifeSciences Research and Production Act of 1993, Government LLC, Carlisle, OH; Curza Inc., Waterloo, Ontario, CAN; 15 U.S.C. 4301 et seq. (‘‘the Act’’), Global, LLC, Salt Lake City, UT; Data MicroHealth, LLC, Vienna, VA; Medical Technology Enterprise Intelligence Technologies, Inc., Microsoft, Redmon, VA; Millennium Consortium (‘‘MTEC’’) has filed written Arlington, VA; DEFTEC Corporation, Enterprise Corporation, Fairfax, VA; notifications simultaneously with the Huntsville, AL; Digital For Mental Mineurva LLC, Albuquerque, NM; Attorney General and the Federal Trade Health (MYNDBLUE), Paris, FRA; Moberg Analytics Inc., Ambler, PA; Commission disclosing changes in its Diomics Corporation, Murrietta, CA; Moleculin Biotech, Inc., Houston, TX; membership. The notifications were DocBox Inc., Waltham, MA; EchoNous Nanowear Inc., New York, NY; filed for the purpose of extending the Inc., Redmond, WA; ECI Defense Group, Neuronasal Inc, Wexford, PA; Act’s provisions limiting the recovery of Lyles, TN; Empatica, Inc., Boston, MA; Neuronoff, Inc., Valencia, CA; New antitrust plaintiffs to actual damages Endomedix Inc., Montclair, NJ; Horizons Diagnostics Corporation, under specified circumstances. Etiometry Inc., Boston, MA; Eumentis Baltimore, MD; New Jersey Institute of Specifically, Abram Scientific, Inc., Therapeutics Inc, Newton, MA; Exciton Technology, Newark, NJ; NoMo Menlo Park, CA; Accenture Federal Technologies Inc., Edmonton, Alberta, Diagnostics, Chicago, IL; Non-Invasive Services, Arlington, VA; Ace CAN; Expesicor Inc., Missoula, MT; Medical Systems LLC, Stamford, CT; Laboratories Inc., Yarrow Point, WA; FesariusTherapeutics Inc., Brooklyn, North Carolina State University, Aceso Plasma, Virginia Beach, VA; ACF NY; FHI Clinical Inc., Durham, NC, Raleigh, NC; Northwestern University, Technologies, Inc, Asheville, NC; Fitbit, Inc., San Franciso, CA; Flashback Evanson, IL; Nostromo, LLC, Action Medical Technologies LLC, Technologies, Inc., Louisville, CO; Kennebunk, ME; Nuada Orthopedics, Conshohocken, PA; Acuity Systems, FloTBI Inc., Cleveland, OH; FUJIFILM Inc., Sherborn, MA; Nyrada Inc., LLC, Herndon, VA; Aerpio Pharmaceuticals USA, Inc., Valhalla, Gordon, AUS; Obatala Sciences, Inc., Pharmaceuticals, Cincinnati, OH; NY; GelMEDIX Inc., Newton, MA; New Orleans, LA; Oculogica, Inc., New AirStrip Technologies, San Antonio, GeneCapture, Inc., Huntsville, AL; York, NY; Odin Technologies, Chicago, TX; Airway Medical Innovations Pty General Biologics Inc., Cambridge, MA; IL; OLGS Inc., Imperial, PA; Oregon Ltd, Brisbane Queensland, AUS; Get Help Now LLC, Fort Myers, FL; Health & Science University, Portland, Aktivax, Inc., Broomfield, CO; Allvivo GreyScan Inc., Melbourne, FL; Heat OR; Otolith Labs, Washington, DC;

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00058 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79220 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Panakeia LLC, Newport News, VA; Systems Inc, Chelmsford, MA; Trustees Huntington Beach, CA; Georgia Tech Parnell Pharmaceuticals Inc., San of the University of Pennsylvania, Research Corporation, Atlanta, GA; Rafael, CA; Patchd, Inc., San Francisco, Philadelphia, PA; UNandUP, LLC, Saint HeadsafelP Pty Ltd, Bronte, NSW, AUS; CA; Perspecta Enterprise Solutions LLC, Louis, MO; Unissant, Inc., Herndon, VA; Healios, Inc., Flemington, NJ; Herndon, VA; Pinteon Therapeutics, Universal Consulting Services, Inc., Hemoclear B.V., Zwolle, Overijssel, Newton Center, MA; Posit Science Fairfax, VA; University of Arizona Netherlands; Howmedica Osteonics Corporation, San Francisco, CA; PPD Applied Research Corporation, Tucson, Corp. dba Stryker Orthopaedics, Development LP, Wilmington, NC; AZ; University of Georgia Research Mahwah, NJ; Human Biomed, Inc., Predictions Systems Inc., Spring Lake, Foundation, Inc., Athens, GA; Siuth Burlington, VT; HYPR Life NJ; Promaxo, Oakland, CA; QUASAR University of Kansas Medical Center Sciences, Inc., Pilot Mountain, NC; Federal Systems, Inc., San Diego, CA; Research Institute, Inc., Kansas City, KS; ImmunoVation, LLC, Pasadena, CA; REACT Neuro, Cambridge, MA; Remote University of North Carolina at Chapel Integrum Scientific, LLC, Greensboro, Health LLC, Springfield, OH; Renovo Hill, Chapel Hill, NC; University of NC; Irving Burton Associates, Inc. (IBA), Concepts, Inc., San Antonio, TX; Ottawa, Ottawa, CAN; University of Falls Church, VA; JumpStartCSR, Rensselaer Polytechnic Institute, Troy, South Carolina, Columbia, SC; Seattle, WA; Knowledge Driven LLC, NY; Research Bridge Partners, Inc., University of South Florida, Tampa, FL; Alexandria, VA; Kindred Biosciences, Austin, TX; Resolys Bio, Inc., Delanson, University of Southern California, Los Inc., Burlingame, CA; Lieber Institute, NY; RIVA Solutions, Inc., McLean, VA; Angeles, CA; Vinformatix LLC, Baton Inc., Baltimore, MD; LongView RTI International, Research Triangle Rouge, LA; VIRGINIA HIGH International Technology Solutions, Park; SAIC, Reston, VA; Sandstone PERFORMANCE LLC, Virginia Beach, Inc., Herndon, VA; Magle Chemoswed Diagnostics, Inc., Pleasanton, CA; VA; VirtuSense Technologies, Inc., AB, Lund, SWE; Massachusetts Eye and SaNOtize Research & Development Peoria, IL; Vista LifeSciences, Inc., Ear Infirmary, Boston, MA; Melinta Corp., Vancouver, CAN; Sense Parker, CO; VXBIOSCIENCES, INC., Therapeutics, Inc., New Haven, CT; Diagnostics Inc., Cincinnati, OH; Oakland, CA; Zane Networks, LLC, MilanaPharm, LLC, Tallassee, AL; Sentien Biotechnologies, Lexington, Washington, DC; ZOLL Medical Molecular Biologicals, Pasadena, TX; MA; ServiceNow, Inc., Vienna, VA; Corporation, Chelmsford, MA; have MO–SCI Corporation, Rollo, MO; New Seventh Dimension, LLC, Mocksville, been added as parties to this venture. Horizons Diagnostics Corporation, NC; Shipcom Federal Solutions, LLC, Also, 21 MedTech, LLC, Burlington, Baltimore, MD; New York University Belcamp, MD; Sibel Inc., Evanston, IL; NC; 410 Medical, Inc., Elgin, NC; 911 School of Medicine, New York, NY; Sierra Nevada Corporation (SNC), Medical Devices, LLC, Houston, TX; Next Generation Stretcher Ltd, Raman Sparks, NV; SightLife, Seattle, WA; Sim 98point6 Inc., Seattle, WA; Adventist gan, ISR; NON–INVASIVE MEDICAL Vivo LLC, Essex, NY; SimX, Inc., Health System—Sunbelt, Inc. dba SYSTEMS, LLC, Stamford, CT; NUES Mountain View, CA; Snoretox Pty Ltd, Florida Hospital, Orlando, FL; Akron LLC, Silver Spring, MD; Onera Health Kew, Victoria, AUS; Softox Solutions Biotechnology, LLC, Boca Raton, FL; Inc., Palo Alto, CA; PEER Technologies AS, Oslo, NOR; STEL Technologies, American Type Culture Collection PLLC, Fairfax, VA; Phagelux (Canada) LLC, Ann Arbor, MI; Stuart (ATCC Federal Solutions), Manassas, Inc., Montreal, CAN; Physcient, Inc., Therapeutics Inc, Stuart, FL; Symbinas VA; Arrevus, Inc., Raleigh, NC; Durham, NC; Pluristem LTD, Haifa, ISR; Pharmaceuticals Inc., Jacksonville, FL; Auckland UniServices Limited, PolarityTE MD, Inc., Salt Lake City, UT; Systems Engineering Solutions Auckland, NZL; Awarables Inc., Pop Test Oncology LLC aka Palisades Corporation, Greenbelt, MD; TechWerks Baltimore, MD; Axonova Medical, LLC, Therapeutics, Cliffside Park, NJ; Power LLC; Arlington Heights, IL; Philadelphia, PA; Becton Dickinson & of Patients, LLC, Charleston, SC; TeleCommunication Systems, Inc., Company, Franklin Lake, NJ; Biobeat Praeses, LLC, Shreveport, LA; Prep Annapolis, MD; TensorX, Inc, Vienna, Technologies Ltd., Petach, Yikva, ISR; Tech, LLC, Westlake, LA; Pulmotect, VA; Texas A&M University, College BioSpyder Technologies, Inc., Carlsbad, Inc., Houston, TX; Q2Pharma, Haifa, Station, TX; The Cleveland Clinic CA; Blood Systems, Inc. dba Blood ISR; Qrons, Inc., Miami, FL; Radical Foundation, Cleveland, OH; The Systems Research Institute, Scottsdale, Concepts LLC, Brooklyn, NY; RegenFix, Curators of the University of Missouri, AZ; bR3 UNIQ, Inc. dba QUADYSTER, LLC, Toledo, OH; Remedor Biomed Ltd., on behalf of Missouri University of Bettendorf, IA; Bramante Bioscience, Nazareth Illit, ISR; Roccor, LLC, Science and Technology, Rolla, MO; Elmira Heights, NY; Brain Power, LLC, Longmont, CO; San Diego Blood Bank, The Research and Recognition Project Cambridge, MA; Caci, Inc.—Federal, San Diego, CA; Scinus Cell Expansion Inc, Corning, NY; The Spaulding Chantilly, VA; Calimex USA B.V., Bilthoven, Utrecht; Seran Rehabilitation Corporation, Corporation, San Francisco, CA; Carmell Bioscience, Bend, OR; Sleep Care, Inc., Charlestown, MA; The Spectrum Group, Therapeutics Corporation, Pittsburgh, Columbus, OH; SmartPoints LLC, Alexandria, VA; The University of PA; Case Western Reserve University, Technology, Inc., Stow, MA; Southern Alabama at Birmingham, Birmingham, Cleveland, OH; CFD Research Research Institute, Birmingham, AL; AL; The University of Tennessee Health Corporation, Huntsville, AL; Combat SurgiBox Inc., Brookline, MA; Syracuse Science Center, Memphis, TN; The Medical Systems, Harrisburg, NC; University, Syracuse, NY; TBT Pharma, University of Texas at Dallas, Cortical Metrics, LLC, Semora, NC; LLC, Baltimore, MD; TearSolutions, Richardson, TX; Thornhill Reasearch Crius Technology Group, Austin, TX; Inc., Charlottesville, VA; TerumoBCT, Inc., North York, Ontario, CAN; Detact Diagnostics BV, Hoge der, Inc., Lakewood, CO; TheraNova, LLC, Thornton Tomasetti, Inc., New York, Gronigen Netherlands; Droper Med San Francisco, CA; The University of NY; Tiber Creek Partners, Tiber Creek America, LLC, Elgin, SC; Engility Arizona, Defense and Security Research Partners, VA; Tissue Regeneration Corporation, Chantilly, VA; Existential Institute (DSRI), Tucson, AZ; ThoraXS Sciences, Inc, Park City, UT; TITUS Technologies, Inc., Chula Vista, CA; Israel 17 Ltd, Tzur Hadassa, ISR; Sports Academy LLC, Tallahassee, FL; Family Health International DBA FHI Trailhead Biosystems Inc., Cleveland, Tomorrow Lab LLC, New York, NY; 360, Durham, NC; FloTBI, Cleveland, OH; Truecath Inc., Camarillo, CA; Topadur Pharma AG, Schlieren, CHE; OH; FullSekurity Corporation, Irving, Trustees of Boston University, Boston, Trifecta Solutions, Reston, VA; Triton TX; Full Spectrum Omega, Inc., MA; University of Florida Division of

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79221

Sponsored Programs, Gainesville, FL; Federal eRulemaking Portal. Follow the SUPPLEMENTARY INFORMATION: The University of South Carolina, Columbia, online instructions for submissions. Secretary of Labor invites interested SC; University of Tartu, Tartu, EST; Facsimile: If your nomination and persons to submit nominations for Upside Biotechnologies Ltd., Auckland, supporting materials, including membership on ACCSH. NZL; Virginia Polytechnic Institute and attachments, do not exceed 10 pages, A. Background State University, Blacksburg, VA; Wello, you may fax them to the OSHA Docket Inc., Addison, TX; Williams-Jones Office at (202) 693–1648. ACCSH advises the Secretary of Labor Consulting, Greenville, SC; Worcester Regular mail, express mail, hand and the Assistant Secretary of Labor for Polytechnic Institute, Worcester, MA; X- delivery, or messenger (courier) service: Occupational Safety and Health Therma Inc., Richmond, CA; Yale Submit materials to the OSHA Docket (Assistant Secretary) in the formulation University, New Haven, CT have Office, Docket No. OSHA–2020–0003, of standards affecting the construction withdrawn as parties to this venture. Room N–3653, U.S. Department of industry, and on policy matters arising No other changes have been made in Labor, 200 Constitution Avenue NW, in the administration of the safety and either the membership or planned Washington, DC 20210; telephone: (202) health provisions under the Contract activity of the group research project. 693–2350. Please note: While OSHA’s Work Hours and Safety Standards Act Membership in this group research Docket Office is continuing to accept (Construction Safety Act (CSA)) (40 project remains open, and MTEC and process requests, due to the U.S.C. 3701 et seq.) and the intends to file additional written COVID–19 pandemic, the Docket Office Occupational Safety and Health Act of notifications disclosing all changes in is closed to the public. 1970 (OSH Act) (29 U.S.C. 651 et seq.) membership. Instructions: All nominations and (see also 29 CFR 1911.10 and 1912.3). In On May 9, 2014, MTEC filed its supporting materials must include the addition, the OSH Act and CSA require original notification pursuant to Section agency name and docket number for this the Assistant Secretary to consult with 6(a) of the Act. The Department of Federal Register document (Docket No. ACCSH before the agency proposes any Justice published a notice in the Federal OSHA–2020–0003). Because of security- occupational safety and health standard Register pursuant to Section 6(b) of the related procedures, submitting affecting construction activities (29 CFR Act on June 9, 2014 (79 FR 32999). nominations by regular mail may result 1911.10; 40 U.S.C. 3704). The last notification was filed with in a significant delay in their receipt. ACCSH operates in accordance with the Department on October 17, 2019. A OSHA will post submissions in the Federal Advisory Committee Act notice was published in the Federal response to this Federal Register (FACA), as amended (5 U.S.C. App. 2), Register pursuant to Section 6(b) of the document, including personal and the implementing regulations (41 Act on November 12, 2019 (84 FR information provided, without change at CFR 102–3 et seq.); and Department of 61071). http://www.regulations.gov. Therefore, Labor Manual Series Chapter 1–900 (8/ OSHA cautions interested parties about 31/2020). ACCSH generally meets two Suzanne Morris, submitting personal information such as to four times a year. Chief, Premerger and Division Statistics, Social Security Numbers and birthdates. Antitrust Division. B. ACCSH Membership Access to docket: The http:// [FR Doc. 2020–26978 Filed 12–8–20; 8:45 am] www.regulations.gov index lists all ACCSH consists of 15 members whom BILLING CODE 4410–11–P submissions provided in response to the Secretary appoints. ACCSH this Federal Register document; members generally serve staggered two- however, some information (e.g., year terms, unless they resign, cease to DEPARTMENT OF LABOR copyrighted material) is not publicly be qualified, become unable to serve, or available to read or download from that the Secretary removes them (29 CFR Occupational Safety and Health web page. All submissions, including 1912.3(e)). The Secretary may appoint Administration materials not available online, are ACCSH members to successive terms. available for inspection through the No member of ACCSH, other than [Docket No. OSHA–2020–0003] OSHA Docket Office. For information members who represent employers or Advisory Committee on Construction about accessing materials in Docket No. employees, shall have an economic Safety and Health (ACCSH) OSHA–2020–0003, including materials interest in any proposed rule that affects not available online, contact the OSHA the construction industry (29 CFR AGENCY: Occupational Safety and Health Docket Office. 1912.6). Administration (OSHA), Labor. FOR FURTHER INFORMATION CONTACT: The categories of ACCSH ACTION: Request for nominations for For press inquiries: Mr. Frank membership, and the number of new membership on ACCSH. Meilinger, Director, OSHA Office of members to be appointed to replace Communications; telephone: (202) 693– members whose terms will expire, are: SUMMARY: The Secretary of Labor 1999; email: [email protected]. • Five members who are qualified by requests nominations for membership For general information about ACCSH experience and affiliation to present the on ACCSH. and ACCSH membership: Mr. Damon viewpoint of employers in the DATES: Submit (postmark, send, Bonneau, OSHA, Directorate of construction industry—five employer transmit) nominations for ACCSH Construction; telephone: (202) 693– representatives will be appointed; membership by January 8, 2021. 2020; email: [email protected]. • Five members who are similarly ADDRESSES: You may submit Copies of this Federal Register qualified to present the viewpoint of nominations and supporting materials document: Electronic copies of this employees in the construction by one of the following methods: Federal Register document are available industry—five employee representatives Electronically: You may submit at http://www.regulations.gov. This will be appointed; nominations, including attachments, document, as well as news releases and • Two representatives of State safety electronically into Docket No. OSHA– other relevant information are also and health agencies—two 2020–0003 at http:// available on the OSHA web page at representatives from a State safety and www.regulations.gov, which is the http://www.osha.gov. health agency will be appointed;

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00060 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79222 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

• Two public members, qualified by provide advice. Information received using this method, you must submit a knowledge and experience to make a through this nomination process, in copy of your comments and attachments useful contribution to the work of addition to other relevant sources of to the OSHA Docket Office, Docket No. ACCSH, such as those who have information, will assist the Secretary in OSHA–2017–0013, Occupational Safety professional or technical experience and appointing members to ACCSH. In and Health Administration, U.S. competence with occupational safety selecting ACCSH members, the Department of Labor, Room N–3653, and health in the construction Secretary will consider individuals 200 Constitution Avenue NW, industry—two public representatives nominated in response to this Federal Washington, DC 20210. Please note: will be appointed; and Register document, as well as other While OSHA’s Docket Office is • One representative designated by qualified individuals. continuing to accept and process the Secretary of the Department of submissions by regular mail, due to the Authority and Signature Health and Human Services and COVID–19 pandemic, the Docket Office appointed by the Secretary—no new Loren Sweatt, Principal Deputy is closed to the public and not able to appointment will be made. Assistant Secretary of Labor for receive submissions to the docket by The Department of Labor is Occupational Safety and Health, hand, express mail, messenger, and committed to equal opportunity in the authorized the preparation of this notice courier service. workplace and seeks broad-based and under the authority granted by 29 U.S.C. Instructions: All submissions must diverse ACCSH membership. Any 655(b)(1) and 656(b), 40 U.S.C. include the agency name and OSHA interested person or organization may 3704(a)(2), 5 U.S.C. App. 2, Secretary of docket number (OSHA–2017–0013) for nominate one or more individuals for Labor’s Order No. 8–2020 (85 FR the Information Collection Request membership on ACCSH. Interested 58393), and 29 CFR part 1912. (ICR). All comments, including any persons also are invited and encouraged Signed at Washington, DC, on December 4, personal information you provide, are to submit statements in support of 2020. placed in the public docket without nominees. Loren Sweatt, change, and may be made available C. Submission Requirements Principal Deputy Assistant Secretary of Labor online at http://www.regulations.gov. for Occupational Safety and Health. For further information on submitting Nominations must include the [FR Doc. 2020–27050 Filed 12–8–20; 8:45 am] comments, see the ‘‘Public following information: Participation’’ heading in the section of • BILLING CODE 4510–26–P Nominee’s contact information and this notice titled SUPPLEMENTARY current employment or position; INFORMATION. • Nominee’s re´sume´ or curriculum DEPARTMENT OF LABOR Docket: To read or download vitae, including prior membership on comments or other materials in the ACCSH and other relevant organizations Occupational Safety and Health docket, go to http://www.regulations.gov and associations; • Administration or the OSHA Docket Office at the above Category of membership (employer, address. All documents in the docket [Docket No. OSHA–2017–0013] employee, public, State safety and (including this Federal Register notice) health agency) that the nominee is Safe + Sound Campaign; Office of are listed in the http:// qualified to represent; www.regulations.gov index; however, • A summary of the background, Management and Budget’s (OMB) some information (e.g., copyrighted experience, and qualifications that Approval of Information Collection material) is not publicly available to addresses the nominee’s suitability for (Paperwork) Requirements read or download from the website. All each of the nominated membership AGENCY: Occupational Safety and Health submissions, including copyrighted categories; Administration, Labor. material, are available for inspection • Articles or other documents the and copying at the OSHA Docket Office. nominee has authored that indicate the ACTION: Request for public comment. You may also contact Theda Kenney at nominee’s knowledge, experience, and SUMMARY: OSHA solicits public the below phone number to obtain a expertise in occupational safety and comments concerning the proposal to copy of the ICR. health, particularly as it pertains to the the Office of Management and Budget’s FOR FURTHER INFORMATION CONTACT: construction industry; and (OMB) approval of the information • A statement that the nominee is Seleda Perryman or Theda Kenney, collection requirements specified in the Directorate of Standards and Guidance, aware of the nomination, is willing to Safe + Sound Campaign. regularly attend and participate in OSHA, U.S. Department of Labor; ACCSH meetings, and has no conflicts DATES: Comments must be submitted telephone (202) 693–2222. of interest that would preclude (postmarked, sent, or received) by SUPPLEMENTARY INFORMATION: membership on ACCSH. February 8, 2021. ADDRESSES: I. Background D. Member Selection Electronically: You may submit The Department of Labor, as part of The Secretary will select ACCSH comments and attachments the continuing effort to reduce members on the basis of their electronically at http:// paperwork and respondent (i.e., experience, knowledge, and competence www.regulations.gov, which is the employer) burden, conducts a in the field of occupational safety and Federal eRulemaking Portal. Follow the preclearance consultation program to health, particularly as it pertains to the instructions online for submitting provide the public with an opportunity construction industry. Nominees will comments. to comment on proposed and also be evaluated in accordance with Facsimile: If your comments, continuing information collection Secretary’s Order 10–2020 (85 FR including attachments, are not longer requirements in accordance with the 71104) to ensure they are sufficiently than 10 pages, you may fax them to the Paperwork Reduction Act of 1995 (PRA) financially independent from the OSHA Docket Office at (202) 693–1648. (44 U.S.C. 3506(c)(2)(A)). This program Department programs and activities for Mail, hand delivery, express mail, ensures that information is in the which they may be called upon to messenger, or courier service: When desired format, reporting burden (time

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00061 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79223

and costs) is minimal, collection III. Proposed Actions material) is not publicly available to instruments are clearly understood, and The Agency is requesting an read or download through this website. OSHA’s estimate of the information adjustment increase of 91 in burden All submissions, including copyrighted collection burden is accurate. The hours (from 754 hours to 845 hours) material, are available for inspection Occupational Safety and Health Act of resulting from an increase in the and copying at the OSHA Docket Office. 1970 (OSH Act) (29 U.S.C. 651 et seq.) number of respondents due to an Information on using the http:// authorizes information collection by increase of participants and the addition www.regulations.gov website to submit employers as necessary or appropriate of the focus group interviews. comments and access the docket is for enforcement of the OSH Act or for Type of Review: Extension of a available at the website’s ‘‘User Tips’’ developing information regarding the currently approved collection. link. Contact the OSHA Docket Office causes and prevention of occupational Title: Safe + Sound Campaign. for information about materials not injuries, illnesses, and accidents (29 OMB Control Number: 1218–0269. available through the website, and for U.S.C. 657). The OSH Act also requires Affected Public: Business or other for- assistance in using the internet to locate that OSHA obtain such information profits. docket submissions. with minimum burden upon employers, Number of Respondents: 11,585. V. Authority and Signature especially those operating small Frequency of Responses: Annually. businesses, and to reduce to the Average Time per Response: Time Loren Sweatt, Principal Deputy maximum extent feasible unnecessary varies per response. Assistant Secretary of Labor for duplication of efforts in obtaining Estimated Total Burden Hours: 845. Occupational Safety and Health, information (29 U.S.C. 657). Estimated Cost (Operation and directed the preparation of this notice. Maintenance): $25,209.88. The authority for this notice is the In 2016, OSHA established the Safe + Paperwork Reduction Act of 1995 (44 Sound Campaign, a voluntary effort to IV. Public Participation—Submission of U.S.C. 3506 et seq.) and Secretary of support the implementation of safety Comments on This Notice and Internet Labor’s Order No. 1–2012 (77 FR 3912). and health programs in businesses Access to Comments and Submissions throughout the United States. Outside Signed at Washington, DC, on December 3, stakeholders, including safety and You may submit comments in 2020. health professional organizations, trade response to this document as follows: Loren Sweatt, and industry associations, academic (1) Electronically at http:// Principal Deputy Assistant Secretary of Labor institutions, and state and federal regulations.gov, which is the Federal for Occupational Safety and Health. government agencies, collaborate with eRulemaking Portal; (2) by facsimile [FR Doc. 2020–27052 Filed 12–8–20; 8:45 am] the agency on the Campaign. The (fax); or (3) by hard copy. Please note: BILLING CODE 4510–26–P Campaign includes periodic activities While OSHA’s Docket Office is and events, ranging from regular email continuing to accept and process updates to quarterly national webinars submissions by regular mail, due to the DEPARTMENT OF LABOR to local meetings to an annual national COVID–19 pandemic, the Docket Office is closed to the public and not able to Office of the Workers’ Compensation stand down (i.e., Safe + Sound Week), Programs designed to increase overall employer receive submissions to the docket by hand, express mail, messenger, and and employee awareness and Agency Information Collection understanding of safety and health courier service. All comments, attachments, and other materials must Activities; Comment Request; programs and promote employer Certification of Medical Necessity adoption of these programs. OSHA identify the agency name and the OSHA believes widespread implementation of docket number for the ICR (Docket No. AGENCY: Division of Coal Mine Workers’ such programs will substantially OSHA–2017–0013). You may Compensation, Labor. supplement electronic submissions by improve overall workplace safety and ACTION: Notice. health conditions. uploading document files electronically. If you wish to mail additional materials SUMMARY: The Department of Labor II. Special Issues for Comment in reference to an electronic or facsimile (DOL) is soliciting comments submission, you must submit them to concerning a proposed extension for the OSHA has a particular interest in the OSHA Docket Office (see the section comments on the following issues: authority to conduct the information of this notice titled ‘‘ADDRESSES’’). The collection request (ICR) titled, • Whether the proposed information additional materials must clearly ‘‘Certification of Medical Necessity.’’ collection requirements are necessary identify your electronic comments by This comment request is part of for the proper performance of the your name, date, and the docket number continuing Departmental efforts to agency’s functions, including whether so the agency can attach them to your reduce paperwork and respondent the information is useful; comments. burden in accordance with the • The accuracy of OSHA’s estimate of Because of security procedures, the Paperwork Reduction Act of 1995 the burden (time and costs) of the use of regular mail may cause a (PRA). significant delay in the receipt of information collection requirements, DATES: Consideration will be given to all including the validity of the comments. Comments and submissions are written comments received by February methodology and assumptions used; 8, 2021. • posted without change at http:// The quality, utility, and clarity of www.regulations.gov. Therefore, OSHA ADDRESSES: A copy of this ICR with the information collected; and cautions comments about submitting applicable supporting documentation; • Ways to minimize the burden on personal information such as social including a description of the likely employers who must comply; for security numbers and date of birth. respondents, proposed frequency of example, by using automated or other Although all submissions are listed in response, and estimated total burden technological information collection the http://www.regulations.gov index, may be obtained free by contacting and transmission techniques. some information (e.g., copyrighted Anjanette Suggs by telephone at 202–

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00062 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79224 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

354–9660 or by email at 725.406, authorizes this information Affected Public: Individuals or [email protected]. collection. households; Business or other for profit, Submit written comments about, or This information collection is subject and Not for profit institutions. requests for a copy of, this ICR by mail to the PRA. A Federal agency generally Estimated Number of Respondents: or courier to the U.S. Department of cannot conduct or sponsor a collection 1,300. Labor, Office of Workers’ Compensation of information, and the public is Frequency: On occasion. Programs, Room S3323, 200 generally not required to respond to an Total Estimated Annual Responses: Constitution Avenue NW, Washington, information collection, unless the OMB 1,300. DC 20210; by email: suggs.anjanette@ under the PRA approves it and displays Estimated Average Time per dol.gov. a currently valid OMB Control Number. Response: 20–40 minutes. Estimated Total Annual Burden FOR FURTHER INFORMATION CONTACT: In addition, notwithstanding any other provisions of law, no person shall Hours: 488 hours. Anjanette Suggs by telephone at 202– Total Estimated Annual Other Cost generally be subject to penalty for 354–9660 or by email at Burden: $0. [email protected]. failing to comply with a collection of Authority: 44 U.S.C. 3506(c)(2)(A). SUPPLEMENTARY INFORMATION: The DOL, information that does not display a as part of continuing efforts to reduce valid Control Number. See 5 CFR Anjanette Suggs, paperwork and respondent burden, 1320.5(a) and 1320.6. Agency Clearance Officer. conducts a pre-clearance consultation Interested parties are encouraged to [FR Doc. 2020–27012 Filed 12–8–20; 8:45 am] program to provide the general public provide comments to the contact shown BILLING CODE 4510–CK–P and Federal agencies an opportunity to in the ADDRESSES section. Written comment on proposed and/or comments will receive consideration, continuing collections of information and summarized and included in the NATIONAL AERONAUTICS AND before submitting them to the OMB for request for OMB approval of the final SPACE ADMINISTRATION final approval. This program helps to ICR. In order to help ensure appropriate ensure requested data can be provided consideration, comments should Privacy Act of 1974; System of in the desired format, reporting burden mention 1240–0024. Records (time and financial resources) is Submitted comments will also be a AGENCY: National Aeronautics and minimized, collection instruments are matter of public record for this ICR and Space Administration (NASA). clearly understood, and the impact of posted on the internet, without collection requirements can be properly redaction. The DOL encourages ACTION: Notice of a Modified System of assessed. commenters not to include personally Records. The Office of Workers’ Compensation identifiable information, confidential SUMMARY: Pursuant to the provisions of Programs administers the Federal Black business data, or other sensitive the Privacy Act of 1974, the National Lung Workers’ Compensation Program. statements/information in any Aeronautics and Space Administration The Black Lung Benefits Act (30 U.S.C. comments. is issuing public notice of its proposal 901(a)(b) and its implementing The DOL is particularly interested in to significantly alter a previously regulations necessitate this information comments that: noticed system of records NASA Health collection. The regulations at 20 CFR • Evaluate whether the proposed Information Management System/NASA 725.701, establish miner eligibility for collection of information is necessary 10HIMS. This notice incorporates medical services and supplies for the for the proper performance of the locations and NASA standard routine length of time required by the miner’s functions of the agency, including uses, as appropriate, that NASA has pneumoconiosis and related disability. whether the information will have previously published separately from, 20 CFR 725.706 requires prior approval practical utility. and cited by reference in, this and other before ordering an apparatus where the • Evaluate the accuracy of the NASA systems of records notices. This purchase price exceeds $300. 20 CFR agency’s estimate of the burden of the notice further clarifies and crystalizes 727.707 provides for the ongoing proposed collection of information, this system of records; updates records supervision of the miner’s medical care, including the validity of the access, notification, and contesting including the necessity, character and methodology and assumptions used. procedures; enhances one and adds one sufficiency of care to be furnished; gives • Enhance the quality, utility, and new routine uses, as set forth below the authority to request medical reports; clarity of the information to be under the caption SUPPLEMENTARY and indicates the right to refuse collected; and INFORMATION. payment of failing to submit any report • required. Because of the above Minimize the burden of the DATES: Submit comments within 30 legislation and regulations, it was collection of information on those who calendar days from the date of this necessary to devise a form to collect the are to respond, including through the publication. The changes will take effect required information. The form is the use of appropriate automated, at the end of that period, if no adverse CM–893, Certification of Medical electronic, mechanical, or other comments are received. Necessity is completed by the coal technological collection techniques or ADDRESSES: Patti F. Stockman, Privacy miner’s doctor and is used by the other forms of information technology, Act Officer, Office of the Chief Division of Coal Mine Workers’ e.g., permitting electronic submission of Information Officer, National Compensation to determine if the miner responses. Aeronautics and Space Administration meets impairment standards to qualify Agency: DOL-Office of Workers’ Headquarters, Washington, DC 20546– for durable medical equipment and Compensation Programs. 0001, (202) 358–4787, NASA- home nursing. This information Type of Review: Extension. [email protected]. collection is currently approved, for use Title of Collection: Certification of FOR FURTHER INFORMATION CONTACT: through April 30, 2021. The Black Lung Medical Necessity. NASA Privacy Act Officer, Patti F. Benefits Act (30 U.S.C. 901(a)(b) and Form: CM–893. Stockman, (202) 358–4787, NASA- implementing regulation, 20 CFR OMB Control Number: 1240–0024. [email protected].

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00063 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79225

SUPPLEMENTARY INFORMATION: John F. Kennedy Space Center 44 U.S.C. 3101—Records management This system notice includes both (NASA), Kennedy Space Center, FL by agency heads; general duties; minor and substantial revisions to 32899–0001; 42 CFR part 2—Confidentiality of NASA’s existing system of records Langley Research Center, (NASA), substance use disorder patient records. notice. This notice clarifies that NASA’s Hampton, VA 23681–2199; PURPOSE(S) OF THE SYSTEM: purpose for this system of records is to George C. Marshall Space Flight ensure a healthy workforce and working Center (NASA), Marshall Space Flight In order to ensure a healthy environment. It adds a field by which Center, AL 35812–0001; environment and workforce, records may be retrieved, and records John C. Stennis Space Center (NASA), information in this system of records is access, notification, and contesting Stennis Space Center, MS 39529–6000; maintained on anyone receiving (1) procedures consistent with NASA Michoud Assembly Facility (NASA), exams for general wellness, (2) Privacy Act regulations; adds new P.O. Box 29300, New Orleans, LA occupational clearances or locations to reflect the location of NASA 70189; and determination of fitness for duty, (3) pandemic contact tracing records that Wallops Flight Facility (NASA), behavioral health assistance, (4) identify individuals who have Wallops Island, VA 23337. workplace surveillance for potential contracted infectious diseases and Electronic records are also hosted at: human exposure within NASA to others they have potentially exposed in CORITY Chicago Data Center, 341 communicable diseases and hazards the NASA workplace; and incorporates, Haynes Drive, in Wood Dale, Illinois such as noise and chemical exposure, as appropriate, information formerly 60191; repetitive motion, and (5) first aid or published separately in the Federal Salesforce Government Cloud in medical care for onsite illness or Register as Appendix A, Location Ashburn, Virginia; and injuries through a NASA clinic Numbers and Mailing Addresses of Salesforce Disaster Recovery Center in outreach. Elk Grove Village, Illinois. NASA Installations at which Records CATEGORIES OF INDIVIDUALS COVERED BY THE are Located. It incorporates, in whole, SYSTEM AND SUBSYSTEM MANAGER(S): SYSTEM: NASA Standard Routine uses heretofore Chief Health and Medical Officer at This system contains information on published by NASA as Appendix B and NASA Headquarters (see System (1) NASA employees and applicants; (2) cited within individual system notices. Location above for address). employees from other agencies and This notice modifies categories of Subsystem Managers: military detailees working at NASA; (3) individuals covered and categories of Director Health and Medical Systems, active or retired astronauts and active records to be more precise. Finally, this Occupational Health at NASA astronaut family members; (4) other notice expands routine use number 2 for Headquarters (see System Location space flight personnel on temporary or contingency medical mission support; above for address); extended duty at NASA; (5) contractor and revises NASA’s Standard Routine Chief, Space Medicine Division at personnel; (6) Space Flight Participants Use 6 and adds a new standard routine NASA Johnson Space Center (see and those engaged in commercial use of use number 9, both to permit disclosure System Location above for address); NASA facilities, (7) civil service and of information to another federal agency Occupational Health Contracting contractor family members; and (8) or entity to permit their response to a Officer Representatives at NASA Ames visitors to NASA Centers who use breach or address of harm caused by a Research Center, (see System Location clinics or ambulance services for breach. above for address); emergency or first-aid treatment. NASA Armstrong Flight Research Cheryl Parker, Center (see System Location above for CATEGORIES OF RECORDS IN THE SYSTEM: Federal Register Liaison Officer. address); Records in this system contain SYSTEM NAME AND NUMBER: NASA Goddard Space Flight Center demographic data and private health Health Information Management (see System Location above for address); information: System, NASA 10HIMS. NASA Kennedy Space Center (see (1) Wellness records including but not System Location above for address); limited to exams provided for SECURITY CLASSIFICATION: NASA Langley Research Center (see continuing healthcare, documentation None. System Location above for address); of immunizations and other outreach NASA Glenn Research Center (see records. SYSTEM LOCATION: System Location above for address); (2) Fitness for duty and/or exposure Records of Medical Clinics/Units and NASA Marshall Space Flight Center exams/surveillance including but not Environmental Health Offices are (see System Location above for address); limited to ergonomics, hazardous maintained at: NASA Jet Propulsion Laboratory (see materials, radiation, noise, Mary W. Jackson NASA Headquarters, System Location above for address); communicable diseases and other National Aeronautics and Space NASA Stennis Space Center (see applicable longitudinal surveillance. Administration (NASA), Washington, System Location above for address); (3) Qualification records including the DC 20546–0001; Michoud Assembly Facility (NASA) use of offsite or onsite exams to Ames Research Center (NASA), (see System Location above for address); determine suitability for duties. Moffett Field, CA 94035–1000; and (4) Behavioral health and employee Armstrong Flight Research Center Wallops Flight Facility (NASA) (see assistance records. (NASA), P.O. Box 273, Edwards, CA System Location above for address). (5) Records of first aid, contingency 93523–0273; response, or emergency care, including John H. Glenn Research Center at AUTHORITY FOR MAINTENANCE OF THE SYSTEM: ambulance transportation. Lewis Field (NASA), 21000 Brookpark 5 U.S.C. 7901—Health service Road, Cleveland, OH 44135–3191; programs; RECORD SOURCE CATEGORIES: Goddard Space Flight Center (NASA), 51 U.S.C. 20113 (a)—Powers of the The information in this system of Greenbelt, MD 20771–0001; Administration in performance of records is obtained from individuals Lyndon B. Johnson Space Center functions to make and promulgate rules themselves, physicians, and previous (NASA), Houston, TX 77058–3696; and regulations; medical records of individuals.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00064 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79226 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

ROUTINE USES OF RECORDS MAINTAINED IN THE prosecuting such violation or charged Standard Routine Use No. 6—A SYSTEM, INCLUDING CATEGORIES OF USERS AND with enforcing or implementing the record from this SOR may be disclosed THE PURPOSES OF SUCH USES: statute, or rule, regulation or order to appropriate agencies, entities, and Any disclosures of information will issued pursuant thereto. persons when (1) NASA suspects or has be compatible with the purpose for Standard Routine Use No. 2—A confirmed that there has been a breach which the Agency collected the record from this SOR may be disclosed of the system of records; (2) NASA has information. Under the following to a Federal, State, or local agency determined that as a result of the routine uses that are unique to this maintaining civil, criminal, or other suspected or confirmed breach there is system of records, information in this relevant enforcement information or a risk of harm to individuals, NASA system may be disclosed: (1) To external other pertinent information, such as (including its information systems, medical professionals and independent current licenses, if necessary to obtain programs, and operations), the Federal entities to support internal and external information relevant to an agency Government, or national security; and reviews for purposes of medical quality decision concerning the hiring or (3) the disclosure made to such assurance; (2) to private or other retention of an employee, the issuance agencies, entities, and persons is government health care providers for of a security clearance, the letting of a reasonably necessary to assist in consultation, referral, or mission contract, or the issuance of a license, connection with NASA’s efforts to medical contingency support; (3) to the grant, or other benefit. respond to the suspected or confirmed Office of Personnel Management, Standard Routine Use No. 3—A breach or to prevent, minimize, or Occupational Safety and Health record from this SOR may be disclosed remedy such harm. Administration, and other Federal or to a Federal agency, in response to its State agencies as required in accordance Standard Routine Use No. 7—A request, in connection with the hiring or with the Federal agency’s special record from this system may be retention of an employee, the issuance program responsibilities; (4) to insurers disclosed to contractors, grantees, of a security clearance, the reporting of for referrals or reimbursement; (5) to experts, consultants, students, and an investigation of an employee, the employers of non-NASA personnel in others performing or working on a letting of a contract, or the issuance of support of the Mission Critical Space contract, service, grant, cooperative a license, grant, or other benefit by the Systems Personnel Reliability Program; agreement, or other assignment for the (6) to international partners for mission requesting agency, to the extent that the federal government, when necessary to support and continuity of care for their information is relevant and necessary to accomplish an Agency function related employees pursuant to NASA Space Act the requesting agency’s decision on the to this system of records. agreements; (7) to non-NASA personnel matter. Standard Routine Use No. 8—A performing research, studies, or other Standard Routine Use No. 4—A record from this system may be activities through arrangements or record from this system may be disclosed to a Member of Congress or agreements with NASA; (8) to the public disclosed to the Department of Justice staff acting upon the Member’s behalf of pre-space flight information having when (a) the Agency, or any component when the Member or staff requests the mission impact concerning an thereof; or (b) any employee of the information on behalf of, and at the individual crewmember, limited to the Agency in his or her official capacity; or request of, the individual who is the crewmember’s name and the fact that a (c) any employee of the Agency in his subject of the record. medical condition exists; (9) to the or her individual capacity where the Department of Justice or the Agency has Standard Routine Use No. 9—A public, limited to the crewmember’s record from this system may be name and the fact that a medical agreed to represent the employee; or (d) the United States, where the Agency disclosed to another Federal agency or condition exists, if a flight crewmember Federal entity, when NASA determines is, for medical reasons, unable to determines that litigation is likely to affect the Agency or any of its that information from this system of perform a scheduled public event records is reasonably necessary to assist following a space flight mission/ components, is a party to litigation or has an interest in such litigation, and the recipient agency or entity in (1) landing; (10) to the public to advise of responding to a suspected or confirmed medical conditions arising from the use of such records by the Department of Justice or the Agency is breach or (2) preventing, minimizing, or accidents, consistent with NASA remedying the risk of harm to regulations; and (12) in accordance with deemed by the Agency to be relevant and necessary to the litigation. individuals, the recipient agency or standard routine uses as set forth here. entity (including its information In addition, the following routine uses Standard Routine Use No. 5—A systems, programs, and operations), the of information contained in SORs are record from this system may be Federal Government, or national standard for many NASA systems and disclosed in a proceeding before a court security, resulting from a suspected or are compatible with the purpose for or adjudicative body before which the confirmed breach. which the Agency collected the agency is authorized to appear, when: (a) The Agency, or any component information. They are NASA Standard POLICIES AND PRACTICES FOR STORAGE OF Routine Uses. thereof; or (b) any employee of the RECORDS: Standard Routine Use No. 1—In the Agency in his or her official capacity; or event this system of records indicates a (c) any employee of the Agency in his Records are stored in multiple formats violation or potential violation of law, or her individual capacity where the including paper, digital, micrographic, whether civil, criminal, or regulatory in Agency has agreed to represent the photographic, and as medical recordings nature, and whether arising by general employee; or (d) the United States, such as electrocardiograph tapes, x-rays statute or particular program statute, or where the Agency determines that and strip charts. by regulation, rule or order issued litigation is likely to affect the Agency pursuant thereto, the relevant records in or any of its components, is a party to POLICIES AND PRACTICES FOR RETRIEVAL OF RECORDS: the SOR may be referred to the litigation or has an interest in such appropriate agency, whether Federal, litigation, and the use of such records by Records are retrieved from the system State, local or foreign, charged with the the Agency is deemed to be relevant and by the individual’s name, date of birth, responsibility of investigating or necessary to the litigation. or unique assigned Numbers.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00065 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79227

POLICIES AND PRACTICES FOR RETENTION AND appealing initial determinations ADDRESSES: The workshop on DISPOSAL OF RECORDS: regarding records access. ‘‘Pioneering the Future of Federally Records are maintained in Agency Supported Data Repositories’’ will be CONTESTING RECORD PROCEDURES: files and destroyed in accordance with held virtually. NASA Records Retention Schedule 1, In accordance with 14 CFR part 1212, Privacy Act—NASA Regulations, Instructions: Participation is by Item 126, and NASA Records Retention invitation only, but observers are Schedule 8, Item 57. information may be obtained by contacting in person or in writing the welcome on a first-come, first-served ADMINISTRATIVE, TECHNICAL, AND PHYSICAL system or subsystem manager listed basis, as there are a limited number of SAFEGUARDS: above at the location where the records virtual seats available. Registration is Records are maintained on secure are created and/or maintained. Requests required; registration link will be NASA servers and protected in must contain the identifying data available a week before the workshop. accordance with all Federal standards concerning the requester, e.g., first, For more information on the workshop, and those established in NASA middle and last name; date of birth; agenda, and registration, please see the regulations at 14 CFR 1212.605. description and time periods of the workshop website: https:// Additionally, server and data records desired. NASA Regulations also www.nitrd.gov/nitrdgroups/ management environments employ address contesting contents and index.php?title=Federally-Supported- infrastructure encryption technologies appealing initial determinations Data-Repositories. both in data transmission and at rest on regarding records access. FOR FURTHER INFORMATION CONTACT: Ji servers. Electronic messages sent within Lee at BDWorkshop-Repositories@ and outside of the Agency that convey NOTIFICATION PROCEDURES: nitrd.gov. Individuals who use a sensitive data are encrypted and In accordance with 14 CFR part 1212, telecommunications device for the deaf transmitted by staff via pre-approved Privacy Act—NASA Regulations, (TDD) may call the Federal Information electronic encryption systems as information may be obtained by Relay Service (FIRS) at 1–800–877–8339 required by NASA policy. Approved contacting in person or in writing the between 8 a.m. and 8 p.m., Eastern time security plans are in place for system or subsystem manager listed (ET), Monday through Friday. information systems containing the above at the location where the records records in accordance with the Federal are created and/or maintained. Requests SUPPLEMENTARY INFORMATION: must contain the identifying data Information Security Management Act Overview: This notice is issued on of 2014 (FISMA) and OMB Circular A– concerning the requester, e.g., first, middle and last name; date of birth; behalf of the NITRD Big Data (BD) 130, Management of Federal Interagency Working Group (IWG). Information Resources. Only authorized description and time periods of the records desired. NASA Regulations also Agencies of the NITRD BD IWG are personnel requiring information in the holding a workshop focused on official discharge of their duties are address contesting contents and appealing initial determinations federally supported repositories. Experts authorized access to records through from federally supported data approved access or authentication regarding records access. repositories, thought-leaders in data methods. Access to electronic records is EXEMPTIONS PROMULGATED FOR THE SYSTEM: science, and representative users will achieved only from workstations within None. explore future visions for federally the NASA Intranet, or remotely via a supported research data repositories, secure Virtual Private Network (VPN) HISTORY: what the repositories can do to prepare connection requiring two-factor token 15–101, 80 FR 214, pp. 68568–68572. for this future vision, and how to build authentication using NASA-issued [FR Doc. 2020–27051 Filed 12–8–20; 8:45 am] and strengthen the community of computers or via employee PIV badge BILLING CODE 7510–13–P federally supported repositories. The authentication from NASA-issued workshop will be held virtually on computers. The CORITY Chicago Data January 13–15, 2021 from 1 p.m. (ET) to Center and Salesforce Government NATIONAL SCIENCE FOUNDATION Cloud and Disaster Recovery Center 5 p.m. (ET). maintain documentation and Notice of Virtual Workshop on Goal: The workshop will explore verification of commensurate safeguards Pioneering the Future of Federally future visions for the federally in accordance with FISMA, NASA Supported Data Repositories supported repositories to identify Procedural Requirements (NPR) opportunities and challenges, areas for 2810.1A, and NASA ITS–HBK–2810.02– AGENCY: Networking and Information cross agency coordination, and ways to 05. Non-electronic records are secured Technology Research and Development build and strengthen the community of in locked rooms or files. (NITRD) National Coordination Office federally supported repositories. (NCO), National Science Foundation. Rationale: Data-driven research and RECORD ACCESS PROCEDURES: ACTION: Notice of Virtual Workshop. In accordance with 14 CFR part 1212, Artificial Intelligence and Machine Privacy Act—NASA Regulations, SUMMARY: The workshop on ‘‘Pioneering Learning (AI/ML) bring renewed focus information may be obtained by the Future of Federally Supported Data on research data repositories. Adapting contacting in person or in writing the Repositories’’ seeks to engage to the emerging and evolving needs and system or subsystem manager listed representatives of federally supported requirements of future data-intensive above at the location where the records data repositories, thought-leaders in research is a challenge facing federally are created and/or maintained. Requests data science, and representative users to supported data repositories. must contain the identifying data imagine future opportunities and Submitted by the National Science concerning the requester, e.g., first, challenges, build and strengthen the Foundation in support of the middle and last name; date of birth; community of federally supported Networking and Information description and time periods of the repositories, and identify areas for cross Technology Research and Development records desired. NASA Regulations also agency coordination. (NITRD) National Coordination Office address contesting contents and DATES: January 13–15, 2021. (NCO) on December 4, 2020.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00066 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79228 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

(Authority: 42 U.S.C. 1861) environmental assessment (EA) and 1–800–397–4209 between 8:00 a.m. and Suzanne H. Plimpton, finding of no significant impact (FONSI) 4:00 p.m. (EST), Monday through related to a request for alternate Friday, except Federal holidays. Reports Clearance Officer, National Science Foundation. disposal, exemptions, and associated FOR FURTHER INFORMATION CONTACT: license amendment for the disposition [FR Doc. 2020–27047 Filed 12–8–20; 8:45 am] David Tiktinsky, Office of Nuclear of waste containing byproduct material Material Safety and Safeguards, U.S. BILLING CODE 7555–01–P and special nuclear material (SNM) Nuclear Regulatory Commission, from the Westinghouse Electric Washington, DC 20555–0001; telephone: Company, LLC’s (WEC) Columbia Fuel 301–415–8740, email: David.Tiktinsky@ NEIGHBORHOOD REINVESTMENT Fabrication Facility (CFFF) in Hopkins, nrc.gov. CORPORATION South Carolina, under License Number SUPPLEMENTARY INFORMATION: SNM–1107. Additionally, the NRC is Sunshine Act Meetings; Regular Board considering the related action of I. Introduction of Directors Meeting approving exemptions to US Ecology, By letter dated May 8, 2020 (ADAMS TIME AND DATE: 2:00 p.m., Thursday, Inc. (USEI) from the NRC licensing Accession No. ML20129J935; Package December 17, 2020. requirements to allow USEI to receive No. ML20129J934), as supplemented on and dispose the material from CFFF PLACE: Via Conference Call. September 22, 2020 (ADAMS Accession without an NRC license. The USEI No. ML20266G551), and October 13, STATUS: Open (with the exception of disposal facility, located near Grand 2020 (ADAMS Accession No. Executive Session). View, Idaho, is a Subtitle C Resource ML20287A545), WEC requested an MATTERS TO BE CONSIDERED: The General Conservation and Recovery Act (RCRA) exemption and associated license Counsel of the Corporation has certified hazardous waste disposal facility amendment to License SNM–1107, that in his opinion, one or more of the permitted by the State of Idaho to issued for the operation of CFFF located exemptions set forth in 5 U.S.C. 552 receive low-level radioactive waste and in Hopkins, South Carolina. The (b)(2) and (4) permit closure of the is not licensed. Approval of the requests are for NRC authorization for following portion(s) of this meeting: alternate disposal request from WEC an alternate disposal of specified NRC- • Executive Session and the exemptions requested by WEC licensed byproduct and SNM from the Agenda: and USEI would allow WEC to transfer CFFF. As required by section 51.21 of the specific waste from CFFF for title 10 of the Code of Federal I. CALL TO ORDER disposal at USEI. Regulations (10 CFR), the NRC II. Executive Session: Report from CEO conducted an EA. Based on the results III. Executive Session: Report of CFO DATES: The EA and FONSI referenced in of the EA that follows, the NRC has IV. Action Item Approval of Minutes this document are available on V. Action Item Acceptance of Revised December 9, 2020. determined that pursuant to 10 CFR Audit Committee Charter ADDRESSES: Please refer to Docket ID 51.31, preparation of an environmental VI. Discussion Item NeighborWorks NRC–2020–0263 when contacting the impact statement for the exemption Compass Update NRC about the availability of request is not required and pursuant to VII. Management Program Background information regarding this document. 10 CFR 51.32, issuance of a FONSI is and Updates You may obtain publicly available appropriate. A corresponding exemption request VIII. Adjournment information related to this document from USEI, dated May 11, 2020 CONTACT PERSON FOR MORE INFORMATION: using any of the following methods: • Federal Rulemaking Website: Go to (ADAMS Accession No. ML20280A601), Lakeyia Thompson, Special Assistant, would allow for possession and disposal (202) 524–9940; [email protected]. https://www.regulations.gov and search for Docket ID NRC–2020–0263. Address of the byproduct and SNM materials at Lakeyia Thompson, questions about Docket IDs in the USEI disposal site. USEI is a RCRA Special Assistant. Regulations.gov to Jennifer Borges; Subtitle C hazardous waste disposal [FR Doc. 2020–27186 Filed 12–7–20; 4:15 pm] telephone: 301–287–9127; email: facility located near Grand View, Idaho. BILLING CODE 7570–01–P [email protected]. For technical II. Environmental Assessment questions, contact the individual listed in the FOR FURTHER INFORMATION Description of the Proposed Action NUCLEAR REGULATORY CONTACT section of this document. WEC and USEI requested NRC COMMISSION • NRC’s Agencywide Documents approval for a 10 CFR 20.2002 alternate Access and Management System disposal request, exemptions to 10 CFR [Docket No. 70–1151; NRC–2020–0263] (ADAMS): You may obtain publicly part 70.3 and 10 CFR 30.3, and a Westinghouse Electric Company, LLC; available documents online in the conforming WEC license amendment to Columbia Fuel Fabrication Facility; and ADAMS Public Documents collection at allow WEC to transfer specific waste US Ecology, Inc.; Idaho Resource https://www.nrc.gov/reading-rm/ from CFFF for disposal at the USEI Conservation and Recovery Act adams.html. To begin the search, select disposal facility. Waste being considered in this Subtitle C Hazardous Disposal Facility ‘‘Begin Web-based ADAMS Search.’’ For request includes approximately 2,550 Located Near Grand View, Idaho problems with ADAMS, please contact the NRC’s Public Document Room (PDR) cubic meters (m3; 90,000 cubic feet (ft3)) AGENCY: Nuclear Regulatory reference staff at 1–800–397–4209, 301– of radiologically contaminated soil, Commission. 415–4737, or by email to pdr.resource@ sludge, and debris associated with the ACTION: Environmental assessment and nrc.gov. East Lagoon, a treatment/settling pond • finding of no significant impact; Attention: The PDR, where you may that received effluents from multiple issuance. examine and order copies of public sources throughout the site. The East documents is currently closed. You may Lagoon is in the process of being closed SUMMARY: The U.S. Nuclear Regulatory submit your request to the PDR via in accordance with a consent agreement Commission (NRC) is issuing an email at [email protected] or call and regulations set by the South

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00067 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79229

Carolina Department of Health and Thus, material associated with the East considers potential environmental Environmental Control (SCDHEC). In Lagoon must be removed from the site impacts from non-radiological materials. addition to the material from the East in order to comply with regulatory With regard to potential non- Lagoon, the request also includes requirements. The proposed alternate radiological impacts, the NRC staff approximately 1,430 m3 (50,400 ft3) of disposal would also conserve low-level concludes that approval of the proposed previously dredged CaF2 sludge being radioactive waste disposal capacity at request to dispose of material with small stored on site. WEC proposes to mix licensed low-level radioactive disposal amounts of radioactive material would these materials with Portland cement to sites while ensuring that the material not have significant environmental stabilize the material for shipping. WEC being considered is disposed of safely in impacts, including effects on non- proposes to transport this aggregated a regulated facility. radiological effluents, air quality, or waste stream to USEI using a noise. In addition, approval of the Environmental Impacts of the Proposed combination of trucks and railcars. proposed action will not significantly Action In addition to this soil and sludge, the increase the probability or consequences request also includes the shipping and The NRC staff reviewed the of accidents as well as occupational and disposal of up to 526 obsolete UF6 information provided by WEC to public radiation exposure because of the cylinders previously used for support their 10 CFR 20.2002 alternate quantities and forms of material transportation. The cylinders are disposal request and for the specific involved, as further evaluated in the contaminated with SNM and U–238, exemptions from 10 CFR 30.3 and 10 NRC’s SER. and represent a disposal volume of CFR 70.3 in order to dispose of the Therefore, due to the very small approximately 651 m3 (23,000 ft3) prior aggregated waste and UF6 cylinders at amounts of radioactive material to downsizing. The UF6 Cylinders are USEI. Under the 10 CFR 20.2002 involved, the evaluation above, and the solid form (steel), approximately 1.8 m criteria, a licensee may seek NRC NRC staff’s analysis in the SER, the NRC (6 ft) in length and 0.76 m (2.5 ft) in authorization to dispose of licensed staff finds that the environmental diameter. The UF6 Cylinders are empty material using procedures not otherwise impacts of the proposed action are not and have been through the UF6 Cylinder authorized by NRC regulations. The significant. internal wash/rinse process following licensee’s supporting analysis must Environmental Impacts of the their last use. The UF6 Cylinders will be show that the radiological doses arising downsized to eliminate void space prior from the proposed 10 CFR 20.2002 Alternatives to the Proposed Action to packaging for shipment offsite for disposal will be as low as reasonably As an alternative to the proposed disposal. The UF6 Cylinders would be achievable and within the 10 CFR part action, the NRC staff considered the no- transported to the USEI site by trucks, 20 dose limits. action alternative in which the NRC separate from the aggregated waste WEC performed a radiological staff would deny the disposal request. shipments. assessment in consultation with USEI. Denial of the request would require Both waste streams would be Based on this assessment, WEC WEC to find another disposal pathway transported from CFFF in South concludes that potential doses to for this material, and would ultimately Carolina to the USEI facility, Grand members of the public, including only change the location of the disposal View, Idaho in the Owyhee Desert. The transportation workers and USEI site. All other factors would remain the USEI facility is a RCRA Subtitle C workers involved in processing and same or similar. Therefore, the no-action hazardous waste disposal facility disposing of the waste upon its arrival alternative was not further considered. permitted by the State of Idaho. The at USEI, are less than 1 mrem/y, well NRC staff also notes that pursuing the USEI site has both natural and within the ‘‘few mrem’’ criteria that the no-action alternative would result in the engineered features that limit the NRC established (see NUREG–1757, licensee potentially violating the transport of radioactive material. The Volume 1, Revision 2). SCDHEC requirements to remove the natural features include a low As documented in the Safety material from the East Lagoon so that it precipitation rate [i.e., 18.4 cm/year (7.4 Evaluation Report (SER), the NRC staff can be remediated while it identifies in./year)] and a long vertical distance to reviewed scenarios and related input another disposal option. groundwater (i.e., 61-meter (203-ft) thick parameters considered by WEC and on average unsaturated zone below the USEI and found that they are Agencies and Persons Consulted disposal zone). The engineered features appropriate for the scenarios In accordance with its stated policy, include an engineered cover, liners, and considered. The NRC staff also reviewed on November 23, 2020, the staff leachate monitoring systems. Because the projected doses from the post- consulted with SCDHEC and the Idaho the USEI facility is not licensed by the closure and intruder scenarios at USEI Department of Environmental Quality NRC, this proposed action requires the and found them acceptable. NRC staff regarding the environmental impacts of NRC to exempt USEI from the Atomic did note that the inadvertent intruder the proposed action. The state officials Energy Act of 1954, and NRC licensing construction scenario had potential concurred with the EA and FONSI. requirements with respect to USEI’s doses that were larger than the other III. Finding of No Significant Impact requested receipt and disposal of this inadvertent intruder scenarios material. evaluated, but the NRC does not The proposed action consists of NRC consider this scenario to be feasible due approval of (a) WEC’s and USEI’s Need for the Proposed Action to the configuration of the disposal cells alternate disposal requests under 10 The need for the proposed action is to and USEI’s waste disposal practices. CFR 20.2002, (b) WEC and USEI’s authorize a safe and appropriate method NRC staff also notes that the proposed exemption requests under 10 CFR of disposal for the subject waste disposals are also subject to regulation 30.11(a) and 10 CFR 70.11(a), and (c) the material generated during day-to-day under RCRA. issuance of a conforming license activities and currently being stored at Based upon its evaluation above and amendment to WEC. Based on this EA, the CFFF. Specifically, the East Lagoon its assessment of the potential impacts the NRC finds that there are no is in the process of being closed in of the proposed action, in addition to significant environmental impacts from accordance with a consent agreement focusing on the potential radiological the proposed action. Therefore, the NRC and regulations set by the SCDHEC. impacts discussed above, this EA next has determined, pursuant to 10 CFR

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00068 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79230 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

51.31, that preparation of an IV. Availability of Documents interested persons through one or more environmental impact statement is not of the following methods, as indicated. required for the proposed action and a The documents identified in the FONSI is appropriate. following table are available to

ADAMS Document accession No.

Request for Alternate Disposal Approval and Exemption for Specific Columbia Fuel Fabrication Facility Waste (License No. ML20129J934 SNM–1197, Docket No. 70–1151), dated May 8, 2020. (Package). Request for Exemptions under 10 CFR 30.11 and 10 CFR 70.17 for Alternate Disposal of Wastes from Columbia Fuel Fab- ML20280A601. rication Facility Under 10 CFR 20.2002, dated May 11, 2020. Response to Request for Additional Information—Alternate Disposal Approval and Exemptions for Specific Columbia Fuel ML20266G551. Fabrication Facility Waste (License No. SNM–1107, Docket No. 70–1151), dated September 22, 2020. Response to Request for Additional Information—Alternate Disposal Approval and Exemptions for Specific Columbia Fuel ML20287A545. Fabrication Facility Waste (License No. SNM–1107, Docket No. 70–1151), dated October 13, 2020. Safety Evaluation Report ...... ML20302A085. NUREG–1757, Volume 1, Revision 2, ‘‘Consolidated Decommissioning Guidance’’ ...... ML063000243.

Dated: December 3, 2020. Commission to consider matters related 39 U.S.C. 3642, 39 CFR part 3035, and For the Nuclear Regulatory Commission. to negotiated service agreement(s). The 39 CFR part 3040, subpart B. Comment Damaris Marcano, request(s) may propose the addition or deadline(s) for each request appear in Acting Chief, Fuel Facility Licensing Branch, removal of a negotiated service section II. Division of Fuel Management, Office of agreement from the market dominant or Nuclear Material Safety and Safeguards. the competitive product list, or the II. Docketed Proceeding(s) [FR Doc. 2020–26973 Filed 12–8–20; 8:45 am] modification of an existing product 1. CP2020–198; Filing Title: Notice of currently appearing on the market BILLING CODE 7590–01–P the United States Postal Service of dominant or the competitive product Filing Modification One to International list. Priority Airmail, Commercial ePacket, POSTAL REGULATORY COMMISSION Section II identifies the docket number(s) associated with each Postal Priority Mail Express International, [Docket Nos. CP2020–198; MC2021–39 and Service request, the title of each Postal Priority Mail International & First-Class CP2021–40] Service request, the request’s acceptance Package International Service with Reseller Contract 5 Negotiated Service New Postal Products date, and the authority cited by the Postal Service for each request. For each Agreement; Filing Acceptance Date: AGENCY: Postal Regulatory Commission. request, the Commission appoints an December 3, 2020; Filing Authority: 39 ACTION: Notice. officer of the Commission to represent CFR 3040.130 through 3040.135, and 39 the interests of the general public in the CFR 3035.105; Public Representative: SUMMARY: The Commission is noticing a proceeding, pursuant to 39 U.S.C. 505 Gregory S. Stanton; Comments Due: recent Postal Service filing for the (Public Representative). Section II also December 11, 2020. Commission’s consideration concerning establishes comment deadline(s) 2. Docket No(s).: MC2021–39 and a negotiated service agreement. This pertaining to each request. CP2021–40; Filing Title: USPS Request notice informs the public of the filing, The public portions of the Postal to Add Priority Mail Contract 682 to invites public comment, and takes other Service’s request(s) can be accessed via Competitive Product List and Notice of administrative steps. the Commission’s website (http:// Filing Materials Under Seal; Filing DATES: Comments are due: December www.prc.gov). Non-public portions of Acceptance Date: December 3, 2020; 11, 2020. the Postal Service’s request(s), if any, Filing Authority: 39 U.S.C. 3642, 39 CFR ADDRESSES: Submit comments can be accessed through compliance with the requirements of 39 CFR 3040.130 through 3040.135, and 39 CFR electronically via the Commission’s 3035.105; Public Representative: Filing Online system at http:// 3011.301.1 Kenneth R. Moeller; Comments Due: www.prc.gov. Those who cannot submit The Commission invites comments on December 11, 2020. comments electronically should contact whether the Postal Service’s request(s) the person identified in the FOR FURTHER in the captioned docket(s) are consistent This Notice will be published in the INFORMATION CONTACT section by with the policies of title 39. For Federal Register. telephone for advice on filing request(s) that the Postal Service states Erica A. Barker, alternatives. concern market dominant product(s), applicable statutory and regulatory Secretary. FOR FURTHER INFORMATION CONTACT: requirements include 39 U.S.C. 3622, 39 [FR Doc. 2020–27023 Filed 12–8–20; 8:45 am] David A. Trissell, General Counsel, at U.S.C. 3642, 39 CFR part 3030, and 39 BILLING CODE 7710–FW–P 202–789–6820. CFR part 3040, subpart B. For request(s) SUPPLEMENTARY INFORMATION: that the Postal Service states concern Table of Contents competitive product(s), applicable statutory and regulatory requirements I. Introduction include 39 U.S.C. 3632, 39 U.S.C. 3633, II. Docketed Proceeding(s) I. Introduction 1 See Docket No. RM2018–3, Order Adopting Final Rules Relating to Non-Public Information, The Commission gives notice that the June 27, 2018, Attachment A at 19–22 (Order No. Postal Service filed request(s) for the 4679).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00069 Fmt 4703 Sfmt 9990 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79231

SECURITIES AND EXCHANGE improvements to specific Order Types 3 Attribute,9 as described below, so that COMMISSION and Order Attributes 4 that are currently they align with how the System, once only available via the RASH Order entry upgraded, will handle these Orders 5 [Release No. 34–90558; File No. SR–Phlx– protocol. Specifically, the Exchange going forward. The Exchange also 2020–51] will be upgrading the logic and proposes to make several associated implementation of these Order Types clarifications and corrections to these Self-Regulatory Organizations; Nasdaq and Order Attributes so that the features Rules, and to Rule 3213, as it prepares PHLX LLC; Notice of Filing and are more streamlined across the to enhance its order handling processes. Immediate Effectiveness of Proposed Exchange’s Systems and order entry The Exchange notes that the Rule Change To Amend Nasdaq PSX protocols, and will enable the Exchange Exchange’s affiliate, the Nasdaq Stock Rules 3213, 3301A, and 3301B to process these Orders more quickly Market, LLC, recently filed a proposal and efficiently. Additionally, this for immediate effectiveness to make December 3, 2020. System upgrade will pave the way for changes that are similar to those Pursuant to Section 19(b)(1) of the the Exchange to enhance the OUCH proposed herein.10 Securities Exchange Act of 1934 6 Order entry protocol so that Changes to Market Maker Peg Order (‘‘Act’’),1 and Rule 19b–4 thereunder,2 Participants may enter such Order notice is hereby given that on November Types and Order Attributes via OUCH, A Market Maker Peg Order is an Order 20, 2020, Nasdaq PHLX LLC (‘‘Phlx’’ or in addition to the RASH Order entry Type that exists to help a Market Maker ‘‘Exchange’’) filed with the Securities protocols.7 The Exchange plans to to meet its obligation to maintain and Exchange Commission implement its enhancement of the continuous two-sided quotations (the (‘‘Commission’’) the proposed rule ‘‘Two-Sided Obligation’’), as set forth in OUCH protocol sequentially, by Order 11 change as described in Items I and II Type and Order Attribute. Rule 3213(a)(2). The Exchange below, which Items have been prepared proposes to make three changes related To support and prepare for these to the Market Maker Peg Order. by the Exchange. The Commission is upgrades and enhancements, the publishing this notice to solicit First, the Exchange proposes to Exchange now proposes to amend its amend Rule 3301A(b)(5) to correct the comments on the proposed rule change Rules governing Order Types and Order from interested persons. conditions under which a Market Maker Attributes, at Rules 3301A and 3301B, Peg Order will be sent back to a I. Self-Regulatory Organization’s respectively. In particular, the Exchange Participant. Rule 3301A(b)(5) currently Statement of the Terms of Substance of proposes to adjust the current states that a Market Maker Peg Order the Proposed Rule Change functionality of the Market Maker Peg will be sent back to the Participant if: (1) Order 8 and Reserve Size Order The Exchange proposes to amend Upon entry of the Order, the limit price Nasdaq PSX Rules 3213, 3301A, and of the Order is not within the 3 An ‘‘Order Type’’ is a standardized set of Designated Percentage; 12 or (2) after the 3301B, as described further below. instructions associated with an Order that define The text of the proposed rule change Order has been posted to the Exchange how it will behave with respect to pricing, Book, the Reference Price 13 shifts to is available on the Exchange’s website at execution, and/or posting to the Exchange Book reach the Defined Limit,14 such that the https://listingcenter.nasdaq.com/ when submitted to the Exchange. See Rule 3301(e). 4 rulebook/phlx/rules, at the principal An ‘‘Order Attribute’’ is a further set of variable instructions that may be associated with an Order 9 See Rule 3301B(h). office of the Exchange, and at the to further define how it will behave with respect to 10 See Securities Exchange Act Release No. 34– Commission’s Public Reference Room. pricing, execution, and/or posting to the Exchange 90389 (November 10, 2020), 85 FR 73304 Book when submitted to the Exchange. See id. (November 17, 2020) (SR–NASDAQ–2020–71). II. Self-Regulatory Organization’s 5 The RASH (Routing and Special Handling) 11 See Rule 3213(a)(2). Statement of the Purpose of, and Order entry protocol is a proprietary protocol that 12 See Rule 3301A(b)(5). The ‘‘Designated Statutory Basis for, the Proposed Rule allows members to enter Orders, cancel existing Percentage’’ is (i) 8% for securities included in the Change Orders and receive executions. RASH allows S&P 500® Index, Russell 1000® Index, and a pilot participants to use advanced functionality, list of Exchange Traded Products (‘‘Tier 1 In its filing with the Commission, the including discretion, random reserve, pegging and Securities’’); (ii) 28% for all NMS stocks that are not Exchange included statements routing. See http://nasdaqtrader.com/content/ Tier 1 Securities with a price equal to or greater technicalsupport/specifications/TradingProducts/ than $1 (‘‘Tier 2 Securities’’); (iii) 30% for all NMS concerning the purpose of and basis for rash_sb.pdf. stocks that are not Tier 1 Securities with a price less the proposed rule change and discussed 6 The OUCH Order entry protocol is a proprietary than $1 (‘‘Tier 3 Securities’’), except that between any comments it received on the protocol that allows subscribers to quickly enter 9:30 a.m. and 9:45 a.m. and between 3:35 p.m. and proposed rule change. The text of these orders into the System and receive executions. the close of trading, the Designated Percentage shall OUCH accepts limit Orders from members, and if be 20% for Tier 1 Securities, 28% for Tier 2 statements may be examined at the there are matching Orders, they will execute. Non- Securities, and 30% for Tier 3 Securities. The places specified in Item IV below. The matching Orders are added to the Limit Order Book, Designated Percentage for rights and warrants shall Exchange has prepared summaries, set a database of available limit Orders, where they are be 30%. See Rule 3213(a)(2)(D). As discussed forth in sections A, B, and C below, of matched in price-time priority. OUCH only below, the Exchange proposes to amend this provides a method for members to send Orders and definition. the most significant aspects of such receive status updates on those Orders. See https:// 13 The ‘‘Reference Price’’ for a Market Maker Peg statements. www.nasdaqtrader.com/Trader.aspx?id=OUCH. Order to buy (sell) is the then-current National Best 7 The Exchange designed the OUCH protocol to Bid (National Best Offer) (including the Exchange), A. Self-Regulatory Organization’s enable members to enter Orders quickly into the or if no such National Best Bid or National Best Statement of the Purpose of, and System. As such, the Exchange developed OUCH Offer, the most recent reported last-sale eligible Statutory Basis for, the Proposed Rule with simplicity in mind, and it therefore lacks more trade from the responsible single plan processor for Change complex order handling capabilities. By contrast, that day, or if none, the previous closing price of the Exchange specifically designed RASH to the security as adjusted to reflect any corporate 1. Purpose support advanced functionality, including actions (e.g., dividends or stock splits) in the discretion, random reserve, pegging and routing. security. See Rule 3301A(b)(5). Presently, the Exchange is making Once the System upgrades occur, then the Exchange 14 The term ‘‘Defined Limit’’ means 9.5% for Tier functional enhancements and intends to propose further changes to its Rules to 1 Securities, 29.5% for Tier 2 Securities, and 31.5% permit participants to utilize OUCH, in addition to for Tier 3 Securities, except that between 9:30 a.m. RASH, to enter order types that require advanced and 9:45 a.m. and between 3:35 p.m. and the close 1 15 U.S.C. 78s(b)(1). functionality. of trading, the Defined Limit shall be 21.5% for Tier 2 17 CFR 240.19b–4. 8 See Rule 3301A(b)(5). Continued

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00070 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79232 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Order is subject to re-pricing at the Second, the Exchange proposes to Securities’’), except that between 9:30 Designated Percentage away from the amend Rule 3301A(b)(5) to no longer a.m. and 9:45 a.m. and between 3:35 shifted Reference Price, but the limit allow entry of a Market Maker Peg Order p.m. and the close of trading, the price of the Order would then fall entered with an offset. The Rule Designated Percentage shall be 20% for outside of the Defined Limit (which presently permits a Market Maker to Tier 1 Securities, 28% for Tier 2 would now be measured by the enter a Market Maker Peg Order with a Securities, and 30% for Tier 3 difference between the re-priced Order more aggressive offset than the Securities. The Designated Percentage and the shifted Reference Price).15 Designated Percentage, but not a less for rights and warrants shall be 30%. The Exchange proposes to correct the aggressive offset. The Exchange has (E) For purposes of this Rule, the second of these two conditions because reviewed usage of offsets with Market ‘‘Defined Limit’’ shall be 9.5% for Tier it inadvertently allows for a Maker Peg Orders and found that no 1 Securities, 29.5% for Tier 2 Securities, circumstance in which a Market Maker Market Maker assigned an offset to their and 31.5% for Tier 3 Securities, except Peg Order will be automatically re- Market Maker Peg Orders since January that between 9:30 a.m. and 9:45 a.m. priced by the System to a limit price 2019. The Exchange does not believe and between 3:35 p.m. and the close of that is outside of the Designated that there is value in keeping offsets as trading, the Defined Limit shall be Percentage but inside of the Defined an option for Market Maker Peg Orders. 21.5% for Tier 1 Securities, 29.5% for Limit. Such an outcome is inconsistent Eliminating this option will also Tier 2 Securities, and 31.5% for Tier 3 with a Market Maker’s obligations to facilitate the System upgrades and ease Securities. price or reprice its bid (offer) quotations the import of RASH functionality to The Exchange is concerned that these not more than the Designated OUCH. Accordingly, the Exchange two provisions could be misinterpreted Percentage away from the then National proposes to delete text from Rule to suggest that prior to 9:30 a.m., the Best Bid (Offer), as set forth in Rule 3301A(b)(5)(A) that discusses offsets Exchange applies a narrower Designated 3213(a)(2).16 In order for Rule and replace it with text stating that Percentage and Defined Limit than it 3301A(b)(5) to be consistent with Rule Market Maker Peg Orders entered with does between 9:30 and 9:45 a.m., under 3213(a)(2), Rule 3301A(b)(5) cannot pegging offsets will not be accepted. The the same conditions. In fact, the permit the System to re-price a Market Exchange also makes conforming Exchange applies the same wider Maker Peg Order to a limit price that is changes to Rule 3301A(b)(5)(B) where Designated Percentage and Defined outside of the Designated Percentage. In the text refers to offsets. Limit prior to 9:30 a.m. as it does any circumstance in which the Order Third, the Exchange proposes to between 9:30 and 9:45 a.m. To avoid would be re-priced to a limit that is amend Rule 3301A(b)(5) to account for confusion (and without changing outside of the Designated Percentage, a scenario where, after entry of a Market existing market maker obligations), the the Rule must require the System to Maker Peg Order whose initial Exchange therefore proposes to clarify return the Order to the Participant. The displayed price was set with reference both of these provisions of Rule Exchange proposes to amend Rule to the National Best Bid or Offer, the 3213(a)(2) to state that ‘‘prior to 9:45 3301A(b)(5) accordingly.17 National Best Bid or Offer shifts such a.m.’’ and between 3:35 p.m. and the that the displayed price of the Order to close of trading, the Designated 1 Securities, 29.5% for Tier 2 Securities, and 31.5% buy (sell) is equal to or greater (less Percentage and Defined Limit (including for Tier 3 Securities. See Rule 3213(a)(2)(E). than) the National Best Bid (Offer). The for Market Maker Peg Orders) shall be 15 See Rule 3301A(b)(5). Exchange proposes to state that the 16 Rule 3213(a)(2) states that for a Market Maker as stated. Furthermore, throughout Rule to satisfy its Two-Sided Obligation, the Market Exchange will not reprice the Market 3213(a)(2)(D), in defining the term Maker must price bid (offer) interest not more than Maker Peg Order in this scenario until ‘‘Designated Percentage,’’ the Exchange the Designated Percentage away from the then a new Reference Price is established that proposes to replace references to Tier 1, current National Best Bid (Offer) (or if there is no is more aggressive than the displayed National Best Bid (Offer), not more than the 2, and 3 NMS Securities with the Designated Percentage away from the last reported price of the Order. By specifying that following: (i) The Designated Percentage sale from the responsible single plan processor). the Exchange will not reprice Market shall be 8% for all Tier 1 NMS Stocks Moreover, Rule 3213(a)(2) states that if the National Maker Peg Orders in this scenario until under the LULD Plan,18 28% for all Tier Best Bid (Offer) or reported sale increases a new, more aggressive Reference Price (decreases) to a level that would cause the bid 2 NMS Stocks under the LULD Plan (offer) interest of the Two-Sided Obligation to be is established, the Exchange will ensure with a price equal to or greater than $1), more than the Defined Limit away from the that it does not engage in a potential and 30% for all Tier 2 NMS Stocks National Best Bid (offer) or last reported sale, or if cycle of pegging against a Reference the bid (offer) is executed or cancelled, then the under the LULD Plan with a price less Market Maker must enter new bid (offer) interest at Price established by the Order itself. than $1, except that prior to 9:45 a.m. a price not more than the Designated Percentage and between 3:35 p.m. and the close of away from the then current National Best Bid Change to Rule 3213 (Offer) or last reported sale. Next, the Exchange proposes to clarify trading, the Designated Percentage shall 17 The Exchange also proposes to amend this the definitions of ‘‘Designated be: (i) 20% for Tier 1 NMS Stocks under condition to state that repricing will occur when the Percentage’’ in Rule 3213(a)(2)(D) and the LULD Plan; (ii) 28% for all Tier 2 difference between the displayed price of a Market NMS Stocks under the LULD Plan with Maker Peg Order and the Reference Price exceeds, ‘‘Defined Limit’’ in Rule 3213(a)(2)(E), rather than merely reaches, the Defined Limit. which presently are as follows: a price equal to or greater than $1; and Currently, the Rule uses the term ‘‘reaches,’’ but (D) For purposes of this Rule, the (iii) 30% for all Tier 2 NMS Stocks this is inconsistent with the example that follows under the LULD Plan with a price less it (‘‘In the foregoing example, if the Defined Limit ‘‘Designated Percentage’’ shall be: (i) 8% ® than $1. Similarly, in Rule 3213(a)(2)(E), is 9.5% and the National Best Bid increases to for securities included in the S&P 500 $10.17, such that the displayed price of the Market Index, Russell 1000® Index, and a pilot Maker Peg Order would be more than 9.5% away, 18 Tier 1 NMS Stocks under the LULD Plan list of Exchange Traded Products (‘‘Tier ® the Order will be repriced to $9.36, or 8% away comprise all NMS Stocks included in the S&P 500 from the National Best Bid.’’) (emphasis added). 1 Securities’’); (ii) 28% for all NMS Index, Russell 1000® Index, and a list of Exchange The Exchange proposes to reconcile this stocks that are not Tier 1 Securities with Traded Products identified as Schedule 1 to the inconsistency in a manner that reflects the stated a price equal to or greater than $1 (‘‘Tier Plan to Address Extraordinary Market Volatility example as well as the manner in which the 2 Securities’’); (iii) 30% for all NMS Submitted to the Securities and Exchange Exchange’s System presently applies the Rule. It Commission Pursuant to Rule 608 of Regulation would also render the Rule consistent with Market stocks that are not Tier 1 Securities with NMS Under the Securities Exchange Act of 1934 Maker obligations under Rule 3213. a price less than $1 (‘‘Tier 3 (the ‘‘LULD Plan’’).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00071 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79233

in defining the term ‘‘Defined Limit,’’ characteristics of its selected Order replenished to its original size.’’ The the Exchange proposes to replace Type) and a Non-Displayed Order. The Exchange proposes to delete this text references to securities subject to Rule Exchange also proposes to delete the because it is redundant of text 4120(a)(11)(A), (B), and (C) [sic] with following sentence: ‘‘Upon entry, the elsewhere in the Rule that describes the following: (i) 9.5% for all Tier 1 full size of each such Order will be how a Displayed Order with Reserve NMS Stocks under the LULD Plan; (ii) processed for potential execution in Size replenishes.22 29.5% for all Tier 2 NMS Stocks under accordance with the parameters Third, the Exchange proposes to the LULD Plan with a price equal to or applicable to the Order Type.’’ The amend text from Rule 3301B(h) that greater than $1; and (iii) 31.5% for all proposed re-formulation reflects that it allows the original and subsequent Tier 2 NMS Stocks under the LULD Plan is possible that the Order with Reserve displayed sizes of the Displayed Order with a price less than $1, except that Size will be executed immediately in to be amounts randomly determined prior to 9:45 a.m. and between 3:35 p.m. full and without needing to place based upon factors they select and the close of trading, the Defined unexecuted portions of the Order in (‘‘Random Reserve’’). The amendments Limit shall be: (i) 21.5% all Tier 1 NMS reserve. Furthermore, it clarifies that the also state that when Participants Stocks under the LULD Plan; (ii) 29.5% System will present the Order for stipulate use of a Random Reserve, they for all Tier 2 NMS Stocks under the immediate execution (provided that it would select a nominal (rather than a LULD Plan with a price equal to or does not trade through a protected ‘‘theoretical’’) displayed size, which is a greater than $1; and (iii) 31.5% for all quotation, in accordance with more precise term. Furthermore, the Tier 2 NMS Stocks under the LULD Plan Regulation NMS) without complying amendment adds a reminder that the with a price less than $1. The Exchange with underlying characteristics of the actual displayed size will be randomly proposes this change because the Order Type that might otherwise require determined by the System from a range existing references are obsolete. an adjustment to the price of the Order of ‘‘normal trading units.’’ Lastly, the The Exchange also proposes to add to before the System attempts to execute amendments include other changes that Rule 3213(a)(2)(E) the fact that the it.21 The proposed language is do not change the substantive meaning Defined Limit for rights and warrants consistent with the following example of the text, but simply improve its shall be 31.5%. The Exchange set forth in the existing rule text: readability. mistakenly omitted the Defined Limit The Exchange intends to implement for such securities from prior filings.19 For example, a Participant might enter a the foregoing changes during the First Price to Display Order with 200 shares Changes to Reserve Size displayed and an additional 3,000 shares Quarter of 2021. The Exchange will issue an Equity Trader Alert at least 30 As set forth in Rule 3301B(h), non-displayed. Upon entry, the Order would attempt to execute against available liquidity days in advance of implementing the ‘‘Reserve Size’’ is an Order Attribute on the PSX Book, up to 3,200 shares. changes. that permits a Participant to stipulate Thereafter, unexecuted portions of the Order that an Order Type that is Displayed would post to the PSX Book as a Displayed 2. Statutory Basis may have its displayed size replenished Price to Display Order and a Non-Displayed The Exchange believes that its from additional non-displayed size.20 Order; provided, however, that if the proposal is consistent with Section 6(b) The Exchange proposes three changes to remaining total size is less than the display of the Act,23 in general, and furthers the the rule text describing the Reserve Size size stipulated by the Participant, the objectives of Section 6(b)(5) of the Act,24 Order Attribute. Displayed Order will post without Reserve in particular, in that it is designed to Size. Thus, if 3,050 shares executed upon First, the Exchange proposes to promote just and equitable principles of amend a paragraph of Rule 3301B(h) entry, the Price to Display Order would post with a size of 150 shares and no Reserve Size. trade, to remove impediments to and which begins as follows: ‘‘Whenever a perfect the mechanism of a free and Participant enters an Order with Reserve The proposed language eliminates open market and a national market Size, PSX will process the Order as two confusion that might otherwise arise system, and, in general to protect Orders: A Displayed Order (with the from perceived inconsistencies between investors and the public interest. characteristics of its selected Order the above example and existing rule The Exchange believes that it is Type) and a Non-Displayed Order. Upon text. Again, the existing rule text states consistent with the Act to amend Rule entry, the full size of each such Order that whenever a participant enters an 3301A(b)(5), which describes the Market will be processed for potential Order with Reserve Size, the System Maker Peg Order Type, to correct one of execution in accordance with the will process the Reserve Order as two the stated conditions under which a parameters applicable to the Order orders upon entry and also, upon entry, Market Maker Peg Order will be sent Type.’’ The Exchange proposes to the full size of an Order with Reserve back to a Participant. As presently amend this language because it does not will be presented for potential execution stated, this condition provides for describe precisely how the Exchange in accordance with the parameters Market Maker Peg Orders to be repriced processes Orders with Reserve Size. The applicable to the Order Type. automatically at limit prices that are Exchange proposes to state instead that When there is, in fact, an unexecuted within the Defined Limit, but outside of whenever a Participant enters an Order portion of the Order, then the Exchange the Designated Percentage, which places with Reserve Size, the full size of the will continue to process the unexecuted Order will be presented for potential portion as two Orders: A Displayed 22 The Exchange proposes to clarify a portion of execution in compliance with Order and a Non-Displayed Order. Rule 3301B(h) which states that if an execution Regulation NMS and that thereafter, Second, the Exchange proposes to against a Displayed Order causes its size to decrease unexecuted portions of the Order will delete text from Rule 3301B(h) which below a normal unit of trading, another Displayed Order will be entered at the ‘‘level’’ stipulated by be processed as two Orders: A states that ‘‘[a] Participant may stipulate the Participant while the size of the Non-Displayed Displayed Order (with the that the Displayed Order should be Order will be reduced by the same amount. In describing the entry of the new Displayed Order in 19 See Securities Exchange Act Release No. 34– 21 This clarification is needed due to the fact that this instance, the Exchange proposes to replace the 69194 (March 20, 2013), 78 FR 18386 (March 26, pursuant to Rule 3301A(b)(2)(A), a Price to Display word ‘‘level’’ with ‘‘limit price and size,’’ which is 2013) (SR–Phlx–2013–24). Order would automatically reprice upon entry if its a more precise phrase. 20 An Order with Reserve Size may be referred to entered limit price would lock or cross a protected 23 15 U.S.C. 78f(b). as a ‘‘Reserve Order.’’ quotation, = . 24 15 U.S.C. 78f(b)(5).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00072 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79234 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

them in conflict with Rule 3213(a)(2), Percentage’’ and ‘‘Defined Limit,’’ as set account for and comply with them. For which requires Market Makers to price forth in Rule 3213(a)(2)(D) and (E), is similar reasons, proposed non- and re-price bid and offer interest at the consistent with the Act because the substantive amendments to other text in Designated Percentage. It is just and in amendment is necessary to correct Rule 3301B(h) are consistent with the the interests of the investors and the obsolete references and to avoid Act because they would improve the public for the Exchange to correct Rule confusion about which particular readability of the Rule. 3301A(b)(5) to ensure that Market Maker percentage or limit will apply to orders Finally, the Exchange believes that Peg Orders operate in a manner that prior to 9:30 a.m. The proposal clarifies various proposed non-substantive helps rather than hinders Market the Rule by stating expressly that the clarifications and corrections to the text Makers from complying with Rule 3213. same sets of bands that apply between of the Rule will improve its readability, It is also consistent with the Act for 9:30–9:45 a.m. and between 3:35 p.m. which is in the interests of market the Exchange to amend Rule and the close of trading also apply prior participants and investors, and would 3301A(b)(5) to clarify that repricing will to 9:30 a.m. The proposal also specifies promote a more orderly market. occur when the difference between the a Defined Limit for rights and warrants, B. Self-Regulatory Organization’s displayed price of a Market Maker Peg which was mistakenly omitted from Statement on Burden on Competition Order and the Reference Price prior filings and which relates to the ‘‘exceeds,’’ rather than merely Designated Percentage for rights and The Exchange does not believe that its ‘‘reaches,’’ the Defined Limit, as the warrants, which is set forth already at proposed rule changes will impose any Rule states presently. The proposed Rule 3213(a)(2)(D). burden on competition not necessary or change would ensure that the Rule text It is also consistent with the Act to appropriate in furtherance of the is internally consistent, as the example amend Rule 3301B(h) to clarify that purposes of the Act. As a general set forth in the text suggests that the when a Participant enters an Order with principle, the proposed changes are Rule should be read to mean exceeds. It Reserve Size, the full size of the Order reflective of the significant competition would also render the Rule consistent will first be presented for potential among exchanges and non-exchange with Market Maker obligations under execution in compliance with venues for order flow. In this regard, Rule 3213. The Exchange believes that Regulation NMS, and only if there is an proposed changes that facilitate it is in the interest of investors and the unexecuted portion of the Order will it enhancements to the Exchange’s System public to eliminate such be processed as a Displayed Order and and order entry protocols as well as inconsistencies. a Non-Displayed Order. This those that clarify and correct the Meanwhile, the Exchange believes clarification describes the behavior of Exchange’s Rules regarding its Order that it is consistent with the Act to the System more precisely than the Types and Attributes, are pro- eliminate the option for Participants to existing Rule language. It also reflects competitive because they bolster the enter offsets from the Market Maker Peg the possibility that the Order with efficiency, integrity, and overall Orders. The proposal is consistent with Reserve Size will be executed attractiveness of the Exchange in an the Act because Market Makers do not immediately in full and without absolute sense and relative to its peers. actively employ such offsets. As noted needing to place unexecuted portions of Moreover, none of the proposed above, the Exchange has reviewed usage the Order in reserve. Furthermore, it changes will burden intra-market of offsets with Market Maker Peg Orders eliminates inconsistency between rule competition among various Exchange and found that no Market Maker has text which presently suggests that the Participants. Proposed changes to the assigned an offset with their Market System will process the Order with Market Maker Peg Order Type, at Rule Maker Peg Orders since January 2019. Reserve Size for potential immediate 3301A(b)(5), and to Rule 3213, will Moreover, elimination of the option to execution consistent with the apply equally to all Market Makers. enter offsets would simplify the characteristics of its underlying Order Market Makers will experience no Exchange’s efforts to improve Type, and an example in the rule text competitive impact from proposals to processing. in which the Exchange provides that the eliminate their ability to use offsets with The Exchange believes that it is System will process the Order for Market Maker Peg Orders because consistent with the Act to clarify Rule potential immediate execution Market Makers do not actually utilize 3301A(b)(5) so that it specifies how the regardless of the parameters applicable offsets. Likewise, Market Makers will System will react when, after entry of a to the Order Type. The proposed feel no competitive effects from Market Maker Peg Order whose initial amendment will resolve this proposed corrections and clarifications displayed price was set with reference inconsistency by making clear that the to the manner in which the Exchange to the National Best Bid or Offer, the System will present an order for prices and re-prices their Market Maker National Best Bid or Offer shifts such potential immediate execution Peg Orders, except that the changes will that the displayed price of the Order to regardless of the characteristics of the benefit Market Makers by ensuring that buy (sell) is equal to or greater (less) underlying Order Type, with the caveat the Exchange always processes those than the National Best Bid (National that the Order will not trade-through a Orders in a manner that complies with Best Offer). Specifically, the Exchange protected quotation as required by their Market Maker pricing obligations believes that it is just and in the Regulation NMS. under Rule 3213. Proposed interests of investors to specify that the It is consistent with the Act to amend clarifications to the Reserve Order Exchange will not reprice Market Maker Rule 3301B(h) to state that when Attribute Rule, at Rule 3301B(h), will Peg Orders in this scenario until a new, participants stipulate use of a Random have no substantive impact on more aggressive Reference Price is Reserve, they would select a participants. established, because doing so ensures ‘‘nominal’’—rather than a ‘‘theoretical’’ Proposed changes to Rule 3213 are that the Exchange will not engage in a displayed size. The proposed term intended to correct inadvertent errors potential cycle of pegging against a ‘‘nominal’’ is more precise than the and should have no competitive impact Reference Price established by the Order existing Rule text. Improving the on Market Makers. Proposed itself. precision of the Exchange’s Rules clarifications and amendments to the The Exchange’s proposal to amend improves the ability of the public and Reserve Order Attribute Rule, at Rule the definitions of ‘‘Designated investors to comprehend them and 3301B(h), are intended to improve the

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00073 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79235

precision and readability of the Rule Commission, 100 F Street NE, SECURITIES AND EXCHANGE text and will not have any competitive Washington, DC 20549–1090. COMMISSION impact on participants. All submissions should refer to File C. Self-Regulatory Organization’s Number SR–Phlx–2020–51. This file [Release No. 34–90556; File No. SR– Statement on Comments on the number should be included on the NYSEArca–2020–101] Proposed Rule Change Received From subject line if email is used. To help the Self-Regulatory Organizations; NYSE Members, Participants, or Others Commission process and review your Arca, Inc.; Notice of Filing and No written comments were either comments more efficiently, please use Immediate Effectiveness of Proposed solicited or received. only one method. The Commission will Rule Change To Streamline the NYSE post all comments on the Commission’s III. Date of Effectiveness of the Arca Equities Fees and Charges Proposed Rule Change and Timing for internet website (http://www.sec.gov/ Commission Action rules/sro.shtml). Copies of the December 3, 2020 submission, all subsequent Pursuant to Section 19(b)(1) 1 of the Because the foregoing proposed rule amendments, all written statements Securities Exchange Act of 1934 change does not: (i) Significantly affect with respect to the proposed rule (‘‘Act’’),2 and Rule 19b–4 thereunder,3 the protection of investors or the public change that are filed with the interest; (ii) impose any significant notice is hereby given that on November Commission, and all written burden on competition; and (iii) become 23, 2020, NYSE Arca, Inc. (‘‘NYSE communications relating to the operative for 30 days from the date on Arca’’ or ‘‘Exchange’’) filed with the proposed rule change between the which it was filed, or such shorter time Securities and Exchange Commission Commission and any person, other than as the Commission may designate, it has (‘‘Commission’’) the proposed rule those that may be withheld from the become effective pursuant to Section change as described in Items I, II, and public in accordance with the 19(b)(3)(A) of the Act 25 and Rule 19b– III below, which Items have been 26 provisions of 5 U.S.C. 552, will be 4(f)(6) thereunder. prepared by the Exchange. The available for website viewing and At any time within 60 days of the Commission is publishing this notice to printing in the Commission’s Public filing of the proposed rule change, the solicit comments on the proposed rule Commission summarily may Reference Room, 100 F Street NE, change from interested persons. temporarily suspend such rule change if Washington, DC 20549 on official it appears to the Commission that such business days between the hours of I. Self-Regulatory Organization’s action is necessary or appropriate in the 10:00 a.m. and 3:00 p.m. Copies of the Statement of the Terms of Substance of public interest, for the protection of filing also will be available for the Proposed Rule Change investors, or otherwise in furtherance of inspection and copying at the principal the purposes of the Act. If the office of the Exchange. All comments The Exchange proposes to streamline Commission takes such action, the received will be posted without change. the NYSE Arca Equities Fees and Commission shall institute proceedings Persons submitting comments are Charges (‘‘Fee Schedule’’) by deleting to determine whether the proposed rule cautioned that we do not redact or edit redundant rule text from Tier 1, Tier 2 change should be approved or personal identifying information from and Tier 3 pricing tiers. The Exchange disapproved. comment submissions. You should proposes to implement the fee changes IV. Solicitation of Comments submit only information that you wish effective November 23, 2020. The to make available publicly. All proposed rule change is available on the Interested persons are invited to Exchange’s website at www.nyse.com, at submit written data, views, and submissions should refer to File Number SR–Phlx–2020–51 and should the principal office of the Exchange, and arguments concerning the foregoing, at the Commission’s Public Reference including whether the proposed rule be submitted on or before December 30, Room. change is consistent with the Act. 2020. Comments may be submitted by any of For the Commission, by the Division of II. Self-Regulatory Organization’s the following methods: Trading and Markets, pursuant to delegated Statement of the Purpose of, and 27 Electronic Comments authority. Statutory Basis for, the Proposed Rule J. Matthew DeLesDernier, Change • Use the Commission’s internet comment form (http://www.sec.gov/ Assistant Secretary. In its filing with the Commission, the rules/sro.shtml); or [FR Doc. 2020–26991 Filed 12–8–20; 8:45 am] self-regulatory organization included • Send an email to rule-comments@ BILLING CODE 8011–01–P statements concerning the purpose of, sec.gov. Please include File Number SR– and basis for, the proposed rule change Phlx–2020–51 on the subject line. and discussed any comments it received Paper Comments on the proposed rule change. The text • Send paper comments in triplicate of those statements may be examined at to Secretary, Securities and Exchange the places specified in Item IV below. The Exchange has prepared summaries, 25 15 U.S.C. 78s(b)(3)(A). set forth in sections A, B, and C below, 26 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– of the most significant parts of such 4(f)(6)(iii) requires a self-regulatory organization to statements. give the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing 1 15 U.S.C. 78s(b)(1). of the proposed rule change, or such shorter time as designated by the Commission. The Exchange 2 15 U.S.C. 78a. has satisfied this requirement. 27 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00074 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79236 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

A. Self-Regulatory Organization’s securities. Additionally, ETP Holders • $0.0010 per share (fee) for PO Statement of the Purpose of, and that qualify for Tier 1 also pay a fee of Orders routed to the NYSE that execute Statutory Basis for, the Proposed Rule $0.0010 per share for Market, Market- in the opening or closing auction. Change On-Close, Limit-On-Close, and Auction- Finally, under Tier 1, the Fee Only Orders executed in a Closing Schedule currently provides for a fee of 1. Purpose Auction. All other fees and credits $0.0029 per share for orders in Tape B The Exchange proposes to streamline under Tier 1 are identical to the fees and securities that take liquidity from the the Fee Schedule by deleting redundant credits provided under the Basic Rates Book, and a fee of $0.0029 per share for rule text from Tier 1, Tier 2 and Tier 3 section of the Fee Schedule. The Limit Non-Displayed Orders that take pricing tiers. The Exchange proposes to Exchange is not proposing to adopt any liquidity from the Book. The Exchange implement the fee changes effective new fees or credits or remove any proposes to merge these two fees into a November 23, 2020. current fees or credits under Tier 1 with single fee by adding the words Currently, each of Tier 1, Tier 2 and this proposed rule change. ‘‘including Limit Non-Displayed Limit Tier 3 pricing tiers provides fees and Orders’’ to the former fee and deleting 4 Accordingly, the Exchange proposes credits that ETP Holders can qualify to delete the following fees and credits the text of the latter from the Fee for if they meet the prescribed volume applicable to Tape A and Tape C Schedule. In addition, similar to the criteria. securities under Tier 1 of the Fee statement that currently appears at the Historically, in addition to the fees Schedule, all of which currently appear end of Tier 3 of the Fee Schedule, the and credits applicable to each of Tier 1, under Basic Rates on the Fee Schedule: Exchange proposes to add the words Tier 2 and Tier 3 pricing tiers, each such • $0.0030 per share (fee) for orders ‘‘For all other fees and credits, Basic tier also included the Basic Rates fees Rates apply’’ at the end of Tier 1 to and credits. The Exchange believes this that take liquidity from the Book for Tape A Securities and Tape C clarify that the rates that are proposed approach has caused more confusion for deletion would continue to apply to than clarity and proposes to delete the Securities. • ETP Holders that qualify for Tier 1 for redundant rule text that appears in Tier For Mid-Point Liquidity (‘‘MPL’’) all of their other trading activity. The 1, Tier 2 and Tier 3. Each of the fees and orders providing liquidity to the Book: Æ Exchange also proposes to delete the credits proposed for deletion currently $0.0015 per share (credit) in Tape following fees and credits applicable to appear under the Basic Rates section of A Securities and $0.0020 per share Tape B securities under Tier 1 as each the Fee Schedule and would continue to (credit) in Tape C Securities if provided are duplicative and currently appear apply to ETP Holders for their activity liquidity in MPL Orders for Tape A, under Basic Rates: that falls outside of Tier 1, Tier 2 and Tape B and Tape C Securities combined • No per share (credit) for PO orders Tier 3, as applicable. The Exchange is (‘‘MPL Adding ADV’’) during the billing routed to NYSE American that provide not proposing any change to the fees month is at least 3 million shares; Æ $0.0015 per share (credit) in Tape liquidity to the NYSE American Book. and credits applicable to ETP Holders • A Securities and Tape C Securities if MPL orders providing liquidity to other than to delete redundant text from the Book: Tier 1, Tier 2 and Tier 3. MPL Adding ADV during the billing Æ month is at least 1.5 million shares and $0.0020 per share (credit) if MPL Under Tier 1, ETP Holders that Adding ADV during the billing month is provide liquidity an average daily share less than 3 million shares; Æ $0.0010 per share (credit) in Tape at least 3 million shares; volume per month of 0.70% or more of Æ $0.0015 per share (credit) if MPL A and Tape C Securities. the US consolidated average daily Adding ADV during the billing month is 5 • $0.0030 per share (fee) for MPL volume (‘‘US CADV’’) pay a fee of at least 1.5 million shares and less than orders removing liquidity from the Book $0.0030 per share for orders, including 3 million shares; Primary Only (‘‘PO’’) Orders, routed to that are not designated as ‘‘Retail Æ $0.0010 per share (credit) if MPL any away market that remove liquidity Orders’’ defined below. • Adding ADV during the billing month is in Tape A, Tape B and Tape C $0.0010 per share (fee) for MPL less than 1.5 million shares. securities, and receive a credit of orders removing liquidity from the Book • $0.0030 per share (fee) for MPL $0.0031 per share for orders that and are designated as ‘‘retail’’ that meet orders removing liquidity from the Book provide liquidity in Tape A securities, the requirements of Rule 7.44–E(a)(3) that are not designated as Retail Orders. $0.0023 per share in Tape B securities,6 but that are not executed in the Retail • $0.0010 per share (fee) for MPL and $0.0032 per share in Tape C Liquidity Program (‘‘Retail Orders’’). orders removing liquidity from the Book • $0.0015 per share (fee) for Market that are designated as Retail Orders. 4 All references to ETP Holders in connection and Auction-Only Orders executed in • $0.0015 per share (fee) for Market with this proposed fee change include Market an Early Open Auction, Core Open and Auction-Only Orders executed in Makers. Auction or Trading Halt Auction, 5 US CADV means United States Consolidated an Early Open Auction, Core Open Average Daily Volume for transactions reported to capped at $20,000 per month per Equity Auction or Trading Halt Auction, the Consolidated Tape, excluding odd lots through Trading Permit ID. capped at $20,000 per month per Equity January 31, 2014 (except for purposes of Lead • No fee or credit for Limit Non- Trading Permit ID. Market Maker pricing), and excludes volume on Displayed Orders that provide liquidity • days when the market closes early and on the date $0.0005 per share (fee) for PO of the annual reconstitution of the Russell to the Book. Orders routed to NYSE American that Investments Indexes. Transactions that are not • $0.0030 per share (fee) for Limit execute in the opening or closing reported to the Consolidated Tape are not included Non-Displayed Orders that take auction. in US CADV. See Fee Schedule, footnote 3. liquidity from the Book. • No fee or credit for Limit Non- 6 Pursuant to the LMM Transaction Fees and Additionally, the Exchange proposes Credits pricing program, ETP Holders affiliated Displayed Orders that provide liquidity with LMMs can receive an additional credit when to delete the following fees and credits to the Book. such ETP Holders provide displayed liquidity to the applicable to Tape A securities under Under Tier 2, ETP Holders can qualify Book based on the number of Less Active ETP Tier 1 of the Fee Schedule: for the applicable fees and credits in one Securities in which the LMM is registered as the • of two ways. ETP Holders can either LMM. See Securities Exchange Act Release No. $0.0012 per share (credit) for PO 87978 (January 15, 2020), 85 FR 3727 (January 22, Orders that provide liquidity to the provide liquidity an average daily share 2020) (SR–NYSEArca–2020–03). NYSE. volume per month of 0.30% or more,

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00075 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79237

but less than 0.70% of the US CADV. (credit) in Tape C Securities if provided • No per share (credit) for PO orders Alternatively, ETP Holders can (a) liquidity in MPL Orders for Tape A, routed to NYSE American that provide provide liquidity an average daily share Tape B and Tape C Securities combined liquidity to the NYSE American Book. volume per month of 0.25% or more, (‘‘MPL Adding ADV’’) during the billing • MPL orders providing liquidity to but less than 0.70% of the US CADV, (b) month is at least 3 million shares; the Book: execute removing volume in Tape B Æ $0.0015 per share (credit) in Tape Æ $0.0020 per share (credit) if MPL Securities equal to at least 0.40% of US A Securities and Tape C Securities if Adding ADV during the billing month is Tape B CADV, and (c) maintain MPL Adding ADV during the billing at least 3 million shares; affiliation with an OTP Holder or OTP month is at least 1.5 million shares and Æ $0.0015 per share (credit) if MPL Firm that provides an ADV of electronic less than 3 million shares; Adding ADV during the billing month is posted Customer and Professional Æ $0.0010 per share (credit) in Tape at least 1.5 million shares and less than Customer executions in all issues on A and Tape C Securities. 3 million shares; NYSE Arca Options (excluding mini • $0.0030 per share (fee) for MPL Æ $0.0010 per share (credit) if MPL options) of at least 0.25% of total orders removing liquidity from the Book Adding ADV during the billing month is Customer equity and ETF option ADV that are not designated as ‘‘Retail less than 1.5 million shares. as reported by OCC. Orders’’ defined below. • $0.0030 per share (fee) for MPL ETP Holders that qualify for Tier 2 • $0.0010 per share (fee) for MPL orders removing liquidity from the Book pay a fee of $0.0030 per share for orders, orders removing liquidity from the Book that are not designated as Retail Orders. including PO Orders, routed to any that are designated Retail Orders. • $0.0010 per share (fee) for MPL away market that remove liquidity in • $0.0015 per share (fee) for Market orders removing liquidity from the Book Tape A, Tape B and Tape C securities, and Auction-Only Orders executed in that are designated as Retail Orders. and receive a credit of $0.0029 per share an Early Open Auction, Core Open • $0.0015 per share (fee) for Market for orders that provide liquidity in Tape Auction or Trading Halt Auction, and Auction-Only Orders executed in 7 A and Tape C securities, and $0.0022 capped at $20,000 per month per Equity an Early Open Auction, Core Open per share for orders that provide Auction or Trading Halt Auction, 8 Trading Permit ID. liquidity in Tape B securities. All other • No fee or credit for Limit Non- capped at $20,000 per month per Equity fees and credits under Tier 2 are Displayed Orders that provide liquidity Trading Permit ID. identical to the fees and credits to the Book. • $0.0005 per share (fee) for PO provided under the Basic Rates section • $0.0030 per share (fee) for Limit Orders routed to NYSE American that of the Fee Schedule. The Exchange is Non-Displayed Orders that take execute in the opening or closing not proposing to adopt any new fees or liquidity from the Book. auction. credits or remove any current fees or Additionally, the Exchange proposes • No fee or credit for Limit Non- credits under Tier 2 with this proposed to delete the following fees and credits Displayed Orders that provide liquidity rule change. to the Book. Accordingly, the Exchange proposes applicable to Tape A securities under Tier 2 of the Fee Schedule: Under Tier 3, ETP Holders that to delete the following fees and credits • provide liquidity an average daily share applicable to Tape A and Tape C $0.0012 per share (credit) for PO Orders that provide liquidity to the volume per month of 0.20% or more, securities under Tier 2 of the Fee but less than 0.30% of the US CADV Schedule, all of which currently appear NYSE. • $0.0010 per share (fee) for PO pay a fee of $0.0030 per share for orders, under Basic Rates on the Fee Schedule: including PO Orders, routed to any • $0.0030 per share (fee) for orders Orders routed to the NYSE that execute away market that remove liquidity in that take liquidity from the Book. in the opening or closing auction. • For Mid-Point Liquidity (‘‘MPL’’) Finally, under Tier 2, the Fee Tape A, Tape B and Tape C securities, orders providing liquidity to the Book: Schedule currently provides for a fee of and receive a credit of $0.0025 per share Æ $0.0015 per share (credit) in Tape $0.0029 per share for orders in Tape B for orders that provide liquidity in Tape 9 A Securities and $0.0020 per share securities that take liquidity from the A and Tape C securities, or and Book, and a fee of $0.0029 per share for $0.0022 per share in Tape B securities.10 7 Under Tier 2, ETP Holders can alternatively Limit Non-Displayed Orders that take Additionally, ETP Holders that qualify qualify for a credit of $0.0031 per share for orders liquidity from the Book. The Exchange for Tier 3 also pay a fee of $0.0010 per in Tape A and Tape C securities that provide proposes to merge these two fees into a share for Market, Market-On-Close, displayed liquidity if such ETP Holder meets the Limit-On-Close, and Auction-Only requirements of Tier 2 and, (1) executes providing single fee by adding the words volume equal to at least 0.30% of US CADV, (2) ‘‘including Limit Non-Displayed Limit Orders executed in a Closing Auction. executes removing volume equal to at least 0.285% Orders’’ to the former fee and deleting All other fees and credits under Tier 3 of US CADV, and (3) executes Market-On-Close and the text of the latter from the Fee are identical to the fees and credits Limit-On-Close Orders executed in a Closing provided under the Basic Rates section Auction of at least 0.075% of US CADV. Schedule. In addition, similar to the 8 Under Tier 2, ETP Holders can alternatively statement that currently appears at the of the Fee Schedule. The Exchange is qualify for a credit of $0.0024 per share for orders end of Tier 3 of the Fee Schedule, the in Tape B securities that provide displayed Exchange proposes to add the words 9 Under Tier 3, ETP Holder can also receive a credit of $0.0027 per share for orders in Tape A and liquidity if such ETP Holder meets the requirements ‘‘For all other fees and credits, Basic of Tier 2 and, (1) executes providing volume equal Tape C securities if the ETP Holder meets the to at least 0.30% of US CADV, (2) executes Rates apply’’ at the end of Tier 2 to requirements of Tier 3 and its ADV of executed removing volume equal to at least 0.285% of US clarify that the rates that are proposed orders that provide liquidity is at least 0.05% of US CADV, and (3) executes Market-On-Close and for deletion would continue to apply to CADV more than the ETP Holder’s ADV of executed Limit-On-Close Orders executed in a Closing ETP Holders that qualify for Tier 2 for orders that provide liquidity as a percent of US Auction of at least 0.075% of US CADV. Pursuant CADV in May 2019. to the LMM Transaction Fees and Credits pricing all of their other trading activity. The 10 Pursuant to the LMM Transaction Fees and program, ETP Holders affiliated with LMMs can Exchange also proposes to delete the Credits pricing program, ETP Holders affiliated receive an additional credit when such ETP Holders following fees and credits applicable to with LMMs can receive an additional credit when provide displayed liquidity to the Book in Tape B Tape B securities under Tier 2 as each such ETP Holders provide displayed liquidity to the securities based on the number of Less Active ETP Book based on the number of Less Active ETP Securities in which the LMM is registered as the are duplicative and currently appear Securities in which the LMM is registered as the LMM. under Basic Rates: LMM.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00076 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79238 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

not proposing to adopt any new fees or Fee Schedule by deleting redundant with respect to the fees and credits that credits or remove any current fees or rule text is reasonable because each of ETP Holders would be subject to. credits under Tier 3 with this proposed the fees and credits proposed for Intermarket Competition. The rule change. deletion currently appear under the Exchange believes the proposed rule Accordingly, the Exchange proposes Basic Rates section of the Fee Schedule change does not impose any burden on to delete the following fees and credits which is the more appropriate place for intermarket competition that is not applicable to Tape A and Tape C such fees and credits. The Exchange necessary or appropriate in furtherance securities under Tier 3 of the Fee believes providing the base rates under of the purposes of the Act. The Schedule, all of which currently appear the Basic Rates section of the Fee Exchange operates in a highly under Basic Rates on the Fee Schedule: Schedule would promote clarity to the • competitive market in which market $0.0030 per share (fee) for orders Fee Schedule and reduce confusion to participants can readily choose to send that take liquidity from the Book. • ETP Holders as to which fees and their orders to other exchanges and off- No fee or credit for Limit Non- credits are applicable to their trading exchange venues if they deem fee levels Displayed Orders that provide liquidity activity on the Exchange. The Exchange at those other venues to be more to the Book. • believes it is reasonable to delete the favorable. Market share statistics $0.0030 per share (fee) for Limit redundant fees and credits from Tier 1, Non-Displayed Orders that take provide ample evidence that price Tier 2 and Tier 3 of the Fee Schedule competition between exchanges is liquidity from the Book. and therefore, streamline the Fee Additionally, the Exchange proposes fierce, with liquidity and market share Schedule to promote clarity and reduce to delete the following fee applicable to moving freely from one execution venue confusion as to the applicability of fees Tape A securities under Tier 3 of the to another in reaction to pricing Fee Schedule: and credits that ETP Holders would be changes. • $0.0010 per share (fee) for PO subject to. The Exchange believes deleting redundant fees and credits C. Self-Regulatory Organization’s Orders routed to the NYSE that execute Statement on Comments on the in the opening or closing auction. would also simplify the Fee Schedule. The Exchange believes that deleting Proposed Rule Change Received From Finally, under Tier 3, the Fee Members, Participants, or Others Schedule currently provides for a fee of redundant fees and credits from Tier 1, $0.0029 per share for orders in Tape B Tier 2 and Tier of the Fee Schedule is No written comments were solicited securities that take liquidity from the equitable and not unfairly or received with respect to the proposed Book, and a fee of $0.0029 per share for discriminatory because the resulting rule change. streamlined Fee Schedule would Limit Non-Displayed Orders that take III. Date of Effectiveness of the liquidity from the Book. The Exchange continue to apply to ETP Holders as it does currently because the Exchange is Proposed Rule Change and Timing for proposes to merge these two fees into a Commission Action single fee by adding the words not adopting any new fees or credits or ‘‘including Limit Non-Displayed Limit removing any current fees or credits The foregoing rule change is effective Orders’’ to the former fee and deleting from the Fee Schedule. All ETP Holders upon filing pursuant to Section the text of the latter from the Fee would continue to be subject to the 19(b)(3)(A) 14 of the Act and Schedule. The Exchange also proposes same fees and credits that currently subparagraph (f)(2) of Rule 19b–4 15 to delete the following fees and credits apply to them. thereunder, because it establishes a due, applicable to Tape B securities under For the foregoing reasons, the fee, or other charge imposed by the Tier 3 as it is duplicative and currently Exchange believes that the proposal is Exchange. appears under Basic Rates: consistent with the Act. At any time within 60 days of the • No fee or credit for Limit Non- filing of such proposed rule change, the Displayed Orders that provide liquidity B. Self-Regulatory Organization’s Statement on Burden on Competition Commission summarily may to the Book. temporarily suspend such rule change if The proposed changes are not In accordance with Section 6(b)(8) of it appears to the Commission that such otherwise intended to address any other the Act,13 the Exchange believes that the action is necessary or appropriate in the issues, and the Exchange is not aware of proposed rule change would not impose public interest, for the protection of any significant problems that market any burden on competition that is not investors, or otherwise in furtherance of participants would have in complying necessary or appropriate in furtherance the purposes of the Act. If the with the proposed changes. of the purposes of the Act. Commission takes such action, the 2. Statutory Basis Intramarket Competition. The Commission shall institute proceedings Exchange’s proposal to delete redundant 16 The Exchange believes that the under Section 19(b)(2)(B) of the Act to fees and credits from Tier 1, Tier 2 and determine whether the proposed rule proposed rule change is consistent with Tier 3 of the Fee Schedule will not place Section 6(b) of the Act,11 change should be approved or in general, and any undue burden on intramarket furthers the objectives of Sections disapproved. competition that is not necessary or 6(b)(4) and(5) of the Act,12 in particular, appropriate in furtherance of the IV. Solicitation of Comments because it provides for the equitable purposes of the Act because all ETP allocation of reasonable dues, fees, and Interested persons are invited to Holders would continue to be subject to other charges among its members, submit written data, views, and the same fees and credits that currently issuers and other persons using its arguments concerning the foregoing, apply to them. To the extent the facilities and does not unfairly including whether the proposed rule proposed rule change places a burden discriminate between customers, change is consistent with the Act. on competition, any such burden would issuers, brokers or dealers. Comments may be submitted by any of The Exchange believes that the be outweighed by the fact that a the following methods: proposed rule change to streamline the streamlined Fee Schedule would promote clarity and reduce confusion 14 15 U.S.C. 78s(b)(3)(A). 11 15 U.S.C. 78f(b). 15 17 CFR 240.19b–4(f)(2). 12 15 U.S.C. 78f(b)(4) and (5). 13 15 U.S.C. 78f(b)(8). 16 15 U.S.C. 78s(b)(2)(B).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00077 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79239

Electronic Comments SECURITIES AND EXCHANGE A. Self-Regulatory Organization’s Statement of the Purpose of, and • COMMISSION Use the Commission’s internet Statutory Basis for, the Proposed Rule comment form (http://www.sec.gov/ Change rules/sro.shtml); or [Release No. 34–90560; File No. SR– NYSENAT–2020–35] 1. Purpose • Send an email to rule-comments@ sec.gov. Please include File Number SR– Self-Regulatory Organizations; NYSE The Exchange proposes to amend its NYSEArca–2020–101 on the subject National, Inc.; Notice of Filing and Fee Schedule to modify Adding Tier 2 line. Immediate Effectiveness of Proposed and Removing Tier 1. The proposed changes respond to the Paper Comments Rule Change To Amend Its Schedule of Fees and Rebates current competitive environment where order flow providers have a choice of • Send paper comments in triplicate where to direct liquidity-providing and to Secretary, Securities and Exchange December 3, 2020. liquidity-removing orders by offering Commission, 100 F Street NE, Pursuant to Section 19(b)(1) 1 of the further incentives for ETP Holders to Washington, DC 20549–1090. Securities Exchange Act of 1934 send additional displayed and non- (‘‘Act’’),2 and Rule 19b–4 thereunder,3 displayed liquidity to the Exchange. The All submissions should refer to File notice is hereby given that on December Number SR–NYSEArca–2020–101. This proposed changes also respond to the 1, 2020, NYSE National, Inc. (‘‘NYSE current volatile market environment file number should be included on the National’’ or ‘‘Exchange’’) filed with the subject line if email is used. To help the that has resulted in unprecedented Securities and Exchange Commission Commission process and review your average daily volumes, which is related (‘‘Commission’’) the proposed rule comments more efficiently, please use to the ongoing spread of the novel change as described in Items I, II, and only one method. The Commission will coronavirus (‘‘COVID–19’’). III below, which Items have been post all comments on the Commission’s The Exchange proposes to implement prepared by the Exchange. The internet website (http://www.sec.gov/ the rule change on December 1, 2020. Commission is publishing this notice to rules/sro.shtml). Copies of the solicit comments on the proposed rule Current Market and Competitive submission, all subsequent change from interested persons. Environment amendments, all written statements The Exchange operates in a highly with respect to the proposed rule I. Self-Regulatory Organization’s competitive market. The Commission change that are filed with the Statement of the Terms of Substance of has repeatedly expressed its preference Commission, and all written the Proposed Rule Change for competition over regulatory communications relating to the The Exchange proposes to amend its intervention in determining prices, proposed rule change between the products, and services in the securities Commission and any person, other than Schedule of Fees and Rebates (‘‘Fee Schedule’’) to modify Adding Tier 2 and markets. Specifically, in Regulation those that may be withheld from the NMS, the Commission highlighted the Removing Tier 1. The Exchange public in accordance with the importance of market forces in proposes to implement the rule change provisions of 5 U.S.C. 552, will be determining prices and SRO revenues available for website viewing and on December 1, 2020. The proposed rule and, also, recognized that current printing in the Commission’s Public change is available on the Exchange’s regulation of the market system ‘‘has Reference Room, 100 F Street NE, website at www.nyse.com, at the been remarkably successful in Washington, DC 20549, on official principal office of the Exchange, and at promoting market competition in its business days between the hours of the Commission’s Public Reference broader forms that are most important to 10:00 a.m. and 3:00 p.m. Copies of the Room. investors and listed companies.’’ 4 filing also will be available for II. Self-Regulatory Organization’s While Regulation NMS has enhanced inspection and copying at the principal Statement of the Purpose of, and competition, it has also fostered a office of the Exchange. All comments ‘‘fragmented’’ market structure where received will be posted without change. Statutory Basis for, the Proposed Rule Change trading in a single stock can occur Persons submitting comments are across multiple trading centers. When cautioned that we do not redact or edit In its filing with the Commission, the multiple trading centers compete for personal identifying information from self-regulatory organization included order flow in the same stock, the comment submissions. You should statements concerning the purpose of, Commission has recognized that ‘‘such submit only information that you wish and basis for, the proposed rule change competition can lead to the to make available publicly. All and discussed any comments it received fragmentation of order flow in that 5 submissions should refer to File on the proposed rule change. The text stock.’’ Indeed, equity trading is Number SR–NYSEArca–2020–101, and of those statements may be examined at currently dispersed across 16 6 should be submitted on or before the places specified in Item IV below. exchanges, 31 alternative trading December 30, 2020. The Exchange has prepared summaries, 4 For the Commission, by the Division of See Securities Exchange Act Release No. 51808 set forth in sections A, B, and C below, (June 9, 2005), 70 FR 37496, 37499 (S7–10–04) Trading and Markets, pursuant to delegated of the most significant parts of such (Final Rule) (‘‘Regulation NMS’’). 17 authority. statements. 5 See Securities Exchange Act Release No. 61358, J. Matthew DeLesDernier, 75 FR 3594, 3597 (January 21, 2010) (File No. S7– 02–10) (Concept Release on Equity Market Assistant Secretary. Structure). [FR Doc. 2020–26990 Filed 12–8–20; 8:45 am] 6 See Cboe Global Markets, U.S. Equities Market Volume Summary, available at http:// BILLING CODE 8011–01–P 1 15 U.S.C. 78s(b)(1). markets.cboe.com/us/equities/market_share/. See 2 15 U.S.C. 78a. generally https://www.sec.gov/fast-answers/ 17 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4. divisionsmarketregmrexchangesshtml.html.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00078 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79240 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

systems,7 and numerous broker-dealer that would provide liquidity on an Proposed Rule Change internalizers and wholesalers. Based on exchange, ETP Holders can choose from publicly-available information, no any one of the 16 currently operating To respond to this competitive single exchange has more than 16% of registered exchanges to route such order environment, the Exchange proposes the the market share of executed volume of flow. Accordingly, competitive forces following changes to its Fee Schedule equity trades (whether excluding or constrain the Exchange’s transaction designed to provide order flow including auction volume).8 Therefore, fees, and market participants can readily providers with incentives to route no exchange possesses significant trade on competing venues if they deem liquidity-providing order flow to the pricing power in the execution of equity pricing levels at those other venues to Exchange. As described above, ETP order flow. More specifically, the be more favorable. Holders with liquidity-providing order Exchange’s share of executed volume of The Exchange utilizes a ‘‘taker- flow have a choice of where to send that equity trades in Tapes A, B and C maker’’ or inverted fee model to attract order flow. securities is less than 2%.9 orders that provide liquidity at the most The Exchange believes that the ever- competitive prices. Under the taker- Proposed Change To Adding Tier 2 shifting market share among the maker model, offering rebates for taking exchanges from month to month (or removing) liquidity increases the Under current Adding Tier 2, ETP demonstrates that market participants likelihood that market participants will Holders that add liquidity to the can move order flow, or discontinue or send orders to the Exchange to trade Exchange in securities with a per share reduce use of certain products, in with liquidity providers’ orders. This price of $1.00 or more and that have at response to fee changes. While it is not increased taker order flow provides an least 0.15% or more of ADV of adding possible to know a firm’s reason for incentive for market participants to send liquidity as a percentage of US CADV moving order flow, the Exchange orders that provide liquidity. The are charged a fee of $0.0022 per share believes that one such reason is because Exchange generally charges fees for for adding displayed orders in Tape A, of fee changes at any of the registered order flow that provides liquidity. These B, and C securities. The Exchange exchanges or non-exchange trading fees are reasonable due to the additional proposes to revise Adding Tier 2 by venues to which a firm routes order marketable interest (in part attracted by modifying the requirements to qualify flow. These fees vary month to month, the Exchange’s rebate to remove for the tier, as follows (proposed and not all are publicly available. With liquidity) with which those order flow additions underlined, deletions respect to non-marketable order flow providers can trade. bracketed):

Tier requirement Adding rate

Adding Tier 2: At least [0.15%] 0.13% or more Adding ADV as a % of US CADV ...... Displayed liquidity: Tapes A, B and C: $0.0022.

The Exchange does not propose any incentivize ETP Holders to submit more revised Adding Tier 2 rate. However, changes to the Adding Rate for Adding orders that add liquidity to the the Exchange believes there are multiple Tier 2, and the rate for Orders that add Exchange, thereby increasing the additional ETP Holders that could liquidity under the Adding Tier 2 would potential for price improvement to qualify for the revised Adding Tier 2, if remain unchanged. incoming marketable orders submitted they so choose, based on their current The Exchange believes that lowering to the Exchange. trading profiles. the ADV requirement for Adding Tier 2 As noted above, the Exchange from 0.15% to 0.13% or more Adding operates in a competitive environment, Proposed Changes To Removing Tier 1 ADV as a percentage of US CADV will particularly as relates to attracting non- Under current Removing Tier 1, the allow greater numbers of ETP Holders to marketable orders, which add liquidity Exchange provides a rebate of $0.0030 potentially qualify for the tier, and will to the Exchange. Currently, only a few per share to ETP Holders that remove incentivize more ETP Holders to route ETP Holders have qualified for Adding their liquidity-providing order flow to Tier 2. The Exchange does not know liquidity from the Exchange in the Exchange in order to qualify for the how much order flow ETP Holders securities with a per share price of $1.00 tier. This in turn would support the choose to route to other exchanges or to or more and that have (i) a combined quality of price discovery on the off-exchange venues. Without having a Adding ADV and Removing ADV of at Exchange and provide additional price view of ETP Holders’ activity on other least 0.20% as a % of US CADV, and (ii) improvement opportunities for exchanges and off-exchange venues, the 250,000 of Adding ADV. incoming orders. The Exchange believes Exchange has no way of knowing The Exchange proposes to revise that by correlating the amount of the fee whether this proposed rule change Removing Tier 1 by modifying the to the level of orders sent by an ETP would result in any additional ETP requirements to qualify for the tier, as Holder that add liquidity, the Holders directing orders to the follows (proposed additions underlined, Exchange’s fee structure would Exchange in order to qualify for the deletions bracketed):

Tier requirement Removing rate

Removing Tier 1: At least [0.20%] 0.18% Adding ADV and Removing ADV combined as a % of US CADV and 250,000 Adding ADV ...... ($0.0030)

7 See FINRA ATS Transparency Data, available at July 29, 2019, only 31 are currently trading. A list 8 See Cboe Global Markets U.S. Equities Market https://otctransparency.finra.org/otctransparency/ of alternative trading systems registered with the Volume Summary, available at http:// AtsIssueData. Although 54 alternative trading Commission is available at https://www.sec.gov/ markets.cboe.com/us/equities/market_share/. systems were registered with the Commission as of foia/docs/atslist.htm. 9 See id.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79241

The Exchange does not propose any particular, because it provides for the The Exchange believes that modifying changes to the Removing Rate for Orders equitable allocation of reasonable dues, Adding Tier 2 and Removing Tier 1 that removed liquidity that qualify for fees, and other charges among its would encourage the submission and Removing Tier 1, and the rate for such members, issuers and other persons removal of additional liquidity from the orders under Removing Tier 1 would using its facilities and does not unfairly Exchange, thus enhancing order remain unchanged. discriminate between customers, execution opportunities for ETP Holders The Exchange believes that lowering issuers, brokers or dealers. from the substantial amounts of the combined Adding ADV and liquidity present on the Exchange. All Removing ADV requirement for The Proposed Change Is Reasonable ETP Holders would benefit from the Removing Tier 1 from 0.20% to 0.18% As discussed above, the Exchange greater amounts of liquidity that would as a percentage of US CADV for ETP operates in a highly fragmented and be present on the Exchange, which Holders that also have 250,000 Adding competitive market. The Exchange would provide greater execution ADV will allow greater numbers of ETP believes that the ever-shifting market opportunities. Holders to qualify for the tier, and will share among the exchanges from month The Exchange believes the proposed incentivize more ETP Holders to route to month demonstrates that market rule change would also improve market liquidity-removing order flow to the participants can move order flow, or quality for all market participants Exchange in order to qualify for the tier. discontinue or reduce use of certain seeking to remove liquidity on the This is turn would support the quality categories of products, in response to fee Exchange and, as a consequence, attract of price discovery on the Exchange and changes. While it is not possible to more liquidity to the Exchange, thereby provide additional price improvement know a firm’s reason for shifting order improving market-wide quality. The opportunities for incoming orders. flow, the Exchange believes that one proposal neither targets nor will it have As described above, ETP Holders with such reason is because of fee changes at a disparate impact on any particular liquidity-removing order flow have a any one of the registered exchanges or category of market participant. choice of where to send that order flow. non-exchange trading venues that a firm Specifically, the Exchange believes The Exchange believes that as a result routes order flow to, which vary month that the proposal constitutes an of the proposed change to Removing to month, and not all of which are equitable allocation of fees because all Tier 1, more ETP Holders will choose to publicly known. With respect to non- similarly situated ETP Holders and route their liquidity-removing order marketable order flow that would other market participants would be flow to the Exchange in order to qualify provide liquidity on an Exchange, ETP eligible for the same general and tiered for the credits for removing liquidity Holders can choose from any one of the rates and would be eligible for the same associated with Removing Tier 1 given 16 currently operating registered fees and credits. Moreover, the proposed that the requirements to qualify have exchanges to route such order flow. change is equitable because the revised been reduced. Accordingly, competitive forces fees would apply equally to all similarly As noted, the Exchange operates in a constrain exchange transaction fees that situated ETP Holders. competitive environment. Currently, relate to orders that would provide The Proposal Is Not Unfairly only a few ETP Holders qualify for liquidity on an exchange. Discriminatory Removing Tier 1. The Exchange does Given the current competitive not know how much order flow ETP The Exchange believes that the environment, the Exchange believes that Holders choose to route to other proposal is not unfairly discriminatory. the proposal represents a reasonable exchanges or to off-exchange venues. In the prevailing competitive attempt to attract additional order flow Without having a view of ETP Holders’ environment, ETP Holders are free to to the Exchange. Specifically, the activity on other exchanges and off- disfavor the Exchange’s pricing if they Exchange believes that the proposed exchange venues, the Exchange has no believe that alternatives offer them revisions to Adding Tier 2 and way of knowing whether this proposed better value. Removing Tier 1 are reasonable because rule change would result in any Moreover, the proposal neither targets they would promote execution additional ETP Holders directing orders nor will it have a disparate impact on opportunities for ETP Holders routing to the Exchange in order to qualify for any particular category of market order flow to the Exchange. the revised Removing Tier 1 rate. participant. The Exchange believes that However, the Exchange believes there The Exchange believes that the the proposal does not permit unfair are multiple ETP Holders that could proposal as a whole represents a discrimination because the proposal qualify for the revised Removing Tier 1, reasonable effort to promote price would be applied to all similarly if they so choose, based on their current improvement and enhanced order situated ETP Holders and all ETP trading profiles. execution opportunities for ETP Holders would be subject to the same The proposed changes are not Holders. All ETP Holders would benefit modified Adding Tier 2 and Removing otherwise intended to address any other from the greater amounts of liquidity on Tier 1. Accordingly, no ETP Holder issues, and the Exchange is not aware of the Exchange, which would represent a already operating on the Exchange any problems that ETP Holders would wider range of execution opportunities. would be disadvantaged by the have in complying with the proposed The Proposal Is an Equitable Allocation proposed allocation of fees and credits. The Exchange further believes that the changes. of Fees proposed changes would not permit 2. Statutory Basis The Exchange believes the proposed unfair discrimination among ETP The Exchange believes that the rule change equitably allocates its fees Holders because the tiered rates are proposed rule change is consistent with among its market participants. The available equally to all ETP Holders. As Section 6(b) of the Act,10 in general, and proposed change would continue to described above, in today’s competitive furthers the objectives of Sections encourage ETP Holders to both submit marketplace, order flow providers have 6(b)(4) and 6(b)(5) of the Act,11 in additional liquidity to the Exchange and a choice of where to direct liquidity- execute orders on the Exchange, thereby providing order flow, and the Exchange 10 15 U.S.C. 78f(b). contributing to robust levels of liquidity, believes there are additional ETP 11 15 U.S.C. 78f(b)(4) & (5). to the benefit of all market participants. Holders that could qualify if they chose

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79242 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

to direct their order flow to the remain competitive with other • Send an email to rule-comments@ Exchange. exchanges and off-exchange venues. sec.gov. Please include File Number SR– Finally, the Exchange believes that it Because competitors are free to modify NYSENAT–2020–35 on the subject line. is subject to significant competitive their own fees and credits in response, forces, as described below in the and because market participants may Paper Comments Exchange’s statement regarding the readily adjust their order routing • Send paper comments in triplicate burden on competition. practices, the Exchange does not believe to Secretary, Securities and Exchange For the foregoing reasons, the its proposed fee change can impose any Commission, 100 F Street NE, Exchange believes that the proposal is burden on intermarket competition. Washington, DC 20549–1090. consistent with the Act. The Exchange believes that the B. Self-Regulatory Organization’s proposed change could promote All submissions should refer to File Statement on Burden on Competition competition between the Exchange and Number SR–NYSENAT–2020–35. This other execution venues, including those In accordance with Section 6(b)(8) of file number should be included on the 12 that currently offer similar order types subject line if email is used. To help the the Act, the Exchange believes that the and comparable transaction pricing, by proposed rule change would not impose Commission process and review your encouraging additional orders to be sent comments more efficiently, please use any burden on competition that is not to the Exchange for execution. necessary or appropriate in furtherance only one method. The Commission will of the purposes of the Act. Instead, as C. Self-Regulatory Organization’s post all comments on the Commission’s discussed above, the Exchange believes Statement on Comments on the internet website (http://www.sec.gov/ that the proposed change would Proposed Rule Change Received From rules/sro.shtml). Copies of the encourage the submission of additional Members, Participants, or Others submission, all subsequent liquidity and order flow to a public No written comments were solicited amendments, all written statements exchange, thereby enhancing order or received with respect to the proposed with respect to the proposed rule execution opportunities for ETP rule change. change that are filed with the Holders. As a result, the Exchange Commission, and all written believes that the proposed change III. Date of Effectiveness of the communications relating to the furthers the Commission’s goal in Proposed Rule Change and Timing for proposed rule change between the Commission Action adopting Regulation NMS of fostering Commission and any person, other than competition among orders, which The foregoing rule change is effective those that may be withheld from the promotes ‘‘more efficient pricing of upon filing pursuant to Section public in accordance with the individual stocks for all types of orders, 19(b)(3)(A) 14 of the Act and provisions of 5 U.S.C. 552, will be large and small.’’ 13 15 subparagraph (f)(2) of Rule 19b–4 available for website viewing and Intramarket Competition. The thereunder, because it establishes a due, proposed change is designed to attract printing in the Commission’s Public fee, or other charge imposed by the Reference Room, 100 F Street NE, additional order flow to the Exchange. Exchange. As described above, the Exchange Washington, DC 20549, on official At any time within 60 days of the business days between the hours of believes that the proposed change filing of such proposed rule change, the 10:00 a.m. and 3:00 p.m. Copies of the would provide additional incentives for Commission summarily may filing also will be available for market participants to route liquidity- temporarily suspend such rule change if providing and liquidity-removing orders it appears to the Commission that such inspection and copying at the principal to the Exchange. Greater liquidity action is necessary or appropriate in the office of the Exchange. All comments benefits all market participants on the public interest, for the protection of received will be posted without change. Exchange by providing more trading investors, or otherwise in furtherance of Persons submitting comments are opportunities and encourages ETP the purposes of the Act. If the cautioned that we do not redact or edit Holders to send orders, thereby Commission takes such action, the personal identifying information from contributing to robust levels of liquidity. Commission shall institute proceedings comment submissions. You should The proposed revised fees would be under Section 19(b)(2)(B) 16 of the Act to submit only information that you wish available to all similarly-situated market determine whether the proposed rule to make available publicly. All participants, and thus, the proposed change should be approved or submissions should refer to File change would not impose a disparate disapproved. Number SR–NYSENAT–2020–35, and burden on competition among market should be submitted on or before IV. Solicitation of Comments participants on the Exchange. December 30, 2020. Intermarket Competition. The Interested persons are invited to Exchange operates in a highly submit written data, views, and For the Commission, by the Division of Trading and Markets, pursuant to delegated competitive market in which market arguments concerning the foregoing, authority.17 participants can readily choose to send including whether the proposed rule their orders to other exchanges and off- change is consistent with the Act. J. Matthew DeLesDernier, exchange venues if they deem fee levels Comments may be submitted by any of Assistant Secretary. at those other venues to be more the following methods: [FR Doc. 2020–26993 Filed 12–8–20; 8:45 am] favorable. As noted above, the BILLING CODE 8011–01–P Exchange’s market share of intraday Electronic Comments trading in Tapes A, B and C securities • Use the Commission’s internet is less than 2%. In such an comment form (http://www.sec.gov/ environment, the Exchange must rules/sro.shtml); or continually adjust its fees and rebates to 14 15 U.S.C. 78s(b)(3)(A). 12 15 U.S.C. 78f(b)(8). 15 17 CFR 240.19b–4(f)(2). 13 Regulation NMS, 70 FR at 37498–99. 16 15 U.S.C. 78s(b)(2)(B). 17 17 CFR 200.30–3(a)(12).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00081 Fmt 4703 Sfmt 9990 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79243

SECURITIES AND EXCHANGE (A) Clearing Agency’s Statement of the requirements and delivery process. ICE COMMISSION Purpose of, and Statutory Basis for, the Clear Europe is not otherwise proposing Proposed Rule Change to change the contractual or delivery [Release No. 34–90554; File No. SR–ICEEU– terms for these contracts, or its financial 2020–015] (a) Purpose resources, risk management, systems Self-Regulatory Organizations; ICE ICE Clear Europe is proposing to and operational arrangements for these Clear Europe Limited; Notice of Filing amend Part Q, Part R and Part B of its contracts (and ICE Clear Europe believes and Immediate Effectiveness of Delivery Procedures. such terms and arrangements are Proposed Rule Change Relating to The Part Q delivery specifications, sufficient to continue support continued Amendments to the ICE Clear Europe which apply to the ICE Futures Europe clearing of these contracts). As a result, Delivery Procedures White Sugar Futures Contracts, would in ICE Clear Europe’s view, the be amended to provide that the contract amendments would be consistent with December 3, 2020. relates to sugar of any origin of the crop the prompt and accurate clearance and Pursuant to Section 19(b)(1) of the or production current on the first day of settlement of the ICE Futures Europe Securities Exchange Act of 1934 the delivery period (instead of White Sugar Futures Contracts, ICE (‘‘Act’’),1 and Rule 19b–4 thereunder,2 referencing the time of delivery). The Futures Europe Wheat Futures Contracts notice is hereby given that on November clarification would facilitate and ICE Futures Europe Gasoil Futures 25, 2020, ICE Clear Europe Limited identification of sugar eligible for Contracts, and the protection of (‘‘ICE Clear Europe’’ or the ‘‘Clearing delivery under the contract. Further, the investors and the public interest House’’) filed with the Securities and related delivery timetable would be consistent with the requirements of Exchange Commission (‘‘Commission’’) amended to provide that the document Section 17A(b)(3)(F) of the Act.7 (In ICE the proposed rule changes described in notice day (i.e., the day on which Clear Europe’s view, the amendments Items I, II, and III below, which Items delivery document notifications are would not affect the safeguarding of have been primarily prepared by ICE made via Guardian (or a successor funds or securities in the custody or Clear Europe. ICE Clear Europe filed the system)) would be 20 days after the date control of the clearing agency or for proposed rule change pursuant to of issue of the bill of lading (whether the which it is responsible, within the Section 19(b)(3)(A) of the Act 3 and Rule date of issue is the same as or later than meaning of Section 17A(b)(3)(F).8) 19b–4(f)(4)(ii) 4 thereunder, such that the date of completion of loading of the In addition, Rule 17Ad–22(e)(10) 9 the proposed rule change was vessel), rather than 20 days after the requires that each covered clearing immediately effective upon filing with vessel has completed loading. agency establish and maintain the Commission. The Commission is The Part R delivery specifications, for transparent written standards that state publishing this notice to solicit ICE Futures Europe Wheat Futures its obligations with respect to the comments on the proposed rule change Contracts, would be amended to provide delivery of physical instruments, and from interested persons. that wheat shall be delivered of an EU establish and maintain operational or UK origin, rather than an EC origin, I. Clearing Agency’s Statement of the practices that identify, monitor and to account for the UK leaving the EU. manage the risks associated with such Terms of Substance of the Proposed The Part B delivery specifications, for Rule Change physical deliveries. As discussed above, ICE Futures Europe Gasoil Futures the amendments would clarify and The principal purpose of the Contracts, would be amended to provide update the delivery specifications proposed amendments is for ICE Clear that if the Buyer chooses the coaster relating to sugar, wheat and gasoil Europe to amend Part Q, Part R and Part delivery method, the maximum size futures contracts, consistent with the B of its Delivery Procedures (the would be 15,000 DWT instead of 10,000 ICE Futures Europe Rules. The ‘‘Delivery Procedures’’) in connection to DWT. amendments would thus clarify and make clarifications and updates with update the role and responsibilities of respect to certain delivery (b) Statutory Basis the Clearing House and Clearing specifications.5 Section 17A(b)(3)(F) of the Act 6 Members in the physical delivery requires, among other things, that the II. Clearing Agency’s Statement of the process. As a result, ICE Clear Europe rules of a clearing agency be designed to Purpose of, and Statutory Basis for, the believes the amendments are consistent promote the prompt and accurate Proposed Rule Change with the requirements of Rule 17Ad– clearance and settlement of securities 22(e)(10).10 In its filing with the Commission, ICE transactions and, to the extent Clear Europe included statements applicable, derivative agreements, (B) Clearing Agency’s Statement on concerning the purpose of and basis for contracts, and transactions, the Burden on Competition the proposed rule change and discussed safeguarding of securities and funds in ICE Clear Europe does not believe the any comments it received on the the custody or control of the clearing proposed rule changes would have any proposed rule change. The text of these agency or for which it is responsible, impact, or impose any burden, on statements may be examined at the and the protection of investors and the competition not necessary or places specified in Item IV below. ICE public interest. The proposed appropriate in furtherance of the Clear Europe has prepared summaries, amendments are designed to clarify and purposes of the Act. The changes are set forth in sections (A), (B), and (C) update certain delivery specifications being proposed in order to update the below, of the most significant aspects of relating to sugar, wheat and gasoil Delivery Procedures in connection with such statements. futures contracts, consistent with the the UK leaving the EU and to provide ICE Futures Europe Rules. These general drafting clarifications and 1 15 U.S.C. 78s(b)(1). changes are intended to facilitate updates to delivery specifications. The 2 17 CFR 240.19b–4. continued clearing and physical 3 15 U.S.C. 78s(b)(3)(A). settlement of the contracts through 7 4 17 CFR 240.19b–4(f)(4)(ii). 15 U.S.C. 78q–1(b)(3)(F). 5 Capitalized terms used but not defined herein enhancements to the delivery 8 15 U.S.C. 78q–1(b)(3)(F). have the meaning specified in the ICE Clear Europe 9 17 CFR 240.17Ad–22(e)(10). Clearing Rules (the ‘‘Rules’’). 6 15 U.S.C. 78q–1(b)(3)(F). 10 17 CFR 240.17Ad–22(e)(10).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79244 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

amendments would not otherwise affect All submissions should refer to File ‘‘Act’’),1 and Rule 19b–4 thereunder,2 the terms of the contracts. ICE Clear Number SR–ICEEU–2020–015. This file notice is hereby given that on November Europe does not believe the number should be included on the 30, 2020, MEMX LLC (‘‘MEMX’’ or the amendments would adversely affect subject line if email is used. To help the ‘‘Exchange’’) filed with the Securities competition among Clearing Members, Commission process and review your and Exchange Commission (the materially affect the cost of clearing, comments more efficiently, please use ‘‘Commission’’) the proposed rule adversely affect access to clearing in the only one method. The Commission will change as described in Items I, II, and new contracts for Clearing Members or post all comments on the Commission’s III below, which Items have been their customers, or otherwise adversely internet website (http://www.sec.gov/ prepared by the Exchange. The affect competition in clearing services. rules/sro.shtml). Copies of the Commission is publishing this notice to Accordingly, ICE Clear Europe does not submission, all subsequent solicit comments on the proposed rule believe that the amendments would amendments, all written statements change from interested persons. impose any impact or burden on with respect to the proposed rule I. Self-Regulatory Organization’s competition that is not appropriate in change that are filed with the Statement of the Terms of Substance of furtherance of the purpose of the Act. Commission, and all written communications relating to the the Proposed Rule Change (C) Clearing Agency’s Statement on proposed rule change between the The Exchange is filing with the Comments on the Proposed Rule Commission and any person, other than Commission a proposed rule change to Change Received From Members, those that may be withheld from the amend the fee schedule applicable to Participants or Others public in accordance with the Members 3 pursuant to Exchange Rules Written comments relating to the provisions of 5 U.S.C. 552, will be 15.1(a) and (c) in order to (i) provide proposed amendments have not been available for website viewing and pricing for Retail Orders 4 that add solicited or received by ICE Clear printing in the Commission’s Public displayed liquidity and are executed on Europe. ICE Clear Europe will notify the Reference Room, 100 F Street NE, the Exchange; and (ii) provide pricing Commission of any comments received Washington, DC 20549, on official for transactions in securities priced with respect to the proposed rule business days between the hours of below $1.00 per share that are executed change. 10:00 a.m. and 3:00 p.m. Copies of such on the Exchange. The text of the filings will also be available for proposed rule change is provided in III. Date of Effectiveness of the inspection and copying at the principal Exhibit 5. Proposed Rule Change and Timing for office of ICE Clear Europe and on ICE Commission Action Clear Europe’s website at https:// II. Self-Regulatory Organization’s The foregoing rule change has become www.theice.com/notices/ Statement of the Purpose of, and effective pursuant to Section 19(b)(3)(A) Notices.shtml?regulatoryFilings. Statutory Basis for, the Proposed Rule of the Act 11 and paragraph (f) of Rule All comments received will be posted Change 19b–4 12 thereunder. At any time within without change. Persons submitting In its filing with the Commission, the 60 days of the filing of the proposed rule comments are cautioned that we do not Exchange included statements change, the Commission summarily may redact or edit personal identifying concerning the purpose of and basis for temporarily suspend such rule change if information from comment submissions. the proposed rule change and discussed it appears to the Commission that such You should submit only information any comments it received on the action is necessary or appropriate in the that you wish to make available proposed rule change. The text of these public interest, for the protection of publicly. All submissions should refer statements may be examined at the investors, or otherwise in furtherance of to File Number SR–ICEEU–2020–015 places specified in Item IV below. The the purposes of the Act. and should be submitted on or before Exchange has prepared summaries, set December 30, 2020. IV. Solicitation of Comments forth in sections A, B, and C below, of For the Commission, by the Division of the most significant aspects of such Interested persons are invited to Trading and Markets, pursuant to delegated statements. submit written data, views, and authority.13 arguments concerning the foregoing, J. Matthew DeLesDernier, A. Self-Regulatory Organization’s including whether the proposed rule Assistant Secretary. Statement of the Purpose of, and change is consistent with the Act. Statutory Basis for, the Proposed Rule [FR Doc. 2020–26988 Filed 12–8–20; 8:45 am] Change Comments may be submitted by any of BILLING CODE 8011–01–P the following methods: 1. Purpose Electronic Comments The Exchange proposes to modify its SECURITIES AND EXCHANGE • Use the Commission’s internet COMMISSION fee schedule to adopt the fees and comment form (http://www.sec.gov/ rebates described herein applicable to rules/sro.shtml) or [Release No. 34–90555; File No. SR–MEMX– Retail Orders that add displayed 2020–14] • Send an email to rule-comments@ liquidity to the Exchange (‘‘Added sec.gov. Please include File Number SR– Self-Regulatory Organizations; MEMX ICEEU–2020–015 on the subject line. 1 15 U.S.C. 78s(b)(1). LLC; Notice of Filing and Immediate 2 17 CFR 240.19b–4. Paper Comments Effectiveness of a Proposed Rule 3 See Exchange Rule 1.5(p). • Change To Amend the Exchange’s Fee 4 A ‘‘Retail Order’’ means an agency or riskless Send paper comments in triplicate Schedule principal order that meets the criteria of FINRA to Secretary, Securities and Exchange Rule 5320.03 that originates from a natural person Commission, 100 F Street NE, December 3, 2020. and is submitted to the Exchange by a Retail Washington, DC 20549–1090. Pursuant to Section 19(b)(1) of the Member Organization, provided that no change is made to the terms of the order with respect to price Securities Exchange Act of 1934 (the or side of market and the order does not originate 11 15 U.S.C. 78s(b)(3)(A). from a trading algorithm or any other computerized 12 17 CFR 240.19b–4(f). 13 17 CFR 200.30–3(a)(12). methodology. See Exchange Rule 11.21(a).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00083 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79245

Displayed Retail Volume’’) and securities traded on the Exchange priced proposes to provide a standard rebate of transactions in securities priced below at or above $1.00 per share (the ‘‘ADRV 0.30% of the total dollar value of any $1.00 per share (‘‘Sub-Dollar Rebate’’).9 The Exchange notes that the transaction (including a Retail Order) in Securities’’) that are executed on the proposed ADRV Rebate would not Sub-Dollar Securities that adds Exchange, effective as of December 1, apply, and that the proposed standard liquidity, displayed or non-displayed, to 2020. pricing with respect to transactions in the Exchange (‘‘Added Sub-Dollar The Exchange first notes that it Sub-Dollar Securities, as further Volume’’).11 The proposed pricing for operates in a highly competitive market described below, would apply, to Removed Sub-Dollar Volume and in which market participants can executions of Added Displayed Retail Added Sub-Dollar Volume would only readily direct order flow to competing Volume transactions in Sub-Dollar apply to transactions that are executed venues if they deem fee levels at a Securities. The Exchange also notes that on the Exchange, and as such there particular venue to be excessive or the proposed ADVR Rebate would not would continue to be no fee charged or incentives to be insufficient. More apply to executions of Retail Orders in rebate provided for transactions in Sub- specifically, the Exchange is only one of securities priced at or above $1.00 per Dollar Securities that are routed to and 16 registered equities exchanges, as well share that add non-displayed liquidity executed at another market center. as a number of alternative trading to the Exchange or remove liquidity The proposed rebate for executions of systems and other off-exchange venues, from the Exchange, and instead, the fees Added Sub-Dollar Volume is intended to which market participants may direct and rebates otherwise applicable to such to increase order flow in Sub-Dollar their order flow. Based on publicly transactions under the current fee Securities to the Exchange by available information, no single schedule would continue to apply. incentivizing Members to increase the registered equities exchange currently Thus, under the proposal, an execution liquidity-providing orders in Sub-Dollar has more than approximately 16% of of a Retail Order in a security priced at Securities they submit to the Exchange, the total market share of executed or above $1.00 per share that adds non- which would support price discovery 5 volume of equities trading. Thus, in displayed liquidity to the Exchange on the Exchange and provide additional such a low-concentrated and highly would receive a rebate of $0.0020 per liquidity for incoming orders. The competitive market, no single equities share, which is the standard rebate for proposed fee for executions of Removed exchange possesses significant pricing adding non-displayed liquidity to the Sub-Dollar Volume is intended to be a power in the execution of order flow, Exchange, and an execution of a Retail direct offset of the rebate provided for and the Exchange currently represents Order in a security priced at or above Added Sub-Dollar Volume so that the less than 1% of the overall market $1.00 per share that removes liquidity Exchange may remain revenue neutral 6 share. from the Exchange would be charged a with respect to such transactions while Rebate for Added Displayed Retail fee of $0.0025 per share, which is the attempting to compete with other Volume standard fee for removing liquidity from venues to attract this order flow. the Exchange. The proposed rule change does not The Exchange recently adopted rules include different fees or rebates for enabling Members to apply for status as Pricing for Transactions in Sub-Dollar Retail Orders or transactions in Sub- 7 Retail Member Organizations, and once Securities Dollar Securities that depend on the approved as such by the Exchange, to The Exchange currently does not amount of orders submitted to, and/or designate qualifying orders as Retail transactions executed on or through, the 8 charge any fees or provide any rebates Orders to the Exchange. Currently, for transactions in Sub-Dollar Securities Exchange. Accordingly, all fees and there are no pricing incentives for Retail that are executed on the Exchange. The rebates described above are applicable Orders, and Retail Orders are subject to Exchange now proposes to charge a to all Members, regardless of the overall the same standard fees and rebates standard fee of 0.30% of the total dollar volume of a Member’s trading activities applicable as if such orders were not value of any transaction (including a on the Exchange. designated as Retail Orders. The Exchange proposes to modify its Retail Order) in Sub-Dollar Securities 2. Statutory Basis that removes liquidity from the fee schedule to adopt pricing for The Exchange believes that the executions of Added Displayed Retail Exchange (‘‘Removed Sub-Dollar Volume’’).10 The Exchange also proposed rule change is consistent with Volume and to adopt a fee code the provisions of Section 6(b) of the applicable to executions of all Retail 9 This proposed pricing is referred to by the Act,12 in general, and furthers the Orders. Specifically, the Exchange Exchange as ‘‘Added displayed volume, Retail objectives of Sections 6(b)(4) and (5) of proposes to adopt a rebate of $0.0034 Order’’ on the fee schedule. The Exchange is also the Act,13 in particular, in that it is per share for executions of Added proposing to adopt new fee code ‘‘r’’ to be designed to provide for the equitable Displayed Retail Volume transactions in appended as the second character after the applicable first fee code character for executions of allocation of reasonable dues, fees and all Retail Orders. The Exchange notes that, as other charges among its Members and 5 Market share percentage calculated as of indicated on the current fee schedule, the Exchange other persons using its facilities and is November 24, 2020. The Exchange receives and also appends as an additional character at the end processes data made available through consolidated of its fee codes either ‘‘A’’ or ‘‘B’’ to indicate data feeds (i.e., CTS and UTDF). whether an execution occurred: (A) In a security ‘‘Removed volume from MEMX Book’’ with a fee 6 Id. priced at or above $1.00 per share or (B) in a Sub- code of ‘‘RB’’ or ‘‘RrB’’, as applicable, assigned by 7 A ‘‘Retail Member Organization’’ or ‘‘RMO’’ is Dollar Security. Accordingly, under the proposal, the Exchange. a Member (or a division thereof) that has been an execution of an Added Displayed Retail Volume 11 This pricing is referred to by the Exchange on approved by the Exchange under Exchange Rule transaction in a security priced at or above $1.00 the fee schedule under the existing description 11.21 to submit Retail Orders. See Exchange Rule per share would be assigned a fee code of ‘‘BrA’’, ‘‘Added displayed volume’’, the existing 11.21(a). ‘‘DrA’’ or ‘‘JrA’’, as applicable, by the Exchange. description ‘‘Added non-displayed volume’’ or the 8 See Securities Exchange Act Release No. 90278 Similarly, under the proposal, an execution of an proposed new description ‘‘Added displayed (October 28, 2020), 85 FR 69667 (November 3, 2020) Added Displayed Retail Volume transaction in a volume, Retail Order’’, as applicable, with a fee (SR–MEMX–2020–13). Retail Orders are only Sub-Dollar Security would be assigned a fee code code of ‘‘BB’’, ‘‘BrB’’, ‘‘DB’’, ‘‘DrB’’, ‘‘JB’’, ‘‘JrB’’, designated as such to the Exchange and are not of ‘‘BrB’’, ‘‘DrB’’ or ‘‘JrB’’, as applicable, by the ‘‘HB’’, ‘‘HrB’’, ‘‘MB’’ or ‘‘MrB’’, as applicable, identified as such on the Exchange’s market data Exchange. assigned by the Exchange. feeds or otherwise identifiable as such to other 10 This pricing is referred to by the Exchange on 12 15 U.S.C. 78f. market participants. See id. the fee schedule under the existing description 13 15 U.S.C. 78f(b)(4) and (5).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79246 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

not designed to unfairly discriminate Rebate for Added Displayed Retail and competitive with, the rebates between customers, issuers, brokers, or Volume provided by other exchanges for added dealers. The Exchange believes that the displayed retail liquidity in securities 17 As discussed above, the Exchange proposed ADRV Rebate is reasonable, priced at or above $1.00 per share. The operates in a highly fragmented and equitable, and consistent with the Act Exchange also believes that providing a competitive market in which market because it would incentivize Members rebate to the liquidity adder, and charging a fee to the liquidity remover, participants can readily direct order to submit additional displayed Retail with respect to the execution of a flow to competing venues if they deem Orders to the Exchange, which would displayed Retail Order is reasonable, fee levels at a particular venue to be enhance liquidity in Retail Orders on equitable and not unfairly excessive or incentives to be the Exchange and promote price discriminatory because it is designed, insufficient, and the Exchange discovery. The Exchange believes that this increased displayed liquidity would and the Exchange believes it is an represents only a small percentage of appropriate effort, to incentivize the overall market. The Commission and potentially stimulate further price competition for Retail Orders, thereby displayable liquidity provision on the the courts have repeatedly expressed Exchange, thereby contributing to price their preference for competition over deepening the Exchange’s liquidity pool, enhancing market quality to the discovery and price formation, regulatory intervention in determining consistent with the overall goal of prices, products, and services in the benefit of all Members and investors by providing more trading opportunities, enhancing market quality. Moreover, the securities markets. In Regulation NMS, Exchange notes that several other the Commission highlighted the supporting price discovery, and subjecting such transactions to the exchanges provide rebates to the importance of market forces in liquidity adder, and charge fees to the determining prices and SRO revenues Exchange’s transparency, regulation, and oversight as a registered national liquidity remover, with respect to and also recognized that current securities exchange. executions of retail orders, and that this regulation of the market system ‘‘has The Exchange notes that a significant aspect of the proposed ADRV Rebate been remarkably successful in percentage of the orders of individual does not raise any new or novel issues promoting market competition in its (i.e., retail) investors are executed over- that have not previously been broader forms that are most important to 15 considered by the Commission in 14 the-counter. In addition, other investors and listed companies.’’ exchanges maintain special pricing to connection with the fees and rebates of 18 The Exchange believes that the ever- encourage entry of retail orders to their other exchanges. shifting market share among the The Exchange understands that markets, in part, to compete against the 19 exchanges from month to month over-the-counter market.16 Without Section 6(b)(5) of the Act prohibits an demonstrates that market participants such pricing, the Exchange is not exchange from establishing rules that can shift order flow or discontinue to currently competitive with such other are designed to permit unfair reduce use of certain categories of exchanges. The Exchange believes that discrimination between market products, in response to new or it is thus appropriate to create a participants. However, Section 6(b)(5) of different pricing structures being financial incentive to bring more Retail the Act does not prohibit exchange members or other broker-dealers from introduced into the market. Order flow to the Exchange. The discriminating, so long as their activities Accordingly, competitive forces Exchange believes that investor are otherwise consistent with the federal constrain the Exchange’s transaction protection and transparency is securities laws. While the Exchange fees and rebates, including with respect promoted by rewarding displayed believes that markets and price to Added Displayed Retail Volume and liquidity on exchanges, including the discovery optimally function through Exchange. By offering a proposed ADRV transactions in Sub-Dollar Securities, the interactions of diverse flow types, it Rebate of $0.0034, which is higher than and market participants can readily also believes that growth in the Exchange’s standard rebate of trade on competing venues if they deem internalization has required $0.0029 for executions of added pricing levels at those other venues to differentiation of Retail Order flow from be more favorable. The Exchange displayed volume, the Exchange believes the proposed rule change believes it will encourage use of Retail 17 See, e.g., The Nasdaq Stock Market LLC reflects a reasonable and competitive Orders, while maintaining consistency equities trading fee schedule on its public website pricing structure designed to incentivize with the Exchange’s overall pricing (available at http://www.nasdaqtrader.com/ market participants to direct order flow philosophy of encouraging displayed trader.aspx?id=pricelisttrading2), which reflects rebates to add displayed designated retail liquidity to the Exchange, which the Exchange liquidity. The Exchange places a higher ranging from $0.00325–$0.0033 per share believes would enhance market quality value on displayed liquidity because the depending on the percentage add to total volume to the benefit of all Members and Exchange believes that displayed ratio, and a standard fee that generally applies to liquidity is a public good that benefits retail orders that remove liquidity of $0.0030 per investors. The Exchange notes that the share; the NYSE Arca, Inc. (‘‘NYSE Arca’’) equities proposal does not include different fees investors generally by providing greater trading fee schedule on its public website (available or rebates for Retail Orders or price transparency and enhancing at https://www.nyse.com/publicdocs/nyse/markets/ transactions in Sub-Dollar Securities public price discovery, which nyse-arca/NYSE_Arca_Marketplace_Fees.pdf), ultimately lead to substantial reductions which reflects rebates for retail orders that provide depending on the amount of orders displayed liquidity ranging from $0.0033–$0.0038 submitted to, and/or transactions in transaction costs. per share depending on the applicable tier; the Cboe executed on or through, the Exchange. Furthermore, the Exchange believes EDGX Exchange, Inc. (‘‘Cboe EDGX’’) equities Accordingly, the proposed pricing that the proposed ADRV Rebate of trading fee schedule on its public website (available $0.0034 per share is reasonable and at https://markets.cboe.com/us/equities/ structure is applicable to all Members, membership/fee_schedule/edgx/), which reflects regardless of the overall volume of a equitable because it is comparable to, rebates for retail orders that add liquidity ranging Member’s trading activities on the from $0.0032–$0.0037 per share depending on the 15 See, e.g., SEC Staff Report on Algorithmic applicable tier, and a standard fee that generally Exchange. Trading in U.S. Capital Markets (August 5, 2020), applies to retail orders that remove liquidity of available at https://www.sec.gov/files/Algo_ $0.0027 per share. 14 Securities Exchange Act Release No. 51808 Trading_Report_2020.pdf. 18 Id. (June 9, 2005), 70 FR 37496, 37499 (June 29, 2005). 16 See infra note 17. 19 15 U.S.C. 78f(b)(5).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79247

other order flow types. The The Exchange believes that, given the burden on competition, the Exchange differentiation proposed herein by the competitive environment in which the believes that its transaction pricing, Exchange is not designed to permit Exchange currently operates, the including with respect to Retail Orders unfair discrimination, but instead to proposed pricing structure, with an and transactions in Sub-Dollar promote a competitive process around offsetting fee and rebate, with respect to Securities, is subject to significant Retail Order executions such that retail executions of transactions in Sub-Dollar competitive forces, and that the investors would receive better rebates Securities, is a reasonable attempt to proposed fees and rebates described on the Exchange than they do currently increase liquidity in Sub-Dollar herein are appropriate to address such in order to encourage entry of retail Securities on the Exchange and improve forces. orders to the Exchange. Accordingly, the the Exchange’s market share relative to B. Self-Regulatory Organization’s Exchange believes the proposed ADRV its competitors while remaining revenue Statement on Burden on Competition Rebate is not unfairly discriminatory. neutral with respect to such transactions. The Exchange does not believe that Pricing for Transactions in Sub-Dollar The Exchange also believes that the the proposed rule change will result in Securities proposed fee and rebate structure any burden on competition that is not The Exchange believes that the applicable to executions of transactions necessary or appropriate in furtherance proposed changes with respect to in Sub-Dollar Securities is equitably of the purposes of the Act. Instead, as pricing for executions of transactions in allocated and not unfairly discussed above, the Exchange believes Sub-Dollar Securities would incentivize discriminatory because it applies that the proposed change would submission of additional liquidity in equally to all Members and is encourage the submission of additional Sub-Dollar Securities to the Exchange reasonably related to the value of the order flow, including Retail Orders and through the proposed rebate of 0.30% of Exchange’s market quality associated orders in Sub-Dollar Securities, to the the total dollar value of any Added Sub- with higher volume. A number of Exchange, thereby promoting market Dollar Volume transactions, thereby Members currently transact in Sub- depth, enhanced execution promoting price discovery and Dollar Securities and they, along with opportunities, as well as price discovery transparency, and enhancing order additional Members that choose to and transparency for all Members. execution opportunities for all direct order flow in Sub-Dollar Furthermore, the Exchange believes that Members. The Exchange believes that Securities to the Exchange, would all the proposed changes would allow the the proposed rebate for Added Sub- qualify for the proposed fee and rebate. Exchange to compete more ably with Dollar Volume is reasonable because it The Exchange believes that maintaining other execution venues by providing would incentivize Members to direct or increasing the proportion of more competitive pricing for Added more order flow in Sub-Dollar Securities transactions in Sub-Dollar Securities Displayed Retail Volume and to the Exchange. The Exchange notes that are executed on the Exchange transactions in Sub-Dollar Securities, that other exchanges provide rebates for would benefit all investors by thereby making it a more desirable liquidity-adding transactions in Sub- deepening the Exchange’s liquidity destination venue for its customers. As Dollar Securities, but that these are pool, which would support price a result, the Exchange believes that the denominated in dollar amounts per discovery, promote market transparency proposed change furthers the share rather than a percentage of the and improve investor protection, further Commission’s goal in adopting total dollar amount of the transaction.20 rendering the proposed changes Regulation NMS of fostering The Exchange expects that the proposed reasonable and equitable. competition among orders, which rebate for Added Sub-Dollar Volume In conclusion, the Exchange also promotes ‘‘more efficient pricing of transactions would typically result in a submits that its proposed fee structure individual stocks for all types of orders, higher overall credit for a given satisfies the requirements of Sections large and small.’’ 22 transaction than the rebates offered by 6(b)(4) and 6(b)(5) of the Act for the other exchanges, although the Exchange reasons discussed above in that it Intramarket Competition provides for the equitable allocation of notes that it may also result in a lower The Exchange believes that the reasonable dues, fees and other charges overall credit for such transaction proposed changes would incentivize among its Members and other persons depending on the number of shares market participants to direct more order using its facilities and is not designed to traded and the total dollar value of the flow to the Exchange. Greater liquidity unfairly discriminate between transaction. benefits all Members by providing more customers, issuers, brokers, or dealers. The Exchange also believes that the trading opportunities and encourages As described more fully below in the proposed fee for Removed Sub-Dollar Members to send orders to the Exchange’s statement regarding the Volume is reasonable because it is in Exchange, thereby contributing to robust line with the fees charged by other levels of liquidity, which benefits all markets.cboe.com/us/equities/membership/fee_ exchanges for liquidity-removing Members. The proposed fees and rebates 21 schedule/edgx/), which reflects a fee of 0.30% of transactions in Sub-Dollar Securities. the total dollar value of the transaction for liquidity- for Added Displayed Retail Volume and removing transactions in securities priced below transactions in Sub-Dollar Securities 20 See, e.g., the Cboe EDGX equities trading fee $1.00 per share; the Cboe BZX Exchange, Inc. would be available to all similarly- schedule on its public website (available at https:// equities trading fee schedule on its public website markets.cboe.com/us/equities/membership/fee_ (available at https://markets.cboe.com/us/equities/ situated market participants, and, as schedule/edgx/), which reflects a rebate of $0.00009 membership/fee_schedule/bzx/), which reflects a such, the proposed change would not per share for liquidity-adding transactions in fee of 0.30% of the total dollar value of the impose a disparate burden on securities priced below $1.00 per share; the NYSE transaction for liquidity-removing transactions in competition among market participants Arca equities trading fee schedule on its public securities priced below $1.00 per share; the NYSE website (available at https://www.nyse.com/ Arca equities trading fee schedule on its public on the Exchange. As such, the Exchange publicdocs/nyse/markets/nyse-arca/NYSE_Arca_ website (available at https://www.nyse.com/ believes the proposed changes would Marketplace_Fees.pdf), which reflects a rebate of publicdocs/nyse/markets/nyse-arca/NYSE_Arca_ not impose any burden on intramarket $0.00004 per share for liquidity-adding transactions Marketplace_Fees.pdf), which reflects a fee of competition that is not necessary or in securities priced below $1.00 per share. 0.295% of the total dollar value for liquidity-taking 21 See, e.g., the Cboe EDGX equities trading fee transactions in securities priced below $1.00 per schedule on its public website (available at https:// share. 22 See supra note 14.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79248 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

appropriate in furtherance of the the U.S. national market system, buyers Paper Comments purposes of the Act. and sellers of securities, and the broker- • Send paper comments in triplicate dealers that act as their order-routing Intermarket Competition to Secretary, Securities and Exchange agents, have a wide range of choices of Commission, 100 F Street NE, The Exchange operates in a highly where to route orders for execution’; Washington, DC 20549–1090. competitive market. Members have [and] ‘no exchange can afford to take its All submissions should refer to File numerous alternative venues that they market share percentages for granted’ Number SR–MEMX–2020–14. This file may participate on and direct their because ‘no exchange possesses a number should be included on the order flow to, including 15 other monopoly, regulatory or otherwise, in subject line if email is used. To help the equities exchanges and numerous the execution of order flow from broker Commission process and review your alternative trading systems and other dealers’. . . .’’.24 Accordingly, the comments more efficiently, please use off-exchange venues. As noted above, no Exchange does not believe its proposed single registered equities exchange only one method. The Commission will fee change imposes any burden on post all comments on the Commission’s currently has more than approximately competition that is not necessary or 16% of the total market share of internet website (http://www.sec.gov/ appropriate in furtherance of the rules/sro.shtml). Copies of the executed volume of equities trading, purposes of the Act. and the Exchange currently represents submission, all subsequent less than 1% of the overall market share. C. Self-Regulatory Organization’s amendments, all written statements Thus, in such a low-concentrated and Statement on Comments on the with respect to the proposed rule highly competitive market, no single Proposed Rule Change Received From change that are filed with the equities exchange possesses significant Members, Participants, or Others Commission, and all written communications relating to the pricing power in the execution of order The Exchange neither solicited nor proposed rule change between the flow. Moreover, the Exchange believes received comments on the proposed Commission and any person, other than that the ever-shifting market share rule change. among the exchanges from month to those that may be withheld from the month demonstrates that market III. Date of Effectiveness of the public in accordance with the participants can shift order flow or Proposed Rule Change and Timing for provisions of 5 U.S.C. 552, will be discontinue to reduce use of certain Commission Action available for website viewing and printing in the Commission’s Public categories of products, in response to The foregoing rule change has become Reference Room, 100 F Street NE, new or different pricing structures being effective pursuant to Section Washington, DC 20549 on official introduced into the market. 19(b)(3)(A)(ii) of the Act 25 and Rule business days between the hours of Accordingly, competitive forces 19b–4(f)(2) 26 thereunder. 10:00 a.m. and 3:00 p.m. Copies of the constrain the Exchange’s transaction At any time within 60 days of the fees and rebates, including with respect filing also will be available for filing of the proposed rule change, the to Added Displayed Retail Volume and inspection and copying at the principal Commission summarily may transactions in Sub-Dollar Securities, office of the Exchange. All comments temporarily suspend such rule change if and market participants can readily received will be posted without change. it appears to the Commission that such choose to send their orders to other Persons submitting comments are action is necessary or appropriate in the exchange and off-exchange venues if cautioned that we do not redact or edit public interest, for the protection of they deem fee levels at those other personal identifying information from investors, or otherwise in furtherance of venues to be more favorable. As comment submissions. You should the purposes of the Act. If the described above, the proposed changes submit only information that you wish Commission takes such action, the are competitive proposals through to make available publicly. All Commission shall institute proceedings which the Exchange is seeking to submissions should refer to File to determine whether the proposed rule encourage certain order flow to be sent Number SR–MEMX–2020–14, and should be approved or disapproved. to the Exchange. should be submitted on or before Additionally, the Commission has IV. Solicitation of Comments December 30, 2020. repeatedly expressed its preference for For the Commission, by the Division of competition over regulatory Interested persons are invited to submit written data, views, and Trading and Markets, pursuant to delegated intervention in determining prices, authority.27 products, and services in the securities arguments concerning the foregoing, including whether the proposed rule J. Matthew DeLesDernier, markets. Specifically, in Regulation Assistant Secretary. NMS, the Commission highlighted the change is consistent with the Act. [FR Doc. 2020–26989 Filed 12–8–20; 8:45 am] importance of market forces in Comments may be submitted by any of determining prices and SRO revenues the following methods: BILLING CODE 8011–01–P and, also, recognized that current Electronic Comments regulation of the market system ‘‘has • Use the Commission’s internet SECURITIES AND EXCHANGE been remarkably successful in COMMISSION promoting market competition in its comment form (http://www.sec.gov/ rules/sro.shtml); or [SEC File No. 270–317, OMB Control No. broader forms that are most important to • investors and listed companies.’’ 23 The Send an email to rule-comments@ 3235–0360] fact that this market is competitive has sec.gov. Please include File Number SR– MEMX–2020–14 on the subject line. Submission for OMB Review; also long been recognized by the courts. Comment Request In NetCoalition v. SEC, the D.C. Circuit stated as follows: ‘‘[n]o one disputes 24 NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Upon Written Request Copies Available Cir. 2010) (quoting Securities Exchange Act Release that competition for order flow is No. 59039 (December 2, 2008), 73 FR 74770, 74782– From: Securities and Exchange ‘fierce.’ . . . As the SEC explained, ‘[i]n 83 (December 9, 2008) (SR–NYSE–2006–21)). Commission, Office of FOIA Services, 25 15 U.S.C. 78s(b)(3)(A)(ii). 23 See supra note 14. 26 17 CFR 240.19b–4(f)(2). 27 17 CFR 200.30–3(a)(12).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79249

100 F Street NE, Washington, DC Paperwork Reduction Act, and is not secrecy laws, blocking statues, national 20549–02736 derived from a comprehensive or even security laws or other laws or Extension: a representative survey or study of the regulations restricting access to Form N–17f–2 costs of Commission rules and forms. information by regulators of U.S.-listed Complying with the collections of Notice is hereby given that, pursuant companies in such jurisdiction. The information required by Form N–17f–2 to the Paperwork Reduction Act of 1995 proposed rule change was published for is mandatory for those funds that (44 U.S.C. 350l et seq.), the Securities comment in the Federal Register on 3 and Exchange Commission (the maintain custody of their own assets. June 12, 2020. On July 21, 2020, 4 ‘‘Commission’’) has submitted to the Responses will not be kept confidential. pursuant to Section 19(b)(2) of the Act, Office of Management and Budget a An agency may not conduct or sponsor, the Commission designated a longer request for extension of the previously and a person is not required to respond period within which to approve the approved collection of information to, a collection of information unless it proposed rule change, disapprove the discussed below. displays a currently valid control proposed rule change, or institute Form N–17f–2 (17 CFR 274.220) number. proceedings to determine whether to under the Investment Company Act is The public may view background disapprove the proposed rule change.5 entitled ‘‘Certificate of Accounting of documentation for this information On September 9, 2020, the Commission Securities and Similar Investments in collection at the following website: instituted proceedings under Section the Custody of Management Investment www.reginfo.gov. Find this particular 19(b)(2)(B) of the Act 6 to determine Companies.’’ Form N–17f–2 is the cover information collection by selecting whether to approve or disapprove the sheet for the accountant examination ‘‘Currently under 30-day Review—Open proposed rule change.7 certificates filed under rule 17f–2 (17 for Public Comments’’ or by using the Section 19(b)(2) of the Act 8 provides CFR 270.17f–2) by registered search function. Written comments and that, after initiating disapproval management investment companies recommendations for the proposed proceedings, the Commission shall issue (‘‘funds’’) maintaining custody of information collection should be sent an order approving or disapproving the securities or other investments. Form within 30 days of publication of this proposed rule change not later than 180 N–17f–2 facilitates the filing of the notice to (i) www.reginfo.gov/public/do/ days after the date of publication of accountant’s examination certificates PRAMain and (ii) David Bottom, notice of filing of the proposed rule prepared under rule 17f–2. The use of Director/Chief Information Officer, change. The Commission may extend the form allows the certificates to be Securities and Exchange Commission, the period for issuing an order filed electronically, and increases the c/o Cynthia Roscoe, 100 F Street NE, approving or disapproving the proposed accessibility of the examination Washington, DC 20549, or by sending an _ rule change, however, by not more than certificates to both the Commission’s email to: PRA [email protected]. 60 days if the Commission determines examination staff and interested Dated: December 4, 2020. that a longer period is appropriate and investors by ensuring that the J. Matthew DeLesDernier, publishes the reasons for such certificates are filed under the proper Assistant Secretary. determination. The date of publication Commission file number and the correct of notice of filing of the proposed rule name of a fund. [FR Doc. 2020–27028 Filed 12–8–20; 8:45 am] BILLING CODE 8011–01–P change was June 12, 2020. December 9, Commission staff estimates that it 2020 is 180 days from that date, and takes: (i) On average 1.25 hours of fund February 7, 2021 is 240 days from that accounting personnel at a total cost of SECURITIES AND EXCHANGE date. $272 to prepare each Form N–17f–2; 1 COMMISSION and (ii) .75 hours of administrative The Commission finds it appropriate assistant time at a total cost of $61 to file [Release No. 34–90559; File No. SR– to designate a longer period within the Form N–17f–2 with the NASDAQ–2020–027] which to issue an order approving or Commission.2 Approximately 201 funds disapproving the proposed rule change currently file Form N–17f–2 with the Self-Regulatory Organizations; The so that it has sufficient time to consider Commission. Commission staff Nasdaq Stock Market LLC; Notice of this proposed rule change. Accordingly, estimates that on average each fund files Designation of a Longer Period for the Commission, pursuant to Section Form N–17f–2 three times annually for Commission Action on Proceedings To 19(b)(2) of the Act,9 designates February a total annual hourly burden per fund Determine Whether To Approve or 7, 2021, as the date by which the of approximately 6 hours at a total cost Disapprove a Proposed Rule Change Commission shall either approve or of $1,002. The total annual hour burden To Apply Additional Initial Listing disapprove the proposed rule change for Form N–17f–2 is therefore estimated Criteria for Companies Primarily (File No. SR–NASDAQ–2020–027). to be approximately 1,206 hours with a Operating in Restrictive Markets total cost of approximately $201,402.3 3 See Securities Exchange Act Release No. 89027 December 3, 2020. Form N–17f–2 does not impose any (June 8, 2020), 85 FR 35962. Comments on the On May 29, 2020, The Nasdaq Stock proposed rule change can be found at: https:// paperwork-related cost burden other Market LLC (‘‘Nasdaq’’ or ‘‘Exchange’’) www.sec.gov/comments/sr-nasdaq-2020-027/ than this internal hour cost. filed with the Securities and Exchange srnasdaq2020027.htm. The estimate of average burden hours 4 Commission (‘‘Commission’’), pursuant 15 U.S.C. 78s(b)(2). is made solely for the purposes of the 5 See Securities Exchange Act Release No. 89358, to Section 19(b)(1) of the Securities 85 FR 45275 (July 27, 2020). The Commission 1 1 This estimate is based on the following Exchange Act of 1934 (‘‘Act’’) and Rule designated September 10, 2020 as the date by which calculation: 1.25 × $218 (fund senior accountant’s 19b–4 thereunder,2 a proposed rule the Commission shall approve or disapprove, or hourly rate) = $272. change to apply additional initial listing institute proceedings to determine whether to approve or disapprove, the proposed rule change. 2 This estimate is based on the following criteria for companies primarily calculation: .75 × $82 (administrative assistant 6 15 U.S.C. 78s(b)(2)(B). hourly rate) = $61. operating in a jurisdiction that has 7 See Securities Exchange Act Release No. 89799, 3 This estimate is based on the following 85 FR 57282 (September 15, 2020). calculation: 201 funds × $1,002 (total annual cost 1 15 U.S.C. 78s(b)(1). 8 15 U.S.C. 78s(b)(2). per fund) = $201,402. 2 17 CFR 240.19b–4. 9 Id.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79250 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

For the Commission, by the Division of the most significant aspects of such Formation accurately reflects the correct Trading and Markets, pursuant to delegated statements. filed document in order to reduce authority.10 potential investor or market participant A. Self-Regulatory Organization’s J. Matthew DeLesDernier, confusion. Assistant Secretary. Statement of the Purpose of, and Statutory Basis for, the Proposed Rule 2. Statutory Basis [FR Doc. 2020–26992 Filed 12–8–20; 8:45 am] Change BILLING CODE 8011–01–P The Exchange believes the proposed 1. Purpose rule change is consistent with the Act and the rules and regulations The Exchange proposes to amend the SECURITIES AND EXCHANGE thereunder applicable to the Exchange Certificate of Formation to make several COMMISSION and, in particular, the requirements of corrective edits and clarifying changes. Section 6(b) of the Act.6 Specifically, [Release No. 34–90562; File No. SR– On February 11, 2016, the Exchange the Exchange believes the proposed rule PEARL–2020–29] executed the original Certificate of change is consistent with the Section Formation. On October 28, 2020, the 6(b)(5) 7 requirements that the rules of Self-Regulatory Organizations; MIAX Exchange filed its proposal to amend PEARL, LLC; Notice of Filing and an exchange be designed to prevent the Certificate of Formation, among fraudulent and manipulative acts and Immediate Effectiveness of a Proposed other corporate documents, to make Rule Change To Amend the practices, to promote just and equitable several non-substantive, administrative principles of trade, to foster cooperation Exchange’s Certificate of Formation 3 and clarifying changes. The Initial and coordination with persons engaged December 3, 2020. Proposal included changes to the title of in regulating, clearing, settling, Pursuant to the provisions of Section the Certificate of Formation to be processing information with respect to, 19(b)(1) of the Securities Exchange Act amended to be titled the ‘‘Amended and and facilitating transactions in of 1934 (‘‘Act’’) 1 and Rule 19b–4 Restated Certificate of Formation of securities, to remove impediments to thereunder,2 notice is hereby given that MIAX PEARL, LLC.’’ On November 10, and perfect the mechanism of a free and on November 24, 2020, MIAX PEARL, 2020, the Commission published for open market and a national market LLC (‘‘MIAX PEARL’’ or the comment the Initial Proposal, which system, and, in general, to protect ‘‘Exchange’’) filed with the Securities granted the Exchange’s request for investors and the public interest. 4 and Exchange Commission waiver of the 30-day operative delay. Additionally, the Exchange believes the (‘‘Commission’’) a proposed rule change The Exchange now proposes to amend proposed rule change is consistent with as described in Items I and II below, the title of the Certificate of Formation the Section 6(b)(5) 8 requirement that which Items have been prepared by the to delete the words ‘‘Amended and’’ in the rules of an exchange not be designed Exchange. The Commission is order to accurately reflect the amended to permit unfair discrimination between publishing this notice to solicit document that was filed with the customers, issuers, brokers, or dealers. comments on the proposed rule change Secretary of State for the State of The Exchange believes that the from interested persons. Delaware, titled the ‘‘Restated proposed changes to the Certificate of Certificate of Formation of MIAX Formation are designed to prevent I. Self-Regulatory Organization’s PEARL, LLC.’’ 5 The Exchange also fraudulent and manipulative acts and Statement of the Terms of Substance of proposes to amend the second sentence practices, promote just and equitable the Proposed Rule Change in the first paragraph of the Certificate principles of trade, foster cooperation The Exchange is filing a proposal to of Formation to delete the words and coordination with persons engaged amend the Exchange’s Amended and ‘‘amending and’’ in order to clarify that in regulating, clearing, settling, Restated Certificate of Formation (the the amended document is the ‘‘Restated processing information with respect to, ‘‘Certificate of Formation’’). Certificate of Formation of MIAX and facilitating transactions in The text of the proposed rule change PEARL, LLC.’’ With the proposed securities, remove impediments to and is available on the Exchange’s website at changes, the first paragraph of the perfect the mechanism of a free and http://www.miaxoptions.com/rule- Certificate of Formation is as follows: open market and a national market filings/pearl at MIAX PEARL’s principal This filing has been executed and filed in system, and, in general, protect office, and at the Commission’s Public accordance with Section 18–208 of the investors and the public interest. The Reference Room. Limited Liability Company Act. This Exchange believes that the proposed document is being executed for the purpose changes are non-substantive, corrective II. Self-Regulatory Organization’s of restating the original Certificate of Statement of the Purpose of, and edits and clarifying changes and will Formation, filed on February 11, 2016, under reduce potential investor or market Statutory Basis for, the Proposed Rule file number: 5880323. Change participant confusion regarding the The purpose of the proposed changes Exchange’s Certificate of Formation. In its filing with the Commission, the to the Certificate of Formation are to Further, the Exchange believes the Exchange included statements ensure that the Exchange’s Certificate of proposed changes are not material and concerning the purpose of and basis for will have no impact on the governance, the proposed rule change and discussed 3 See Securities Exchange Act Release No. 90394 ownership, or operations of the any comments it received on the (November 10, 2020) (SR–PEARL–2020–23) (Notice Exchange. proposed rule change. The text of these of Filing and Immediate Effectiveness of a Proposed Rule Change to Amend the Exchange’s Certificate B. Self-Regulatory Organization’s statements may be examined at the of Formation, Amended and Restated Limited places specified in Item IV below. The Liability Company Agreement, and the By-Laws) Statement on Burden on Competition Exchange has prepared summaries, set (the ‘‘Initial Proposal’’). The Exchange does not believe that forth in sections A, B, and C below, of 4 See id. the proposed rule change will impose 5 The Certificate of Formation is available the Exchange’s website, at https:// 10 17 CFR 200.30–3(a)(57). www.miaxoptions.com/sites/default/files/page- 6 15 U.S.C. 78f(b). 1 15 U.S.C. 78s(b)(1). files/MIAX_PEARL_Restated_Certificate_of_ 7 15 U.S.C. 78f(b)(5). 2 17 CFR 240.19b–4. Formation_11122020.pdf. 8 Id.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79251

any burden on competition that is not proposed rule change operative upon business days between the hours of necessary or appropriate in furtherance filing.13 10:00 a.m. and 3:00 p.m. Copies of the of the purposes of the Act. The At any time within 60 days of the filing also will be available for Exchange does not believe the proposed filing of the proposed rule change, the inspection and copying at the principal rule change will impose any burden on Commission summarily may office of the Exchange. All comments intra-market and inter-market temporarily suspend such rule change if received will be posted without change. competition that is not necessary or it appears to the Commission that such Persons submitting comments are appropriate in furtherance of the action is necessary or appropriate in the cautioned that we do not redact or edit purposes of the Act because the public interest, for the protection of personal identifying information from proposed changes are not intended to investors, or otherwise in furtherance of comment submissions. You should address competitive issues but rather the purposes of the Act. If the submit only information that you wish are corrective, non-substantive changes Commission takes such action, the to make available publicly. All that are concerned solely with Commission shall institute proceedings submissions should refer to File correcting the title of the Certificate of to determine whether the proposed rule Number SR–PEARL–2020–29, and Formation to reflect current, accurate change should be approved or should be submitted on or before information. disapproved. December 30, 2020. C. Self-Regulatory Organization’s IV. Solicitation of Comments For the Commission, by the Division of Statement on Comments on the Interested persons are invited to Trading and Markets, pursuant to delegated authority.14 Proposed Rule Change Received From submit written data, views, and Members, Participants, or Others arguments concerning the foregoing, J. Matthew DeLesDernier, Written comments were neither including whether the proposed rule Assistant Secretary. solicited nor received. change is consistent with the Act. [FR Doc. 2020–26994 Filed 12–8–20; 8:45 am] Comments may be submitted by any of BILLING CODE 8011–01–P III. Date of Effectiveness of the the following methods: Proposed Rule Change and Timing for Commission Action Electronic Comments SECURITIES AND EXCHANGE Because the foregoing proposed rule • Use the Commission’s internet COMMISSION change does not: (i) Significantly affect comment form (http://www.sec.gov/ [SEC File No. 270–238, OMB Control No. the protection of investors or the public rules/sro.shtml); or 3235–0214] interest; (ii) impose any significant • Send an email to rule-comments@ burden on competition; and (iii) become sec.gov. Please include File Number SR– Submission for OMB Review; operative for 30 days from the date on PEARL–2020–29 on the subject line. Comment Request which it was filed, or such shorter time Paper Comments Upon Written Request Copies Available as the Commission may designate, it has • From: Securities and Exchange become effective pursuant to Section Send paper comments in triplicate Commission, Office of FOIA Services, 19(b)(3)(A) of the Act 9 and Rule 19b– to Secretary, Securities and Exchange 100 F Street NE, Washington, DC 4(f)(6) thereunder.10 Commission, 100 F Street NE, A proposed rule change filed Washington, DC 20549–1090. 20549–02736 pursuant to Rule 19b–4(f)(6) under the All submissions should refer to File Extension: Act 11 normally does not become Number SR–PEARL–2020–29. This file Rule 17a–7 operative for 30 days after the date of its number should be included on the Notice is hereby given that, pursuant filing. However, Rule 19b–4(f)(6)(iii) 12 subject line if email is used. To help the to the Paperwork Reduction Act of 1995 permits the Commission to designate a Commission process and review your (44 U.S.C. 3501–3520), the Securities shorter time if such action is consistent comments more efficiently, please use and Exchange Commission with the protection of investors and the only one method. The Commission will (‘‘Commission’’) has submitted to the public interest. The Exchange has post all comments on the Commission’s Office of Management and Budget a requested that the Commission waive internet website (http://www.sec.gov/ request for extension of the previously the 30-day operative delay. As the rules/sro.shtml). Copies of the approved collection of information proposed rule change raises no novel submission, all subsequent described below. issues and merely corrects the title of amendments, all written statements Rule 17a–7 (17 CFR 270.17a–7) (the the Exchange’s Certificate of Formation, with respect to the proposed rule ‘‘rule’’) under the Investment Company the Commission believes that waiver of change that are filed with the Act of 1940 (15 U.S.C. 80a–1 et seq.) the 30-day operative delay is consistent Commission, and all written (the ‘‘Act’’) is entitled ‘‘Exemption of with the protection of investors and the communications relating to the certain purchase or sale transactions public interest. Accordingly, the proposed rule change between the between an investment company and Commission hereby waives the Commission and any person, other than certain affiliated persons thereof.’’ It operative delay and designates the those that may be withheld from the provides an exemption from section public in accordance with the 17(a) of the Act for purchases and sales 9 15 U.S.C. 78s(b)(3)(A). provisions of 5 U.S.C. 552, will be of securities between registered 10 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– available for website viewing and investment companies (‘‘funds’’), that 4(f)(6)(iii) requires a self-regulatory organization to printing in the Commission’s Public give the Commission written notice of its intent to are affiliated persons (‘‘first-tier file the proposed rule change, along with a brief Reference Room, 100 F Street NE, affiliates’’) or affiliated persons of description and text of the proposed rule change, Washington, DC 20549 on official affiliated persons (‘‘second-tier at least five business days prior to the date of filing affiliates’’), or between a fund and a of the proposed rule change, or such shorter time 13 For purposes only of waiving the 30-day first- or second-tier affiliate other than as designated by the Commission. The Exchange operative delay, the Commission also has has satisfied this requirement. considered the proposed rule’s impact on another fund, when the affiliation arises 11 17 CFR 240.19b–4(f)(6). efficiency, competition, and capital formation. See 12 17 CFR 240.19b–4(f)(6)(iii). 15 U.S.C. 78c(f). 14 17 CFR 200.30–3(a)(12).

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79252 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

solely because of a common investment series), and that the same percentage The public may view background adviser, director, or officer. Rule 17a–7 (25%, or 23 funds) of the estimated 90 documentation for this information requires funds to keep various records funds that newly register each year will collection at the following website: in connection with purchase or sale also enter into these transactions, for a www.reginfo.gov. Find this particular transactions effected in reliance on the total of 752 5 companies that are affected information collection by selecting rule. The rule requires the fund’s board by the recordkeeping requirements of ‘‘Currently under 30-day Review—Open of directors to establish procedures rule 17a–7. These funds must keep for Public Comments’’ or by using the reasonably designed to ensure that the records of each of these transactions, search function. Written comments and rule’s conditions have been satisfied. and the board of directors must recommendations for the proposed The board is also required to determine, quarterly determine that all relevant information collection should be sent at least on a quarterly basis, that all transactions were made in compliance within 30 days of publication of this affiliated transactions effected during with the company’s policies and notice to (i) www.reginfo.gov/public/do/ the preceding quarter in reliance on the procedures. The rule generally imposes PRAMain and (ii) David Bottom, rule were made in compliance with a minimal burden of collecting and Director/Chief Information Officer, these established procedures. If a fund storing records already generated for Securities and Exchange Commission, enters into a purchase or sale other purposes.6 The staff estimates that c/o Cynthia Roscoe, 100 F Street NE, transaction with an affiliated person, the the burden related to making these Washington, DC 20549, or by sending an rule requires the fund to compile and records and for the board to review all email to: [email protected]. maintain written records of the transactions would be 3 hours annually Dated: December 4, 2020. transaction.1 The Commission’s for each respondent, (2 hours spent by J. Matthew DeLesDernier, examination staff uses these records to compliance attorneys and 1 hour spent Assistant Secretary. evaluate for compliance with the rule. by the board of directors) 7 or 2,256 total While most funds do not commonly hours each year.8 [FR Doc. 2020–27027 Filed 12–8–20; 8:45 am] engage in transactions covered by rule Based on these estimates, the staff BILLING CODE 8011–01–P 17a–7, the Commission staff estimates estimates the combined total annual that nearly all funds have adopted burden hours associated with rule SECURITIES AND EXCHANGE procedures for complying with the 17a–7 is 2,616 hours.9 The staff also 2 COMMISSION rule. Of the approximately 2,915 estimates that there are approximately currently active funds, the staff 752 respondents and 6,016 total estimates that virtually all have already responses.10 [Release No. 34–90563; File No. SR– adopted procedures for compliance with The estimates of burden hours are PEARL–2020–30] rule 17a–7. This is a one-time burden, made solely for the purposes of the Self-Regulatory Organizations; MIAX and the staff therefore does not estimate Paperwork Reduction Act, and are not an ongoing burden related to the PEARL, LLC; Notice of Filing of a derived from a comprehensive or even Proposed Rule Change To Amend the policies and procedures requirement of a representative survey or study of the the rule for funds.3 The staff estimates Exchange’s By-Laws in Connection costs of Commission rules. The With an Equity Rights Program that there are approximately 90 new collection of information required by funds that register each year, and that rule 17a–7 is necessary to obtain the December 3, 2020. each of these funds adopts the relevant benefits of the rule. Responses will not Pursuant to the provisions of Section policies and procedures. The staff be kept confidential. An agency may not estimates that it takes approximately 4 19(b)(1) of the Securities Exchange Act conduct or sponsor, and a person is not 1 hours to develop and adopt these of 1934 (‘‘Act’’) and Rule 19b–4 required to respond to, a collection of 2 policies and procedures. Therefore, the thereunder, notice is hereby given that information unless it displays a on November 24, 2020, MIAX PEARL, total annual burden related to currently valid control number. developing and adopting these policies LLC (‘‘MIAX PEARL’’ or the and procedures would be approximately ‘‘Exchange’’) filed with the Securities 5 This estimate is based on the following 360 hours.4 and Exchange Commission calculation: (729 + 23 = 752). (‘‘Commission’’) a proposed rule change Of the 2,915 existing funds, the staff 6 Commission staff believes that rule 17a–7 does assumes that approximately 25%, (or not impose any costs associated with record as described in Items I, II, and III below, 729) enter into transactions affected by preservation in addition to the costs that funds which Items have been prepared by the rule 17a–7 each year (either by the fund already incur to comply with the record Exchange. The Commission is preservation requirements of rule 31a–2 under the publishing this notice to solicit directly or through one of the fund’s Act. Rule 31a–2 requires companies to preserve certain records for specified periods of time. comments on the proposed rule change 1 The written records are required to set forth a 7 The staff estimates that funds that rely on rule from interested persons. description of the security purchased or sold, the 17a–7 annually enter into an average of 8 rule identity of the person on the other side of the 17a–7 transactions each year. The staff estimates I. Self-Regulatory Organization’s transaction, and the information or materials upon that the compliance attorneys of the companies Statement of the Terms of Substance of which the board of directors’ determination that the spend approximately 15 minutes per transaction on the Proposed Rule Change transaction was in compliance with the procedures this recordkeeping, and the board of directors was made. spends a total of 1 hour annually in determining The Exchange is filing a proposal to 2 Unless stated otherwise, these estimates are that all transactions made that year were done in amend the Exchange’s By-Laws. based on conversations with the examination and compliance with the company’s policies and The text of the proposed rule change inspections staff of the Commission and fund procedures. representatives. 8 This estimate is based on the following is available on the Exchange’s website at 3 Based on our reviews and conversations with calculation: (3 hours × 752 companies = 2,256 http://www.miaxoptions.com/rule- fund representatives, we understand that funds hours). filings/pearl at MIAX PEARL’s principal rarely, if ever, need to make changes to these 9 This estimate is based on the following office, and at the Commission’s Public policies and procedures once adopted, and calculation: (360 hours + 2,256 hours = 2,616 total Reference Room. therefore we do not estimate a paperwork burden hours). for such updates. 10 This estimate is based on the following 4 This estimate is based on the following calculations: 752 funds that engage in rule 17a–7 1 15 U.S.C. 78s(b)(1). calculations: (4 hours × 90 new funds = 360 hours). transactions × 8 transactions per year = 6,016. 2 17 CFR 240.19b–4.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79253

II. Self-Regulatory Organization’s the prepayment of certain ERP Exchange amount such that the ERP Member earns Statement of the Purpose of, and Fees 6 for trading equity securities on Units during such specified Statutory Basis for, the Proposed Rule MIAX PEARL Equities and the Measurement Period and as more fully Change achievement of certain liquidity volume set forth in the ERP Agreement. • In its filing with the Commission, the thresholds on MIAX PEARL Equities ‘‘Unit’’ means the securities issued Exchange included statements over a 42-month period. This filing pursuant to the ERP Agreement. The Exchange also proposes to delete concerning the purpose of and basis for amends the By-Laws to the extent the definition of the term ‘‘Exchange the proposed rule change and discussed necessary to incorporate rights to Contract’’ from the By-Laws because it any comments it received on the participating Members in an ERP to is no longer used. The term ‘‘Exchange proposed rule change. The text of these appoint representation to the MIAX Contract’’ is currently defined as ‘‘a statements may be examined at the PEARL Board. contract that is then listed for trading by places specified in Item IV below. The Article I, Definitions the Exchange or that is contemplated by Exchange has prepared summaries, set the then current business plan of the forth in sections A, B, and C below, of The Exchange proposes to amend the Company to be listed for trading by the the most significant aspects of such By-Laws to provide definitions for key Exchange within ninety (90) days statements. terms used to incorporate provisions related to the ERP. Specifically, the following such date.’’ A. Self-Regulatory Organization’s Exchange proposes the following The Exchange proposes to renumber Statement of the Purpose of, and definitions: the existing definitions accordingly to Statutory Basis for, the Proposed Rule • ‘‘ERP Agreement’’ means the accommodate the proposed additions Change agreement between the Exchange’s and deletions. 1. Purpose parent holding company, Miami Article II, Section 2.2, Composition of International Holdings, Inc., and ERP The Exchange proposes to amend the Board Members dated September 11, 2020 certain sections of its By-Laws to: (i) The Exchange proposed to amend the pursuant to which Units were issued. Correspond with an Equity Rights title of Article II, Section 2.2 to include • ‘‘ERP Director’’ means a MIAX Program (‘‘ERP’’) recently established by reference to Observer Rights. The PEARL Equities Industry Director who the Exchange; 3 and (ii) make non- Exchange also proposes to amend has been nominated by an ERP Member substantive changes to the current By- Article II, Section 2.2(b)(i) to provide and appointed to the Board of Directors. Laws. • that ERP Directors will be included in On August 14, 2020, the Commission ‘‘ERP Member’’ means an Exchange the number of Industry Directors for approved a proposed rule change to Member who acquired Units pursuant to purposes of calculating the composition adopt rules governing the trading of an ERP Agreement sufficient to acquire of the Board. In addition, the Exchange an ERP Director or an Observer position. equity securities on the Exchange (the • proposes to amend Article II, Section platform for the trading of equity ‘‘Measurement Period’’ means the 2.2 (b)(ii) to specify that Member securities is referred to herein as ‘‘MIAX time period over which Units are Representative Directors will not 4 vested. PEARL Equities’’). This filing • include ERP Directors for purposes of corresponds with the recently ‘‘MIAX PEARL Equities’’ means the calculating the Board composition. implemented ERP pursuant to which market of the Exchange on which equity In addition, the Exchange proposes to units representing the right to acquire securities are traded. amend Article II, Section 2.2(e) to • equity in the Exchange’s parent holding ‘‘Observer’’ has the meaning set replace the existing text with text that company, Miami International forth in Article II, Section 2.2 of the By- provides that an ERP Member has a Holdings, Inc., were issued to Laws. right to nominate one (1) ERP Director • participating Members 5 in exchange for ‘‘Performance Criteria’’ means the or appoint an Observer to the Board of trades on MIAX PEARL Equities in an Directors. If at any time such ERP 3 See Securities Exchange Act Release No. 89730 amount equal to a percentage of the Member is otherwise able to nominate (September 1, 2020), 85 FR 55530 (September 8, average daily volume for National an ERP Director, but is unable to fill 2020) (SR–PEARL–2020–10) (‘‘ERP Notice’’). This Market System securities on MIAX filing is also based on a past filing by the such position as a result of such ERP Exchange’s affiliate, Miami International Securities PEARL Equities as reported by the Member already having a representative Exchange, LLC (‘‘MIAX’’). See Securities Exchange Consolidated Tape Association (CTA) on the Board, such ERP Member will Act Release Nos. 71541 (February 12, 2014), 79 FR and Unlisted Traded Privileges (UTP) have the right to nominate such Director 9572 (February 19, 2014) (SR–MIAX–2013–58) Plans, or any successor plans, for a (Notice of Filing of Amendment No. 1 and Order in accordance with amended Article II, Granting Accelerated Approval of a Proposed Rule specified Measurement Period in an Section 2.2(e) upon the resignation or Change, as Modified by Amendment No. 1 Thereto, removal of such Director already serving To Amend the Exchange’s ByLaws); and 77876 6 The ERP Exchange fees under the Program on the Board.7 The nominee shall be (May 20, 2016), 81 FR 33283 (May 25, 2016) (SR– consist of: (a) Transaction fees as set forth in MIAX–2016–08) (collectively, the ‘‘MIAX Approval Section (1)a of the MIAX PEARL Options Fee appointed at the first annual meeting of Orders’’). Schedule; (b) membership fees as set forth in the Company following the effective 4 See Securities Exchange Act Release Nos. 88132 Section 3 of the MIAX PEARL Options Fee date of the By-Law amendment. (February 6, 2020), 85 FR 8053 (February 12, 2020) Schedule; (c) system connectivity fees as set forth The Exchange proposes to adopt (SR–PEARL–2020–03) (Notice of Filing of a in Section 5 of the MIAX PEARL Options Fee Proposed Rule Change to Adopt Rules Governing Schedule; (d) market data fees as set forth in paragraph (f) under Article II, Section the Trading of Equity Securities); and 89563 Section 6 of the MIAX PEARL Options Fee 2.2. to provide that if an ERP Director (August 14, 2020), 85 FR 51510 (August 20, 2020) Schedule; (a) transaction fees as set forth under position needs to be added pursuant to (Order Approving Proposed Rule Change to Adopt Section (1)a of the MIAX PEARL Equities Fee amended Article II, Section 2.2(e), such Rules Governing the Trading of Equity Securities). Schedule; (b) system connectivity fees as set forth ERP Director shall be nominated by the 5 The term ‘‘Member’’ means an individual or under Section (2) of the MIAX PEARL Equities Fee organization that is registered with the Exchange Schedule; and (c) market data fees as set forth under pursuant to Chapter II of the Exchange’s Rules for Section (3) of the MIAX PEARL Equities Fee 7 At this time, an ERP Member that is represented purposes of trading on the Exchange as an Schedule (collectively, the ‘‘ERP Exchange Fees’’). by a Member Representative Director may also have ‘‘Electronic Exchange Member’’ or ‘‘Market Maker.’’ The Exchange notes that proprietary real-time an Observer. But, an ERP Member that is Members are deemed ‘‘members’’ under the market data will be provided free of charge for a represented by an ERP Director may not also have Exchange Act. See Exchange Rule 100. period of time. an Observer.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79254 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

applicable ERP Member and elected by the Board size will increase, but the The Exchange believes these changes the LLC Member and additional Director current composition will remain. regarding Terms of Office are reasonably positions shall be added and filled at Lastly, the Exchange proposes to designed to account for the removal of the same time as the election of the new amend the title of Article II, Section 2.2 Directors or Observers of non- ERP Director, as required to comply to refer to Observer Rights and reflect performing ERP Members and Members with the requirements set forth in the above-proposed changes. that no longer have a controlling interest Article II, Section 2.2(a) and (b). in the shares that provided them the The Exchange also proposes to adopt Article II, Section 2.3, Terms of Office right to such appointments. paragraph (g) under Article II, Section The Exchange proposes to amend 2.2 to provide that, per amended Article Article II, Section 2.4, Nomination and Article II, Section 2.3(b) to specify that Election II, Section 2.2(e), a person may be it does not apply to ERP Directors. The invited to attend meetings of the Board Exchange also proposes to adopt The Exchange proposes to amend in a nonvoting Observer capacity as paragraph (c) under Article II, Section Article II, Section 2.4(a) to provide that follows. Proposed Article II, Section 2.3 to provide that in the event that an the Nominating Committee shall 2.2(g)(i) would provide that any ERP ERP Member (either by itself or its nominate to ERP Director positions only Member that is not otherwise affiliates) who has the right to nominate those persons whose names have been represented on the Board shall have the an ERP Director and which fails to meet approved and submitted by the right to appoint one individual as an its Performance Criteria under the ERP applicable ERP Members having the Observer. If the ERP Member is Agreement for three consecutive right to nominate such person. As otherwise able to nominate an ERP Measurement Periods such that it only mentioned above, the LLC Member is Director, an Observer appointment meets the required performance criteria then obligated to vote for the nominated would be in lieu of such ERP Director of an ERP Member that may appoint an ERP Director. The nominee shall be nomination. Proposed Article II, Section Observer, then the individual appointed at the first annual meeting of 2.2(g)(ii) would provide that the ERP designated by the non-performing ERP the Company following September 11, Member’s right to appoint an Observer Member shall immediately cease to be 2020, which was the closing date of the pursuant to proposed Section 2.2(g) an ERP Director of the Company and ERP established by the Exchange.8 shall be perpetual, subject to the such ERP Member shall cease to have Article II, Section 2.8, Vacancies provisions of Section 2.3 discussed the right to nominate an ERP Director. The Exchange proposes to adopt below. An Observer may not be subject Such non-performing ERP Member shall to a statutory disqualification. paragraph (c) under Article II, Section continue to maintain Observer rights as Lastly, proposed Article II, Section 2.8 to provide that if an ERP Director set forth in the By-Laws. 2.2(g)(iii) would provide that Observers position becomes vacant that the Notwithstanding the foregoing, in the will have the right to attend all meetings applicable ERP Member will retain the event that the non-performing ERP of the Board of Directors in a nonvoting ability to nominate a person to fill the Member satisfies the Performance observer capacity and, in this respect, vacant ERP Director position. To Criteria for a subsequent Measurement the Company shall give such eliminate any potential confusion Period, then such ERP Member may representative copies of all notices, between the treatment of true vacancies reappoint an ERP Director at the minutes, consents, and other materials and the non-performance provisions in immediately following annual meeting that it provides to its directors at the proposed Article II, Section 2.3(c), the of the Company. The Exchange believes same time and in the same manner as Exchange proposes to specify that that it is fair and reasonable to treat non- provided to such Directors; provided, proposed Article II, Section 2.8(c) will performing ERP Member’s that can however, that such representative shall not apply for a vacancy resulting from nominate an ERP Director differently agree to hold in confidence and trust an ERP Director position becoming than non-performing ERP Member’s that and to act in a fiduciary manner with vacant due to a non-performing ERP can only appoint Observers. ERP respect to all information so provided; Member. In the situation of non- Members that can nominate ERP and provided further, that the Company performance of an ERP Member, the Directors have assumed greater reserves the right to withhold any provisions of proposed Article II, performance obligations under the ERP information and to exclude such Section 2.3(c) would apply. representative from any meeting or Agreement, and thus even at the non- portion thereof if access to such performing level are entitled to more Article II, Section 2.9, Removal and information or attendance at such protections to their representation on Resignation meeting could adversely affect the the Board than non-performing ERP The Exchange proposes to amend attorney-client privilege between the Members that can only appoint Article II, Section 2.9 to provide that Company and its counsel or result in Observers. ERP Directors may only be removed for disclosure of trade secrets or a conflict The Exchange also proposes to adopt cause, which shall include, without of interest. paragraph (d) under Article II, Section limitation, such Director being subject The Exchange believes these changes 2.3 to provide that an individual ERP to a statutory disqualification. are reasonably designed to ensure that Director or Observer position shall be the Board of Directors maintains the immediately terminated following the Article X, Sections 10.3 and 10.4 appropriate composition after the ERP transfer of common stock or warrants of The Exchange proposes to amend and that Directors and Observers are the LLC Member acquired pursuant to Article X, Section 10.3 to provide that qualified to represent ERP Members on the ERP Agreement by an ERP Member Observers will be subject to the same the Board. The changes will also help to which, after giving effect to such participation rights on the Board during ensure that Directors, ERP Directors, transfer, results in such ERP Member meetings pertaining to the self- and Observers, are qualified and held to holding less than 25% of the aggregate regulatory function of the Company as the same restrictions against statutory number of shares of common stock of other members of the Board. In addition, disqualification. The Exchange notes the LLC Member issued or issuable Article X, Section 10.4 would be that no substantive changes are being pursuant to the Units acquired pursuant proposed to the Board’s composition; to the ERP Agreement collectively. 8 See ERP Notice, supra note 3.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79255

amended to provide that Observers will and not be associated with a member of necessary or appropriate in furtherance be subject to the same requirements to the exchange, broker, or dealer. of the purposes of the Act. The maintain the confidentiality of all books Specifically, the proposed proposed changes to the Exchange By- and records of the Company reflecting amendments to the By-Laws are Laws are designed to enable the confidential information pertaining to reasonably designed to incorporate Exchange to be so organized as to have the self-regulatory function of the provisions related to the ERP in a the capacity to carry out the purposes of Company. manner that ensures that the Exchange the Act and to comply, and to enforce will remain so organized as to have the Miscellaneous Non-Substantive Changes compliance by its Members and persons capacity to carry out the purposes of the associated with its Members, with the In addition to the changes set forth Act and to comply, and to enforce provisions of the Act, the rules and above, the Exchange proposes to make compliance by its Members and persons regulations thereunder, and the rules of the following non-substantive changes associated with its Members, with the the Exchange. As such, this is not a to the current By-Laws. The Exchange provisions of the Act, the rules and competitive filing and thus should not proposes to delete dated references to regulations thereunder, and the rules of impose any burden on competition. time periods and events that have the Exchange. The changes will also expired since the proposal of the new help to ensure that Directors, ERP C. Self-Regulatory Organization’s By-Laws. Specifically, the Exchange Directors, Observers, and committee Statement on Comments on the proposes to delete provisions in Article members are qualified and held to the Proposed Rule Change Received From II, Section 2.5, and Article III, Section same restrictions against statutory Members, Participants, or Others 3.1(b), regarding Interim Directors and disqualification. The proposed ERP Written comments were neither Interim Member Representative Directors will be subject to the same solicited nor received. Directors since these appointments have restrictions as current Directors already occurred. Consistent with this including evaluating proposals with the III. Date of Effectiveness of the change, the Exchange proposes to Company’s self-regulatory status in Proposed Rule Change and Timing for remove references to Article II, Section mind, restricting participation in Commission Action 2.5 and Interim Directors and Interim activities where there is a conflict of Within 45 days of the date of Member Representative Directors from interest, and requirement to maintain publication of this notice in the Federal current Article I(x) (proposed to be the confidentiality of information Register or within such longer period (i) renumbered as Article I(aa)) and Article related to the Company’s self-regulatory as the Commission may designate up to II, Section 2.2(b)(i). function. The proposed Observers will 90 days of such date if it finds such be subject to the same restrictions as longer period to be appropriate and 2. Statutory Basis current Directors regarding maintaining publishes its reasons for so finding or The Exchange believes that its the confidentiality of information (ii) as to which the Exchange consents, proposed rule change is consistent with related to the Company’s self-regulatory the Commission shall: (a) By order Section 6(b) of the Act 9 in general, and function. However, Observers will not approve or disapprove such proposed furthers the objectives of Sections be subject to the same restrictions as rule change, or (b) institute proceedings 6(b)(1) and 6(b)(5) of the Act 10 in current Directors regarding evaluating to determine whether the proposed rule particular, in that it enables the proposals with the Company’s self- change should be disapproved. Exchange to be so organized as to have regulatory status in mind and restricting the capacity to carry out the purposes of participation in activities where there is IV. Solicitation of Comments the Act and to comply, and to enforce a conflict of interest. The Exchange Interested persons are invited to compliance by its Members and persons believes that treating Observers submit written data, views, and associated with its Members, with the differently than Directors in these arguments concerning the foregoing, provisions of the Act, the rules and circumstances is reasonable because including whether the proposed rule regulations thereunder, and the rules of Observers will not be affirmatively change is consistent with the Act. the Exchange; and that it is designed to voting on any such proposals in their Comments may be submitted by any of prevent fraudulent and manipulative non-voting observer capacity. the following methods: acts and practices, to promote just and In addition, the Exchange’s proposed Electronic Comments equitable principles of trade, to foster amendments address other non- cooperation and coordination with substantive revisions to reflect changes • Use the Commission’s internet persons engaged in facilitating since the Commission granted the comment form (http://www.sec.gov/ transactions in securities, to remove Exchange’s registration as a national rules/sro.shtml); or • impediments to and perfect the securities exchange. Send an email to rule-comments@ mechanisms of a free and open market The proposal will continue to assure sec.gov. Please include File Number SR– and a national market system and, in a fair representation of its Members in PEARL–2020–30 on the subject line. general, to protect investors and the that ERP Directors will not affect the Paper Comments public interest. In addition, the current Member Representation Director • proposed change is consistent with calculation or process in any way. The Send paper comments in triplicate Section 6(b)(3) of the Act,11 in that it Exchange notes that no substantive to Secretary, Securities and Exchange enables the Exchange to assure a fair changes are being proposed to the Commission, 100 F Street NE, representation of its members in the Board’s composition; the Board size will Washington, DC 20549–1090. selection of its directors and increase, but the current composition All submissions should refer to File administration of its affairs and provide will remain. Number SR–PEARL–2020–30. This file number should be included on the that one or more directors shall be B. Self-Regulatory Organization’s representative of issuers and investors subject line if email is used. To help the Statement on Burden on Competition Commission process and review your 9 15 U.S.C. 78f(b). The Exchange does not believe that comments more efficiently, please use 10 15 U.S.C. 78f(b)(5). the proposed rule change will impose only one method. The Commission will 11 15 U.S.C. 78f(b)(3). any burden on competition not post all comments on the Commission’s

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00094 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79256 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

internet website (http://www.sec.gov/ Rule 31a–1 (17 CFR 270.31a–1) under a representative survey or study. The rules/sro.shtml). Copies of the the Investment Company Act of 1940 collection of information required by submission, all subsequent (the ‘‘Act’’) (15 U.S.C. 80a) is entitled rule 31a–1 is mandatory. Responses will amendments, all written statements ‘‘Records to be maintained by registered not be kept confidential. The records with respect to the proposed rule investment companies, certain majority- required by rule 31a–1 are required to change that are filed with the owned subsidiaries thereof, and other be preserved pursuant to rule 31a–2 Commission, and all written persons having transactions with under the Investment Company Act (17 communications relating to the registered investment companies.’’ Rule CFR 270.31a–2). Rule 31a–2 requires proposed rule change between the 31a–1 requires registered investment that certain of these records be Commission and any person, other than companies (‘‘funds’’), and every preserved permanently, and that others those that may be withheld from the underwriter, broker, dealer, or be preserved six years from the end of public in accordance with the investment adviser that is a majority- the fiscal year in which any transaction provisions of 5 U.S.C. 552, will be owned subsidiary of a fund, to maintain occurred. In both cases, the records available for website viewing and and keep current accounts, books, and should be kept in an easily accessible printing in the Commission’s Public other documents which constitute the place for the first two years. An agency Reference Room, 100 F Street NE, record forming the basis for financial may not conduct or sponsor, and a Washington, DC 20549 on official statements required to be filed pursuant person is not required to respond to, a business days between the hours of to section 31 of the Act (15 U.S.C. 80a– collection of information unless it 10:00 a.m. and 3:00 p.m. Copies of the 30) and of the auditor’s certificates displays a currently valid OMB control filing also will be available for relating thereto. The rule lists specific number. inspection and copying at the principal records to be maintained by funds. The An agency may not conduct or office of the Exchange. All comments rule also requires certain underwriters, sponsor, and a person is not required to received will be posted without change. brokers, dealers, depositors, and respond to, a collection of information Persons submitting comments are investment advisers to maintain the unless it displays a currently valid cautioned that we do not redact or edit records that they are required to control number. personal identifying information from maintain under federal securities laws. The public may view background comment submissions. You should The Commission periodically inspects documentation for this information submit only information that you wish the operations of funds to insure their collection at the following website: to make available publicly. All compliance with the provisions of the www.reginfo.gov. Find this particular submissions should refer to File Act and the rules thereunder. The books information collection by selecting Number SR–PEARL–2020–30, and and records required to be maintained ‘‘Currently under 30-day Review—Open should be submitted on or before by rule 31a–1 constitute a major focus for Public Comments’’ or by using the December 30, 2020. of the Commission’s inspection search function. Written comments and program. For the Commission, by the Division of recommendations for the proposed There are approximately 3,964 information collection should be sent Trading and Markets, pursuant to delegated investment companies registered with authority.12 within 30 days of publication of this the Commission, all of which are J. Matthew DeLesDernier, notice to (i) www.reginfo.gov/public/do/ required to comply with rule 31a–1. For Assistant Secretary. PRAMain and (ii) David Bottom, purposes of determining the burden Director/Chief Information Officer, [FR Doc. 2020–26995 Filed 12–8–20; 8:45 am] imposed by rule 31a–1, the Commission Securities and Exchange Commission, BILLING CODE 8011–01–P staff estimates that each fund is divided c/o Cynthia Roscoe, 100 F Street NE, into approximately four series, on Washington, DC 20549, or by sending an average, and that each series is required email to: [email protected]. SECURITIES AND EXCHANGE to comply with the recordkeeping COMMISSION requirements of rule 31a–1. Based on Dated: December 4, 2020. [SEC File No. 270–173, OMB Control No. conversations with fund representatives, J. Matthew DeLesDernier, 3235–0178] it is estimated that rule 31a–1 imposes Assistant Secretary. an average burden of approximately [FR Doc. 2020–27029 Filed 12–8–20; 8:45 am] Submission for OMB Review; 1,750 hours annually per series for a BILLING CODE 8011–01–P Comment Request total of 7,000 annual hours per fund. Upon Written Request Copies Available The estimated total annual burden for From: Securities and Exchange all 3,964 funds subject to the rule DEPARTMENT OF TRANSPORTATION Commission, Office of FOIA Services, therefore is approximately 27,748,000 hours. Based on conversations with 100 F Street NE, Washington, DC Federal Aviation Administration 20549–02736 fund representatives, however, the Commission staff estimates that even Extension: absent the requirements of rule 31a–1, [Docket No. 2120–0671] Rule 31a–1 90 percent of the records created Agency Information Collection Notice is hereby given that, pursuant pursuant to the rule are the type that Activities: Request for Renewal of a to the Paperwork Reduction Act of 1995 generally would be created as a matter Previously Approved Information (44 U.S.C. 3501–3520), the Securities of normal business practice and to Collection(s): Safety Management and Exchange Commission prepare financial statements. Thus, the Systems for Part 121 Certificate (‘‘Commission’’) has submitted to the Commission staff estimates that the total Holders Office of Management and Budget a annual burden associated with rule 31a– request for extension of the previously 1 is 2,774,800 hours. AGENCY: Federal Aviation approved collection of information The estimate of average burden hours Administration (FAA), DOT. discussed below. is made solely for the purposes of the ACTION: Notice and request for Paperwork Reduction Act, and is not comments. 12 17 CFR 200.30–3(a)(12). derived from a comprehensive or even

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79257

SUMMARY: In accordance with the information collection, including (a) the future. While the burden for existing Paperwork Reduction Act of 1995, FAA Whether the proposed collection of Part 121 certificate holders is invites public comments about our information is necessary for FAA’s significantly reduced, it is anticipated intention to request the Office of performance; (b) the accuracy of the there will be some ongoing Management and Budget (OMB) estimated burden; (c) ways for the FAA recordkeeping requirements for Part 5 approval to renew an information to enhance the quality, utility and compliance. collection used to support the analysis clarity of the information collection; and The FAA previously published a 60- of safety data as part of Safety (d) ways that the burden could be Day Federal Register Notice on June 20, Management Systems required for part minimized without reducing the quality 2018 (83 FR 28758) and a 30-Day 121 certificate holders. The information of the collected information. The agency Federal Register Notice on September to be collected will be used to identify will summarize and/or include your 17, 2018 (83 FR 46990). The FAA did hazards and show ongoing compliance comments in the request for OMB’s with part 5, Safety Management clearance of this information collection. not receive any comments on either Systems. All collected data and records OMB Control Number: 2120–0763. notice. Since the 60-Day and 30-Day are maintained by the certificate holders Title: Safety Management Systems for notices there have been changes to the and not submitted to the FAA. Part 121. original request. The current number of DATES: Written comments should be Form Numbers: None. Part 121 certificate holders in 2020 is 68 submitted by February 8, 2021. Type of Review: Renewal of an compared to 90 in 2015. The 68 Part 121 ADDRESSES: Please send written Information Collection with changes. certificate holders implemented a Safety comments: Background: The information Management System by the March 9, By Electronic Docket: collection involves the collection and 2018 Part 5 deadline. The burden www.regulations.gov (Enter docket analysis of safety data as part of a Safety analysis has been revised reflecting Part number into search field). Management System (SMS), as required 121 SMS implementation, revised By Mail: Docket Management Facility, for Part 121 certificate holders by 14 industry numbers, and analysis of post- U.S. Department of Transportation, 1200 CFR Part 5, Safety Management implementation recordkeeping. New Jersey Avenue SE, West Building, Systems. The information to be Respondents: All 68 existing Part 121 Room W12–140, Washington, DC 20590, collected will continue to be used to certificate holders. between 9 a.m. and 5 p.m. identify hazards and show compliance Frequency: Implementation plan By Fax: 202–493–2251. with Part 5. collection: 1 future applicant for Part FOR FURTHER INFORMATION CONTACT: The existing information collection Sean Denniston, Safety Management included the submission of SMS 121 certificate (anticipating no more Program Office (AFS–910), by email at: Implementation Plans to the FAA by than one new applicant a year). [email protected] or by phone: March 9, 2018. That portion of the Recordkeeping requirement: Annual 202–267–1493. information collection has been recordkeeping requirements for all 68 existing Part 121 certificates. SUPPLEMENTARY INFORMATION: completed and only new applicants for Public Comments Invited: You are a Part 121 certificate will be required to Estimated Average Burden per asked to comment on any aspect of this submit SMS Implementation Plans in Response:

Number of air Air carrier groups carriers

Part 121 Certificate Holders

Large (50+ aircraft) ...... 25 Medium (10–49 aircraft) ...... 19 Small (<9 aircraft) ...... 24 Number of Operators ...... 68

Respondents:

Summary (annual numbers) Reporting Recordkeeping Disclosure

Large and Medium Air Carrier

Number of Respondents ...... 44 N/A Number of Responses per respondent ...... 1 N/A Time per Response ...... 2,000 N/A Total number of responses ...... 44 N/A Total burden (hours) ...... 99,440 N/A

Summary (annual numbers) Reporting Recordkeeping Disclosure

Small Air Carrier

Number of Respondents ...... 24 N/A Number of Responses per respondent ...... 1 N/A Time per Response ...... 1,000 N/A Total number of responses ...... 24 N/A Total burden (hours) ...... 24,000 N/A

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79258 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Estimated annual collection activity for one new medium Part 121 air carrier.

Implementation Summary (annual numbers) GAP analysis plan SMS

Medium Air Carrier

Number of Respondents ...... 1 ...... Number of Responses per respondent ...... 1 ...... Time per Response ...... 2,732 ...... Total number of responses ...... 1 ...... Total burden (hours) ...... 2,732 ......

Estimated Total Annual Burden: accessible through the project website at More information can also be found at Total annual burden for existing Part www.ElCaminoRealProject.com or the project website at 121 certificate holders 123,400 hours. https://dot.ca.gov/caltrans-near-me/ www.ElCaminoRealProject.com or Total annual burden for new Part 121 district-4/d4-projects/d4-san-mateo-82- https://dot.ca.gov/caltrans-near-me/ certificate applicant 2,732 hours. el-camino-real-project. Project materials district-4/d4-projects/d4-san-mateo-82- Issued in Washington, DC. will be posted on the el-camino-real-project. Robert C. Carty, www.ECRalternatives.com website and FOR FURTHER INFORMATION CONTACT: Deputy Executive Director, Flight Standards will include project background, project Yolanda Rivas, Senior Environmental Service. schedule, frequently asked questions, Planner, Caltrans District 4, P.O. Box [FR Doc. 2020–27000 Filed 12–8–20; 8:45 am] archival information from prior public 23660, MS–8B, Oakland, CA 94623– BILLING CODE 4910–13–P outreach presentations, the El Camino 0660, telephone (510) 506–1461, or Real Task Force effort 2017–2018, newly email [email protected]. For developed narrated presentation slides FHWA, contact David Tedrick, DEPARTMENT OF TRANSPORTATION about the ECR Project’s purpose and telephone (916) 498–5024, or email need, the alternatives being considered, [email protected]. Federal Highway Administration tree survey information, and SUPPLEMENTARY INFORMATION: Effective information regarding the Howard- Notice of Intent To Prepare a Draft July 1, 2007, the FHWA assigned, and Ralston Eucalyptus Tree Rows, a Caltrans assumed, environmental Environmental Impact Statement for resource on the National Register of the El Camino Real Roadway Renewal responsibilities for this project pursuant Historic Places, and other historic to 23 U.S.C. 327. Caltrans as the Project on State Route 82, in San resources in the project area. A poster Mateo County, California assigned National Environmental Policy gallery will also be available that Act (NEPA) agency, will prepare a Draft AGENCY: Federal Highway features project alternatives and key EIS on a proposal for 3.6-mile roadway Administration (FHWA), U.S. slide content. rehabilitation project in San Mateo Department of Transportation (DOT). The virtual public information tour County, California. The project limits ACTION: Notice of Intent (NOI) to prepare will also include a virtual public forum extend from East Santa Inez Avenue in a Draft Environmental Impact Statement for the public to share thoughts on the the City of San Mateo to Millbrae (Draft EIS) for the El Camino Real project material, the project alternatives Avenue in the City of Millbrae. Roadway Renewal Project. under consideration, suggest other The project is needed to address the alternatives, and read what other overall condition of the existing SUMMARY: The FHWA on behalf of the members of the public are saying about roadway by correcting the following California Department of Transportation the project. All comments offered deficiencies: The pavement is currently (Caltrans), is issuing this notice to through the virtual public forum will be rated as poor, with moderate alligator advise the public that a Draft EIS will moderated to maintain respectful cracking and very poor ride quality be prepared for the El Camino Real discourse. Comments shared through indicating roadway structural Roadway Renewal Project (Project), a the virtual public forum will become inadequacy; water ponding and frequent proposed highway project on State part of the public record. localized flooding occurs due to uneven Route 82 in San Mateo County, In addition, the public can submit roadway surfaces and inadequate or California. formal scoping comments through the impacted drainage systems; pedestrian DATES: This notice will be accompanied www.ECRalternatives.com website via access is impaired due to lack of by a 30-day public scoping comment an electronic comment submission updated curb ramps and uneven period from Monday, November 16, form, via email at ECRproject@ sidewalks; pedestrian infrastructure is 2020, to December 17, 2020. The dot.ca.gov, or via USPS at the contact not compliant with state and federal deadline for public comments is 5:00 information listed below. In addition to Americans with Disabilities Act (ADA) p.m. (PST) on December 17, 2020. email notifications, Caltrans has mailed requirements; existing sidewalks lack Because COVID–19 social distancing notification postcards via USPS to the accessible pedestrian signals systems, advisories are still in effect, no physical public, based on information collected countdown pedestrian systems, high- public meetings will be held during the from early pubic outreach efforts, and to visibility striping, or current devices; public scoping comment period. city, county and state officials with and pavement markings. However, Caltrans will be making jurisdiction in the project area. The purpose of the project is to project information available on the Postcards provide contact information preserve and extend the life of the internet at www.ECRalternatives.com for requesting information in alternative roadway and improve ride quality, throughout the entire public comment formats or alternative language improve drainage efficiency to reduce period. A link to the above website is translation services. localized flooding, improve visibility for

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00097 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79259

all users, and enhance pedestrian The project team anticipates days for filing such claim, then that infrastructure by bringing it into reviewing all public comments received shorter time period still applies. compliance with Title II of the ADA. during the public scoping period and FOR FURTHER INFORMATION CONTACT: For Currently, the range of alternatives circulating a Draft EIS. A public hearing Caltrans: Brandon Larsen, being considered includes either taking will be held once the Draft EIS is Environmental Branch Chief, 1656 no action on the 3.6-mile segment of El completed. Public notice will be given Union Street, Eureka, CA, 8 a.m. to 4 Camino Real, or proceeding with one of of the time and place of the meeting and p.m., (707) 441–5730, brandon.larsen@ several potential build alternatives. The hearing. The Draft EIS will be available dot.ca.gov. For FHWA, contact David build alternatives would all involve for public and agency review and Tedrick at (916) 498–5024 or email performing roadway rehabilitation with comment prior to the public hearing to [email protected]. upgrades to drainage, pedestrian, and ensure that the full range of issues SUPPLEMENTARY INFORMATION: Effective roadway infrastructure to achieve the related to this proposed action are July 1, 2007, FHWA assigned, and the purpose and need of the project. The addressed and all significant issues are Caltrans assumed, environmental roadway rehabilitation alternatives may identified, and comments and responsibilities for this project pursuant include the following: Rehabilitation suggestions are invited from all to 23 U.S.C. 327. Notice is hereby given while keeping utilities overhead; interested parties. Comments or that the Caltrans has taken final agency rehabilitation while relocating utilities questions concerning this proposed actions subject to 23 U.S.C. 139(l)(1) by underground; rehabilitation while action and the Draft EIS should be issuing licenses, permits, and approvals reducing the number of travel lanes directed to Caltrans at the address for the following highway project in the from 4 to 2 and including a 12-foot provided above. State of California: Replace the Dr. Fine center-turning lane while keeping (Catalog of Federal Domestic Assistance Bridge over the Smith River on Route utilities overhead; and rehabilitation Program Number 20.205, Highway Planning 101 north of Crescent City. Built in while reducing the number of travel and Construction. The regulations 1940, the existing bridge is near the end lanes from 4 to 2 and including a 12-foot implementing Executive Order 12372 of its useful life. A new bridge will center-turning lane while relocating regarding intergovernmental consultation on better accommodate vehicles, utilities underground. Varying roadway Federal programs and activities apply to this program.) pedestrians, and bicyclists. The actions widths (ranging 44–46 feet), travel lane by the Federal agencies, and the laws widths (ranging 10–11 feet), and Issued on: November 19, 2020. under which such actions were taken, sidewalk widths (ranging 4–6 feet) are Rodney Whitfield, are described in the Final being considered to avoid and minimize Director, Financial Services, Federal Highway Environmental Assessment (FEA) for impacts to the Howard-Ralston Administration, California Division. the project, approved on March 19, Eucalyptus Tree Rows, where feasible. [FR Doc. 2020–27032 Filed 12–8–20; 8:45 am] 2020, in the FHWA Finding of No Avoidance and minimization measures BILLING CODE 4910–RY–P Significant Impact (FONSI) issued on will be studied and implemented March 19, 2020, and in other documents depending upon the limits of state right in the FHWA project records. The FEA, of way, Caltrans’ ability to meet state DEPARTMENT OF TRANSPORTATION NOD, and other project records are highway design and safety provisions, available by contacting Caltrans at the and/or other factors. Federal Highway Administration addresses provided above. The Caltrans The only anticipated Federal approval FEA and FONSI can be viewed at public includes a permit under the National Notice of Final Federal Agency Actions on Proposed Highway in California libraries in the project area or an Pollutant Discharge Elimination System electronic document can be requested. (NPDES). Other Federal administrative AGENCY: Federal Highway Contact information for requesting activities include coordination with the Administration (FHWA), Department of digital copies can be found at https:// Department of the Interior under Transportation (DOT). dot.ca.gov/caltrans-near-me/district-1/ Section 4(f) of the Department of ACTION: Notice of limitation on claims d1-projects/d1-dr-fine-bridge- Transportation Act (1966) and the for judicial review of actions by the replacement. Advisory Council on Historic California Department of Transportation This notice applies to all Federal Preservation under Section 106 of the (Caltrans). agency decisions as of the issuance date National Historic Preservation Act of this notice and all laws under which (1966). Notices describing the proposed SUMMARY: The FHWA, on behalf of such actions were taken, including but action and soliciting comments will be Caltrans, is issuing this notice to not limited to: sent to appropriate Federal cooperating announce actions taken by Caltrans, that 1. Council on Environmental Quality and participating agencies. are final. The actions relate to a Regulations Since June 2019, Caltrans has been in proposed highway project, bridge 2. National Environmental Policy Act of consultation under Section 106 of the replacement on US Route 101 in Del 1969, as amended, 42 U.S.C. National Historic Preservation Act to Norte County, State of California. Those 4332(2)(c) evaluate potential effects to the Howard- actions grant licenses, permits, and 3. 49 U.S.C. 303 for Section 4(f) Ralston Eucalyptus Tree Rows, a approvals for the project. 4. Federal-Aid Highway Act of 1970, 23 historic property listed on the National DATES: By this notice, FHWA, on behalf U.S.C 109 Register of Historic Places (NRHP), and of Caltrans, is advising the public of 5. MAP–21, the Moving Ahead for to evaluate potential effects to other final agency actions subject to 23 U.S.C. Progress in the 21st Century Act historic properties determined eligible 139(l)(1). A claim seeking judicial (Pub. L. 112–141) for the NRHP. Notifications have been review of the Federal agency actions on 6. Clean Air Act Amendments of 1990 sent to appropriate State, tribal the highway project will be barred (CAAA) governments, local agencies, private unless the claim is filed on or before 7. Clean Water Act of 1977 and 1987 organizations, and citizens who have May 10, 2021. If the Federal law that 8. Federal Water Pollution Control Act previously expressed or are known to authorizes judicial review of a claim of 1972 (see Clean Water Act of have interest in this proposal. provides a time period of less than 150 1977 & 1987)

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00098 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79260 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

9. Federal Land Policy and Management the Drug and Alcohol Clearinghouse SUPPLEMENTARY INFORMATION: Act of 1976 (Paleontological (DAC). Due to an error, the public Resources) comment period was not published. I. Public Participation and Request for 10. The National Historic Preservation This notice establishes a deadline for Comments Act of 1966 (NHPA) the submission of public comments. FMCSA encourages you to participate 11. Noise Control Act of 1972 DATES: Comments must be received on by submitting comments and related 12. Safe Drinking Water Act of 1944, as or before January 8, 2021. materials. amended ADDRESSES: You may submit comments 13. Endangered Species Act of 1973 bearing the Federal Docket Management Submitting Comments 14. Executive Order 11990, Protection of System (FDMS) Docket ID FMCSA– Wetlands If you submit a comment, please 2012–0032 using any of the following include the docket number for this 15. Executive Order 13112, Invasive methods: Species • notice (FMCSA–2012–0032), indicate Federal eRulemaking Portal: the specific section of this document to 16. Executive Order 13186, Migratory www.regulations.gov. Follow the online which the comment applies, and Birds instructions for submitting comments. provide a reason for suggestions or 17. Fish and Wildlife Coordination Act • Mail: Send comments to Dockets recommendations. You may submit of 1934, as amended Operations, U.S. Department of 18. Migratory Bird Treaty Act Transportation, 1200 New Jersey your comments and material online or 19. Wildflowers, Surface Transportation Avenue SE, West Building, Ground by fax, mail, or hand delivery, but and Uniform Relocation Act of 1987 Floor, Room W12–140, Washington, DC please use only one of these means. Section 130 20590–0001. FMCSA recommends that you include 20. Executive Order 11988, Floodplain • Hand Delivery or Courier: Deliver your name and a mailing address, an Management comments to Dockets Operations, West email address, or a phone number in the 21. Department of Transportation (DOT) Building, Ground Floor, Room W12– body of your document so the Agency Executive Order 5650.2— 140, 1200 New Jersey Avenue SE, can contact you if it has questions Floodplain Management and between 9 a.m. and 5 p.m., E.T., regarding your submission. Protection (April 23, 1979) Monday through Friday, except Federal To submit your comment online, go to 22. Title VI of the Civil Rights Act of holidays. www.regulations.gov and put the docket 1964, as amended • Fax: (202) 493–2251. number, ‘‘FMCSA–2012–0032’’ in the 23. Executive Order 12898, Federal Each submission must include the ‘‘Keyword’’ box, and click ‘‘Search.’’ Actions to Address Environmental Agency name and the docket number for When the new screen appears, click on Justice and Low-Income this notice. Note that DOT posts all ‘‘Comment Now!’’ button and type your Populations comments received without change to comment into the text box in the (Authority: 23 U.S.C. 139(l)(1)) www.regulations.gov, including any following screen. Choose whether you Issued on: November 19, 2020. personal information included in a are submitting your comment as an comment. Please see the Privacy Act Rodney Whitfield, individual or on behalf of a third party heading below. and then submit. If you submit your Director, Financial Services, Federal Highway Docket: For access to the docket to Administration, California Division. comments by mail or hand delivery, read background documents or submit them in an unbound format, no [FR Doc. 2020–27038 Filed 12–8–20; 8:45 am] comments, go to www.regulations.gov at larger than 81⁄2 by 11 inches, suitable for BILLING CODE 4910–RY–P any time or visit Room W12–140 on the copying and electronic filing. If you ground level of the West Building, 1200 submit comments by mail and would New Jersey Avenue SE, Washington, DEPARTMENT OF TRANSPORTATION like to know that they reached the DC, between 9 a.m. and 5 p.m., ET, facility, please enclose a stamped, self- Monday through Friday, except Federal Federal Motor Carrier Safety addressed postcard or envelope. Administration holidays. To be sure someone is there to help you, please call (202) 366–9317 or Viewing Comments and Documents [Docket No. FMCSA–2012–0032] (202) 366–9826 before visiting Dockets Operations. To view comments, as well as Commercial Driver’s License Privacy Act: In accordance with 5 documents mentioned in this preamble Standards: Application for Exemption; U.S.C. 553(c), DOT solicits comments as being available in the docket, go to Daimler Trucks North America, LLC from the public to better inform its www.regulations.gov and insert the (Daimler) rulemaking process. DOT posts these docket number, ‘‘FMCSA–2012–0032’’ AGENCY: Federal Motor Carrier Safety comments, without edit, including any in the ‘‘Keyword’’ box and click Administration (FMCSA), DOT. personal information the commenter ‘‘Search.’’ Next, click ‘‘Open Docket provides, to www.regulations.gov, as ACTION: Notice of correction; extension Folder’’ button and choose the of comment period. described in the system of records document listed to review. If you do not notice (DOT/ALL–14 FDMS), which can have access to the internet, you may SUMMARY: FMCSA corrects the be reviewed at www.dot.gov/privacy. view the docket online by visiting September 8, 2020 notice seeking public FOR FURTHER INFORMATION CONTACT: Mr. Dockets Operations in Room W12–140 comment on Daimler Trucks North Richard Clemente, FMCSA Driver and on the ground floor of the DOT West America, LLC’s (Daimler) request for an Carrier Operations Division; Office of Building, 1200 New Jersey Avenue SE, exemption from the commercial driver’s Carrier, Driver and Vehicle Safety Washington, DC 20590, between 9 a.m. license (CDL) requirements for nine of Standards, (202) 366–4225, MCPSD@ and 5 p.m., e.t., Monday through Friday, its commercial motor vehicle (CMV) dot.gov. If you have questions on except Federal holidays. To be sure drivers. Daimler also requested an viewing or submitting material to the someone is there to help you, please call exemption for the same drivers from the docket, contact Dockets Operations, (202) 366–9317 or (202) 366–9826 requirement to register CDL holders in (202) 366–9826. before visiting Dockets Operations.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00099 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79261

II. Correction ACTION: Notice of actions on special Hazardous Materials Approvals and On September 8, 2020 (85 FR 55572), permit applications. Permits Division, Pipeline and FMCSA published a notice announcing Hazardous Materials Safety SUMMARY: In accordance with the Daimler’s request for an exemption from Administration, U.S. Department of procedures governing the application the CDL requirements for nine of its Transportation, East Building, PHH–30, for, and the processing of, special CMV drivers. The notice sought public 1200 New Jersey Avenue Southeast, permits from the Department of comment, but did not include a closing Washington, DC 20590–0001, (202) 366– Transportation’s Hazardous Material date for the public comment period. 4535. Regulations, notice is hereby given that Through this notice, FMCSA provides a SUPPLEMENTARY INFORMATION: deadline for the comment period. the Office of Hazardous Materials Safety Copies of has received the application described the applications are available for Larry W. Minor, herein. inspection in the Records Center, East Associate Administrator for Policy. DATES: Comments must be received on Building, PHH–30, 1200 New Jersey [FR Doc. 2020–26981 Filed 12–8–20; 8:45 am] or before January 8, 2021. Avenue Southeast, Washington DC. BILLING CODE 4910–EX–P ADDRESSES: Record Center, Pipeline and This notice of receipt of applications Hazardous Materials Safety for special permit is published in DEPARTMENT OF TRANSPORTATION Administration, U.S. Department of accordance with part 107 of the Federal Transportation, Washington, DC 20590. hazardous materials transportation law Pipeline and Hazardous Materials Comments should refer to the (49 U.S.C. 5117(b); 49 CFR 1.53(b)). Safety Administration application number and be submitted in Issued in Washington, DC, on December 1, triplicate. If confirmation of receipt of 2020. Hazardous Materials: Notice of Actions comments is desired, include a self- Donald P. Burger, on Special Permits addressed stamped postcard showing the special permit number. Chief, General Approvals and Permits AGENCY: Pipeline and Hazardous Branch. Materials Safety Administration FOR FURTHER INFORMATION CONTACT: (PHMSA), DOT. Donald Burger, Chief, Office of

Application No. Applicant Regulation(s) affected Nature of the special permits thereof

Special Permits Data—Granted

11380–M ...... Baker Hughes Oilfield Oper- 173.302(a)(1) ...... To modify the special permit to authorize an improved de- ations LLC. sign of the cylinders. 13250–M ...... Pacific Consolidated Indus- 173.302(a)(1) ...... To modify the special permit to authorize an extension of tries LLC. cylinder life utilizing the Modal Acoustic Emission (MAE) test method. 14509–M ...... Pacific Consolidated Indus- 173.302(a), 173.302(f)(3), To modify the special permit to authorize an extension of tries LLC. 173.302(f)(4), 173.302(f)(5), cylinder life utilizing the Modal Acoustic Emission (MAE) 173.304(a), 175.501(e)(3). test method. 16560–M ...... Lightstore, Inc ...... 173.302(a) ...... To modify the special permit to authorize additional 2.1 and 2.2 hazmat and to authorize an increase in the allowable maximum working pressure of certain cylinders. 20973–M ...... Olin Winchester LLC ...... 172.203(a), 173.63(b)(2)(v) ... To modify the special permit to remove the requirement for carrying a copy of the permit on each vessel, aircraft or motor vehicle transporting packages covered by the per- mit. 21014–N ...... Volvo Cars of North America, ...... To authorize the transportation in commerce of lithium ion LLC. batteries exceeding 35 kg net weight by cargo-only air- craft. 21059–N ...... Union Pacific Railroad Com- 172.203(a), 174.24, 174.26(a) To authorize the use of electronic means to maintain and pany Inc. communicate on-board train consist information in lieu of paper documentation when hazardous materials are transported by rail. 21063–N ...... Cobham Mission Systems Or- 173.302(a)(1) ...... To authorize the transportation in commerce of certain chard Park Inc. gases in non-refillable, non-DOT specification cylinders. 21067–N ...... Stainless Tank & Equipment 172.203(a), 178.345–2, To authorize the manufacture, mark, sale, and use of DOT Co., LLC. 178.346–2, 178.347–2, 400 series cargo tanks fabricated using certain stainless 178.348–2. steels and other materials not authorized as materials of construction by § 178.345–2. 21084–N ...... Samsung SDI America, Inc ... 172.101(j) ...... To authorize the transportation in commerce of lithium bat- teries in excess of 35 kg by cargo-only aircraft. 21085–N ...... Omron Robotics and Safety 172.101(j), 173.185(b)(3) ...... To authorize the transportation in commerce of certain lith- Technologies, Inc. ium batteries in alternative packaging and exceeding 35 kg aboard cargo-only aircraft. 21104–N ...... Kelley Fuels, Inc ...... 172.336(c) ...... To authorize the transportation in commerce of cargo tanks containing either gasoline or diesel fuel with a placard permanently marked with a ‘‘1203’’ UN number identifica- tion mark.

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79262 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

Application No. Applicant Regulation(s) affected Nature of the special permits thereof

21130–N ...... Tatonduk Outfitters Limited ... 175.9(b) ...... To authorize the acceptance and transportation in com- merce of hazardous materials to be used for zero-gravity research experiments conducted aboard the aircraft dur- ing parabolic flight operations for from the point of origin airport to the return of the aircraft to that same airport. 21131–N ...... Department of Defense US 173.185(a), 173.185(e)(6) ...... To authorize the transportation in commerce of low produc- Army Military Surface De- tion lithium ion batteries that have not passed the re- ployment & Distribution quired tests in the UN Manual of Tests and Criteria. Command. 21132–N ...... Northwest Energetic Services 173.56(a) ...... To authorize the transportation in commerce of bags of ex- LLC. plosives which are marked with an incorrect EX number. 21138–N ...... LG Chem, Ltd ...... 173.185(f)(3) ...... To authorize the transportation in commerce aboard motor vehicle of defective lithium-ion batteries in 4G fiberboard outer boxes that were used to transport replacement bat- teries.

Special Permits Data—Denied

20245–M ...... Jaguar Instruments Inc ...... 173.302(a), 173.304(a) ...... To modify the special permit to update reporting procedure, update cylinder design drawings and incorporate ICAO references to the permit.

Special Permits Data—Withdrawn

15689–M ...... Mercedes-Benz Research & 172.200, 172.301(c), To modify the permit to authorize a larger cylinder to be uti- Development North Amer- 177.834(h). lized in the test equipment. ica, Inc. 21121–N ...... Mountain Flame Propane, Inc 173.315(j)(2)(iv) ...... To authorize the transportation in commerce of more than one container of liquid propane gas on a motor vehicle.

[FR Doc. 2020–27017 Filed 12–8–20; 8:45 am] the Office of Hazardous Materials Safety Hazardous Materials Approvals and BILLING CODE 4910–60–P has received the application described Permits Division, Pipeline and herein. Each mode of transportation for Hazardous Materials Safety which a particular special permit is Administration, U.S. Department of DEPARTMENT OF TRANSPORTATION requested is indicated by a number in Transportation, East Building, PHH–30, the ‘‘Nature of Application’’ portion of 1200 New Jersey Avenue Southeast, Pipeline and Hazardous Materials the table below as follows: 1–Motor Washington, DC 20590–0001, (202) 366– Safety Administration vehicle, 2–Rail freight, 3–Cargo vessel, 4535. 4–Cargo aircraft only, 5–Passenger- Hazardous Materials: Notice of carrying aircraft. SUPPLEMENTARY INFORMATION: Copies of Applications for Modifications to the applications are available for DATES: Comments must be received on Special Permit inspection in the Records Center, East or before December 24, 2020. Building, PHH–30, 1200 New Jersey AGENCY: Pipeline and Hazardous ADDRESSES: Record Center, Pipeline and Avenue Southeast, Washington DC. Materials Safety Administration Hazardous Materials Safety (PHMSA), DOT. Administration, U.S. Department of This notice of receipt of applications for special permit is published in ACTION: Transportation, Washington, DC 20590. List of applications for accordance with part 107 of the Federal modification of special permits. Comments should refer to the application number and be submitted in hazardous materials transportation law SUMMARY: In accordance with the triplicate. If confirmation of receipt of (49 U.S.C. 5117(b); 49 CFR 1.53(b)). procedures governing the application comments is desired, include a self- Issued in Washington, DC, on December 1, for, and the processing of, special addressed stamped postcard showing 2020. permits from the Department of the special permit number. Donald P. Burger, Transportation’s Hazardous Material FOR FURTHER INFORMATION CONTACT: Chief, General Approvals and Permits Regulations, notice is hereby given that Donald Burger, Chief, Office of Branch.

Application No. Applicant Regulation(s) affected Nature of the special permits thereof

Special Permits Data

5749–M ...... Chemours Company Fc LLC 173.315(a) ...... To modify the special permit to authorize a new distillate trailer. (mode 1) 14372–M ...... Kidde Technologies Inc ...... 173.309(a), 180.213(a) ...... To modify the special permit to update the permit with the addition of a new part number. (modes 1, 2, 3, 4, 5) 16308–M ...... Vero Biotech LLC ...... 173.175 ...... To modify the special permit to authorize a new absorbent filler surrounding the ampules being transported. (modes 1, 2, 3, 4, 5)

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00101 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices 79263

Application No. Applicant Regulation(s) affected Nature of the special permits thereof

20584–M ...... Battery Solutions, LLC ...... 173.185(f)(3), To modify the special permit to authorize up to 400 lbs. of 173.185(c)(1)(iii), damaged/defective batteries in individual packaging to be 173.185(c)(1)(iv), shipped in a 55-gallon drum. (modes 1, 2, 3) 173.185(c)(1)(v), 173.185(c)(3), 173.185(f), 173.185(f)(1). 20986–M ...... Olin Corporation ...... 172.302(c), 173.26, To modify the special permit to clarify the GRL limit. (mode 173.314(c), 179.13(b). 2)

[FR Doc. 2020–27018 Filed 12–8–20; 8:45 am] has received the application described Hazardous Materials Approvals and BILLING CODE 4910–60–P herein. Each mode of transportation for Permits Division, Pipeline and which a particular special permit is Hazardous Materials Safety requested is indicated by a number in Administration, U.S. Department of DEPARTMENT OF TRANSPORTATION the ‘‘Nature of Application’’ portion of Transportation, East Building, PHH–30, the table below as follows: 1–Motor 1200 New Jersey Avenue Southeast, Pipeline and Hazardous Materials vehicle, 2–Rail freight, 3–Cargo vessel, Washington, DC 20590–0001, (202) 366– Safety Administration 4–Cargo aircraft only, 5–Passenger- 4535. Hazardous Materials: Notice of carrying aircraft. SUPPLEMENTARY INFORMATION: Copies of Applications for New Special Permits DATES: Comments must be received on the applications are available for or before January 8, 2021. inspection in the Records Center, East AGENCY: Pipeline and Hazardous ADDRESSES: Record Center, Pipeline and Building, PHH–30, 1200 New Jersey Materials Safety Administration Hazardous Materials Safety Avenue Southeast, Washington DC. (PHMSA), DOT. Administration, U.S. Department of This notice of receipt of applications ACTION: List of applications for special Transportation Washington, DC 20590. for special permit is published in permits. Comments should refer to the accordance with Part 107 of the Federal SUMMARY: In accordance with the application number and be submitted in hazardous materials transportation law procedures governing the application triplicate. If confirmation of receipt of (49 U.S.C. 5117(b); 49 CFR 1.53(b)). for, and the processing of, special comments is desired, include a self- Issued in Washington, DC, on December 1, permits from the Department of addressed stamped postcard showing 2020. Transportation’s Hazardous Material the special permit number. Donald P. Burger, Regulations, notice is hereby given that FOR FURTHER INFORMATION CONTACT: Chief, General Approvals and Permits the Office of Hazardous Materials Safety Donald Burger, Chief, Office of Branch.

SPECIAL PERMITS DATA

Application No. Applicant Regulation(s) affected Nature of the special permits thereof

21139–N ...... KULR Technology Corpora- 172.200, 172.700(a) ...... To authorize the transportation in commerce of lithium bat- tion. teries with limited relief from the shipping papers and training required in 49 CFR Subparts C and H of Part 172 of the U.S. HMR when shipped in a thermal containment packaging manufactured by KULR for recycling. (modes 1, 2) 21140–N ...... Philips Medical Systems MR, 172.101(j) ...... To authorize the transportation of MRI machines that con- Inc. tain compressed helium in non-specification pressure ves- sels. (modes 1, 2, 3, 4, 5) 21141–N ...... Pollution Control Inc ...... 172.320, 173.56(b) ...... To authorize the transportation in commerce, for the pur- pose of disposal only, of certain waste energetic sub- stances and/or articles classed as Division 1.1D, subject to the packaging and special provisions prescribed here- in. (mode 1) 21142–N ...... Atlas Air, Inc ...... 172.101(j), 172.204(c)(3), To authorize the transportation in commerce of explosives 173.27(b)(2), 173.27(b)(3). forbidden aboard cargo-only aircraft by cargo-only aircraft. (mode 4) 21143–N ...... Tradewater LLC ...... 172.700(a), 173.306(a) ...... To authorize the transportation in commerce of refrigerant gases in DOT 2Q receptacles as limited quantities by motor vehicle and rail without requiring training in accord- ance with Part 172 subpart H. (modes 1, 2) 21144–N ...... Consolidated Nuclear Security 173.56(b) ...... To authorize the transportation in commerce of certain ma- LLC. terials containing low quantities of explosive substances without requiring approval in accordance with 173.56(b). (modes 1, 4) 21145–N ...... Reg Grays Harbor LLC ...... 173.31(d)(1)(ii) ...... To authorize the transportation in commerce of tank cars that have been pneumatic positive pressure tested in lieu of visually inspected prior to shipping. (mode 2)

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES 79264 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Notices

SPECIAL PERMITS DATA—Continued

Application No. Applicant Regulation(s) affected Nature of the special permits thereof

21147–N ...... IPACKCHEM Group SAS ...... 173.158(f)(3) ...... To authorize the manufacture, mark, sale, and use of UN 4G specification packagings for the transport of nitric acid where the primary receptacles are not individually over- packed in tightly closed metal packagings. (modes 1, 2, 3) 21150–N ...... ZECO, Inc ...... 172.203(a), 172.302(c), To authorize the transportation in commerce of Division 5.2 173.225(h). materials in non-authorized bulk packagings. (modes 1, 2)

[FR Doc. 2020–27019 Filed 12–8–20; 8:45 am] BILLING CODE 4910–60–P

VerDate Sep<11>2014 16:16 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00103 Fmt 4703 Sfmt 9990 E:\FR\FM\09DEN1.SGM 09DEN1 jbell on DSKJLSW7X2PROD with NOTICES Vol. 85 Wednesday, No. 237 December 9, 2020

Part II

Department of the Interior

Bureau of Safety and Environmental Enforcement 30 CFR Part 250 Bureau of Ocean Energy Management 30 CFR Part 550 Oil and Gas and Sulfur Operations on the Outer Continental Shelf— Revisions to the Requirements for Exploratory Drilling on the Arctic Outer Continental Shelf; Proposed Rule

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79266 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

DEPARTMENT OF THE INTERIOR Identifier Number (RIN) 1082–AA01 as (907) 334–5300. For technical questions an identifier in your message. For related to regulatory changes BOEM is Bureau of Safety and Environmental comments specifically related to the proposing in Part 550, contact Joel Enforcement draft Environmental Assessment (EA) Immaraj, BOEM, Alaska Regional Office, conducted under the National [email protected], (907) 334– 30 CFR Part 250 Environmental Policy Act of 1969 5238. For procedural questions contact (NEPA), please refer to NEPA in the Bryce Barlan, BSEE, Regulations and Bureau of Ocean Energy Management heading of your message. See also Standards Branch, [email protected], (703) Public Availability of Comments under 787–1126. 30 CFR Part 550 Procedural Matters. SUPPLEMENTARY INFORMATION: • Federal eRulemaking Portal: http:// [Docket ID: BSEE–2019–0008, EEEE500000, Executive Summary 21XE1700DX, EX1SF0000.EAQ000] www.regulations.gov. In the entry entitled, ‘‘Enter Keyword or ID,’’ enter In response to BSEE- and BOEM- RIN 1082–AA01 BSEE–2019–0008, then click search. initiated environmental and safety reviews of potential oil and gas Oil and Gas and Sulfur Operations on Follow the instructions to submit public comments and view supporting and operations on the Arctic OCS, the Outer Continental Shelf—Revisions experiences gained from Shell’s 2012 to the Requirements for Exploratory related materials available for this rulemaking. BSEE and BOEM may post and 2015 Arctic operations, and Drilling on the Arctic Outer Continental concerns expressed by environmental Shelf all submitted comments. • Mail or hand-carry comments to the organizations and Alaska Natives, BSEE AGENCIES: Bureau of Safety and DOI, BSEE and BOEM: Attention: and BOEM published the 2016 Arctic Environmental Enforcement (BSEE); Regulations and Standards Branch, Exploratory Drilling Rule (see 81 FR Bureau of Ocean Energy Management 45600 Woodland Road, VAE–ORP, 46478, July 15, 2016). The rule was (BOEM), Interior. Sterling VA 20166. Please reference RIN narrowly focused, applying solely to exploratory drilling operations ACTION: Proposed rule. 1082–AA01, ‘‘Oil and Gas and Sulfur Operations on the Outer Continental conducted during the Arctic OCS open- SUMMARY: The Department of the Shelf—Revisions to the Requirements water drilling season by drilling vessels Interior (DOI or Department), acting for Exploratory Drilling on the Arctic and ‘‘jack-up rigs’’ (collectively known through BOEM and BSEE, has reviewed Outer Continental Shelf,’’ in your as mobile offshore drilling units or and is proposing to revise its existing comments, and include your name and MODU) in the Beaufort Sea and regulations for exploratory drilling and return address. Chukchi Sea Planning Areas. The related operations on the Arctic Outer • Send comments on the information regulations were intended to ensure that Continental Shelf (OCS), to reduce collection in this rule to: Interior Desk Arctic OCS exploratory drilling unnecessary burdens on stakeholders Officer 1082–AA01, Office of operations are conducted in a safe and while ensuring that energy exploration Management and Budget; 202–395–5806 responsible manner, while taking into on the Arctic OCS is safe and (fax); or via the online portal at account the unique conditions of the environmentally responsible. In RegInfo.gov. Please also send a copy to Arctic OCS, as well as Alaska Natives’ particular, this proposed rule would BSEE and BOEM by one of the means cultural traditions and their need for revise certain requirements promulgated previously described. access to subsistence resources. BSEE through the rule entitled, Oil and Gas • Public Availability of Comments— and BOEM have since reviewed the and Sulfur Operations on the Outer Before including your address, phone 2016 Arctic Exploratory Drilling Rule Continental Shelf-Requirements for number, email address, or other taking into account a Congressional declaration of purposes in the Outer Exploratory Drilling on the Arctic Outer personal identifying information in your Continental Shelf Lands Act (OCSLA) to Continental Shelf (‘‘2016 Arctic comment, you should be aware that ‘‘establish policies and procedures for Exploratory Drilling Rule’’). This your entire comment—including your managing the oil and natural gas proposed rule would also add new personal identifying information—may resources of the Outer Continental Shelf provisions to BSEE’s regulations be made publicly available at any time. which are intended to result in pertaining to suspensions of operations For BSEE and BOEM to withhold from expedited exploration and development (SOO), and BOEM’s Exploration Plan disclosure your personal identifying of the Outer Continental Shelf in order (EP) and Development and Production information, you must identify any to achieve national economic and Plan (DPP) regulations. information contained in the submittal energy policy goals, assure national DATES: Submit comments by February 8, of your comments that, if released, security, reduce dependence on foreign 2021. BSEE and BOEM may not fully would constitute a clearly unwarranted sources, and maintain a favorable consider comments received after this invasion of your personal privacy. You balance of payments in world trade.’’ 1 date. You may submit comments to the must also briefly describe any possible The bureaus have also reviewed new Office of Management and Budget harmful consequence(s) of the information about technological (OMB) on the information collection disclosure of information, such as developments in an ice environment. burden in this proposed rule by January embarrassment, injury, or other harm. Based on that review, BSEE and BOEM 8, 2021. The deadline for comments on While you can ask us in your comment are proposing revisions in this proposed the information collection burden does to withhold your personal identifying rule that are consistent with OCSLA, not affect the deadline for the public to information from public review, we and would reduce unnecessary burdens comment to BSEE and BOEM on the cannot guarantee that we will be able to on stakeholders while still maintaining proposed regulations. do so. safety and environmental protection. ADDRESSES: You may submit comments FOR FURTHER INFORMATION CONTACT: For Since publication of the 2016 Arctic on BSEE’s or BOEM’s sections of the technical questions related to regulatory Exploratory Drilling Rule, new rulemaking by any of the following changes BSEE is proposing in Part 250, methods. For comments on this contact Mark E. Fesmire, BSEE, Alaska 1 Outer Continental Shelf Lands Act, Public Law proposed rule, please use the Regulation Regional Office, [email protected], 95–372, sec. 102 (Sept. 8, 1978), 43 U.S.C. 1802(1)).

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79267

Executive Orders (E.O.) and Secretary’s Arctic Exploration Activities. The 3. Arctic OCS Source Control and Orders (S.O.) called on Federal agencies Bratslavsky and SolstenXP study was Containment Equipment (SCCE); to review existing regulations that finalized in October 2018 and may be 4. Relief rig capabilities for the Arctic potentially burden the development or downloaded from BSEE’s TAP website OCS; use of domestically produced energy at: https://www.bsee.gov/research- 5. Timing and submission resources and appropriately begin record/suitability-of-source-control- requirements related to Integrated processes to potentially suspend, revise, containment-equipment-versus-same- Operations Plans (IOP) for proposed or rescind those regulations that are season-relief-well. The NPC 2019 Report Arctic exploratory drilling; determined to unduly burden the was finalized in April 2019 and may be 6. What must be included in the IOP; development of domestic energy downloaded from an NPC website at: and resources, beyond the degree necessary https://www.npc.org/ARSA-FINAL- 7. What data and information must to protect the public interest or 052219-LoRes.pdf. The NPC 2015 accompany the EP and DPP. otherwise comply with the law. Report was finalized in March 2015 and This proposed rule is designed to Executive Order 13795, Implementing may be downloaded from an NPC reflect the need to ensure the safe, an America-First Offshore Energy website at: http:// effective, and responsible exploration of Strategy (82 FR 20815) and Secretary’s www.npcarcticpotentialreport.org/ Arctic OCS oil and gas resources, while Order 3350, America-First Offshore index.html. protecting the marine, coastal, and Energy Strategy, which are discussed in Based on the results of these reports, human environments, and preserving more detail below in Section I. BSEE and BOEM are proposing to Alaska Natives’ cultural traditions and Background, Subsection C. Executive amend, revise, or remove certain current their access to subsistence resources. and Secretary’s Orders, specifically regulatory provisions promulgated This proposed rule is intended to revise called for a review of the 2016 Arctic through the 2016 Arctic Exploratory the regulations promulgated through the Exploratory Drilling Rule.2 In response Drilling Rule, to reduce unnecessary 2016 Arctic Exploratory Drilling Rule by to these E.O.s and S.O.s, BSEE and burdens on stakeholders while still creating more flexible and less costly BOEM undertook a review of the maintaining safety and environmental compliance options in BSEE’s and regulations promulgated through the protection. This proposed rulemaking is BOEM’s regulations that could achieve 2016 Arctic Exploratory Drilling Rule consistent with OCSLA’s Congressional these objectives. While this proposed with a view toward encouraging energy declaration of purposes to ‘‘establish rule seeks to promulgate new provisions exploration and production on the policies and procedures for managing in addition to those addressed in the Arctic OCS, as appropriate and the oil and natural gas resources of the 2016 Arctic Exploratory Drilling Rule, consistent with applicable law, and Outer Continental Shelf which are these new provisions (i.e., provisions to reducing unnecessary regulatory intended to result in expedited address leaseholding operations burdens, while ensuring that any such exploration and development of the impacted by seasonal weather-related activity is safe and environmentally Outer Continental Shelf in order to constraints on the Arctic OCS) would responsible. achieve national economic and energy further enhance BSEE’s and BOEM’s BSEE’s and BOEM’s views about policy goals, assure national security, abilities to ensure the safe, effective, and certain features of the existing reduce dependence on foreign sources, responsible exploration of Arctic OCS regulations were also informed by new and maintain a favorable balance of oil and gas resources. They would do so information that has become available payments in world trade.’’ 43 U.S.C. while protecting the marine, coastal, since the 2016 rule was finalized. This 1802(1). and human environments, and new information includes a BSEE- BSEE and BOEM also considered preserving Alaska Natives’ cultural commissioned Technology Assessment another issue on the Arctic OCS in traditions and access to subsistence Program (TAP) study entitled, addition to those addressed in the 2016 resources. Through lease stipulations Suitability of Source Control and Arctic Exploratory Drilling Rule, but is related to the Conflict Avoidance Containment Equipment versus Same logical to address as part of this Agreements (CAA), BOEM currently Season Relief Well in the Alaska Outer rulemaking to further encourage safe requires operators to consult with Continental Shelf Region (Bratslavsky and environmentally responsible affected subsistence communities and and SolstenXP, 2018) and a National exploration of this region, where the describe in exploration and Petroleum Council (NPC) report areas known to have oil and gas have development plans the mitigating entitled, Supplemental Assessment to been explored or studied. This issue practices the operator would undertake the 2015 Report on Arctic Potential: pertains to the effective means by which to avoid conflicts with the communities. Realizing the Promise of U.S. Arctic Oil BSEE and the operator could address Conflict Avoidance Agreements provide and Gas Resources (NPC 2019 Report). seasonal weather-related constraints in a framework for mitigating the adverse BSEE also re-assessed the original NPC the Arctic OCS that severely impact the impacts a drilling project may have on report entitled, Arctic Potential: operator’s ability to safely perform subsistence activities, values, and uses. leaseholding operations for a significant Realizing the Promise of U.S. Arctic Oil Table of Contents and Gas Resources (NPC 2015 Report; portion of the term on a lease. together with the NPC 2019 Report, the Accordingly, this proposed rule I. Background NPC reports). Both NPC reports include would revise certain provisions in 30 A. Overview of the Alaska Arctic Region discussions about global Arctic Code of Federal Regulations (CFR) Part B. BSEE and BOEM Statutory and Regulatory Authority and operations. These global operations are 250, Subparts A, C, D, and G, and 30 CFR part 550, subpart B, that pertain to: Responsibilities discussed in further detail below in C. Executive and Secretary’s Orders Subsection 5. Industry Interest in the 1. The factors that the BSEE Regional Supervisor may evaluate in assessing D. Purpose and Summary of the Arctic OCS of Section I. Background, Rulemaking under the subheading entitled, Global whether to grant an SOO, to address E. Partner Engagement in Preparation for unique and specific conditions relevant This Proposed Rule 2 These Orders did no dictate outcomes; rather, only to exploration and development II. Section-by-Section Discussion of Proposed they directed a review in accordance with activities on the Arctic OCS; Changes applicable law. 2. Pollution prevention; A. Key Revisions Proposed by BSEE

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79268 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

Subpart A—General • When and how must I secure a well? B. Regulatory Flexibility Act and Small • Definitions. (§ 250.105) (§ 250.720) Business Regulatory Enforcement • When may the Regional Supervisor grant B. Key Revisions Proposed by BOEM Fairness Act an SOO? (§ 250.175) Subpart B—Plans and Information C. Unfunded Mandates Reform Act of 1995 • Documents incorporated by reference. • Definitions. (§ 550.200) (UMRA) (§ 250.198) • Removal of § 550.204, When must I D. Takings Implication Assessment Subpart C—Pollution Prevention and submit my IOP for proposed Arctic Control E. Federalism (E.O. 13132) • exploratory drilling operations and what F. Civil Justice Reform (E.O. 12988) Pollution prevention. (§ 250.300) must the IOP include? Subpart D—Oil and Gas Drilling G. Consultation With Indian Tribes (E.O. • How do I submit the EP, DPP, or DOCD? Operations 13175) (§ 550.206) • What additional information must I H. Environmental Justice in Minority • What must the EP include? (§ 550.211) submit with my APD for Arctic OCS Populations and Low-Income • If I propose activities in the Arctic OCS exploratory drilling operations? Populations (E.O. 12898) (§ 250.470) Region, what planning information must • accompany the EP? (§ 550.220) E.O. 12898 What are the requirements for Arctic I. Paperwork Reduction Act (PRA) OCS source control and containment? III. Additional Comments Solicited on the J. National Environmental Policy Act of (§ 250.471) Same Season Relief Well and Relief Rig • What are the additional well control Requirement 1969 (NEPA) equipment or relief rig requirements for IV. Procedural Matters K. Data Quality Act the Arctic OCS? (§ 250.472) A. Regulatory Planning and Review L. Effects on the Nation’s Energy Supply Subpart G—Well Operations and (Executive Orders (E.O.) 12866, 13563, (E.O. 13211) Equipment and 13771) M. Clarity of Regulations

LIST OF ACRONYMS AND REFERENCES

Report to the Secretary of the Interior, review of Shell’s 2012 Alaska Offshore Oil and 60-Day report Gas Exploration Program

2016 Arctic Exploratory Drilling Rule .. Oil and Gas and Sulfur Operations on the Outer Continental Shelf-Requirements for Exploratory Drilling on the Arctic Outer Continental Shelf, 81 FR 46478, July 15, 2016 (available at https://www.doi.gov/ sites/doi.gov/files/migrated/news/pressreleases/upload/Shell-report-3-8-13-Final.pdf.). ABS ...... American Bureau of Shipping. ACP ...... Alternative Compliance Program. ADNR ...... Alaska Department of Natural Resources. AEWC ...... Alaska Eskimo Whaling Commission. ANILCA ...... Alaska National Interest Lands Conservation Act. ANCSA ...... Alaska Native Claims Settlement Act. ANWR ...... Arctic National Wildlife Refuge. APD ...... Application for Permit to Drill. API ...... American Petroleum Institute. Arctic OCS ...... OCS within the Beaufort Sea and Chukchi Sea Planning Areas. AWKS ...... Alternative Well Kill System. BOEM ...... Bureau of Ocean Energy Management. BOEMRE ...... Bureau of Ocean Energy Management, Regulation and Enforcement. BOP ...... Blowout Preventer. Bratslavsky and SolstenXP, 2018 ...... Suitability of Source Control and Containment Equipment versus Same Season Relief Well in the Alaska Outer Continental Shelf Region, October 2018. BSEE ...... Bureau of Safety and Environmental Enforcement. BLM ...... Bureau of Land Management. CAA ...... Conflict Avoidance Agreement. CFR ...... Code of Federal Regulations. CZMA ...... Coastal Zone Management Act. CWA ...... Clean Water Act. Department ...... Department of the Interior. DNV GL ...... Det Norske Veritas and Germanischer Lloyd. DOCD ...... Development Operations Coordination Document. DOI ...... Department of the Interior. DPP ...... Development and Production Plan. EA ...... Environmental Assessment. EIA ...... Environmental Impact Analysis. EIS ...... Environmental Impact Statement. E.O...... Executive Order. EP ...... Exploration Plan. EPA ...... Environmental Protection Agency. ESA ...... Endangered Species Act. G&G ...... Geological and geophysical. IC ...... Information Collection. ICAS ...... Inupiat Community of the Arctic Slope. IOP ...... Integrated Operations Plan. IRIA ...... Initial Regulatory Impact Analysis. IWC ...... International Whaling Commission. LMRP ...... Lower Marine Riser Package. MASP ...... Maximum Anticipated Surface Pressures. MMPA ...... Marine Mammal Protection Act. MMS ...... Minerals Management Service. MODU ...... Mobile Offshore Drilling Unit.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79269

LIST OF ACRONYMS AND REFERENCES—Continued

Report to the Secretary of the Interior, review of Shell’s 2012 Alaska Offshore Oil and 60-Day report Gas Exploration Program

NAICS ...... North American Industry Classification System. NEPA ...... National Environmental Policy Act of 1969. NMFS ...... National Marine Fisheries Service. NOAA ...... National Oceanic and Atmospheric Administration. NPC ...... National Petroleum Council. NPC 2015 Report ...... Arctic Potential: Realizing the Promise of U.S. Arctic Oil and Gas Resources. NPC 2019 Report ...... Supplemental Assessment to the 2015 Report on Arctic Potential: Realizing the Promise of U.S. Arctic Oil and Gas Resources. NPDES ...... National Pollutant Discharge Elimination System. NPR–A ...... National Petroleum Reserve—Alaska. NSB ...... North Slope Borough. NTL ...... Notice to Lessees and Operators. OCS ...... Outer Continental Shelf. OCSLA ...... Outer Continental Shelf Lands Act. ODCE ...... Ocean Discharge Criteria Evaluations. OIRA ...... Office of Information and Regulatory Affairs. OMB ...... Office of Management and Budget. ONRR ...... Office of Natural Resources Revenue. OSRP ...... Oil Spill Response Plan. PFD ...... Permanent Fund Dividend. PRA ...... Paperwork Reduction Act. psi/ft ...... pounds per square inch per foot. RIN ...... Regulation Identifier Number. ROV ...... Remotely Operated Vehicle. RP ...... Recommended Practice. SCCE ...... Source Control and Containment Equipment. Secretary ...... Secretary of the Interior. S.O...... Secretary’s Orders. SEMS ...... Safety and Environmental Management Systems. SSID ...... Subsea Isolation Device. SSRW ...... Same Season Relief Well. SOO ...... Suspensions of Operations. TAP ...... Technology Assessment Program. TAPS ...... Trans-Alaska Pipeline System. TCF ...... Trillion Cubic Feet. UMRA ...... Unfunded Mandates Reform Act of 1995. U.S...... United States. USCG ...... U.S. Coast Guard. USFWS ...... U.S. Fish and Wildlife Service. USGS ...... United States Geological Survey. Utquiavik ...... Barrow. WCD ...... Worst Case Discharge.

I. Background the Prudhoe Bay State #1 well. BP percent of that amount.4 Currently, the Exploration drilled a confirmation well only offshore Federal production in the A. Overview of the Alaska Arctic Region the following year. However, production Arctic OCS 5 is Hilcorp’s Northstar field, 1. History of Arctic Oil and Gas did not come online until June 20, 1977, which includes both State and Federal Development after the TAPS was completed and other acreage in the 8(g) Zone.6 Located in the Although Alaska’s first oil production companies with lease holdings in the Beaufort Sea about 12 miles northwest is attributable to the 1957 Swanson area undertook a host of activities to of Prudhoe Bay, this prospect has been River discovery on the Kenai Peninsula, delineate the reservoir, resolve equity producing since 2001. Over 150 million oil and gas resources have been known participation, and put together initial barrels of oil have been produced to to exist in the Arctic since as early as infrastructure for the field. After over 40 date at Northstar. In 2019, the Federal 1839. Early explorers had reported that years of production, Prudhoe Bay Government received nearly $5 million Alaska Natives on the Arctic coast used remains the largest oil field in North in royalty payments from oil production on Federal leases at Northstar, and from oil-soaked tundra for fuel. The oil came America and is the 18th largest field 2003 to 2018, royalty payments ranged from natural oil seeps on the ground. ever discovered worldwide.3 According However, the extent of the resource, as to data maintained by the Alaska Oil well as the State’s overall oil and gas 4 http://aogweb.state.ak.us/DataMiner3/Forms/ and Gas Conservation Commission, Production.aspx. endowment, would not be realized until Alaska’s North Slope has produced over 5 There are Federal OCS leases that do not have the discovery of the Arctic’s Prudhoe 17.3 billion barrels of oil, with Prudhoe ongoing production in the Cook Inlet, which is not Bay oil field on the North Slope and Bay contributing approximately 68 considered part of the Arctic. completion of the Trans-Alaska Pipeline 6 Section 8(g) of the OCSLA requires the Federal System (TAPS) in 1977. Government to share with the State of Alaska 27% 3 https://dec.alaska.gov/spar/ppr/response/sum_ of revenue from leases in the 8(g) Zone (the first The Prudhoe Bay field was discovered fy06/060302301/factsheets/060302301_factsheet_ three nautical miles of the Outer Continental Shelf). on March 12, 1968, with the drilling of PB.pdf. 43 U.S.C. 1337(g).

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79270 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

from $3 million to over $20 million in revenue to the State’s budget since 2012 due to a confluence of events, including any given year. In 2019, the Federal is due primarily to declining oil decreased demand from coronavirus Government disbursed just over $1.5 production in the North Slope, but also effects, as well as production output million to the State of Alaska for due to a general downward trend in oil negotiations between OPEC and Russia. Northstar Federal leases in the 8(g) prices. These events caused the price of oil to Zone.7 Aside from annual State operating slide to 17-year lows. While prices have The construction of TAPS enhanced and capital budgets, several Statewide already partially recovered and the significance of the Arctic’s government programs established for stabilized, this could affect interest and production to the State of Alaska. TAPS the benefit of the people of Alaska are activity in the region if the low-price is an 800-mile-long pipeline system that largely dependent on oil and gas-related environment continues into the future, was designed to accommodate the revenues, most notably the Alaska as drilling and other exploration transport of over 2 million barrels of oil Permanent Fund. In 1976, Alaska’s State activities in the Arctic are more per day. The pipeline begins at Prudhoe constitution was amended to establish expensive than other regions. Given the Bay and stretches south to Valdez in the Alaska Permanent Fund, which long period of time before exploratory southern Alaska, which is the provides that at least 25 percent of all drilling in the Arctic is expected to start northernmost ice-free port in North mineral lease rentals, royalties, royalty and the short-term nature of the America. TAPS is one of the world’s sale proceeds, Federal mineral revenue underlying price events, the Bureaus largest pipeline systems, an engineering sharing payments, and bonuses received expect that prices will continue to icon that was the biggest privately by the State are to be placed in a rebound. The events in 2020 also funded construction project when it was permanent fund, known as the Alaska underscore the importance of ensuring constructed in the 1970s. At peak flow Permanent Fund, the principal of which that BOEM and BSEE regulations are no in 1988, 11 pump stations helped to is used only for income-producing more burdensome than necessary to move 2.1 million barrels of oil a day.8 investments. All income generated from protect safety and the environment. the permanent fund is available for 2. Budgetary Economic Impact on the 3. Arctic Resource Potential and People of Alaska distribution to all Alaskan residents— Geology adults and children—on an annual basis North Slope Alaska oil and gas through the State’s Permanent Fund The Arctic region is characterized by exploration and production has been a Dividend (PFD) program.11 Since 1978, its extensive oil and gas resources. The significant economic driver, not only to this fund has grown to a total fund value Arctic Alaska Petroleum Province, the State of Alaska and Alaskan Native of $60 billion as of March 2020.12 which consists of up to 43 geologic communities, but also to the national Individual distributions to Alaskans plays between the Chukchi Sea and the domestic energy supply. The State’s oil from the fund have ranged from $386 Beaufort Sea planning areas, extends and gas endowments have provided per person to as high as $2,072 per about 684 miles from the United States- greater economic prosperity to its person.13 These annual payments are Canadian border westward to the people than other important resources estimated to have lifted between 15,000 maritime boundary with Russia, and in the State. Specifically, Alaska relies and 25,000 Alaskans above the Federal from 62 to 372 miles northward from on revenues generated from oil and gas poverty line.14 the Brooks Range to the approximate resources, along with other revenue- Much of the North Slope Borough’s edge of the Continental Shelf. Although generating streams, to fund a major economy is tied to the oil and gas the edge of the Continental Shelf portion of the State’s operating and industry, primarily in the greater provides a well-defined physiographic capital budgets. This has allowed Prudhoe Bay region. Some borough boundary for the province, this edge Alaska to be the only State in the United residents have rotational work in the does not represent a geologic limit to States that does not have either a State oilfields or in a position supporting the potential petroleum resources. The sales tax or personal income tax. Oil and oil industry, but the greatest offshore part of the province is gas revenues are generated by means of contribution to the economy is through characterized by a relatively narrow (62- a variety of taxes, royalties, and other tax revenue. The borough assesses mile-wide) shelf in the Beaufort Sea and charges related to oil and gas property taxes on infrastructure, the a broad (372-mile-wide) shelf in the development and production. Other primary funding source for the Chukchi Sea. The province is bounded examples of revenue-generating streams borough’s operations and capital onshore on the south by the Brooks for Alaska include corporate income, projects, which include building roads, Range-Herald mountain range and fuel, alcohol, and tobacco taxes. In 2016, operating schools, and funding for other offshore to the north by the passive 72 percent of Alaska’s unrestricted public services, such as health clinics continental margin of the Canada general funds, which come from the 16 and fire departments.15 Basin. In general, the formations are State’s overall revenue-generating In March and April of 2020, global oil fairly continuous across the Arctic stream, were derived from oil and gas prices experienced significant volatility Alaska Petroleum Province. revenues and were available to the Although most of the Arctic’s oil 9 State’s budget. In 2012, as much as 93 11 https://apfc.org/frequently-asked-questions/ production to date is attributed to the percent of Alaska’s unrestricted general #why-did-alaskans-create-the-fund. North Slope, most of the undiscovered funds were derived from oil and gas 12 https://apfc.org/our-performance/. resources are located off the Arctic revenues and were also available to the 13 https://pfd.alaska.gov/Division-Info/Summary- coast, within the Chukchi Sea and State’s budget.10 The reduced of-Applications-and-Payments. Beaufort Sea Planning Areas. According contribution of oil and gas-generated 14 Berman, Matt., Random Reamy. ‘‘Permanent to BOEM’s 2016 Assessment of Fund Dividends and Poverty in Alaska.’’ Institute of Social and Economic Research, University of Undiscovered Technically Recoverable 7 https://revenuedata.doi.gov/downloads/ Alaska Anchorage. (November 2016), available Oil and Gas Resources of the Nation’s disbursements/. online at: https://iseralaska.org/static/legacy_ 8 _ _ https://www.alyeska-pipe.com/TAPS. publication links/2016 12-PFDandPoverty.pdf. p. 16 Houseknecht, D.W., and Bird, K.J., 2006, Oil 9 https://www.legfin.akleg.gov/, Budget History 25 of pdf. and gas resources of the Arctic Alaska petroleum Data (Excel) (posted 1–15–2020), Row 59. 15 http://www.north-slope.org/assets/images/ province: U.S. Geological Survey Professional Paper 10 https://www.legfin.akleg.gov/, Budget History uploads/13_Economic_Development_-_NSB_ 1732–A, 11 p., available online at: http:// Data (Excel) (posted 1–15–2020), Row 55. Comprehensive_Plan.pdf. pubs.usgs.gov/pp/pp1732/pp1732a/.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79271

OCS (mean estimates available at http:// the NPR–A. In addition, USGS’s be developed using existing field- www.boem.gov/National-Assessment- assessment of the 1002 Area 17 of the proven technology, which was 2016/), there are approximately 23.6 ANWR estimated (mean estimates reaffirmed by the NPC 2019 Report billion barrels of undiscovered available at https://pubs.usgs.gov/of/ (NPC 2015 Report at 28). technically recoverable oil and about 2005/1217/pdf/2005-1217.pdf) there are As identified by the NPC, targeted 104.4 trillion cubic feet (TCF) of 7.6 billion barrels of technically potential reservoirs in the Arctic OCS technically recoverable natural gas recoverable oil and 7.04 18 TCF of may be shallow and normally (mean estimates) in the combined technically recoverable natural gas. pressured.20 However, this condition is Beaufort Sea and Chukchi Sea Planning Efforts are already underway to bring not consistent throughout all areas in Areas. BOEM re-assessed its Beaufort some of these new onshore resources the Arctic OCS that have already been Sea Planning Area estimates due to online. Collectively, these offshore and explored. For example, a study recent onshore discoveries in the onshore assets are enormous, and most published by the American Rock National Petroleum Reserve-Alaska of the resources are located offshore.19 Mechanics Association 21 analyzed (NPR–A) from two formations that However, the Arctic OCS’s vast wells drilled in the Chukchi Sea in extended offshore. In December 2017, potential has yet to be realized. order to provide an improved BOEM published its updated re- In the Arctic, the circumstances interpretation and delineation of pore assessment (mean estimates available at associated with drilling from a MODU pressure in the Chukchi shelf region. A https://www.boem.gov/2016a-National- can be different than those in the Gulf majority of the wells contained Assessment-Fact-Sheet/), which of Mexico. The geological pressures in significant overpressure at depths estimated that there are approximately the hydrocarbon bearing zones in the ranging from 1,098 to 2,317 meters (i.e., 24.3 billion barrels of technically shallow seas of Alaska’s Arctic are, in 3,602 to 7,601 feet) subsea. In the recoverable oil and about 104. TCF of many cases, likely to be substantially Beaufort Sea, the Alaska Department of technically recoverable natural gas in lower than those encountered during Natural Resources (ADNR) noted that, as the combined Beaufort Sea and Chukchi the Deepwater Horizon incident, part of its findings to support Beaufort 22 Sea Planning Areas; an increase of about reducing certain risk factors of a major Sea areawide oil and gas lease sales, 680 million barrels of oil and 100 billion blowout. As reviewed by the NPC, operators may reasonably expect to cubic feet of natural gas. Of the 24.3 through the NPC 2019 Report, encounter extremely high pore billion barrels of oil, the Chukchi Sea subsurface conditions (below the pressures along the central Beaufort Sea Planning Area makes up about 63% of seafloor) for the Arctic OCS—geology, region where ‘‘ . . . Cenozoic strata the estimate, while the Beaufort Sea pressure, resource depth, and drilling (sedimentary layers) are very thick, such Planning Area makes up 37%. With depth—are much simpler as compared as in the Kaktovik, Camden, and Nuwuk respect to gas, the Chukchi Sea Planning to other areas, such as the deepwater Basins,’’ and suggests that challenges Area makes up about 73% of the 104.5 Gulf of Mexico OCS. The NPC 2019 from over pressured areas could be TCF of gas and the Beaufort Sea Report states that the targeted Arctic reduced by ‘‘. . . identifying locations Planning Area makes up 27% of the potential reservoirs are shallow and of overpressured sediments via seismic estimate. These estimates represent normally pressured, but that exploration data analysis, and then adjusting the about one-quarter of the technically and development are dominated by mud mixture accordingly as the well is recoverable oil resources and one-third other challenges, such as water depth, drilled.’’ In the Point Thomson area, for of the technically recoverable gas ice conditions, and the length of the example, where drilling has taken place from an onshore facility into a reservoir resources on the OCS. open-water season, which make the Arctic unique (NPC 2019 Report at 10). located primarily offshore, the pore While not as large, the Arctic’s The NPC 2015 Report found, however, pressure gradients were measured as onshore undiscovered oil and gas that most of the U.S. Arctic offshore high as 0.8 pounds per square inch per resources are also considerable. In conventional oil and gas potential can foot (psi/ft) at depths of 2.5 miles January 2020, the United States (13,200 feet). A pore pressure gradient Geological Survey (USGS) published an 17 The Alaska National Interest Lands of 0.433 psi/ft is considered normal in assessment of undiscovered oil and gas Conservation Act (ANILCA) of 1980 required this area.23 resources in the central portion of the ANWR to be managed as a protected wilderness. Section 1002 of ANILCA, however, deferred a Alaska North Slope, (mean estimates 20 ‘‘Normally pressured’’ is not defined in the decision regarding future management of a 1.5 NPC 2019 Report. However, as a general matter, available at https://pubs.usgs.gov/fs/ million-acre coastal plain portion of ANWR (known 2020/3001/fs20203001.pdf). The normal pressure generally refers to the hydrostatic as the ‘‘1002’’ area) in order to continuously study pressure within a well. ‘‘Normally pressured’’ refers assessment estimated that there are the various natural resources on the coastal plain, to conditions present when formation pressures are approximately 3.6 billion barrels of and analyze how oil and gas exploration, predictable at any given depth and follow a normal development, and production could potentially formation pressure gradient or ‘‘hydrostatic undiscovered technically recoverable oil impact those resources. Section 20001 of the Tax and about 8.9 TCF of undiscovered pressure gradient.’’ Normal formation pressure, at Cuts and Jobs Act of 2017 lifted a provision in any given depth, equals the normal formation technically recoverable natural gas Section 1003 of ANILCA that prohibits oil and gas pressure gradient multiplied by the depth. The resources on State and Native lands, and leasing and production in the 1002 area, and the normal pressure is expressed in pounds per square State waters, east of the NPR–A and BLM is in the process of developing an oil and gas inch (psi). leasing program for that area. 21 west of the Arctic National Wildlife Elowe, K.E., & Sherwood, K.W., 2017, 18 This value represents the combined estimates ‘‘Abnormal Formation Pressure in the Chukchi Refuge (ANWR). According to a 2017 of natural gas that could technically be produced Shelf, Alaska,’’ American Rock Mechanics USGS assessment of undiscovered oil from gas fields as well as associated gas that could Association Conference Paper, Document ID and gas resources in the Alaska North be produced from oil fields. ARMA–2017–0194, available online at https:// 19 D.L. Gautier et al., ‘‘Circum-Arctic Resource www.onepetro.org/conference-paper/ARMA-2017- Slope, (mean estimates available at Appraisal: Estimates of Undiscovered Oil and Gas 0194. https://pubs.usgs.gov/fs/2017/3088/ North of the Arctic Circle,’’ U.S. Geological Survey, 22 Alaska Department of Natural Resources, 2019, fs20173088.pdf), there are USGS Fact Sheet 2008–3049, 2008. M.E. Brownfield ‘‘Beaufort Sea Areawide Oil and Gas Lease Sales,’’ approximately 8.8 billion barrels of et al., ‘‘An Estimate of Undiscovered Conventional p. 3–20, available online at https://aws.state.ak.us/ undiscovered technically recoverable oil Oil and Gas Resources of the World,’’ U.S. OnlinePublicNotices/Notices/View.aspx?id=193811. Geological Survey, USGS Fact Sheet 2012–3024, 23 Craig, J.D., K.W. Sherwood, and P.P. Johnson. and about 39 TCF of undiscovered 2012, available at https://pubs.usgs.gov/fs/2008/ 1985. Geologic report for the Beaufort Sea planning technically recoverable natural gas in 3049/fs2008-3049.pdf. Continued

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79272 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

While these reports’ findings do not oil-bearing zones were located.26 The offshore oil exploration and fully align with the NPC’s findings, Bureaus have the means, through access development on the bowhead whale. there are other sources of information to relevant geological and geophysical Whalers observed how bowhead whales confirming that, to a certain degree, (G&G) data and drilling application were responding to the presence of typical geologic conditions in the Arctic regulatory reviews, to confirm that ocean-going oil and gas industry OCS are normally pressured. For operators identify and plan for these exploration vessels, which were making example, a BOEM report that studied potential risks. For example, the the whales skittish and affecting the the Chukchi Sea’s Burger gas discovery bureaus confirm that operators have whalers’ ability to effectively meet the calculated the pore pressure gradient for properly designed well casing and quotas for their communities. In one of the Chukchi Sea wells in the drilling programs and ensure that response, the AEWC worked with study to be 0.44 psi/ft up to 4,850 feet operators have access to properly industry stakeholders to establish the subsea, which the report determined to designed equipment that is readily ‘‘Oil/Whaler Agreement,’’ which was a be normally pressured. However, available to quickly respond to an communication plan between whalers beneath 4,850 feet, the pore pressure incident, such as the availability of a and exploration vessels that was gradient became over-pressurized capping stack in advance of drilling into intended to prevent direct threats to the having a pore pressure gradient of 0.88 the targeted productive zones. whalers’ safety from industry vessels. psi/ft.24 For the Beaufort Sea, a USGS The AEWC and industry stakeholders report analyzed pressure data from five 4. Partnership With Alaska Natives in eventually turned the ‘‘Oil/Whaler offshore wells and found that the Northern Alaska Agreement’’ into a framework for pressures in the area where the wells The bowhead whale provides the understanding and addressing indirect were located were normally pressured largest subsistence resource available to interference with hunting activities, (i.e., at hydrostatic pressure) up to 2,000 the native villages of Alaska’s northern resulting from behavioral changes in feet subsea, and increased only slightly shores. In 1977, Eskimo whalers from bowhead whales as they react to the above hydrostatic pressure deeper into these villages established the Alaska noise and other pollutants the well. By 10,000 feet, however, the Eskimo Whaling Commission (AEWC), accompanying oil and gas work. This pressure in all five wells were over- whose mission is to safeguard the framework of understanding eventually pressured, 1.5 times higher than the bowhead whale and its habitat, defend formed the basis of what is now known hydrostatic pressure.25 Over-pressure the Aboriginal Subsistence Whaling as a CAA.27 While DOI does not require started to occur at around 6,700 feet Rights of their members, and preserve executing a CAA, BSEE and BOEM subsea. the cultural and traditional values of highly encourage operators to work with While it is not possible to confirm their villages. Eskimo whalers the AEWC to establish CAAs, since that all targeted potential reservoirs established the AEWC in response to these agreements essentially would be shallow and normally actions taken by the International acknowledge, within CAA provisions, pressured in all exploratory drilling Whaling Commission (IWC) that that both subsistence hunting activities situations, BSEE and BOEM will have resulted in the IWC’s assumption of and oil and gas development can and access to the relevant geologic and direct jurisdiction over the Alaskan should coexist. See discussion in geophysical information to help identify Native bowhead whale subsistence Section I.E.3, History and Background hydrocarbon bearing zones and zones hunt, without Alaska Native input. The on the Conflict Avoidance Agreement, with potential geologic risk, such as IWC assumed direct jurisdiction over of this preamble describing the over-pressurized zones, that may be Alaska Native’s bowhead whale provisions typically included in a CAA. encountered during drilling operations. subsistence in response to the IWC’s This longstanding process allows for These higher pressured, hydrocarbon concerns regarding the decline in the industry representatives to sit, in zones are, in fact, the targeted western Arctic bowhead whale stock. council, with members of the AEWC, formations the industry has attempted The IWC’s only mechanism for local tribes, and village and regional to produce. For example, the BOEM protecting whale stocks is the setting of corporations to determine cultural report analyzing the Chukchi Sea’s hunting quotas. Therefore, the IWC’s circumstances and situations that could Burger gas discovery illustrated the only recourse for addressing its cause conflict—and thus avoid them. regional geology of all the wells concerns was to prohibit the Alaska For example, during whale (or walrus) included in the study, and showed that Native bowhead whale subsistence hunting seasons in the spring and fall, the higher pressured zones in the wells hunt. This action devastated local the CAA may include provisions occurred at the same point where the communities, creating immediate and whereby industry will avoid severe food shortages. In response, in construction or production noise and area, Alaska: Regional geology, petroleum geology, 1981, the AEWC was able to establish an related activities during those times environmental geology. U.S. Department of the Interior, Minerals Management Service, Alaska OCS agreement with the Federal Government when whales are transiting nearby, and Region, OCS Report MMS 85–0111. Anchorage, to co-manage the bowhead whale the hunters are in the area. With this Alaska. https://www.boem.gov/BOEM-Newsroom/ _ hunting quotas. early initiative, direct collaboration with Library/Publications/1985/85 0111.aspx. Although the AEWC was able to local hunters, specifically the whaling 24 Craig, J.D., & Sherwood, K.W., 2001 (revised 2004), ‘‘Economic Study of the Burger Gas regain control of its bowhead whale captains and their representative Discovery, Chukchi Shelf, Northwest Alaska,’’ U.S. hunting quotas, the organization shared organization, the AEWC, became a Department of the Interior, Minerals Management a similar concern with the IWC critical element of offshore industrial Service, p. 67, available online at https:// regarding the potential effects of www.boem.gov/sites/default/files/boem-newsroom/ development planning and management Library/Publications/2004/Economic-Study-of-the- in the Alaskan Arctic. Burger-Gas-Discovery.pdf. 26 Craig, J.D., & Sherwood, K.W., 2001 (revised Today, the AEWC includes registered 25 Hayba, D.O., Houseknecht, D.W., and Rowan, 2004), ‘‘Economic Study of the Burger Gas whaling captains and their crews from E., 1999, ‘‘Stratigraphic, Hydrogeologic, and Discovery, Chukchi Shelf, Northwest Alaska,’’ U.S. eleven whaling communities of the Thermal Evolution of the Canning River Region, Department of the Interior, Minerals Management North Slope, Alaska,’’ U.S. Department of the Service, p. 72, available online at https:// Interior, U.S. Geological Survey, p. FF–21, available www.boem.gov/sites/default/files/boem-newsroom/ 27 Conflict Avoidance Agreements are contracts online at https://pubs.usgs.gov/of/1998/ofr-98- Library/Publications/2004/Economic-Study-of-the- signed by the operators and the Alaska native 0034/FF.pdf. Burger-Gas-Discovery.pdf. communities to which BOEM is not a party.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00008 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79273

Arctic Alaska coast: Gambell, Savoonga, field) was made in State waters, the day.30 The price of oil increased steadily Wales, Little Diomede, Kivalina, Point Department, acting through the Bureau through 2007 from approximately $50 to Hope, Point Lay, Wainwright, Barrow 28 of Land Management (BLM), held the $90 per barrel by the time the most (Utquiavik), Nuiqsut, and Kaktovik. The first oil and gas lease sale in the Arctic recent Arctic sale, Lease Sale 193, was AEWC often represents the Inupiat OCS, offering tracts adjacent to Prudhoe held in February of 2008.31 These Community of the Arctic Slope (ICAS) Bay in the Beaufort Sea Planning Area. market factors may have contributed to in matters pertaining to energy That sale resulted in 24 leases, covering the outcome of Lease Sale 193, one of exploration or development specifically 85,776 acres, being issued. Although it the most successful in Arctic OCS for the OCS. The ICAS is a unique was the first sale ever conducted for the history, based on multiple metrics—the federally recognized tribal entity. ICAS Arctic OCS, the revenues generated number of bids received, the number of membership is based on an individual’s from that sale, over $491 million, make tracts receiving bids, and the total ancestral lineage to a village tribe; it it the 4th largest sale in Arctic OCS amount of bonus bids received from the includes the peoples of eight Native history. That dollar amount would sale. The MMS received a total of 667 Villages: Kaktovik, Atqasuk, Nuiqsut, represent almost $1.9 billion dollars in bids on 488 blocks; both record-setting Anaktuvuk Pass, Barrow, Wainwright, 2019 after adjusting for inflation. numbers for the Arctic OCS. A total of Point Lay, and Point Hope. Each village Between 1979 and 2008, the 487 leases, covering over 2.7 million tribe acts independently but will Department, acting through the BLM acres, were issued, and the sale interact with ICAS and its membership and Minerals Management Service generated over $2.6 billion in bonus 29 as it relates to Federal and State energy (MMS), held 13 oil and gas lease sales, bids, which went to the U.S. Treasury. issues. and issued nearly 1,800 leases, covering Since 2008, however, the Department Conflict avoidance tools are often over 9.7 million acres, on the Arctic has not conducted any new lease sales incorporated into leasing stipulations OCS. These sales generated over $6.8 for the Arctic OCS. A description of the billion in bonus bids. As many as 23 addressing consultation with status of active leases in the Artic OCS companies/bidders have participated in subsistence communities, and will is discussed in further detail below an Alaska OCS lease sale and, while the continue to be essential to help satisfy within this subsection, prior to the number of companies/bidders the need to provide a secure source of subheading entitled, Global Arctic participating from one sale to the next energy for the Nation while at the same Exploration Activities. time protecting the subsistence varied, an average of 10 companies/ resources and uses of the local bidders participated in each sale. Sale 193 was significant, not only in communities where these energy By 2008, U.S. oil production had been number of tracts sold and the amount resources are located. steadily declining for 5 years to an received from the sale, but in that the average of 5 million barrels per day, industry’s interest spurred a flurry of 5. Industry Interest in the Arctic OCS while U.S. consumption of crude oil activities on the Arctic OCS prior to and In 1979, a year after the first Arctic and petroleum products reached an all- after the sale. The following table lists offshore discovery (i.e., the Endicott oil time high of 20.68 million barrels per those activities:

2006

June 20 ...... MMS authorizes ConocoPhillips, Shell, and GX Technology Corporation to conduct geophysical operations for a portion of Chukchi Sea Planning Area, which covered the Sale 193 area.

2007

July 13 ...... MMS authorizes Shell to conduct additional geophysical operations in Chukchi Sea Planning Area covering the same area as their 2006 geophysical permit.

2008

February 6 ...... MMS holds Chukchi Sea Lease Sale 193. Seven companies were issued leases from this sale—NACRA; Repsol; Shell; ConocoPhillips; Eni Petroleum; StatoilHydro; and Iona Energy Company. February 15 ...... MMS authorizes Shell to conduct even further geophysical operations, also covering the same area as their 2006 geo- physical permit.

2009

May 9 ...... Shell submits its initial EP for the Chukchi Sea.

2010

April 10 ...... BP Deepwater Horizon Incident—Blowout of the Macondo well (Gulf of Mexico). May 19 ...... Secretary’s Order 3299 reorganizing the Minerals Management Service and dividing its functions between three separate bureaus. June 18 ...... Secretary’s Order 3302 creating the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE). August 8 ...... BOEMRE authorizes Statoil to conduct geophysical operations within and around the area where their leases were lo- cated in the Chukchi Sea Planning Area.

28 Although the Alaska Native tribe is based in group of whaling captains collectively by the table entitled, ‘‘U.S. Product Supplied of Crude Oil Utquiavik, at any given time, the whaling may broader term ‘‘Barrow.’’ and Petroleum Products (Thousand Barrels per involve members of the Apugauti and Nalukatq 29 MMS was the predecessor agency of BSEE and Day)’’. tribes, whose native lands do not border the coast. BOEM. 31 https://www.eia.gov/dnav/pet/hist/ 30 For this reason, the AEWC prefers to refer to this https://www.eia.gov/dnav/pet/hist/ LeafHandler.ashx?n=PET&s=F000000__3&f=M. LeafHandler.ashx?n=PET&s=MTTUPUS2&f=A,

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79274 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

December 7 ...... BOEMRE conditionally approves Shell’s initial EP for the Chukchi Sea.

2011

May 11 ...... Shell submits a revised EP for the Chukchi Sea. August 29 ...... Secretary’s Order 3299 was amended to divide BOEMRE into the Bureau of Ocean Energy Management (BOEM), the Bu- reau of Safety and Environmental Enforcement (BSEE), and the Office of Natural Resources Revenue (ONRR). December 16 ..... BOEM conditionally approves Shell’s revised EP for the Chukchi Sea.

2012

August 30 ...... BSEE authorizes Shell to initiate certain limited preparatory exploration drilling activities; drilling of the top hole for Burger A exploration well in the Chukchi Sea. September 9 ...... Shell begins drilling operations for its Burger A exploration well in the Chukchi Sea, but was not able to complete its well operations. Shell returned in 2016 to complete its well operations, ultimately plugging and abandoning the well. September 20 .... While not applicable to the Chukchi Sea, BSEE also authorizes Shell to initiate drilling of the top hole for the Sivuliq N exploration well in the Beaufort Sea. October 3 ...... Shell begins drilling operations for its Sivuliq N exploration well in the Beaufort Sea, but was not able to complete its well operations. Shell returned in 2016 to complete its well operations, ultimately plugging and abandoning the well.

2013

August 5 ...... BOEM authorizes TGS to conduct geophysical operations for a portion of Chukchi Sea Planning Area covering a portion of the Sale 193 area. November 6 ...... Shell submits a revised EP for the Chukchi Sea in response to lessons learned from its 2012 drilling operations of the Sivuliq N and Burger A exploration wells.

2014

August 28 ...... Shell submits a revised EP for the Chukchi Sea, replacing its November 2013 submission.

2015

January 21 ...... President Obama signed E.O. 13689, which calls for multiple agencies that may have jurisdictional responsibilities in the Arctic to enhance their coordination efforts to protect the nation’s various interests in the region. January 27 ...... President Obama issues Presidential Memorandum withdrawing certain areas of the OCS within the Beaufort and Chukchi Seas from leasing. These areas included the Hannah Shoal in the Chukchi Sea and lease deferral areas identi- fied in BOEM’s 2012–2017 National OCS Oil and Gas Leasing Program. February 24 ...... BSEE and BOEM published the 2015 Proposed Arctic Exploratory Drilling Rule, providing a 90-day period for the pub- lic to review and comment on the proposed rule. May 11 ...... BOEM conditionally approves Shell’s revised EP for the Chukchi Sea. July 22 ...... BSEE authorizes Shell to initiate certain limited preparatory exploration drilling activities; drilling of the top hole for Burger J exploration well in the Chukchi Sea. July 31 ...... Shell begins drilling operations for its Burger J exploration well in the Chukchi Sea. September 21 .... Shell completes its Burger J exploration operations, and ultimately plugs and abandons the well. October 16 ...... The Department cancels all Beaufort and Chukchi lease sales that were scheduled to take place as part of BOEM’s 2012– 2017 National OCS Oil and Gas Leasing Program.

2016

December 30 ..... President Obama issues a Presidential Memorandum that expands the withdrawal to all areas of the Chukchi Sea plan- ning area and much of the Beaufort Sea planning area that were not currently withdrawn at that time. The withdrawal excludes Beaufort tracts located nearshore in an area that included existing leases at the time.

A key factor that contributed to the information into a Supplemental EIS per day in 2015 and 12.2 million barrels length of time taken to authorize Shell’s that was published in February 2015 in 2019.33 Demand for oil remained exploration drilling activities was a and affirmed the sale as held. Only relatively stable between 2008 and 2019, lawsuit filed by the Native Village of thereafter were BOEM and BSEE able to with only a minor increase in 2019 over Point Hope challenging the complete their formal review of Shell’s 2008—approximately a 4% increase.34 Department’s decision to hold Sale 193. exploration plan for the Chukchi Sea On September 28, 2015, Shell See Native Village of Point Hope v. and approve the drilling activities that announced that it would cease further Salazar, 730 F. Supp.2d 1009 (D. Ak., took place in the summer of 2015. exploration activity in offshore Alaska 2010); see also Native Village of Point Between 2008 and 2019, oil prices for the foreseeable future. Shell stated Hope v. Jewell, 740 F.3d 489 (9th Cir., remained unstable, increasing to an all- that its decision was based on the time high of almost $96 per barrel in results of their Burger J well, which 2014). The original Environmental 2013 to $44 per barrel in 2015, which found indications of oil and gas, but Impact Statement (EIS) for Sale 193 was increased to $56 per barrel in 2019.32 were insufficient to warrant further published in 2007, and the lease sale Domestic oil production had grown was held, but subsequent legal since 2008, in part due to developments 33 https://www.eia.gov/todayinenergy/ challenges and Federal court decisions in tight oil onshore and Gulf of Mexico detail.php?id=4910. 34 remanded the lease sale to BOEM for production, to about 9.4 million barrels https://www.eia.gov/dnav/pet/hist/ further analysis. In response to the court LeafHandler.ashx?n=PET&s=MTTUPUS2&f=A, table titled ‘‘U.S. Product Supplied of Crude Oil remand, BOEM conducted additional 32 https://www.eia.gov/dnav/pet/hist/ and Petroleum Products (Thousand Barrels per analysis and incorporated that LeafHandler.ashx?n=PET&s=F000000__3&f=M. Day).

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79275

exploration in the Burger prospect. The icebergs that may impact their requirements from these countries that company also stated that its decision exploration operations. Operators also pertain to relief wells, SCCE, and was motivated by the high costs have contingency plans that may require approval of alternative technologies. associated with the project, and the disconnecting their drilling rig from the The study did not include Russia in its challenging and unpredictable Federal well and moving off location to avoid review because the country’s regulations regulatory environment offshore contact with icebergs. could not be accessed. Here is a Alaska.35 On November 17, 2015, Statoil Canada—In the Jeanne d’Arc, Orphan, summary of that review: announced its decision to exit Alaska and Flemish Pass oil and gas basins on • Relief Wells—All the Arctic and relinquish its leases acquired from the Grand Banks of Newfoundland, countries that were reviewed Sale 193. All leaseholders that acquired operators have conducted exploration specifically require relief wells, but leases in Sale 193 eventually drilling from MODUs in shallow and regulations among them differ. For relinquished their leases. deep waters. Like Greenland, the areas example, Canada simply requires a Despite these setbacks, industry with oil and gas potential are located in ‘‘same-season’’ relief well capacity, interest in the Arctic OCS and other sub-Arctic regions that experience some whereby the operator demonstrates its areas of the Arctic, globally, has shown seasonal sea ice and significant iceberg capability to drill a relief well and kill to be consistent amidst fluctuating incursions. In these areas, operators also an out-of-control well in the same commodity prices and concerns about employ strong ice management and drilling season. Whereas the U.S. regulatory challenges. Since 1998, contingency plans. requires the ability to bring in a nineteen geological and geophysical Norway—In Norway’s portion of the relief-drilling rig and complete the plug seismic surveys were permitted and Barents Sea, which is located entirely and abandonment within 45 days, completed for the Beaufort Sea and within the Arctic, exploration activities Norway and Greenland require a Chukchi Sea Planning Areas. The data have taken place since 1980. Most of the relief-drilling rig to be on site within 12 from these surveys provide information area is free of sea ice year-round, but days. • to both industry and the government for drilling has taken place in areas that do SCCE—Canada is the only country use in lease sales and for design and experience challenging Arctic OCS besides the U.S. that has specific SCCE evaluation of activities described in EPs conditions. As late as 2014, exploration requirements. Canada’s requirements, and DPPs. Several different companies drilling took place in Norway’s northern however, are less prescriptive in that participated in each of the four Beaufort portion of the Barents Seas in what is they include a more general requirement Sea Planning Area lease sales and the known as the Hoop area. Those for ‘‘cap and containment methods and one Chukchi Sea Planning Area lease exploration operations entailed the use same-well intervention methods,’’ as sale indicating on-going industry of winterized semisubmersible rigs and compared to the U.S. requirement for interest in the area. Companies the availability of a capping stack. access to specific SCCE equipment Russia—Russia’s latest drilling submitted EPs, three in the Beaufort and within a specified time period. operations also took place in 2014 when • one in the Chukchi Sea. These plans, Alternative Technologies—With ExxonMobil drilled a well in the South and their revisions, received evaluation respect to approval of alternative Kara Sea. The operation took place in an and conditional approval. BOEM technologies in lieu of a relief rig or area of the Arctic where drilling could approved two DPPs, both for the SCCE, the U.S. has specific regulations not take place during the winter Beaufort Sea. Currently, there are 19 oil that allow for potential substitutions months, similar to the Chukchi and and gas leases in the Arctic OCS, all of and accommodations for innovative Beaufort Seas. Exploration activities which are located in the Beaufort Sea technologies. Canada also provides for took place during the summer, when Planning Area. Exploratory drilling and the approval of alternative technologies little to no sea ice was present at the development on these leases have taken through specific approval processes. drilling location and were completed in place from gravel islands in State Norway’s regulations, in general, are mid-fall. The operation was similar to waters. largely performance-based. As such, the operations from the other countries their regulations allow for the Global Arctic Exploration Activities just described—a winterized MODU and consideration of different technologies In addition to the Arctic OCS robust ice management and contingency at the onset when planning a project. plans. However, unique to this project activities just described, global interest B. BSEE and BOEM Statutory and and development has taken place in was the use of a subsea isolation device (SSID). (NPC Report 2015 at 6–17 and Regulatory Authority and other parts of the Arctic. Countries, such Responsibilities as Russia, Norway, Canada, and 6–18, and NPC Report 2019 at C–10). The Outer Continental Shelf Lands Greenland have been diligently The Kara Sea project is discussed in Act, 43 U.S.C. 1331 et seq., was first exploring their oil and gas resources in more detail below in Section II. Section- enacted in 1953 and substantially or near the Arctic. by-Section Discussion of Proposed Greenland—Since the 1970s, Changes, Subsection A. Key Revisions amended in 1978. In amending OCSLA, exploration activities have taken place Proposed by BSEE, under the Congress established a national policy on the offshore waters of western subheading entitled, Supplemental of making the OCS ‘‘available for Greenland. While these exploration Assessment to the 2015 Report on Arctic expeditious and orderly development, activities have taken place in sub-Arctic Potential: Realizing the Promise of U.S. subject to environmental safeguards, in regions, operators do experience some Arctic Oil and Gas Resources (NPC 2019 a manner which is consistent with the of the key challenges present in the Report). maintenance of competition and other national needs.’’ (43 U.S.C. 1332(3)). Arctic. It is not uncommon for icebergs Global Arctic Exploration Requirements to pose dangers to drilling operations. OCSLA authorizes the Secretary of the Norway, Canada, and Greenland have Operators use ice management plans to Interior (Secretary) to lease the OCS for similar regulatory requirements to the identify, monitor, and tow away any mineral development and to regulate oil United States for Arctic offshore drilling and gas exploration, development, and 35 https://www.shell.com/media/news-and-media- operations performed from a MODU. production operations on the OCS. releases/2015/shell-updates-on-alaska- The Bratslavsky and SolstenXP study On May 19, 2010, Secretary Ken exploration.html. also included a review of the regulatory Salazar issued S.O. 3299, which

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79276 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

restructured and divided the former activities within BOEM’s activities and exploratory drilling. After BOEM MMS’s responsibilities under OCSLA areas of responsibility. approves the EP, the operator must among three new bureaus: (i) BOEM; (ii) Secretary’s Order 3299 made BSEE submit to BSEE an APD, which BSEE BSEE; and the (iii) Office of Natural responsible for safety and must approve before an operator may Resources Revenue (ONRR). S.O. 3299 environmental enforcement functions, drill a well (43 U.S.C. 1340(d); delegated those responsibilities for oil including, but not limited to, the § 250.410). Among other things, the and gas operations to BSEE and BOEM, authority to permit activities, inspect, APD must be consistent with the both of which are charged with investigate, summon witnesses and approved EP and include information administering and regulating aspects of produce evidence: Levy penalties; on the well location, the drilling design the Nation’s OCS oil and gas program cancel or suspend activities; and and procedures, casing and cementing (see 30 CFR parts 250 and 550). oversee safety, and oil spill response programs, the diverter and blowout and removal preparedness. BSEE’s preventer (BOP) systems, MODU (if one On June 18, 2010, Secretary Salazar mission is to promote safety, protect the is to be used), and any additional issued S.O. No. 3302, which announced environment, and conserve resources information requested by the BSEE the name change of part of the former through vigorous regulatory oversight District Manager. MMS to the Bureau of Ocean Energy and enforcement. BSEE’s functions Management, Regulation and include evaluating permit applications C. Executive and Secretary’s Orders Enforcement (BOEMRE). This name, for post-lease oil and natural gas On March 28, 2017, the President BOEMRE, would remain in effect until exploration and development activities issued E.O. 13783—Promoting Energy BOEM and BSEE were officially created on the OCS and conducting inspections Independence and Economic Growth under S.O. 3299, effective October 1, to ensure compliance with laws, (82 FR 16093). The E.O. directed 2011. regulations, lease terms, and approved Federal agencies to review all existing On October 1, 2010, the revenue- plans and permits. regulations and other similar agency collection functions of the former MMS BOEM evaluates EPs, and BSEE, actions, which potentially burden the were transferred to ONRR, reporting to thereafter, evaluates Applications for development or use of domestically the Assistant Secretary for Policy, Permits to Drill (APDs) and other produced energy resources with the goal Management and Budget. permits and applications, to determine of ‘‘avoiding regulatory burdens that whether the operator’s proposed unnecessarily encumber energy S.O. 3299 assigned BOEM the activities meet OCSLA’s standards and production, constrain economic growth, responsibility for managing the each Bureau’s regulations governing and prevent job creation.’’ It made it development of the Nation’s offshore OCS exploration. Based on their U.S. policy for agencies to ‘‘review conventional and renewable energy respective evaluations, BSEE and BOEM existing regulations that potentially resources. BOEM’s mission is to manage will either approve the operator’s EP burden the development or use of the development of the OCS energy and and APD, require the operator to modify domestically produced energy resources mineral resources in an environmentally its submissions, or disapprove the EP or and appropriately suspend, revise, or and economically responsible way. APD (§ 250.410, How do I obtain rescind those that unduly burden the BOEM’s functions include: Leasing; EP approval to drill a well?). The review development of domestic energy administration; DPP administration; and approval of these activities is resources beyond the degree necessary permitting of geological and geophysical outlined below in the following section. to protect the public interest or activities; environmental analyses in otherwise comply with the law.’’ compliance with NEPA; environmental 1. BOEM Approval of the EP On April 28, 2017, the President studies; compliance with relevant laws As promulgated through the 2016 issued E.O. 13795—Implementing an (e.g., the Endangered Species Act (ESA), Arctic Exploratory Drilling Rule, America-First Offshore Energy Strategy the Marine Mammal Protection Act, the § 550.204, When must I submit my IOP (82 FR 20815), which directed the Magnuson-Stevens Fishery for proposed Arctic exploratory drilling Secretary to ‘‘take all steps necessary to Conservation and Management Act, and operations and what must the IOP review’’ the 2016 Arctic Exploratory the Coastal Zone Management Act 36 include?, requires that a lessee submit Drilling Rule and, ‘‘if appropriate, [to,] (CZMA)); resource evaluation; oil spill an IOP at least 90 days before filing an as soon as practicable and consistent worst case discharge (WCD) EP with BOEM, if that EP would involve with law, publish for notice and determination; economic analysis and exploration for oil and gas on the Arctic comment a proposed rule suspending, fair market value bid/lease evaluations; OCS. While the IOP is not subject to revising, or rescinding this rule.’’ The management of the OCS renewable approval, the submission was intended policy underlying E.O. 13795 is ‘‘to energy and marine mineral programs; to facilitate the prompt sharing of encourage energy exploration and and consultation with other entities at information among the relevant Federal production, including on the Outer the local (e.g., North Slope Borough, agencies that may be involved in Continental Shelf, in order to maintain Native Villages), tribal (e.g., Federally overseeing exploratory drilling the Nation’s position as a global energy recognized tribes and Alaska Native operations conducted from MODUs. The leader and foster energy security and Claims Settlement Act Corporations), operator may then submit an EP to resilience for the benefit of the State, and Federal levels (e.g., National BOEM for approval. An EP must include American people, while ensuring that Oceanic and Atmospheric information such as a schedule of any such activity is safe and Administration (NOAA) Fisheries, U.S. anticipated exploration activities, environmentally responsible.’’ These Coast Guard (USCG)) related to equipment to be used, the general E.O.s did not dictate outcomes; rather, location of each well to be drilled, and they provided direction for review in 36 BOEM is not subject to the requirements of the any other information deemed pertinent accordance with all relevant laws. CZMA in Alaska as it is on the rest of the OCS, by BOEM (§§ 550.211 through 550.228). To further implement E.O. 13795, on where it is required to provide opportunities to the May 1, 2017, the Secretary issued S.O. coastal State to review the proposed Federal actions 2. BSEE Approval of the APD for consistency with the state’s federally approved 3350, America-First Offshore Energy coastal management program. More specifically, on Approval of an EP does not, by itself, Strategy, directing BSEE and BOEM to July 1, 2011, Alaska repealed its CZMA program. permit the operator to proceed with review the 2016 Arctic Exploratory

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00012 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79277

Drilling Rule ‘‘for consistency with the there is also a greater probability for safe addressed by the 2016 Arctic policy set forth in section 2 of E.O. deployment of a relief rig versus SCCE. Exploratory Drilling Rule, they are 13795’’ and to prepare a report In the Beaufort Sea, the probability for unique to the Arctic OCS and, therefore, ‘‘summarizing the review and providing safely deploying relief wells and SCCE are appropriate to address as part of this recommendations on whether to is the same. This is because the Beaufort proposed rulemaking. suspend, revise, or rescind the rule.’’ Sea has fewer ice-free days than the BSEE and BOEM recognize that the Consistent with E.O.s 13783 and Chukchi and ice helps maintain calm 2016 Arctic Exploratory Drilling Rule 13795, and S.O. 3350, BSEE and BOEM sea state conditions. addressed specific operational and reviewed the regulations promulgated The study also determined that water environmental conditions that are through the 2016 Arctic Exploratory depth in the Arctic OCS is also a factor unique to the Arctic OCS. While this Drilling Rule and are proposing limiting the safe deployment of SCCE. proposed rule would leave most of the revisions to those regulations to reduce According to the Bratslavsky and regulations promulgated by the 2016 unnecessary burdens on industry while SolstenXP study, safe deployment of rule unaltered, certain of these maintaining safety and environmental SCCE is likely to be impaired in water regulations are worth reconsidering to protection. depths shallower than 984 feet because accommodate technological innovation the equipment would potentially and encourage energy exploration on D. Purpose and Summary of the encounter a gas boil at the surface the Arctic OCS. Based on the new Rulemaking caused by a subsea blowing well scientific information gathered from the BSEE and BOEM promulgated the (Bratslavsky and SolstenXP at 143). Bratslavsky and SolstenXP study, and 2016 Arctic Exploratory Drilling Rule Water depths in the majority of the global practical experience gained in based on experiences gained from Chukchi Sea and Beaufort Sea where recent years, as described in the NPC Shell’s 2012 and 2015 Arctic operations, exploration has historically occurred are Reports, the bureaus believe that these internal reviews conducted on potential relatively shallow—167 feet or less (id. proposed revisions reduce unnecessary oil and gas operations on the Arctic at 7 to 9). This water depth range limits regulatory burdens on stakeholders and OCS, and concerns expressed by the fleet of support vessels that could be increase the ability to review and apply environmental organizations and Alaska used for the safe deployment of SCCE. advancing technological innovations, Natives. The NPC also published its NPC 2019 while ensuring safety and Since publication of the 2016 Arctic Report as a supplemental assessment to environmental protection. Exploratory Drilling Rule, however, the NPC 2015 Report. The NPC prepared The following paragraphs briefly BSEE and BOEM have become aware of the NPC 2019 Report in response to an summarize the key elements of this additional information informing and April 2018 request from the Secretary of proposed rule, which are more fully warranting the bureaus’ reconsideration Energy. The Secretary of Energy explained in Section II. Section-by- of certain regulatory provisions requested that the NPC provide Section Discussion of Proposed Changes promulgated through that rule. BSEE recommendations for enhancing the of this preamble: commissioned a Technology Nation’s regulatory environment by 1. Seasonal Conditions SOO—The Assessment Program study (Bratslavsky improving reliability, safety, efficiency, unique seasonal conditions in the Arctic and SolstenXP, 2018) that entailed a and environmental stewardship of oil make it difficult or physically historical statistical analysis of recent and gas activities on the OCS. That impossible for operators to explore their Alaska Arctic OCS drilling seasons (5- report specifically addressed the leases for a significant portion of each year period between 2012 and 2016), in regulatory burdens associated with U.S. year. To facilitate the proper which meteorology and physical Arctic OCS development. development of Arctic leases in oceanographic (‘‘metocean’’) and Key findings from the NPC’s accordance with OCSLA sec. 5,37 BSEE operational conditions would support supplemental assessment that helped proposes to add a new provision to its the safe deployment of SCCE, the inform the preparation of this proposed regulations that would provide those drilling of a relief well, or both. The rule include the NPC’s determination operators that are conducting drilling study included a comprehensive review that the requirement to drill an SSRW operations, but are prevented from and gap analysis of U.S. and to mitigate the risk of a late season well completing those leaseholding international regulations, standards, control event continuing over the winter operations due to seasonal constraints recommended practices, specifications, season is ‘‘outdated.’’ The report unique to the Arctic, with the technical reports, and common industry concluded that SSIDs and capping opportunity to obtain an SOO. If methods regarding the safe deployment stacks are superior solutions that could granted, this type of SOO would of SCCE, as compared to the stop the flow of oil and allow suspend the running of the lease term effectiveness of drilling a relief well in intervention through the original and effectively extend the term of the Arctic conditions. borehole before a relief well could be affected lease by a period equivalent to The Bratslavsky and SolstenXP study completed (NPC 2109 Report at 19). the period of such suspension. This determined that metocean conditions Details in the report regarding Russia’s would provide operators that are prevalent in the Chukchi Sea and 2014 drilling operation that included otherwise ready and able to conduct Beaufort Sea (i.e., rough sea states and the use of an SSID in the South Kara Sea drilling operations with additional time sea ice conditions, primarily) are key also informs this proposed rule. to diligently explore their leases, factors that limit the ability to safely In this proposed rule, the Bureaus without facing lease expiration due to deploy SCCE throughout the Arctic also address other issues in addition to OCS. The study determined that, when those addressed in the 2016 Arctic 37 OCSLA sec. 5 (as amended) provides in operating in the presence of sea ice in Exploratory Drilling Rule, including pertinent part: ‘‘The regulations prescribed by the Secretary . . . shall include . . . provisions . . . for the Chukchi Sea and the Beaufort Sea, seasonal weather-related constraints in the suspension . . . of any operation or activity there is a greater probability for safe the Arctic that severely impact an . . . at the request of a lessee, in the national relief well deployment versus SCCE operator’s ability to safely perform interest, [or] to facilitate proper development of a deployment. When operating in open leaseholding operations for a significant lease . . . and for the extension of any permit or lease affected by [such] suspension . . . by a period water conditions (i.e., those prone to portion of the term on a lease. While equivalent to the period of such suspension . . . .’’ rough sea states) in the Chukchi Sea, these issues are in addition to the issues 43 U.S.C. 1334(a)(1).

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00013 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79278 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

interference by seasonal constraints meteorological conditions (e.g., rough documentation it submits as part of its unique to the Arctic. sea state and sea ice conditions) APD, that the operations it plans to 2. Water-Based Mud and Cuttings— prevalent in the Chukchi Sea and conduct below the surface casing would BSEE proposes to eliminate references Beaufort Sea are the key factors limiting not encounter any abnormally high- to the Regional Supervisor’s the time periods when SCCE may be pressured zones or other geological discretionary authority to require the safely deployed throughout the Arctic hazards before reaching the last casing capture of water-based muds and OCS. This is discussed in further detail point prior to penetrating a zone capable cuttings in those cases where below in Section II. Section-by-Section of flowing hydrocarbons in measurable subsistence values might be impacted Discussion of Proposed Changes, under quantities, then BSEE will allow the by such discharges. While not intended, the subheading What are the operator to delay its staging of the relief BSEE understands that this reference requirements for Arctic OCS source rig until reaching that casing point. created some uncertainty for the control and containment? (§ 250.471). It regulated industry, because it appeared is not practical for BSEE’s regulations to BSEE’s proposal to permit the delay of to overlap with regulation by the prescribe that certain SCCE the staging of the relief rig will be based Environmental Protection Agency (EPA) (containment dome and cap and flow on the documentation that operator and, if implemented, might result in system, in particular) be positioned provides, as well as any other available BSEE issuing requirements that within proximity to a well location data and information. In the relief rig contradict EPA’s requirements. when the conditions for safely and SSRW regulation, BSEE would also 3. SCCE—BSEE would preserve the deploying this equipment in the Arctic eliminate the reference to expected requirement for the operator to have OCS are limiting. However, BSEE would seasonal ice encroachment because the access to its SCCE when drilling below retain other existing containment dome relevant timeframes for operations or working below the surface casing. and cap and flow system requirements should be based on the capabilities of However, with respect to the capping in § 250.471, which provide that the the operator’s rig and equipment to stack, the Bureau proposes to provide an operator must: operate in the applicable ice conditions, opportunity to the operator to adjust the (i) Demonstrate that it has access to a rather than an absolute date. point in time during operations when it containment dome and cap and flow must position its capping stack so that system; 5. Mudline Cellars—BSEE proposes to it is available to arrive at the well (ii) Provide a containment dome and clarify the requirement for the operator, location within 24 hours after a loss of cap and flow system that meets BSEE’s in areas of ice scour, to use a mudline well control. The existing regulations operating standards; cellar when drilling that is designed to also impose a positioning requirement (iii) Conduct tests or exercises for all minimize the risk of damage to the well on the cap and flow system, and SCCE; and head and wellbore. The existing containment dome—slightly different (iv) Maintain records pertaining to the regulation could be read to require the from the capping stack—‘‘positioned to testing, inspection, maintenance, and operator to use a mudline cellar in all ensure that it will arrive at the well use of the SCCE and make these cases, except when the operator can location within 7 days after a loss of available to BSEE upon request. The prove that the mudline cellar would well control.’’ BSEE’s proposed changes changes BSEE proposes to the SCCE present an operational risk, and that was to the positioning requirement for the requirements in § 250.471 would not BSEE’s intent. This proposed change cap and flow system and containment preserve the regulations’ requirement would make it clear that the operator dome are discussed in more detail later that operators have redundant has more flexibility to propose to protective measures that are appropriate in this paragraph. If the operator is able employ alternate procedures or for Arctic OCS conditions because there to demonstrate to BSEE, based on equipment instead of the mudline cellar documentation it submits as part of its is no guarantee that a single measure under appropriate circumstances, as APD, that the operations it plans to could control or contain a WCD. provided by the longstanding provisions conduct below the surface casing would 4. Same Season Relief Well (SSRW) not encounter any abnormally high- Requirement and Subsea Isolation of § 250.141, May I ever use alternate pressured zones or other geological Devices (SSID)—BSEE proposes to procedures or equipment?; not just hazards before reaching the last casing revise the relief rig and SSRW when a mudline cellar would present an point prior to penetrating a zone capable requirements by providing the operator operational risk and if the operator is of flowing hydrocarbons in measurable with the option of using an SSID or able to demonstrate that the alternate quantities, then BSEE will allow the having access to a relief rig as an procedure or equipment would provide operator to delay its positioning of the additional means to secure the well in a level of safety and environmental capping stack until reaching that casing the event of a loss of well control, if the protection that equals or surpasses the point. BSEE’s proposal to delay the operator will be conducting exploratory mudline cellar requirement. positioning of the capping stack would drilling operations from a MODU. In 6. IOP—BOEM proposes to eliminate addition, BSEE proposes to provide an be based on the documentation that the the requirement that the operator submit opportunity to the operator to adjust the operator provides as well as any other an IOP because it requires submission of point in time during operations when it available data and information. As information that overlaps with that previously mentioned, BSEE also must stage its relief rig (if the operator required in the EP and the IOP’s early proposes to eliminate the requirement elects to have access to a relief rig) when for the operator to ensure that the conducting Arctic OCS exploratory information sharing is unnecessary in containment dome and cap and flow drilling operations—from when drilling light of BOEM’s practice for reviewing system are positioned so as to arrive at below or working below the ‘‘surface and coordinating review of the EP. the well location within seven days after casing’’ to when drilling below or Consequently, the operator is already a loss of well control. The Bratslavsky working below the ‘‘last casing point aware that it must plan for how it will and SolstenXP study evaluated current prior to penetrating a zone capable of reduce operational risks and address the industry methods and standards for flowing hydrocarbons in measurable challenges associated with operations deploying SCCE in Arctic OCS quantities.’’ If the operator is able to on the Arctic OCS through its EP. conditions, and determined that demonstrate to BSEE, based on

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00014 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79279

E. Partner Engagement in Preparation other marine mammals, fish, and birds, a commitment to consultation with for This Proposed Rule are a key food source for many peoples’ tribes and recognition of their right to diets in the native villages. The Alaska self-governance and tribal sovereignty. 1. Summary of Partner Interaction Natives’ primary concerns pertained to E.O. 13175, Consultation and In advance of publishing this protecting their food sources. BSEE and Coordination with Indian Tribal proposed rule, BSEE and BOEM reached BOEM are fully aware that subsistence Governments and DOI’s tribal out to Alaska Native tribal leaders, resources play a key role in offsetting consultation policy, which implements ANCSA corporations, and native village the high costs of conventional food the E.O., provide for procedures for leaders in Northern Alaska for supplies and that subsistence hunting consultation with tribes when taking an Government-to-Government and fishing play a key role in the action with tribal implications. DOI has consultations and municipal meetings. cultural identity of Alaska Natives. extended its consultation policy to These Bureaus arranged consultations BOEM’s leases all contain provisions ANCSA corporations. Furthermore, and meetings to receive input from related to the protection of these BSEE and BOEM recently issued their these groups on potential regulatory subsistence uses and BOEM’s own expanded tribal consultation changes that could encourage energy regulations at §§ 550.227(b)(7) and guidance on August 20, 2019 and June exploration and production and reduce 550.261(b)(7) require lessees to explain 29, 2018, respectively. BSEE’s guidance unnecessary regulatory burdens, while how they propose to protect these (Bureau of Safety and Environmental maintaining safety and environmental subsistence uses. In addition, BSEE and Enforcement (BSEE) Tribal Consultation protection. Between November 29, 2018 BOEM are not proposing any regulatory Guidance, August 20, 2019, available at and January 30, 2019, BSEE and BOEM changes that would adversely affect https://www.bsee.gov/bsee-tribal- officials met with 23 tribal, ANCSA protection of subsistence uses. guidance-2019) and BOEM’s guidance corporation, and municipal leaders at Certain tribal representatives, and (BOEM Tribal Consultation Guidance, villages throughout Northern Alaska most ANCSA corporations, were June 29, 2018, available at https:// (Kotzebue, Point Hope, Utqiagvik [i.e., supportive of this rulemaking, and www.boem.gov/Tribal-Engagement/), Barrow], Nuiqsut, and Kaktovik), in explained that it could help attract more identify various consultation authorities Fairbanks, and in Anchorage. In economic opportunities to their villages. that BSEE and BOEM will follow in addition, BSEE and BOEM held a In some cases, tribes or corporations consulting with tribes and ANCSA consultation meeting via a conference advocated for the use of their villages to corporations. call with tribal representatives from the support safer oil and gas operations, DOI recognizes and respects the Native Village of Point Lay. The because the villages have deeper ports distinct, unique, and individual cultural following list identifies the entities with that could support larger vessels, or traditions and values of Alaska Native which BSEE and BOEM met: because they may be located closer to people and the statutory relationship • Tribal Governments—Native potential drilling operations than those between ANCSA Corporations and the Village of Utqiagvik, Native Village of ports or facilities that have been used in Federal Government. BSEE and BOEM Wainwright, Native Village of Kotzebue, the past. This could allow for quicker will endeavor to go above and beyond Native Village of Point Hope, Native response to emergency incidents. their consultation responsibilities where BSEE did not include any regulatory Village of Nuiqsut, Native Village of and when appropriate throughout the changes in this proposed rule Kaktovik, Tanana Chiefs Conference, rulemaking process to maintain a strong specifically designed to respond to this and Native Village of Point Lay; working relationship with their tribal • comment. While requiring the staging of Native Corporations—Olgoonik and ANCSA corporation partners. equipment at strategically located Native Corporation, Doyon Limited, BSEE and BOEM also received a Arctic Slope Regional Corporation, coastal depots could have a positive impact on oil spill responses in the comment from one of the ANCSA Tikigaq Native Corporation, Cully corporations recommending that this Corporation, Kuukpik Corporation, and Arctic, the identification and placement of depots for such resources falls to the rulemaking take into account the NPC Kaktovik Inupiat Corporation; 2019 Report. BSEE and BOEM • Municipal Governments— discretion of the operator (within the parameters established by existing considered the NPC reports when Northwest Arctic Borough, Point Hope, preparing this proposed rule and based North Slope Borough, City of Utqiagvik, regulation). To provide each plan holder with the flexibility needed to respond to some of the proposed regulatory Nuiqsut, and Kaktovik; and, revisions on that report’s • Other Tribal Organizations—ICAS their WCD scenarios, BSEE’s Oil Spill recommendations, as discussed more and the AEWC. Response Plan (OSRP) regulations do BSEE and BOEM shared information not mandate the use of any particular fully below. with the tribal representatives staging location(s) for equipment and Another common comment that BSEE describing potential options for personnel. BSEE will review the and BOEM received was a regulatory change that the Bureaus were operator’s staging arrangements recommendation to include a considering at the time the meetings submitted as part of the proposed OSRP requirement for a CAA between the oil took place. BSEE and BOEM made to ensure that the OSRP would fully and gas operator and those whaling multiple attempts to contact two comply with the planning requirements communities potentially affected by an corporations—Kikiktagruk Corporation in the governing regulations. operator’s proposed drilling project. A and NANA Regional Corporation but Other comments provided during the CAA is typically established through a did not receive a response from them. consultation meetings included a collaborative process whereby both recommendation for BSEE and BOEM to parties work to create mitigation 2. Summary of Comments Received provide broader outreach by presenting strategies that would avoid adverse BSEE and BOEM heard a variety of this proposed rule to their tribal impacts to bowhead whales and other perspectives during these meetings with assembly and to citizens within the marine mammals, their habitat, and Alaska Natives. The most common communities. hunting opportunities. Historically, comment received was a concern over DOI strives to strengthen its operators have voluntarily used the food security. Subsistence resources, government-to-government relationship CAA process and, currently, existing including bowhead and beluga whales, with federally recognized tribes through lessees are required to do so through

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79280 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

lease stipulations.38 See discussion in communities. Such a requirement for habitat, bowhead whale migration, and Section I.E.3, History and Background lessees and operators to execute an ice coverage), BOEM’s environmental on the Conflict Avoidance Agreement, agreement could give a third-party studies program both adds to our of this preamble describing the history power to set conditions for, or veto, OCS understanding and tracks these changes and background of the CAA. In activities over which they otherwise to have the best science available for the addition, under the MMPA, the taking have no authority. public, industry, and federal permitting of marine mammals without a permit or For those reasons, BOEM has decisions. While BOEM has observed exception is prohibited in order to concluded that a regulation would not changes through these studies, these prevent the decline of species and result in any additional protections of changes follow the trajectory that BOEM populations. To avoid liability for take, subsistence whaling beyond those has been studying and documenting for operators must obtain an Incidental provided by its longstanding practice of several decades. While this proposed Take Authorization or Incidental addressing the issue in a lease rule would change how operators could Harassment Authorization for activities stipulation. BOEM has included as a explore for OCS resources in the Arctic, related to offshore exploration, lease stipulation for all Arctic OCS lease there are ample opportunities to permit development and production. sales since 1991 that the lessee must these activities consistent with ESA, Implementation of the MMPA is shared make every reasonable effort, including MMPA, NEPA, and consultation with between NMFS and USFWS. such mechanisms as a CAA, to assure Alaska Native communities. Section 7(a)(2) of the ESA requires that exploration, development, and every Federal agency to ensure that any production activities are compatible 3. History and Background on the action they authorize, fund, or carry out with whaling and other subsistence Conflict Avoidance Agreement is not likely to jeopardize the continued hunting activities and will not result in In 1977, the IWC expressed concern existence of a listed species or result in unreasonable interference with over the low bowhead whale the adverse modification of designated subsistence harvests. Implementation of population. Its report specifically critical habitat. When any exploration or the stipulation must be described in an mentioned that the future expansion of development plan, or G&G permit EP under § 550.222. In addition, either offshore oil and gas extraction in the application, is submitted to BOEM, BOEM or BSEE may require additional Arctic posed a potential risk to the BOEM evaluates the proposal, and mitigation measures at the EP or the bowhead whale population. At that consults with NMFS and USFWS on APD stages, as necessary, to time, Inuit subsistence hunters knew species listed under the ESA. During appropriately address potential that bowhead whales were sensitive to this process, mitigation measures (e.g., interference with subsistence activities. anthropogenic noise, movements, and vessel speed restrictions, rig lighting For example, because subsistence even smells. There were concerns that specifications, and protected species hunters are concerned that the effects of increased activity would affect their observer requirements) are developed to offshore oil and gas exploration might hunt. Traditional hunters had noticed reduce impacts to protected species. displace migrating bowhead whales and that boat traffic, seismic exploration, These measures are then included in other marine mammals (like beluga and drilling were causing migrating BOEM’s conditions of approval for the whales), the Bureaus will meet with the whales to deflect away from the shore EP, DPP, or G&G permit. AEWC and its whaling captains to help and beyond the hunters’ reach. BOEM did not include any regulatory document traditional knowledge Beginning in 1986, offshore changes in this proposed rule pertaining to bowhead whales, stakeholders, such as representatives specifically designed to respond to this including movement and behavior. from whaling villages, the AEWC, and comment. BOEM cannot require Given the importance of subsistence oil and gas companies, have all met to whaling communities to establish activities and related socio-cultural identify sources of potential conflict, agreements with operators, since BOEM activities to the Alaska Native and have relied on local traditional has no jurisdiction over such communities, BOEM has long knowledge as well as other information. encouraged operators to work directly CAAs were developed first in the 1980s 38 Every BOEM Arctic lease contains a variant of with interested parties to help mitigate to address these sources of potential the following stipulation: ‘‘Prior to submitting an potential impacts to subsistence conflict and have been referenced in exploration plan or development and production activities. In addition, BOEM funds and lease stipulations since 1991. plan (including associated oil-spill contingency supports studies to better understand plans) to MMS for activities proposed during the Since 1991, all leases in the Arctic bowhead whale migration period, the lessee shall the potential impacts from OCS issued by BOEM or its predecessors consult with the directly affected subsistence operations on marine mammals and have included a stipulation requiring communities, Barrow, Kaktovik, or Nuiqsut, the subsistence activities. Over the last 46 the operator to coordinate their North Slope Borough (NSB), and the AEWC to years, the environmental studies discuss potential conflicts with the siting, timing, activities with potentially affected and methods of proposed operations and safeguards program has provided more than $1.2 Alaska native communities. While the or mitigating measures which could be billion nationally for scientific research text of these stipulations has varied implemented by the operator to prevent on the OCS. Nearly $500 million of that from time to time, all of them have unreasonable conflicts. Through this consultation, amount has funded studies in Alaska to included certain important components. the lessee shall make every reasonable effort, produce more than 1,000 technical including such mechanisms as a conflict avoidance The following is an extract from such a agreement, to assure that exploration, development, reports and innumerable peer reviewed stipulation, incorporated into the leases and production activities are compatible with publications. BOEM uses information issued from the Oil and Gas Lease Sale whaling and other subsistence hunting activities from the studies program to evaluate the Number 202, issued on April 18, 2007: and will not result in unreasonable interference potential environmental effects of with subsistence harvests. Prior to submitting an exploration plan or A discussion of resolutions reached during this leasing OCS lands for exploration and development. Since July 2016, BOEM development and production plan (including consultation process and plans for continued associated oil-spill contingency plans) to consultation shall be included in the exploration has completed 35 environmental studies MMS for activities proposed during the plan or the development and production plan. In and has 23 ongoing studies that cover particular, the lessee shall show in the plan how its bowhead whale migration period, the lessee activities, in combination with other activities in the Arctic, totaling nearly $72 million. shall consult with the directly affected the area, will be scheduled and located to prevent While environmental conditions change subsistence communities, Barrow, Kaktovik, unreasonable conflicts with subsistence activities.’’ and continue to change (e.g., walrus or Nuiqsut, the North Slope Borough (NSB),

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79281

and the Alaska Eskimo Whaling Commission stacks are similar to SSIDs. Accordingly, would list the factors upon which BSEE (AEWC) to discuss potential conflicts with this modification in the 2016 final rule may rely when determining whether to the siting, timing, and methods of proposed effectively allows the operator to install grant an SOO and include when an operations and safeguards or mitigating an SSID below a subsea BOP and would measures which could be implemented by operator: the operator to prevent unreasonable be in compliance with the capping stack (1) Has conducted operations on the conflicts. Through this consultation, the requirement in the existing § 250.471, lease during the drilling season lessee shall make every reasonable effort, What are the requirements for Arctic immediately preceding the period for including such mechanisms as a conflict OCS source control and containment? which the operator is seeking a avoidance agreement, to assure that Existing § 250.471(a)(1), specifically suspension; exploration, development, and production requires the operator, when drilling (2) is drilling from: A MODU, an activities are compatible with whaling and below or working below the surface artificial gravel island or a gravity-based other subsistence hunting activities and will casing, to have access to a capping stack structure, or an artificial ice island; and not result in unreasonable interference with subsistence harvests. that is positioned to ensure that it will (3) is not able to safely continue its be able to arrive at the well location operations due to the presence of Because this stipulation was provided within 24 hours after a loss of well seasonal ice, temporary seasonal drilling for in the lease sale notice and included control. Typically, an operator would restrictions in its approved oil spill in the lease agreements resulting from comply with this requirement by having response plan, or seasonal temperature the lease sale, its requirements became one or more support vessels capable of changes (respectively, for each facility binding for all leases issued as a result handling and deploying the capping type). of that particular lease sale. stack down to the subsea wellhead, Currently, BOEM issues Alaska OCS The intent of this stipulation is for the when needed. Installing an SSID below leases with the maximum 10-year operator to make a reasonable effort to the subsea BOP allows the operator to primary lease term allowed under establish a CAA with potentially comply with § 250.471(a)(1) and forgo OCSLA.40 However, operators may be affected whaling or subsistence hunting the need to provide support vessels and precluded from properly developing communities. It is the operator’s a capping stack on standby at the leases because it is not possible to responsibility to attempt to reach surface. conduct leaseholding operations for agreement on a CAA with those However, BSEE is proposing to significant portions of those 10-year communities. eliminate this language because a pre- terms. Offshore drilling locations on the II. Section-by-Section Discussion of positioned capping stack is a piece of Arctic OCS are inaccessible for a Proposed Changes equipment that, as previously significant portion of each year, due to mentioned, aligns closely with an SSID. This section provides explanations of seasonal changes that make operating The Bureau is currently proposing and justifications for each of the specific conditions unsafe or otherwise preclude distinct SSID requirements under regulatory changes proposed in this operations. Moreover, it is difficult to § 250.472, What are the additional well document. Since this is a joint BSEE predict precisely when sea ice will control equipment or relief rig and BOEM proposed rulemaking, this persist or break-up. requirements for the Arctic OCS? This MODUs—For example, drilling Section-by-Section discussion is proposed revision would provide clarity operations performed from a MODU organized according to the order in concerning the capping stack may occur only during the open-water which the relevant provisions would requirements under § 250.471, drilling season (generally late June to appear in the CFR. BSEE’s and BOEM’s specifically that installation of an SSID early November), when sea ice is non- regulations are found in the CFR at Title under § 250.472 does not constitute existent or minimal. This practical 30—Mineral Resources, Volume 2; compliance with the capping stack limitation, without considering other BSEE’s regulations are in Chapter II, and requirements under § 250.471. For logistical problems unique to the Arctic BOEM’s regulations are in Chapter V. purposes of BSEE’s proposed OCS, could mean that during a A. Key Revisions Proposed by BSEE regulations, an SSID is not considered to consecutive 10-year period, a lease may be the same as, or to satisfy the Title 30, Chapter II, Subchapter B, Part be unavailable for operations for requirement to have, a capping stack. 250 approximately 70 percent of the time. The new SSID option that BSEE is Artificial Gravel Islands or Gravity- Subpart A—General proposing under § 250.472 does not, and based Structures—Drilling from Definitions. (§ 250.105) is not intended to, replace any of the artificial gravel islands and gravity- SCCE requirements in proposed based structures is prohibited during the BSEE proposes to revise the definition § 250.471(a), where BSEE’s capping spring/summer ice break-up and the of Capping Stack by deleting the phrase stack requirement is addressed. fall/early winter freeze-up periods, ‘‘including one that is pre-positioned’’ because of the potential impact of from the definition. BSEE included this When may the Regional Supervisor weather and ice conditions on potential phrase as part of the 2016 Arctic grant an SOO? (§ 250.175) oil spill response and cleanup efforts. In Exploratory Drilling Rule in response to BSEE proposes to revise § 250.175 by particular, response and cleanup a suggestion that the definition in the adding a new paragraph (d), which techniques for a large spill are not as 2015 Arctic Proposed Rule should be would allow an operator to request an effective when sea ice is broken and expanded to allow pre-positioned SOO under certain situations that may unconsolidated around the drilling capping stacks to be used below subsea be present in the Arctic OCS. This location. By contrast, response and BOPs when deemed technically and proposed revision is consistent with operationally appropriate. Recognizing OCSLA’s requirement that the Secretary 40 OCSLA sec. 8, as amended, states in part: ‘‘An that the comment was helpful, BSEE promulgate suspensions regulations that oil and gas lease issued pursuant [OCSLA] shall be agreed with the suggestion and added ‘‘facilitate proper development of a lease for an initial period of (A) five years; or (B) not to the phrase ‘‘including one that is pre- 39 exceed ten years where the Secretary finds that ....’’ The proposed regulation such longer period is necessary to encourage positioned’’ to the capping stack exploration and development in areas because of definition (see 81 FR 46492). As a 39 OCSLA sec. 5, as amended, codified at 43 unusually deep water or other unusually adverse practical matter, pre-positioned capping U.S.C. 1334(a)(1). conditions . . . .’’ 43 U.S.C. 1337(b).

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00017 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79282 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

cleanup efforts for a large oil spill from schedule for resuming operations, BSEE other offshore areas in the U.S., where an artificial gravel island or a gravity- will typically grant the SOO (assuming operators have access to the leases all based structure could be executed the other requirements are satisfied). year-round.’’ (NPC 2015 Report at 31 effectively during the summer (i.e., in BSEE will use the reasonable schedule and NPC 2019 Report at 25). The NPC open-water conditions) using existing of work as an established measuring 2019 Report pointed out that a ‘‘10-year oil spill response technologies. During stick by which the Bureau would assess lease in the U.S. Arctic equates to about the winter (i.e., under solid ice the operator’s diligence and progress 3 to 4 years of working time, compared conditions), the ice, and any snow on toward prudent development. If the with the equivalent 10 years working the ice, could provide an effective operator does not adhere to its approved time in the Gulf of Mexico.’’ (NPC 2019 platform for oil spill response and work schedule, BSEE may terminate the Report at 25). While it is not possible for cleanup efforts, and help absorb the SOO under existing regulations. BOEM to award leases with more than spill and contain it to an area relatively Paragraph (e) of existing § 250.170, How the maximum ten-year primary lease close to the gravel island or gravity- long does a suspension last? authorizes term allowed under OCSLA, this based structure. Land-based equipment BSEE to terminate any suspension when proposed regulatory change would rely could then be used to collect and the Regional Supervisor determines the on the Secretary’s statutorily delegated transport the oil-covered ice out of the circumstances that justified the authority, which has, in turn, been location. For context, a gravity-based suspension no longer exist. Because a delegated to BSEE, to administer structure would include a concrete reasonable schedule of work serves as a suspensions to address, as appropriate, island drilling structure and a steel required foundation for BSEE’s SOO the effects of Arctic working conditions drilling caisson(s). approval, the operator’s adherence to when they may limit the operator’s Artificial Ice Islands—A similar issue that schedule is necessary to maintain ability to perform leaseholding would be encountered if drilling were to the SOO. This allows BSEE to ensure activities. take place from a man-made ice island. that the operator complies with the Documents Incorporated by Reference. In those cases, the drilling location OCSLA Congressional declaration of (§ 250.198) would be accessible only during the purpose. Other regulations under winter season when temperatures are Subpart A that would also apply to BSEE proposes to revise the existing very low, and the area is completely BSEE’s implementation of proposed relief rig and SSRW requirements in covered by ice stable enough to safely paragraph (d) of § 250.175 includes § 250.472 by providing the operator support a drilling rig and associated § 250.170, How long does a suspension with an option to either use an SSID or equipment. As temperatures rise during last? which allows BSEE to issue a have access to a relief rig if the operator the spring and summer seasons, the ice suspension for up to five years and will conduct exploratory drilling breaks or melts away, making the provides that the suspension operations from a MODU. As part of that drilling location inaccessible until the automatically ends when the suspended proposed regulatory change, which is next winter season. operation commences. discussed in detail later below in the The new paragraph (d) of § 250.175 BSEE understands the requirement in What are the relief rig or additional well would facilitate the proper development OCSLA to supervise operations in a control equipment or relief rig of a lease by addressing those seasonal manner that assures due diligence in the requirements for the Arctic OCS? conditions that limit leaseholding exploration and development of each (§ 250.472) section-by-section operations by providing an operator lease. Therefore, BSEE is contemplating discussion, BSEE proposes to require ready and able to complete its the option of limiting the period for the SSID to include Remotely Operated operations with the opportunity to when the suspension would remain in Vehicle (ROV) intervention equipment obtain an SOO. If granted, this SOO effect; only during the period between that has the capabilities to function the would suspend the running of the lease one drilling season and the next when SSID. Under proposed term and effectively extend the term of the operator is prevented from § 250.472(a)(3)(ii), BSEE would require the affected lease by a period equivalent continuing its drilling or other the ROV to have panels that are to the period of such suspension. The leaseholding activities due to seasonal compliant with API RP 17H, Remotely SOO would allow a diligent operator to conditions. This option would still Operated Tools and Interfaces on use the full 10 years in a 10-year lease provide operators more time to Subsea Production Systems, Second term to explore for hydrocarbons, effectively explore their leases without Edition, June 2013; Errata, January 2014, without the concern for a lease expiring fear of an expiring lease. It could also to ensure that the operator’s ROV because Arctic seasonal constraints provide BSEE with a better means of capabilities for the SSID follow BSEE’s prevented operations. tracking an operator’s diligence efforts. existing ROV panel requirements for BSEE would continue to require the This option, however, could result in BOP systems. In conjunction with operator to comply with the existing additional unnecessary burdens, since proposed paragraph (a)(3)(ii) that would requirements for requesting a an operator would have to ‘‘reapply’’ for require the operator’s ROV panels to be suspension under existing § 250.171, a new suspension if the operator is compliant with API RP 17H, BSEE How do I request a suspension? For unable to return to the location during proposes to add the citation for example, § 250.171 requires the operator the next open-water season. BSEE is proposed § 250.472(a)(3) to to submit a reasonable schedule of work seeking comment on this regulatory § 250.198(e)(73). Paragraph (e)(73) of for resuming the suspended operations option for the SOO or any other option § 250.198 documents the locations in on the subject lease for which the that could avoid or minimize additional the regulations where API RP 17H is operator requests the suspension. A burden, but still assure diligent lease incorporated by reference as a schedule of work typically includes exploration and development. regulatory requirement, which would milestones describing what activities BSEE’s proposed regulatory change include § 250.472(a)(3) under this the operator will perform to resume would address concerns raised in the proposed rule. Adding the citation for operations and when those operations NPC reports, which suggested that the § 250.472(a)(3) to § 250.198(e)(73) would will be performed. If the operator current approach toward administration clarify that API RP 17H is a regulatory submits a schedule of work that of the 10-year primary lease term requirement when complying with demonstrates a reasonable plan and allowed under OCSLA ‘‘comes from § 250.472 and is subject to BSEE

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00018 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79283

oversight and enforcement in the same reference, or by sending a request by and the Chukchi Sea. Those general manner as other regulatory email to [email protected]. permits additionally prohibit the requirements. discharge of oil-based and non-aqueous Subpart C—Pollution Prevention and based muds and cuttings. The EPA must API Recommended Practice 17H— Control issue an NPDES general permit before Remotely Operated Tools and Interfaces an operator may seek coverage under on Subsea Production Systems Pollution prevention. (§ 250.300) that general permit. Compliance with This recommended practice provides BSEE proposes to revise paragraphs (b)(1) and (2) of § 250.300 by eliminating the CWA, including gaining coverage general recommendations and overall under an applicable NPDES general guidance for the design and operation of the existing language that states the Regional Supervisor may require the permit, is necessary before an operator remotely operated tools (ROT) and may discharge pollutants from its remotely operated vehicle (ROV) tooling capture of all water-based mud, and associated cuttings, from operations exploratory drilling operations. used on offshore subsea systems. ROT Before issuing an NPDES permit, EPA after completion of the hole for the and ROV performance is critical to must make specific determinations to conductor casing to prevent its ensuring safe and reliable subsea ensure that issuance of a permit will not operations and this document provides discharge into the marine environment. lead to unreasonable degradation of the general performance guidelines for this While this proposed rule would marine environment. EPA’s and associated equipment. This second eliminate the language regarding the determination is guided by an Ocean edition also includes provisions on high Regional Supervisor’s discretionary Discharge Criteria Evaluation (ODCE). flow Type D hot stabs. authority to require the capture of The ODCE requires the agency to The American Petroleum Institute water-based muds and cuttings, it consider multiple environmental (API) provides free online public access would maintain the existing factors, such as potential impacts on to view read only copies of its key requirement in § 250.300(b)(1) and (2) human health through direct and industry standards, including a broad that operators capture all petroleum- indirect pathways, and the importance range of technical standards. All API based mud and associated cuttings of the receiving water area to the standards that are safety-related and that while operating on the Arctic OCS. surrounding biological community. Existing § 250.300(b)(1) and (2) state are incorporated into Federal These factors take into consideration that the BSEE Regional Supervisor may regulations are available to the public how discharges could impact exercise his or her discretionary for free viewing online in the subsistence activities, marine resources, authority to restrict discharges of water- Incorporation by Reference Reading and coastal areas. The most relevant based muds and associated cuttings Room on API’s website at: http:// NPDES permits issued for offshore oil [1] from Arctic OCS exploratory drilling publications.api.org . In addition to and gas exploration activities conducted based on various factors, such as: the free online availability of these from a MODU on the Arctic OCS are Proximity of drilling operations to standards for viewing on API’s website, two 2012 general permits that covered subsistence hunting and fishing hardcopies and printable versions are oil and gas exploration facilities locations; the extent to which available for purchase from API. The conducting operations in Federal waters discharged water-based mud or cuttings API website address to purchase of the Beaufort Sea and the Chukchi may cause marine mammals to alter standards is: https://www.api.org/ Sea. The Beaufort Sea permit 41 does not their migratory patterns in a manner products-and-services/standards/ allow the discharge of water-based that impedes subsistence users’ access purchase. muds and cuttings during the fall [1] to or use of those resources, or increases To view these standards online, go bowhead whale hunt. However, the to the API publications website at: the risk of injury to subsistence users; or Chukchi Sea permit 42 did not include a http://publications.api.org. You must the extent to which discharged mud or similar restriction. According to the cuttings may adversely affect marine then log-in or create a new account, ODCE for the Chukchi Sea permit, the mammals, fish, or their habitat. BSEE accept API’s ‘‘Terms and Conditions,’’ restriction was not necessary because promulgated the existing provisions in click on the ‘‘Browse Documents’’ the migration of bowhead whales would response to concerns raised by Alaska button, and then select the applicable be over before discharge-related category (e.g., ‘‘Exploration and Native Tribes during preparation of the activities would begin.43 Production’’) for the standard(s) you 2015 Arctic Proposed Rule. These Under this proposed rule, BSEE wish to review. concerns included how water-based would preserve the requirements in For the convenience of the viewing muds or cuttings could adversely affect § 250.300(b)(1) and (2) that the operator public who may not wish to purchase or marine species (e.g., whales and fish) capture all petroleum-based mud and view the incorporated documents and their habitats and compromise the associated cuttings. This requirement is online, the documents may be inspected effectiveness of subsistence hunting consistent with a longstanding, OCS- at BSEE’s offices at: 3801 Centerpoint activities. wide regulatory authority that existed Dr, Anchorage, Alaska, 99503 (phone: BSEE re-examined the language in prior to the promulgation of the 2016 907–334–5300); 1919 Smith Street, paragraphs (b)(1) and (2) of this section Arctic Exploratory Drilling Rule. BSEE Suite 14042, Houston, Texas 77002 in light of EPA’s authority to address must preserve the petroleum-based (phone: 1–844–259–4779); or 45600 water-based muds and cuttings muds and cuttings requirement since it Woodland Road, Sterling, Virginia discharges. The Clean Water Act (CWA) is not unusual for petroleum-based 20166 (email: [email protected]), by (Section 301(a), 33 U.S.C. 1311(a)) appointment only. BSEE will make provides EPA with the authority to issue 41 https://www.epa.gov/sites/production/files/ documents incorporated in the rule National Pollutant Discharge 2017-12/documents/r10-npdes-beaufort-oil-gas-gp- available for viewing at the time and Elimination System (NPDES) general akg282100-final-permit-2012.pdf. date agreed upon for the appointment. permits, which authorize certain 42 https://www.epa.gov/sites/production/files/ Additional information on where these discharges, including certain restricted 2017-12/documents/r10-npdes-chukchi-oil-gas-gp- akg288100-final-permit-2012.pdf. documents can be inspected or discharges of water-based muds and 43 https://www.epa.gov/sites/production/files/ purchased can be found at 30 CFR cuttings, from oil and gas exploratory 2017-12/documents/r10-npdes-chukchi-oil-gas-gp- 250.198, Documents incorporated by facilities on the OCS in the Beaufort Sea akg288100-odce-2012.pdf, pp. 6–14 to 6–17.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00019 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79284 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

muds to contain constituents that are environmentally responsible manner with ‘‘use’’ to improve the readability of toxic and harmful to the environment. pursuant to OCSLA. Therefore, the the regulation. Although water-based muds may not be proposed rule would not alter the Subpart D—Oil and Gas Drilling a feasible option for all drilling longstanding regulation at Operations operations, such as when drilling § 250.300(b)(1), under which the District through hydrophobic geologic Manager (or Regional Supervisor) What additional information must I formations that could be damaged by retains the ability to restrict the rate of submit with my APD for Arctic OCS water-based muds, its use is a more drilling fluid discharges or prescribe exploratory drilling operations? environmentally benign approach in alternative discharge methods where (§ 250.470) comparison to the use of petroleum- warranted. Pursuant to § 250.300(b)(1), BSEE proposes to revise paragraph (b) based muds. However, BSEE’s proposed BSEE would be able to determine of § 250.470 by adding paragraph (b)(13) revisions reflect the Bureau’s whether there is a need to require to include ‘‘Recover the subsea isolation understanding that the express capture of water-based muds and device (SSID), where applicable.’’ This statements regarding the Regional cuttings on a case-by-case basis, if the revision is necessary to address the Supervisor’s discretionary authority to EPA has not done so. In particular, the SSID alternative proposed in § 250.472, require the capture of water-based muds District Manager would consider and and to ensure the operator’s permit and cuttings in existing § 250.300(b)(1) determine whether such a requirement addresses how it would recover the and (2) are not necessary. In particular, would be appropriate for any facility. SSID, if one is used. For operations the EPA already addresses the goals of The District Manager would make this relying on an SSID, the SSID is a critical protecting water quality through the piece of equipment. Therefore, BSEE NPDES program, protecting marine determination on a case-by-case basis, must understand how the operators will species and their habitats, as well as the in conjunction with the EP and APD handle it, prior to and after drilling effectiveness of subsistence hunting approval process. This process includes operations. We also propose minor, non- activities, through the exercise of that coordinating with BOEM, particularly at agency’s authorities. Thus, BSEE does the EP stage, when BOEM conducts an substantive edits to paragraphs (b)(11) not expect the Regional Supervisor to environmental review to identify the and (12) to accommodate this addition. In cases where an operator obtains need to exercise the discretionary direct, indirect, and cumulative SCCE capabilities through contracting, authority under existing § 250.300(b)(1) environmental effects that may be paragraph (f)(3) currently requires the and (2) in the foreseeable future. expected as a result of implementing the Furthermore, BSEE understands, and EP. That environmental review also operator to provide proof of contracts or did so even while it was preparing the incorporates input about potential membership agreements with 2016 Arctic Exploratory Drilling rule, environmental effects that may be cooperatives, service providers, or other that the references to the BSEE Regional obtained through consultations and contractors. This includes information Supervisor’s authority in existing review by interested parties, Federal demonstrating the availability of the paragraphs (b)(1) and (2) created some agencies (e.g., EPA), State or local personnel and/or equipment on a 24- uncertainty for the regulated industry agencies, Tribes, or the public. Nothing hour per day basis during operations because it appeared to overlap with would change BSEE’s position from the below the surface casing. BSEE proposes EPA’s jurisdiction and, if implemented, 2016 rule to communicate with other to revise paragraph (f)(3) by replacing might result in BSEE issuing duplicative agencies responsible for oversight of the ‘‘below the surface casing’’ language or conflicting requirements. BSEE discharges related to oil and gas in this paragraph with the phrase addressed this concern by explaining exploration drilling in the Arctic. This ‘‘below the surface casing, or before the that the amendments were meant to communication will help ensure that last casing point prior to penetrating a clarify the Regional Supervisor’s conflicts do not arise (81 FR 46504). zone capable of flowing hydrocarbons in authority to impose operational BSEE expects that such input from EPA measurable quantities, as approved by measures that complement EPA’s would address whether that agency has the Regional Supervisor.’’ This change discharge limitations by considering issued or plans to issue a permit for the would make the requirement in potential impacts to specific same exploratory drilling facilities, and paragraph (f)(3) consistent with the components of the Arctic environment, whether that agency believes that changes BSEE is proposing to § 250.471, such as subsistence activities, marine capture of water-based muds in a which houses the substance of the Arctic OCS SCCE requirements. This resources, and coastal areas (81 FR specific case is warranted. Through proposed change is discussed in further 46505). Given the policy in E.O. 13783 BSEE’s longstanding authority under detail in connection with that provision. to review existing regulations that § 250.300(b)(1), the District Manager Finally, BSEE proposes to add a new potentially burden the development or could require an operator to restrict the use of domestically produced energy paragraph (h) to complement the rate of drilling fluid discharges or proposed revisions to § 250.472, which resources and the general principles in prescribe alternative discharge methods. Section 1 of E.O. 13563—Improving would provide the operator with the Such a restriction on the discharge of option to use an SSID or have access to Regulation and Regulatory Review (76 water-based muds and cuttings might be FR 3821)—to promote predictability and a relief rig, as an additional means to appropriate if identified in the EP secure the well in the event of a loss of reduce uncertainty, BSEE believes it is environmental review process. appropriate to propose eliminating the well control, if the operator will be water-based mud, and associated In addition to the proposed revisions conducting exploratory drilling cuttings, provisions in § 250.300(b)(1) just described, BSEE proposes a minor operations from a MODU (that change is and (2). modification to the second sentence in discussed in further detail in connection This proposed regulatory change does existing paragraph (b)(2), which requires with that provision). Under proposed not suggest any change in BSEE’s the operator to capture all cuttings from paragraph (h), if the operator elects to recognition that it is responsible for operations that ‘‘utilize’’ petroleum- use an SSID, BSEE would require the ensuring that oil and gas exploration based mud to prevent their discharge operator to provide a certification, and production activities on the OCS into the marine environment. BSEE signed by a registered professional are conducted in a safe and proposes to replace the word ‘‘utilize’’ engineer, confirming that its SSID and

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00020 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79285

well design (including casing and (iii) removing the phrase ‘‘positioned regulations—§ 250.462 (What are the cementing program) meet the design to ensure that it will arrive at the well source control, containment, and requirements in proposed § 250.472(a), location within 7 days after a loss of collocated equipment requirements?) and the design is appropriate for the well control’’ from subparagraphs (a)(2) and is able to deploy the equipment as purpose for which it is intended under and (3), which apply to the cap and flow directed by the Regional Supervisor. expected wellbore conditions. BSEE is system and containment dome, Details regarding BSEE’s proposed proposing this new provision to be respectively. revisions to § 250.471(a)(2) and (3) are consistent with existing requirements The changes described in item (i) discussed in the subsection below, under existing § 250.420 (a)(7)(i), which from the previous paragraph could entitled, Revisions to the Cap and Flow require the operator to include with the allow the operator to adjust the point in System, and Containment Dome APD a certification signed by a time during operations when it must Requirements. registered professional engineer that the position its capping stack—from ‘‘when • Revisions to the Capping Stack casing and cementing design is drilling or working below the surface Requirements appropriate for the purpose for which it casing’’ to ‘‘when drilling or working BSEE’s proposed revisions to is intended under expected wellbore below the last casing point prior to the paragraph (a) would provide an conditions. zone capable of flowing hydrocarbons in opportunity to the operator to adjust the measurable quantities’’—if the operator point in time during operations when it What are the requirements for Arctic is able to demonstrate that it will not must position its capping stack, so that OCS source control and containment? encounter any abnormally high- it will be available to arrive at the well (§ 250.471) pressured zones or other geological location within 24 hours after a loss of Section 250.471(a) currently requires hazards before that casing point. well control. If the operator is able to the operator to have access to the SCCE However, unless otherwise approved by demonstrate to BSEE that the operations described in paragraphs (a)(1) through BSEE, the operator must have access to it plans to conduct below the surface (3), which must be capable of stopping their SCCE as described in paragraph casing would not encounter any or capturing the flow of an out-of- (a)(1) and proposed paragraphs (a)(2) abnormally high-pressured zones or control well if the operator will be using and (3), when drilling or working below other geologic hazards before reaching a MODU when drilling below or the surface casing. While BSEE does not the last casing point prior to penetrating working below the surface casing. propose changes to the capping stack a zone capable of flowing hydrocarbons Paragraph (a)(1) specifically requires the provision in paragraph (a)(1), changes to in measurable quantities, then BSEE capping stack to be positioned to ensure paragraph (a) would have a practical would allow the operator delay its that it will be able to arrive at the well effect on the existing capping stack positioning of the capping stack until location within 24 hours after a loss of requirements. Changes to the capping that point. A capping stack, as defined well control. Paragraphs (a)(2) and (3) stack requirements are discussed in the under the existing regulations at § 250.105, is a mechanical device that require the cap and flow system and the next subsection, entitled, Revisions to can be installed on top of a subsea or containment dome to be positioned to the Capping Stack Requirements. BSEE’s proposed modifications to the surface well head or BOP to stop the ensure that they will be able to arrive at language in paragraph (a), describing the uncontrolled flow of fluids into the the well location within 7 days after a performance standard that the operator’s environment. BSEE also proposes loss of well control. SCCE must meet, is administrative in certain non-substantive language BSEE proposes to revise § 250.471 by: nature. BSEE proposes this change so changes for clarity. (i) Adding a new provision at the end that the language is consistent with the The existing capping stack of paragraph (a) stating that ‘‘However, source ‘‘control’’ and ‘‘containment’’ requirements in paragraphs (a) and the Regional Supervisor will approve description of this equipment, as well as (a)(1) are intended to ensure that a delaying access to your SCCE until your the title of this section of the regulations capping stack is readily available to stop operations have reached the last casing (i.e., § 250.471 What are the or capture the flow of hydrocarbons in point prior to penetrating a zone capable requirements for Arctic OCS source case of a loss of well control when of flowing hydrocarbons in measurable control and containment?). It would not drilling below or working below the quantities provided that you submit change the performance standard that surface casing. While BSEE does not adequate documentation (such as, but the operator’s SCCE must meet. propose to eliminate the requirement in not limited to, risk modeling data, off- BSEE’s proposed changes to remove paragraph (a)(1) to ensure that the set well data, analog data, seismic data), the phrase ‘‘positioned to ensure that it capping stack will be able to arrive at with your APD, demonstrating that you will arrive at the well location within 7 the well location within 24 hours after will not encounter any abnormally high- days after a loss of well control’’ from a loss of well control, the existing pressured zones or other geologic paragraphs (a)(2) and (3) would still requirement in paragraph (a) to ensure hazards. The Regional Supervisor will require the operator to ensure it has the equipment is accessible when base the determination on any access to a cap and flow system or a drilling below the surface casing does documentation you provide as well as containment dome. However, the not fully take into consideration the any other available data and operator would no longer be required to known geology of an area. The information.’’ ensure the equipment is positioned to formations below the surface casing, (ii) modifying the language in be able to arrive at the well location based on the known geology of the area, paragraph (a) describing the within 7 days after the loss of well may have minimal or no potential to performance standard that the SCCE control. The distinction between the flow hydrocarbons in measurable must meet by replacing ‘‘capable of positioning requirement and the quantities during drilling operations. stopping or capturing the flow of an out- requirement to have access to the This obviates the need for ensuring of-control well’’ with ‘‘capable of equipment is that ‘‘having access’’ refers capping stack availability during controlling or containing the flow from to ensuring the operator has identified operations in those zones. Prior to an out-of-control well when drilling the equipment that would meet the submitting an APD, operators assess the below or working below the surface performance requirements in this formations they will potentially casing;’’ and section and in other existing BSEE encounter during drilling operations,

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79286 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

including the potential for hydrocarbon The criteria BSEE proposes to rely criteria, other than ‘‘abnormally high- flow. Operators base this assessment on on—that the operator can demonstrate pressured zones or other geologic existing G&G data that they include in to BSEE that it will not encounter hazards,’’ that the Bureau should use to the APD. ‘‘abnormally high-pressured zones or determine whether to allow the operator In many cases, flowable hydrocarbons other geologic hazards’’—to determine to delay positioning of the capping are not anticipated or encountered in whether to grant an exception accounts stack. measurable quantities until the target for those downhole risks that could lead BSEE’s proposed regulatory language productive formation is reached. For to a blowout and may require the use of describing the types of documentation it example, a surface casing shoe setting a capping stack. With respect to would consider adequate to demonstrate depth for an Arctic OCS exploration abnormally high-pressured zones, BSEE that abnormally high-pressured zones or well could be only 1,500 feet, but the is concerned that there could be a case other geological hazards would not be hydrocarbon bearing formation may be where a kick (an influx, or flow, of encountered before reaching the last thousands of feet below that point. The formation fluid from the high-pressured casing point prior to penetrating a zone existing regulations require the operator zone entering into the wellbore) is not capable of flowing hydrocarbons in to have access to an available capping controlled and could lead to a blowout. measurable quantities—‘‘such as, but stack when drilling or working below While there are means of mitigating the not limited to, risk modeling data, off- the surface casing, even though geologic risk of a kick, (i.e., overbalanced set well data, analog data, seismic and engineering risk analyses the drilling), the capping stack needs to be data’’—is not meant to be an exhaustive operator must submit as part of their readily available if heavier weight list. BSEE would accept any other types APD may show that there is little or no drilling muds, the BOP, and SSID, if of documentation the operator may potential for hydrocarbons to escape the applicable, fail to control the well. provide that will help its demonstration. formation and flow into the well prior There could be other geologic BSEE does not anticipate this to reaching the targeted productive hazards, such as fractured or high submission requirement would lead to a formation. In such circumstances, the permeability zones, that may also pose significant information collection operator could safely drill for thousands a risk, particularly if those zones burden on the operator because it is of feet below the surface casing, without contain hydrocarbons. It is possible that normal practice for operators to gather any identifiable need for a capping normally pressured zones may be highly these types of information to develop stack. This proposed change would, permeable or contain fractures, in which and design an offshore exploration when appropriate, eliminate an lost circulation may occur. This could drilling project on the OCS in the unnecessary burden for the operator to cause a dynamic effect where drilling Arctic. BSEE is requesting comment on maintain a positioned capping stack mud flows into the permeable formation what other types of information could causing the circulating pressure to be used to demonstrate the absence of while drilling into low risk, non- decrease below the zone’s pore pressure abnormally pressured zones or other productive sections of the well below resulting in formation fluids flowing geologic hazards, and how burden on the surface casing. into the well bore. This may lead to a the operator could change—increase or An extensive amount of geophysical loss of well control. The capping stack decrease—if BSEE were to require its data already exists for certain areas of needs to be readily available if heavier submission. both the Beaufort and Chukchi Sea weight drilling muds, the BOP, and At the APD stage, BSEE would Planning Areas, and there has been SSID, if applicable, fail to control the evaluate the operator’s documentation extensive drilling in certain areas of the well. along with other accompanying geologic Beaufort Sea Planning Area. In the However, if the operator is able to and engineering information/analyses known geologic conditions of the U.S. demonstrate that a highly permeable or that must be submitted as part of its Arctic, operators have a good fractured zone is predicted to only APD. BSEE would also consider any understanding of the locations of contain water, BSEE would consider other available G&G information, such reservoirs that they will encounter, allowing the operator to delay as information gathered from prior which can be relatively shallow and positioning of the capping stack. Under drilling operations in the area (e.g., well normally pressured above certain this scenario, the operator would be able log and pressure testing information), geologic depths. Therefore, it may not to use the diverter system in and any other applicable geophysical be necessary to have access to a capping conjunction with the BOP system to (e.g., seismic data) information. BSEE stack when drilling through zones maintain safety and environmental makes clear in its proposed regulatory below the surface casing that do not protection because it would be unlikely language that the Regional Supervisor have abnormally high formation for hydrocarbons to be released into the will base the determination on whether pressures or contain other geological environment. The diverter system to allow the operator to delay hazards, and do not have the potential consists of a mechanical device similar positioning of the capping stack on the to flow hydrocarbons in measurable to a BOP annular preventer. The documentation that the operator quantities, as they are penetrated. diverter system is used to divert gases, submits, as well as any other available However, because geologic conditions fluids, and other materials flowing from data and information. are not uniformly normally pressured the well, away from facilities and BSEE is also considering an throughout the Arctic OCS, BSEE is personnel. Also, an operator would alternative regulatory approach whereby maintaining the existing requirement to pump fluid loss materials into the well the Bureau would instead revise have the capping stack positioned when to bridge the formation to reduce its existing paragraph (a) by replacing drilling or working below the surface permeability and allow drilling muds to ‘‘surface casing’’ with ‘‘last casing point casing. At the same time, BSEE does not isolate the formation from the well. To prior to penetrating a zone capable of discount the possibility that future permanently address the incident, the flowing hydrocarbons in measurable projects would not need to have SCCE operator could also install a liner or set quantities.’’ This regulatory option (i.e., the capping stack) positioned until a new casing point at the interval where would uniformly adjust the point in reaching the last casing point prior to that highly permeable or fractured zone time during operations when the penetrating a zone capable of flowing is located. BSEE would like to know operator must have access to its capping hydrocarbons. whether there are more appropriate stack, by requiring the operator to have

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79287

its capping stack positioned before whether it is appropriate to delay proposed change would remove the drilling below or working below the last positioning of the capping stack at a requirement to have a cap and flow casing point prior to penetrating a zone point in time when operations are system or a containment dome capable of flowing hydrocarbons in taking place below the surface casing positioned to ensure the equipment will measurable quantities. resides with BSEE. BSEE, ultimately, be available to arrive at the well location Under this regulatory option, BSEE may decide not to allow the operator to within 7 days after the loss of well would evaluate the geologic and delay positioning of the capping stack if control, while preserving the existing engineering information/analysis that the Bureau reasonably assesses that requirement to deploy those pieces of the operator must submit as part of its potential risks below the surface casing equipment as directed by BSEE. APD, while also taking into exist that may require immediate BSEE proposes to allow the operator consideration any other available G&G deployment of this device. However, the to adjust the point in time during information the Bureau may have (e.g., distinction under this regulatory option operations when it must position its off-set well data, such as well logs and is that the operator would not need to capping stack under paragraph (a), from pressure testing information, or specifically demonstrate that ‘‘when drilling or working below the geophysical information, such as abnormally high-pressured zones or surface casing’’ to ‘‘when drilling below seismic data). Based on these different other geologic hazards would be or working below last casing point prior sources of information, BSEE would encountered above last casing point to penetrating a zone capable of flowing determine whether there may be a need prior to penetrating a zone capable of hydrocarbons in measurable quantities’’ for the operator to position the capping flowing hydrocarbons in measurable if the operator is able to demonstrate stack at a point in time during quantities. The presumption would be that it will not encounter any operations earlier than last casing point that all zones above the last casing point abnormally high-pressured zones or prior to penetrating a zone capable of prior to penetrating a zone capable of other geologic hazards before that casing flowing hydrocarbons in measurable flowing hydrocarbons are safe unless point. Only the 7-day arrival timing quantities. BSEE determines otherwise. In addition, related to the ‘‘flow’’ part of the cap and There may be cases where the under BSEE’s proposed regulatory flow system would be altered as a result operator or BSEE may not have change, it would be clear that the of BSEE’s proposed modification to sufficient G&G or analogous well data Bureau may request additional paragraph (a)(2) of § 250.471.44 during the permit review process on a information from the operator and The changes proposed in paragraphs proposed project to provide an adequate would provide that BSEE may consider (a)(2) and (3) to remove the requirement level of certainty regarding anticipated other available data and information. for the cap and flow system and the formations that may be encountered BSEE is specifically soliciting containment dome to arrive at the well prior to reaching the targeted productive comments about the benefits or location within 7 days after a loss of formation. Therefore, BSEE is also disadvantages of this regulatory option. well control would not change other considering, as part of this regulatory BSEE is also soliciting comments about existing requirements throughout option, a clarification that the Regional the need for the operator to verify on a § 250.471 for the operator to ensure: Supervisor may require the operator to case-by-case basis those zones incapable (i) Access to a containment dome and have access to a capping stack in of flowing hydrocarbons in measurable cap and flow system; advance of drilling below or working quantities. Operators verify these zones (ii) that the cap and flow system is below the last casing point prior to by analyzing G&G data to evaluate the designed to capture at least the amount penetrating a zone capable of flowing formations that are expected to be of hydrocarbons equivalent to the hydrocarbons in measurable quantities encountered during drilling operations calculated WCD rate referenced in the if BSEE determines there is insufficient and confirm that there are no operator’s BOEM-approved EP; G&G or analogous well data. hydrocarbons present. Operators must (iii) that the containment dome has For example, there may be use available offset well data in the capacity to pump fluids without insufficient G&G or analogous well data conjunction with the G&G data. BSEE relying on buoyancy; in cases where there have been a limited requests comment on other methods (iv) that tests or exercises are number of wells drilled within operators use to verify the hydrocarbon conducted for the SCCE, as directed by proximity to the planned well. In most zones, or abnormally high-pressured the Regional Supervisor; cases, G&G and analogous well data are zones or other geologic hazards (such as (v) that records pertaining to the gathered from multiple sources. fractured or high permeability zones), testing, inspection, maintenance, and However, the same sets and amounts of they anticipate encountering for a use of the SCCE are maintained and data and information may not be proposed drilling project and how made available to BSEE upon request; available for each area, well, or project. frequently the data would be lacking at (vi) that all SCCE identified in There is no single set of criteria for the point of preparing information to § 250.471 are transported to the well determining the sufficiency of G&G or submit as part of an APD. upon a loss of well control; and analogous well data. The more data that • Revisions to the Cap and Flow (vii) that SCCE is deployed as directed are available from sources near to the System, and Containment Dome by the Regional Supervisor. proposed drilling location, the greater Requirements BSEE proposes to remove the cap and confidence BSEE will have in the G&G As described at the beginning of this flow system and containment dome 7- interpretations. BSEE wants to ensure section-by-section discussion, § 250.471, day arrival timing requirements based the operator has the most accurate data BSEE is also proposing to revise on the Bratslavsky and SolstenXP study. to make determinations about where the paragraphs (a)(2) and (3) of existing The Bratslavsky and SolstenXP study zones capable of flowing hydrocarbons § 250.471, which refers to the timing of determined that the time periods when in measurable quantities are located. the arrival of a cap and flow system and SCCE may be safely deployed This alternative regulatory option containment dome, respectively, by throughout the Arctic OCS is limited would maintain the same level of safety removing the phrase ‘‘positioned to based on typical Arctic conditions. In and environmental protection in ensure that it will arrive at the well comparison to BSEE’s proposed location within 7 days after a loss of 44 Existing § 250.105 defines Cap and flow system regulatory change. The decision on well control’’ from each paragraph. This and Capping stack.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79288 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

the Chukchi Sea, this means that safe the historically active exploration area Since publication of the 2016 rule, SCCE deployment could only occur and in the other areas of the Beaufort however, BSEE has sought to better between August and October in the Sea. (id. at 98,102) understand the ability to safely deploy historically active exploration area. Water depth is also an important SCCE (and relief rigs) in Arctic OCS Moving north from the historically factor to consider for the safe conditions, through a study it active exploration area of the Chukchi deployment of SCCE. Deployment is commissioned to Bratslavsky Consulting Sea, the ability to safely deploy SCCE likely to be impaired in water depths Engineers, Inc., and SolstenXP, Inc. diminishes significantly (id. at 100). The shallower than 984 feet because the According to the Bratslavsky and study mentions there are more equipment would potentially be subject SolstenXP study, the time periods when opportunities for safe deployment of to a gas boil at the surface from a subsea SCCE may be safely deployed SCCE in other portions of the Chukchi blowing well (id. at 143). A gas boil is throughout the Arctic OCS is limited in Sea (June through December). However, a forceful release of hazardous gases comparison to relief-well drilling it is only in the southwestern extent of which can present human-health operations, based on typical Arctic the Chukchi Sea Planning Area; outside hazards to workers, fire hazards, and conditions. BSEE did not have the of the historically active exploration potential stability problems for support benefit of having the Bratslavsky and area. vessels and the vessel deploying the SolstenXP study when finalizing the In the Beaufort Sea, the study noted SCCE directly above the blowing well. 2016 Arctic Exploratory Drilling Rule. that sea ice concentrations tend to be Water depths in the majority of the BSEE’s proposed changes to greater year-round as compared to the Chukchi Sea and Beaufort Sea where § 250.471(a)(2) and (3) for the Chukchi Sea (id. at 75). Accordingly, exploration has historically occurred are containment dome and cap and flow safe SCCE deployment could occur from relatively shallow—167 feet or less system responds to the information it ice capable vessels between early has gathered from the study. (Table 1–1 and Table 1–2, id. at 7 to 9). August and October in the historically In light of these findings, BSEE As recently as April of 2020,45 active exploration area of the Beaufort there proposes the revisions under § 250.471 Sea (i.e., the southern portion of the were active leases in the Arctic OCS to the containment dome and cap and Beaufort Sea Planning Area). However, where SCCE may be deployed. These flow system deployment requirements moving north beyond the historically leases were located in the Beaufort Sea in paragraphs (a)(2) and (3) because it is active exploration area, time windows in water depths less than approximately not reasonable to impose such for safe SCCE deployment decrease 170 feet deep. This water depth range universal, prescriptive requirements for significantly (id. at 104). limits the fleet of support vessels that equipment that may not be safely In the case of open water operations can be used for the safe deployment of deployed (moved to the location, in both the Chukchi and Beaufort Seas, SCCE. A possible solution that could equipment put into place, and activated) the study points out that sea state is an enable SCCE deployment in the and effectively used under certain important limiting factor for safe SCCE presence of a gas boil is the use of Arctic OCS conditions. The deployment deployment. Rough sea states—high offset-deployment technology to and arrival schedules of the cap and waves and longer wave periods—can remotely position SCCE over the flow system and the containment dome affect the safety and operating limits of blowing well in shallow water (id. at A– will be directed by the BSEE Regional SCCE deployment. The vessel carrying 35). Supervisor on a case-by-case basis. the SCCE can become very unstable in When BSEE proposed its original However, as previously described, rough sea states and the heave action on Arctic OCS SCCE requirements in 2015, BSEE proposes only to adjust, rather the deck can therefore increase the Bureau explained that there is than eliminate, the reference to the significantly beyond the vessel’s limited ability in the Arctic region to point in time during operations when tolerance levels for conducting summon additional source control and the operator must have access to a operations, which may negatively affect containment resources. Accordingly, the capping stack that is positioned to be the ability to safely deploy the SCCE. Bureau required operators to plan for able to arrive at the well location within Rough sea states are most likely to occur response redundancies and planning 24 hours after a loss of well control. The when there is less sea ice coverage and complexities not required elsewhere (80 Bratslavsky and SolstenXP study shows larger open water areas to generate large FR 9938). BSEE determined that the that the time periods when SCCE waves, which is more of an issue in the provisions finalized in 2016 provided (capping stack, containment dome, and Chukchi Sea, where there are larger for the necessary redundancy and cap and flow system) may safely be open water areas throughout the open sequencing of the responses, based on deployed and effectively used are water season (id. at 11). the time necessary to deploy, and limited. Metocean conditions (i.e., When operating in open water therefore provided sufficient safety and rough sea states and sea ice conditions, sea states generally dictate environmental protection to allow for concentrations) prevalent in the Arctic that safe SCCE deployment could occur exploratory drilling on the Arctic OCS. OCS can exceed the operating limits of only between late September and At that time, BSEE believed that the the vessels that transport and deploy the October in the historically active technologies identified in its SCCE SCCE. In addition, SCCE deployment is exploration area of the Chukchi Sea, and requirements represented the optimal likely impaired in water depths that window diminishes significantly approach to well control capabilities shallower that 984 feet, where gas boils moving north of the historically active available for the Arctic OCS (81 FR could form above a blowing well. Water exploration area. In the Beaufort Sea, 46520). depths in the majority of the Chukchi where there is less open water Sea and Beaufort Sea where exploration throughout the operating season, sea 45 In April of 2020, the only leases with potential has historically occurred are relatively states would generally permit safe projects that would be subject to the Arctic OCS’s shallow—167 feet or less. However, deployment of SCCE between late- SCCE requirements were relinquished. However, BSEE’s independent observation outside August and early-to mid-October in the there are other active leases in the Beaufort Sea of the study is that the chances for located nearer to the shore in shallow waters where historically active exploration area. exploration and development projects are being successfully deploying a capping stack Beyond that, the probability for safe pursued (primarily through man-made gravel under Arctic OCS conditions is greater SCCE deployment decreases rapidly in islands). in comparison to the containment dome

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00024 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79289

and cap and flow system. More capping stack positioning requirement. What are the additional well control specifically, in comparison to the BSEE invites comments on any equipment or relief rig requirements for containment dome, the capping stack technological upgrades or methods that the Arctic OCS? (§ 250.472) has proven to be a more effective exist for SCCE that would meet the Paragraph (b) of § 250.472 currently technology when successfully deployed objective of being a redundant system requires the operator to have access to and has a different function compared that could control or contain a WCD. a relief rig (different from the primary to a containment dome. The capping Although BSEE is proposing to drilling rig), when drilling or working stack latches on to a connector or pipe remove the requirement in existing below the surface casing. In addition, stub located on or in the well to achieve when drilling or working below the a pressure tight seal to capture or stop paragraphs (a)(2) and (3) to ensure that the cap and flow system and surface casing, paragraph (b) requires all fluids flowing out of the well. A the operator to stage the relief rig so that containment dome, which removes oil containment dome will be available to it could arrive on site, drill a relief well, and gas from the water column, will arrive at the well location within 7 days kill and permanently plug the out-of- likely capture only a portion of the after a loss of well control, BSEE would control well, and abandon the relief hydrocarbon flow due to the non-sealing maintain the provisions under the same well prior to expected seasonal ice design. In addition, the use of a paragraphs that require that the operator encroachment at the drill site, and in no containment dome may be constrained identify and have access to a event later than 45 days after the loss of by the drilling unit itself. Certain containment dome and cap and flow well control. drilling rigs, such as jackups and system capable of deployment as BSEE proposes to revise the existing submersible drilling vessels, are directed by BSEE. BSEE would also relief rig and SSRW requirements in unlikely to provide adequate structural maintain the requirement under existing § 250.472 by: clearance for deployment of a paragraph (g) to initiate transit of all (i) Providing the operator with an containment dome without moving the SCCE identified under § 250.471 upon a option to either use an SSID or have rig off the drill site. (id. at 33). loss of well control. Collectively, the access to a relief rig, if the operator will Furthermore, containment domes have proposed revisions to paragraphs (a)(2), conduct exploratory drilling operations limited field application to prove their (a)(3), and existing paragraph (g) would from a MODU; capabilities while, in contrast, capping mean that, in the event of a loss of well (ii) Establishing the requirements that stacks have been field tested and control, the containment dome and cap the operator must satisfy if the operator successfully deployed in multiple and flow system would be in transit 46 elects to use an SSID to comply with practice drills (id. at 32 and 34). while the capping stack is being § 250.472; With respect to the cap and flow deployed at the well location. In light of (iii) Establishing the requirements that system, the flow portion of the system the distinct functions and capabilities of the operator must satisfy if the operator would require additional vessel support these various elements of SCCE under elects to have access to a relief rig to activities on the surface (e.g., support anticipated Arctic OCS exploratory comply with § 250.472; vessels for oil and gas processing, and drilling conditions, BSEE proposes to (iv) Adding a new provision that hydrocarbon storage/transfer) to keep retain these requirements, as modified, would apply if the operator elects to the system working in comparison to have access to a relief rig, which states, what would be needed to deploy a to preserve the regulations’ requirement ‘‘However, the Regional Supervisor will capping stack (e.g., a single vessel that for redundant protective measures, approve delaying access to your relief would load the capping stack and while acknowledging the capability of rig until your operations have reached deploy to the well when needed). The each SCCE component, as there is no the last casing point prior to penetrating support activities and the vessel on guarantee that a single measure could a zone capable of flowing hydrocarbons which the flow system is loaded would control or contain a WCD. in measurable quantities provided that be subject to the same challenging Finally, BSEE proposes to revise you submit adequate documentation metocean conditions previously existing paragraph (b) by eliminating the (such as, but not limited to, risk described, thus limiting their ability to requirement for the operator to conduct modeling data, off-set well data, analog be safely deployed throughout the a stump test of a pre-positioned capping data, seismic data), with your APD, Arctic drilling season. The capping stack, if the operator elects to use one, demonstrating that you will not stack would generally have a better prior to installation on each well. This encounter any abnormally high- opportunity for deployment because proposed change would provide pressured zones or other geological once the capping stack is lowered under consistency with BSEE’s proposed hazards. The Regional Supervisor will the water and attached to the wellhead, revision to the definition of a capping base the determination on any weather becomes less of a factor. stack in § 250.105 and the new SSID BSEE believes it is critical to ensure documentation you provide as well as alternative BSEE is proposing under any other available data and that operators have redundant § 250.472. BSEE’s proposed SSID protective measures in place, as there is information.’’; and alternative includes specific testing (v) Eliminating the reference to no guarantee that a single measure procedures, which is discussed in detail expected seasonal ice encroachment at could control or contain a worst-case later in this preamble. BSEE’s prior the drill site, which applies to relief rig discharge (see 81 FR 46487). Because references to ‘‘pre-positioned capping operations. the chances of successfully deploying a stacks’’ were intended to address a With respect to the structure of capping stack under Arctic OCS comment on the 2015 Arctic § 250.472, proposed paragraph (a) conditions may be greater in Exploratory Drilling Proposed Rule would establish the requirements the comparison to the containment dome suggesting that the definition of a operator must follow if the operator and cap and flow system, BSEE is capping stack be expanded to allow pre- elects to use an SSID, and proposed revising, and not eliminating, the positioned capping stacks to be used paragraph (b) would establish the below subsea BOPs when deemed requirements the operator must follow if 46 For example, the capping stack technology was used to shut-in the Macondo well during the technically and operationally the operator elects to maintain access to Deepwater Horizon incident. appropriate. a relief rig. BSEE would combine the

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00025 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79290 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

requirements in existing paragraphs (a) conducted from MODUs are and Gas Resources.’’ The supplemental and (b) into a single paragraph— complicated by the fact that these assessment evaluated recent experiences proposed paragraph (b)—for operations can take place only during a with Arctic exploration and organizational purposes, since existing short period each year, when ice advancements in technology, and it paragraphs (a) and (b) cover relief rigs. hazards can be physically managed and provided findings and Proposed paragraph (b) would also there is no continuous ice layer over the recommendations directed toward include the relief rig-related revision water. Outside of that window, ice enhancing the Nation’s regulatory described in item (iv) of the previous encroachment complicates or prevents environment to improve reliability, paragraph, which could allow the drilling, including drilling a relief well, safety, efficiency, and environmental operator to adjust the point in time and transit operations. Therefore, BSEE stewardship for Arctic oil and gas during operations when it must stage its concluded in the proposed rule: Oil and development. One of the key areas the relief rig—from ‘‘when drilling or Gas and Sulphur Operations on the Secretary of Energy requested that the working below the surface casing’’ to OCS—Requirements for Exploratory NPC address was regulatory burdens ‘‘when drilling or working below the Drilling on the Arctic OCS (February 24, related to development on the Arctic last casing point prior to the zone 2015, 80 FR 9916) that, for Arctic OCS OCS. (NPC 2019 Report at A–1) capable of flowing hydrocarbons in Conditions, it was necessary to establish The NPC 2015 Report described measurable quantities’’—if the operator a relief rig and SSRW requirements, various technologies employed by is able to demonstrate that it will not whereby the rig would be positioned at industry as preventative measures, to encounter any abnormally high- a location that would enable it to transit reduce the risk of a well control pressured zones or other geological to the well site, drill a relief well, kill incident or to mitigate the impacts of an hazards before that casing point. and permanently plug the out-of-control incident through response and recovery However, unless otherwise approved by well, plug the relief well, and measures. It recommended further BSEE, the operator must stage its relief demobilize from the site, prior to examination of source control and rig in a location, such that the relief rig expected seasonal ice encroachment. containment technologies, including would be available to arrive on site, drill (see 80 FR 9940). capping stacks and SSIDs, noting that a relief well, kill and abandon the Prior to finalizing the 2016 Arctic such alternatives ‘‘. . . could prevent or original well, and abandon the relief Exploratory Drilling Rule, BSEE did not significantly reduce the amount of well no later than 45 days after the loss identify any alternative technologies spilled oil compared to a relief well, of well control, when drilling or that provided a comparable level of which could take a month or more to be working below the surface casing. results to drilling a relief well and effective.’’ (NPC 2015 Report at 4–16). Finally, proposed paragraph (b) would permanently killing an out-of-control In July/August of 2007, BSEE’s include the proposed relief rig-related well. Drilling a relief well prior to predecessor, MMS, published a paper revision to eliminate the reference to seasonal ice encroachment eliminates entitled, ‘‘Absence of fatalities in expected seasonal ice encroachment at the risk of a prolonged uncontrolled blowouts encouraging in MMS study of the drill site, which could potentially flow of hydrocarbons under the ice, OCS incidents 1992–2006.’’ You may extend the open-water drilling season throughout the winter season. The SCCE download and view the paper at http:// for MODUs. The changes included in intervention options in BSEE’s existing drillingcontractor.org/dcpi/dc- proposed paragraphs (a) and (b) are regulations (capping stack, cap and flow julyaug07/DC_July07_ discussed in further detail below, system, and containment dome) are MMSBlowouts.pdf. The paper respectively, under the two subheadings intended only to temporarily control a summarizes BSEE’s assessment of entitled, Proposed Paragraph (a)— well and not to be left in place over an statistical information about loss of well Complying with § 250.472 by Using an entire ice season. However, BSEE did control events that occurred during SSID and Proposed Paragraph (b)— provide an option through the 2016 rule drilling operations on the OCS from Complying with § 250.472 by Having for the operator to request that BSEE 1992 through 2006. The paper noted Access to a Relief Rig. approve ‘‘alternative compliance that although relief wells were initiated In addition, the general alternative measures to the relief rig requirement,’’ in 2 of the 39 blowouts that occurred compliance language in existing as provided in the longstanding during the study period, both wells paragraph (c) would be eliminated regulation at § 250.141, May I ever use were controlled by other means prior to because the proposed rule would alternate procedures or equipment? completion of the relief well. According provide the operator with the Since the promulgation of the 2016 to the NPC 2015 report, ‘‘[a] relief well alternatives of either using an SSID or Arctic Exploratory Drilling Rule, BSEE under good weather conditions may having access to a relief rig, and because has received and considered new take 30 to 90 days plus rig mobilization, § 250.141, May I ever use alternate information regarding the current relief whereas a capping stack could be procedures or equipment?, already rig and SSRW requirements in installed significantly sooner, and a provides an option for an operator to § 250.472. BSEE used the following subsea shut-in device could be activated seek approval to use alternate information when developing the in minutes.’’ (NPC 2015 Report at 8–17) procedures or equipment, potentially proposed requirements of this section: The NPC 2019 Report noted that, including future technologies that have • Supplemental Assessment to the when ExxonMobil drilled an not yet been developed. 2015 Report on Arctic Potential: exploratory well in the Russian waters When it promulgated the 2016 Arctic Realizing the Promise of U.S. Arctic Oil of the Kara Sea, it used an SSID that was Exploratory Drilling Rule, BSEE and Gas Resources (NPC 2019 Report) built and tested in Norway. According understood that, based on past loss of In April 2018, the Secretary of Energy, to the NPC 2019 Report, the SSID used well control events (including the in cooperation with DOI, requested that in the Kara Sea used existing capping Deepwater Horizon incident), it was the NPC develop a supplemental stack technology, including dual blind important for the operator to be assessment to the NPC 2015 Report. In shear rams; an upgraded, redundant prepared to drill a relief well to April 2019, the NPC issued a report control system; and side inlets for permanently plug a well, in the event of entitled, ‘‘Supplemental Assessment to intervention below the shear rams. (id. a loss of well control. Arctic OCS the 2015 Report on Arctic Potential: at C–10). At the same time, the NPC exploratory drilling operations Realizing the Promise of U.S. Arctic Oil 2019 Report described the SSID as

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00026 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79291

similar to a second BOP that was changes to the current Arctic OCS advance the best BOP technologies designed to be left on the wellhead, source control and containment available at the time and would meet or instead of being removed with the requirements in § 250.471. As exceed Canada’s SSRW Arctic offshore drilling rig, if the rig moves off the well previously mentioned, the Bratslavsky regulations. The SSID was known as the near the end of the drilling season. The and SolstenXP study entailed a Alternative Well Kill System (AWKS), SSID, which could be actuated comprehensive review and gap analysis which had two shear rams that were remotely, and the casing design together of U.S. and international regulations, capable of simultaneously shearing and were capable of safe full well shut-in, standards, recommended practices (RP), sealing heavier wall, larger diameter diminishing the risk related to a loss of specifications, technical reports, and tubulars, and casings than was possible well control event occurring in late common industry methods regarding at that time. According to the NPC 2015 season and continuing over the winter the safe deployment of SCCE as Report, Chevron successfully completed season. The NPC 2019 Report observed compared to the effectiveness of drilling its testing of the AWKS in 2014 and is that this design approach could an SSRW in Arctic conditions. BSEE ready for deployment. (NPC 2015 Report eliminate the need for an SSRW. (id. at notes that the Bratslavsky and at 4–18). C–28). Ultimately, the NPC SolstenXP study refers to the SSID as a Although the Bratslavsky and recommended that the use of an SSID, ‘‘subsea intervention device’’ and SolstenXP study points out that SSIDs in conjunction with capping stacks, be considers the device to be SCCE, which could provide a faster and safer accepted in place of the existing is used to mitigate the consequences of response to a blowout than capping requirement for SSRW capability. (id. at a well control event. However, stacks or containment domes, BSEE 2). consistent with the findings in the NPC does not conclude from this observation The NPC 2019 Report also included 2019 Report that categorizes SSIDs as that SSIDs should also replace the SCCE additional data regarding the geologic preventative measures (instead of a requirements in existing and proposed characteristics of the formations targeted response and recovery measure), BSEE § 250.471. In the Arctic, it is critical for during exploratory drilling operations in considers SSIDs to be a barrier intended the operator to have redundant the Chukchi Sea and Beaufort Sea. The to prevent or minimize the impacts of a protective measures in place, as there is NPC 2019 Report provides an well control event. (id. at 16). no guarantee that a single measure illustrative comparison of the geologic could control or contain a WCD. (see 81 The Bratslavsky and SolstenXP study depths encountered in the Arctic OCS FR 46487). In addition to these noted that an SSID was installed and and the Gulf of Mexico OCS. (NPC 2019 redundant protective measures, the Report at 11). The shallower targeted field tested on a submersible drilling SSID, well design, and BOPs serve as geologic formations in the Arctic OCS vessel (i.e., a steel drilling caisson) for controls and barriers that prevent or make drilling less complex and lower a 2005/2006 drilling project in the minimize the likelihood of loss of well risk. This is different from current water Canadian Beaufort Sea. However, the control. depths encountered by operators in the system was not completed in time to Other pertinent information from the Gulf of Mexico. In the Arctic OCS, meet the approval process timelines and Bratslavsky and SolstenXP study exploratory drilling operations shipping deadlines required for timely includes the statistical analysis of recent conducted from MODUs have taken implementation of the unit. (Bratslavsky OCS drilling seasons in the Beaufort and place in waters less than 200 feet. In the & SolstenXP at A–36). According to the Chukchi Seas. The analysis identified Gulf Mexico, drilling activities are study, the use of a preinstalled SSID the metocean and operational continually taking place in waters could provide a faster and safer conditions that would support the safe deeper than 9,000 feet. additional line of defense for a response drilling of a relief well. The study noted The Arctic OCS’s distinct challenges to a blowout than an SSRW or that the hazards of sea ice to drilling are driven by the region’s extreme deployment of a capping stack or vessels and associated support vessels environmental conditions, geographic containment dome, resulting in smaller are primarily determined by the remoteness, and a relative lack of fixed discharges to the environment. The concentration and thickness of the sea infrastructure and existing operations. report also mentions that the ability to ice. A vessel’s ice classification, which In comparison to the Gulf of Mexico, the remotely function the SSID ensures that are determined by various marine Arctic OCS lacks extensive operations it can be used in instances where other classification societies, such as the and infrastructure from which resources types of SCCE cannot be deployed due American Bureau of Shipping (ABS) could be drawn to respond to a well to site hazards that make it unsafe or and Det Norske Veritas and control incident. In addition, the open inaccessible. These instances may Germanischer Lloyd (DNV GL), water season for drilling from a MODU include: A blowout with pressurized indicates the vessel’s capabilities. As ice is limited, allowing operators to perform fluids coming up solely through the concentrations increase, a vessel’s drilling operations only during the wellbore (forming a gas boil on the efficiency decreases. (Bratslavsky & summer and early fall. A late-season surface), a rig catching fire or collapsing SolstenXP at 23). well-control event could challenge an on top of the well, or an incident in an The study notes that the currently operator’s ability to perform well area where response operations are available open water operating season in intervention operations prior to freeze limited, such as in shallow waters (id. the Chukchi Sea ranges from up. at 35). The report also stated that if the approximately 60 to 90 days in the • Suitability of Source Control and well is designed to accommodate a full historically active exploration area. (id. Containment Equipment versus SSRW shut-in of the last casing string interval, at 143). However, the results of the in the Alaska Outer Continental Shelf the SSID can temporarily cap and study showed that there is a high Region (Bratslavsky and SolstenXP, control a well and facilitate its plugging probability (90 percent) that drilling can 2018) and abandonment. This finding is be conducted safely in sea ice In addition to the NPC 2019 Report, consistent with the information from the conditions in a majority of the BSEE received information about SSIDs NPC 2019 Report discussed previously. historically active exploration area of through the Bratslavsky and SolstenXP In 2008, Chevron initiated a technology the Chukchi Sea for 70 to 160 days if an study, discussed in the previous section venture with its partners on an R&D ice class MODU and associated support in connection with the proposed project to develop an SSID that would vessels are used as part of the drilling

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79292 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

operation. (id. at 108 and 145). publication of the 2016 rule, BSEE has including the SSID’s redundant control Moreover, the NPC 2019 Report notes reevaluated the use of SSIDs and the system (i.e., under proposed that ‘‘vessels and equipment that are overall improved technology for similar § 250.472(a)(2)(ii)) and subsea positioned in the theater ‘just in case’ components (BOPs). In this proposed accumulators (i.e., under proposed they are needed to minimize rule, BSEE would allow operators the § 250.472(a)(2)(iii)). environmental impact, can actually option to use an SSID based on BSEE’s Although the NPC 2019 Report impede personnel safety and source assessment of improved SSID design recommended that the use of an SSID control objectives, because they distract and operating requirements, including and capping stacks replace the operations personnel, add congestion, the ability to shut in a well over the requirement for an SSRW capability, and can impede surface access to the winter ice season with a well cap. BSEE is not proposing to eliminate the well location.’’ (NPC 2019 Report at 19). Additionally, BSEE would make this relief rig and SSRW requirements. In the Beaufort Sea, the available open revision to potentially minimize Rather, BSEE is proposing to maintain water operating season is limited to environmental damage due to a the relief rig and SSRW requirement as approximately 50 to 60 days across the prolonged ongoing well control event. an option for the operator to meet the historically active exploration area. (id. An SSID is not a permanent solution for regulatory requirements of § 250.472. at 143). The study’s analysis showed well remediation. However, it can BSEE has determined that its there is a high probability (90 percent) provide a significantly quicker response regulations should provide options and that drilling can be conducted safely for time to address a well control event flexibility to the operator (i.e., an SSID 70 days, from mid-August through compared to drilling a relief well. or a relief rig) to fit its needs and plans October, in a majority of the historically Consistent with the policy in E.O. to develop its Arctic OCS leases. There active exploration area of the Beaufort 13783 to review existing regulations that could be cases where the operator’s Sea. (id. at 146). potentially burden the development or drilling schedule may not align with the In light of the information from the use of domestically produced energy availability of an SSID. In such a case, NPC reports and the Bratslavsky and resources, BSEE re-considered the SSID the operator should have the option to SolstenXP study, and BSEE’s more closely, in light of the SSID elect to proceed by complying with the consideration of that information, BSEE information from the NPC reports and relief rig and SSRW requirements. If an proposes to revise § 250.472 in the the Bratzlavsky and SolstenXP study, to operator does not complete its following manner: determine whether the device could exploratory drilling operations during • Proposed Paragraph (a)— address the issues the Bureau identified that open water operating season, the Complying with § 250.472 by Using an when promulgating the 2016 rule. operator could come back during a SSID Drilling a relief well is a complex, subsequent open water operating season The use of an SSID is not a new time-consuming process. After setting and use an SSID, if one has become concept and was discussed in the 2016 up the drill rig and drilling begins, the available in time. Arctic Exploratory Drilling Rule.47 process to intercept the original There could also be cases where two Through the 2016 rulemaking comment wellbore may take several weeks or or more operators may plan to perform process, stakeholders informed the more because the operator needs to drill exploratory drilling operations during Bureau that use of an SSID could help deep enough at great precision to ensure the same open water season. In such a significantly reduce the risk of a release interception of the original well. This case, each operator’s drilling rig could of hydrocarbons if the BOP system fails. delay increases the length of the time oil serve as the other’s relief rig. Under the At that time, BSEE focused more on and other fluids within the original well existing regulations, BSEE would permanent remediation to resolve a could be flowing uncontrollably into the consider this type of a scenario to be in WCD event in the Arctic. Nonetheless, marine environment. There is no delay compliance with the relief rig and the Bureau agreed that an operator for operational use of an SSID compared SSRW requirements. BSEE would not could request to use an SSID as an to the process of using the relief rig or change that interpretation as part of this alternate procedure or equipment to the capping stack. rulemaking. In a scenario like this, none relief rig (80 FR 9940). Stopping short of In this proposed rule, BSEE of the operators would need to install an requiring the use of an SSID, BSEE, developed its proposed SSID SSID, so long as there is an agreement instead, stated in the 2016 rule that it requirements based on existing BOP among the operators that their drilling would consider the use of an SSID as an equipment/technology whose rigs will serve as a relief rig, if alternate procedure or equipment, under performance and reliability has been necessary. While it is not possible to appropriate circumstances, if proposed tested, proven in a manner that is identify every conceivable scenario, for use with a jack-up (when surface repeatable and reproducible, and has BSEE recognizes there could be other BOPs are used). At that time, BSEE improved since promulgation of the scenarios that are reasonably possible. determined that, in the case where 2016 rule. BSEE also proposes to require Thus, it is appropriate to provide subsea BOPs are used in conjunction an SSID used in the Arctic OCS to regulatory flexibility in order to with floating drilling units, SSIDs operate independently from the BOP. accommodate an operator’s drilling would only be marginally effective or This would be accomplished by program. BSEE also retains its redundant (81 FR 46531). Since the requiring the SSID to have a redundant regulatory authority to approve alternate control system, independent from the procedures or equipment if the 47 See, e.g., 80 FR 9940 (‘‘[BSEE] requests BOP control system, and independent, proposed procedures or equipment comments on alternative compliance approaches dedicated subsea accumulators to either meet or exceed the level of safety and specifically requests data on the performance operate the SSID. By having two and environmental protection required. of SIDs, including operational issues (such as timeframes needed to activate such alternatives). In independent, redundant components The term SSID is a broadly used particular, BSEE requests comments on appropriate (i.e., the BOP and the SSID) as part of industry term, and there is not a single, staging requirements for a relief rig assuming that the well control system, the overall all-encompassing definition that an SID has been installed at the exploration well. reliability and effectiveness of the entire establishes the scope and function of an Comments are also requested on the need for an operator to have an in- season relief well drilling system increases. The following SSID. In some cases, different terms are capability if an SID is used at a location that is not paragraphs describe BSEE’s proposed used to describe the device. For subject to ice scouring.’’) requirements associated with the SSID, example, as stated earlier, the

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00028 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79293

Bratslavsky and SolstenXP study refers wellbore). If the wellbore is pressure may exceed the strength of the to the device as a ‘‘subsea intervention compromised during or after a full shut- formation (fracture pressure) in the device,’’ while some in the industry also in, an underground blowout or broach wellbore, potentially resulting in a refer to the SSID as a ‘‘mudline closure to the seafloor may occur. BSEE fracture of the formation and an device.’’ Irrespective of these reviewed available incident data on loss underground blowout. Because synonymous titles, BSEE uses the term of well control events,48 and determined proposed paragraph (a) of § 250.472 SSID to refer to a fit-for-purpose device that, on average, five loss of well control contemplates allowing the operator to that may be used for different types of events occurred each year on the OCS leave a well shut-in from one open- situations, including for well between 2007 and 2017. water season to the next (i.e., in the case intervention applications, and can be The well design language in proposed of a late season well control event), used in different locations, including paragraph (a) would also require the wells need to be designed to withstand outside of the Arctic. However, for the operator to account for the stresses and this potential loading condition. purposes of Arctic OCS exploratory loads placed on the well from the In a new paragraph (a)(1), BSEE drilling from a MODU, BSEE is equipment that may be required to proposes to establish performance-based proposing to define the minimum regain control after a loss of well control design requirements for the SSID. BSEE acceptable capabilities and functions of event. This includes the SSID, BOP would require the operator to ensure an SSID. BSEE notes that, outside of the stack, and capping stack. It is imperative that the SSID is designed to: Arctic OCS, operators are contemplating that all well components are designed to (1) Close and seal the wellbore, using SSIDs for future projects, and withstand all potential loads and independent of the BOP; SSIDs have already been approved for stresses placed on the well, including (2) Perform under the maximum use in other parts of the OCS. The NPC those that may be required during well environmental and operational 2019 Report notes that the requirement control situations and deployment of conditions anticipated to occur at the to drill an SSRW to mitigate the risk of SCCE (i.e., the well must be able to well; a late season well control event support a capping stack in addition to (3) Be left on the wellhead in the continuing over the winter season is the other equipment required for normal event the drilling rig is moved off ‘‘outdated.’’ The 2019 report concludes operations). location (e.g., due to storms, ice that SSIDs and capping stacks are The need for the operator to account incursions, or emergency situations); superior solutions that could stop the for all potential loads placed on the well (4) Preserve isolation through the flow of oil and allow intervention also includes consideration of winter season without relying on the through the original borehole before a conditions where a well would be shut- elastomer elements of the rams (e.g., by relief well could be completed. (NPC in over the ice season. For example, in using a well cap) and allow re-entry 2109 Report at 19). The SSID typical well control operations, a BOP is during the following open-water season; requirements BSEE is proposing to used to stop the uncontrolled flow and and establish in this proposed rule would shut-in the well. It remains shut-in for (5) In the event of a loss of well not apply to projects outside of the a relatively short period of time while control, preserve isolation until other Arctic OCS. The design requirements for well kill operations are implemented methods of well intervention may be those SSIDs would be based on the and, if needed, materials and personnel completed, including the need to drill a needs of a particular project and may or are mobilized to the rig. relief well. may not be similar to what BSEE is For wells that may be shut-in for BSEE’s analysis of loss of well control proposing in this proposed rule. BSEE extended periods, the operator must events data indicates that the most requests comments on these SSID consider the potential effects of gas common methods employed to regain requirements as outlined in the expansion within the well. For example, control of a well include pumping mud proposed rule. in reservoirs containing gas, which is or cement into the uncontrolled well or Under proposed paragraph (a) of less dense than the liquids in the activating mechanical well control § 250.472, if the operator elects to satisfy wellbore (e.g., drilling mud, completion equipment (e.g., blowout preventer). the requirements of this section by using fluid, brine), the gas will migrate These SSID design requirements an SSID, BSEE would require the upward in the wellbore until it reaches would help ensure the device is capable operator to ensure that the SSID and the closed BOP. This gas exerts a lower of shutting in and containing all fluids well design (including the casing and hydrostatic pressure than the column of within the wellbore for an entire ice cementing program) are designed to oil or drilling fluids in the wellbore, and season (in the case of a loss of well achieve a full shut-in, without causing more of the reservoir pressure is control event too late in the open-water an underground blowout or having transmitted to the top of the wellbore as season to provide enough time for the reservoir fluids broach to the seafloor. a result. As the hydrostatic pressure operator to perform well kill or plug and Currently, BSEE’s regulations for acting on the bubbles decreases, the abandonment operations). BSEE is SCCE under § 250.462 do not require all bubbles expand. basing the proposed design requirement wells to be designed to achieve a full As these bubbles continue to migrate for the SSID to be capable of preserving shut-in (e.g., partial shut-in is and expand over time, the wellbore isolation through the winter season acceptable) as there are methods to pressure profile increases. What was without relying on the elastomer control the residual fluid flow into a once a low pressure at the top of the elements of the rams (e.g., by using a surface production and storage system well, with a hydrostatic pressure well cap) on information it gained from when a well is designed for partial shut- gradient below it, will eventually the Kara Sea project. BSEE understands in. However, because BSEE is proposing increase to reservoir pressure, that the SSID used in the Kara Sea that the SSID be designed to achieve full increasing the downhole pressure. As project was capable of preserving wellbore shut-in until kill operations are the pressures in the wellbore increase, isolation over an entire ice season completed, it is important that the well some of the liquid may bleed into the because it was designed to have a metal- design assures that the well will be able open formation(s). Eventually, the to-metal cap installed on top of the to withstand the associated loads for the SSID, after the BOP is detached and all entire time the SSID is closed (e.g., 48 See, BSEE’s website at https://www.bsee.gov/ equipment is moved off of the drill site. prevents gas migration in the shut-in stats-facts/offshore-incident-statistics. BSEE understands that isolation could

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00029 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79294 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

not be achieved over the ice season if require the SSID control system to (2) Include an ROV panel that is the shut-in relied solely on the remain independent of the BOP control compliant with API RP 17H (as elastomer elements of the rams. The system, it would not require those incorporated by reference in § 250.198); design requirements would also ensure systems to be located in separate (3) Meet the ROV requirements in the SSID will allow for re-entry to locations. existing § 250.734(a)(5); and, perform well recovery operations during BSEE is seeking comment on whether (4) Have the ability to function the the following open water season. the proposed requirement in paragraph SSID in any environment (e.g., when in In a new paragraph (a)(2), BSEE (a)(2)(ii) is appropriate for the SSID or a mudline cellar). proposes to require that the operator’s whether there are additional ways to The requirement in proposed SSID include the following equipment: enhance the system’s reliability. For paragraph (a)(3)(i) for the ROV to be able (1) Dual shear rams, including ram example, BSEE is contemplating to close each shear ram under the locks; one ram must be a blind shear whether it may be more appropriate to operation’s defined MASP would ensure ram; require the SSID’s redundant control that the operator is able to remotely (2) A redundant control system, system capabilities to be separate from close (through the ROV) each shear ram independent from the BOP control the ROV’s capabilities. BSEE is also on the SSID and seal the well, which are system, that includes ROV (remotely considering, as part of the final rule, the most critical functions during a well operated vehicle) capabilities and a requiring the SSID control systems to be control event. The requirement in control station on the rig; consistent with the fully redundant proposed paragraph § 250.472 (a)(3)(ii) (3) Independent, dedicated subsea control system requirements described for the ROV to have panels that are accumulators with the capacity to in American Petroleum Institute (API) compliant with API RP 17H would function all components of the SSID; Specification (Spec.) 16D (e.g., yellow ensure that the operator’s ROV and, pod and blue pod). More specifically, capabilities for the SSID follow BSEE’s (4) Two side inlets for intervention, BSEE is further considering whether existing ROV panel requirements for one of which must be located below the there should be an additional manual BOP systems. API RP 17H provides lowest ram on the SSID. method (separate from the redundant recommendations and overall guidance The dual shear ram requirement in control system) to close the SSID’s rams for the design and operation of ROV proposed paragraph (a)(2)(i) would with the ROV and whether it may be tooling used on offshore subsea systems ensure that the SSID is capable of appropriate to require a standby or (e.g., provision for high flow Type D hot shearing through drill pipe, sealing the tending vessel with an ROV. These stabs). This guidance is critical to wellbore, and containing the fluids measures could address cases where the ensuring safe and reliable ROV before they can escape during a loss of SSID’s control system on the drilling rig operations. In conjunction with the well control event. BSEE notes that the is not available (e.g., due to failure or an proposal in paragraph (a)(3)(ii) to NPC 2019 Report describes the SSID as evacuation of the rig). require the operator’s ROV panels to be having shearing/sealing rams. In fact, The requirement in proposed compliant with API RP 17H, BSEE when describing the SSID used in the paragraph (a)(2)(iii) for SSIDs to have proposes to add the citation for Kara Sea Project, the report explains independent, dedicated subsea proposed § 250.472(a)(3) to that the device utilized dual blind shear accumulators with capacity to function § 250.198(e)(73). Section 250.198(e)(73) rams. While proposed paragraph (a)(2)(i) all components of the SSID would help documents the locations in the would require only one of the rams to ensure that, if the BOP system fails, the regulations where API RP 17H is be a blind shear ram, BSEE is seeking SSID will have the capabilities to incorporated by reference as a comment on the advisability of function as needed, independent of the regulatory requirement, which would requiring dual blind shear rams on the BOP’s accumulator system. The include § 250.472(a)(3) under this SSID. As described in the bow-tie requirement in proposed paragraph proposed rule. Adding the citation for diagram of the NPC 2019 Report, the (a)(2)(iv) for SSIDs to have two side § 250.472(a)(3) to § 250.198(e)(73) would SSID is the last line of prevention to inlets, with one of the inlets located clarify that API RP 17H is a regulatory minimize the impacts of an event. (NPC below the lowest ram on the SSID, requirement when complying with 2019 Report at 14). would allow for re-entry through the § 250.472 and is subject to BSEE The redundant control system SSID to perform well intervention oversight and enforcement in the same requirements in proposed paragraph operations. Side inlets allow the manner as other regulatory (a)(2)(ii) would ensure there is operator to pump fluids into the well to requirements. reliability in the system and that the kill the well, before opening the blind The requirement in proposed SSID will function when needed in an shear ram to perform additional well paragraph (a)(3)(iii) for the operator to emergency situation. This proposed intervention operations. meet the requirements in existing requirement is intended to align with In proposed paragraph (a)(3), BSEE § 250.734(a)(5) would ensure that the the existing requirement in existing would require the SSID to include ROV operator has a trained ROV crew on § 250.734(a)(2), which requires subsea intervention equipment and capabilities each rig unit. The crew must ensure that BOPs to have a redundant control to function the SSID. BSEE regulations the ROV is maintained and capable of system to ensure proper and currently include requirements for ROV carrying out the necessary tasks during independent operation of the BOP intervention capabilities in relation to a emergency operations and be trained in system. With respect to the requirement BOP’s functionality. BSEE is proposing operating the ROV, including stabbing that an SSID have a separate control similar requirements for the SSID into the ROV intervention panel on the station on the rig that is independent because the SSID functions similarly to SSID. The crew must also have the from the BOP control system located on a BOP. Under proposed paragraph (a)(3), capability to communicate with the rig, it is important for the SSID the ROV equipment and capabilities designated rig personnel, who are functions to be controlled by personnel must: knowledgeable about the SSID’s directly involved in the drilling process (1) Be able to close each shear ram capabilities. to allow for an appropriate response under the Maximum Anticipated The requirement in proposed from a ‘‘situationally aware’’ individual. Surface Pressures (MASP), as defined paragraph (a)(3)(iv) for the ROV to be Therefore, while BSEE is proposing to for the operation; capable of functioning the SSID in any

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79295

environment is meant to address those necessary for certain emergency this issue, then the SSID may also cases where it may be necessary to place situations. BSEE is aware that in the encounter the same problem, depending the SSID in an enclosed or restricted Arctic OCS, it is possible for a drilling on the part of the drill string that is environment. For example, if the SSID vessel to sink and allide with (i.e., strike across the rams at that time. In this is used in an area with ice scouring or against) the top of a wellhead during a scenario, it would be more appropriate with deep ice keels, the SSID would be loss of well control event (Bratslavsky to assess the situation to determine placed in a mudline cellar. If the ROV and SolstenXP at 17). As discussed in whether other well intervention panels are attached to the SSID, the the previous section, all exploratory operations could be performed to ROV may not be able to access the drilling in the Beaufort Sea and the address the position of the drill string, panels if there is not enough space in Chukchi Sea has taken place in waters before activating the SSID. the cellar. The operator must ensure that less than 167 feet deep, and as recent as Regardless of these challenges, BSEE the ROV has the capabilities to address April 2020,49 there were active leases in is seeking comment on what fail-safe these types of scenarios. BSEE is aware the Beaufort Sea where an SSID could mechanism(s) may be appropriate to of current projects that are evaluating have been deployed. These leases were address cases where the BOP fails and positioning the ROV panels away from located in water depths less than the SSID is inaccessible by an ROV or the SSID. The ROV would function the approximately 170 feet deep. In these a control station. If an autoshear system SSID from the remote panel, which water depths, during an emergency, a or a deadman system are appropriate would be hardwired to the SSID. In vessel could sink before the BOP or fail-safe mechanisms to add to the SSID, addition, it is possible for a mudline SSID can be activated. A self-actuating BSEE is seeking input on what criteria cellar to be constructed via a dragline. system incorporated into the SSID could should be used to function these In such a case, the mudline cellar could potentially address this problem. systems, to ensure the system does not be constructed wide enough to provide One option BSEE is considering is function at the wrong time or interferes adequate space for the ROV to access whether it may be appropriate to with or impacts the BOP’s autoshear the panel if the panel was attached to establish an autoshear and deadman and deadman systems. the SSID. BSEE proposes to make the system requirement for the SSID. The BSEE is also seeking comment on how requirement in proposed paragraph intent would be to address those to ensure that the SSID will be able to (a)(3)(iv) flexible, recognizing that there emergency situations, such as when a preserve isolation over the winter are multiple ways an operator could sunken MODU allides with the season in the event of a late-season address this type of concern. wellhead, where the SSID could no emergency incident, such as a sunken In general, however, BSEE is seeking longer be functioned via the ROV (due drillship. As previously mentioned, comment on the feasibility of installing to lack of access) or a control station on BSEE understands that prior SSIDs have an SSID below a subsea BOP in cases the drill ship. BSEE’s regulations planned for long-term isolation through where the SSID would also be installed already address autoshear and deadman installation of a metal-to-metal cap (i.e., in a mudline cellar. BSEE’s current systems for subsea BOPs. Existing a well cap) on the SSID before leaving regulations at §§ 250.734(a)(13) and § 250.734(a)(6)(i) requires subsea BOPs the device on the seafloor over the 250.738(h) require placement of subsea to have an autoshear system that is winter season. In the case of a late- BOP systems in mudline cellars when designed to automatically shut-in the season emergency situation that drilling occurs in areas subject to ice- wellbore in the event of a disconnect of prevents access to the SSID to install a scouring. In addition, proposed the lower marine riser package (LMRP). metal-to-metal cap, how would isolation § 250.720(c)(2) requires placement of the Also, existing § 250.734(a)(6)(ii) requires be preserved through the winter season? wellhead in a mudline cellar in areas a deadman system, that is designed to In addition, BSEE is soliciting subject to ice-scouring. BSEE is automatically shut-in the wellbore in comment on whether the regulations requesting more information about the event of a simultaneous absence of should require use of an autoshear or whether there are any other operational hydraulic supply and signal deadman system in cases where these or installation challenges that the transmission capacity in the subsea systems are not built into the BOP’s operator may encounter when control pods, respectively. However, system. As previously mentioned, attempting to effectively operate the BSEE did not propose this requirement BSEE’s autoshear and deadman system SSID in this environment. If so, what are for SSIDs in this rulemaking. The SSID requirements currently apply to subsea those challenges, and how could they be is meant to be a backup to the BOP, and BOPs. There is no current requirement addressed? it is not necessary for the SSID to have to use an autoshear or deadman system BSEE understands that the SSID used the same automatic emergency when surface BOPs are used. BSEE in the Kara Sea could be manually functions as the BOP. would expect that if an operator uses a activated using acoustic technologies. There could potentially be negative surface BOP, the operator would still While such technologies are available to consequences if both systems were to install the SSID on the seafloor. BSEE function the SSID from a remote automatically function. For example, seeks comment on whether it would be location, BSEE is proposing to require there could be a situation where the appropriate in such a case to require use use of an ROV, as described in proposed BOP’s autoshear or deadman systems of an autoshear or deadman system on paragraph (a)(3). BSEE understands that function, but they are not able to shut- the SSID. If so, what criteria should ROVs are more reliable for this type of in the well because a non-shearable drill BSEE apply to the functioning of the application. However, BSEE requests string is positioned across the rams. If autoshear or deadman systems in an that commenters provide any the subsea BOP rams are experiencing environment where a surface BOP is information that demonstrates the used? Furthermore, BSEE welcomes any reliability of acoustic (or other) 49 In April 2020, the only leases with potential other comments, unrelated to autoshear technologies to actuate an SSID from a projects that would be subject to the Arctic OCS’s or deadman systems, regarding use of a remote location. SSID or SSRW requirements were relinquished. surface BOP. Furthermore, although BSEE is not However, there are other active leases in the With respect to installation of the Beaufort Sea located nearer to the shore in proposing to require the SSID to have a shallower waters where exploration and SSID, BSEE proposes in paragraph (a)(4) self-actuating function, the Bureau is development projects are actively being pursued to require operators to install the SSID: contemplating whether one may be (primarily through man-made gravel islands). (1) Below the BOP;

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79296 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

(2) At or before the time they install along with the proper well design, approximately 70 feet + SSID their BOP; and would allow the well to be shut in over approximately 18 feet). In addition, the (3) In a way that will provide the ice season without requiring bottom of a ship’s hull, in the case protection from deep ice keels in the additional vessels and the situation where a drillship is used, may extend as event it must remain in place over the addressed permanently in the following much as 40 feet into the water from the winter season (e.g., installed in a open water season. It would also allow sea surface. Historically, drilling in the mudline cellar). the operator the time necessary to Beaufort Sea and the Chukchi Sea has Installing the SSID below the BOP complete the intervention, without the occurred in waters less than 167 feet would allow for quick detachment of well flowing, if unforeseen problems are deep. With as much as 128 feet of water the BOP and other equipment above the encountered. column taken up by the BOP system, SSID, which would be critical when Collectively, the SSID’s design SSID, and ship’s hull, very little space moving off of a location for emergency requirements; equipment specifications; remains for operations between the purposes. With respect to timing of the ROV intervention capabilities; bottom of the ship and the top of the SSID’s installation, the operator would installation requirements; and testing well control system. BSEE seeks be required to install the SSID at or requirements; together with the comment on what sorts of challenges before the time they install the BOP. additional well design requirements, operators have faced or would The proposed requirement for the SSID would help ensure that the device will anticipate facing in the scenario just to be installed in a way that will provide function when needed during an described. BSEE would also like to protection from deep ice keels would emergency situation and will be capable know how operators addressed those help ensure that the device is not of controlling the well over the ice challenges in the past or could address damaged by ice in areas of ice scour. As season, if necessary, until the operator them for future operations, taking into previously discussed, this could be returns to perform well intervention account the unique characteristics and accomplished by placing the SSID in a operations during the following open- extreme conditions of the Arctic OCS. mudline cellar. In complying with this water season. In connection with that BSEE is also generally seeking proposed requirement, the operator well intervention operation, BSEE may comment on its proposed changes to must also consider situations where the still exercise its existing authority to § 250.472. For example, BSEE is seeking drill site is not located in an ice scour also require the operator to drill a relief comments on how well design could be area, but could experience ice floes with well to permanently plug and abandon better addressed in this rulemaking to keels deep enough to clip and the out-of-control well, if needed. BSEE enhance overall safety of operations on compromise the SSID if left on the reviewed recent incident data from 2013 the Arctic OCS. Is the well design seafloor over the winter season. to 2017, which may be accessed on requirement proposed in paragraph (a) In a new paragraph (a)(5), BSEE BSEE’s website at https://www.bsee.gov/ adequate to address the situations that proposes to require the operator to test stats-facts/offshore-incident-statistics, to may be encountered if a well is shut-in the SSID according to the BOP testing try to identify any past incidents with an SSID over a winter season? As requirements in § 250.737, What are the involving the use of a BSEE directed previously described, there could be BOP system testing requirements? The relief well to remedy the loss of well cases where the wellbore pressure SSID’s testing requirements should align control. Aside from the Macondo well profile may increase to reservoir with the BOP testing requirements incident in 2010, one incident in 2013 pressures at the top of the well over the since, as previously mentioned, the required the drilling of a relief well (see course of a winter season. What other SSID functions similarly, and in https://www.bsee.gov/newsroom/latest- scenarios should BSEE consider that addition, to a BOP. This testing would news/statements-and-releases/press- could occur in the well over the ice aid in predicting future performance of releases/drilling-of-relief-well-begins-at- season that could be addressed in the SSID to ensure that the device will south). Other loss of well control events proposed paragraph (a)? function when needed during an during that timeframe were successfully • Proposed Paragraph (b)— emergency situation. While BSEE remedied with conventional well Complying with § 250.472 by Having proposes to align the SSID testing control methods. These incidents Access to a Relief Rig requirements with the Bureau’s existing occurred in the Gulf of Mexico and were As discussed earlier, BSEE proposes BOP testing requirements, BSEE controlled by either circulating heavier to combine existing paragraphs (a) and welcomes input on whether there are weighted muds into the well or closing (b) into a single, new paragraph (b), more appropriate and reliable testing the BOP (or both), to control pressures Relief Rig, for organizational purposes methods. For example, what testing within the well. BSEE would evaluate because both existing paragraphs cover procedures have been used in the past the individual circumstances associated relief rigs. Combining existing to test an SSID when it was deployed? with each case to make this paragraph (a) into proposed paragraph For future operations, what testing determination. For these reasons, (b) would not be a substantive procedures are being developed BSEE’s proposed changes to § 250.472 modification to BSEE’s regulations specifically for an SSID? What testing would maintain safety and because the specific requirements from procedures should be applied to SSIDs, environmental protection, though BSEE existing paragraph (a) would remain and why? invites comment on the technical unchanged. More specifically, the Overall, BSEE intends for the SSID to feasibility of such requirements. provision in existing paragraph (a) that provide time for the operator to marshal BSEE is seeking comment on whether requires the operator’s relief rig to the equipment and materials necessary the use of an SSID, particularly in a case comply with all other requirements of to permanently address a well control where a subsea BOP is deployed, could 30 CFR part 250 that pertain to drill rig event, without the constraints of present operational or installation characteristics and capabilities, and seasonal ice coverage, and to prevent challenges. For example, if the well is requires the relief rig to be able to drill the potential environmental impacts not located in an ice scour area and the a relief well under anticipated Arctic that could occur if an out of control well BOP system, including the LMRP, and OCS conditions, would be relocated to was allowed to flow over the season the SSID are placed on the seafloor, then proposed paragraph (b)(1). The when the operator would not have these pieces of equipment could get as provision in existing paragraph (a) that access to the site due to ice. The SSID, tall as 88 feet when installed (BOP provides that the Regional Supervisor

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79297

may direct the operator to drill a relief operator to delay staging of its relief rig different geological features that can well in the event of a loss of well until reaching that point. affect the pressure profiles and control would be relocated to proposed The changes BSEE is proposing would potentially create abnormal pressures paragraph (b)(2). make proposed paragraph (b) of (e.g., salt domes, and shallow water flow Æ Last Casing Point Prior to § 250.472 and proposed paragraph (a) of areas). Penetrating a Zone Capable of Flowing § 250.471 consistent, with respect to An extensive amount of geophysical Hydrocarbons in Measurable Quantities providing a potential opportunity to the data already exists for certain areas of Substantively, BSEE proposes to operator to delay access to its SCCE (as both the Beaufort and Chukchi Sea revise the requirements in existing described in § 250.471(a)(1) and Planning Areas, and there has been paragraph (b) that prescribe the proposed § 250.471(a)(2) and (3)) until extensive drilling in certain areas of the availability of the relief rig. BSEE would its operations have reached the last Beaufort Sea Planning Area. In the maintain the requirement for the casing point prior to penetrating a zone known geologic conditions of the U.S. operator to have access to a relief rig, capable of flowing hydrocarbons in Arctic, operators have a good different from its primary drilling rig, measurable quantities, so long as the understanding of the locations of when drilling or working below the operator submits adequate reservoirs that they will encounter, surface casing. However, BSEE proposes documentation, with its APD, which can be relatively shallow and to add a new provision to the newly demonstrating that it will not encounter normally pressured to certain depths. rearranged proposed paragraph (b) any abnormally high-pressured zones or Therefore, it may not be necessary to stating ‘‘However, the Regional other geologic hazards before that casing have a relief rig immediately available Supervisor will approve delaying access point. when drilling through zones below the to your relief rig until your operations The existing requirement in surface casing that do not have § 250.472(b) pertaining to the have reached the last casing point prior abnormally high formation pressures or availability of a relief rig does not take to penetrating a zone capable of flowing contain other geological hazards, and do into consideration that the operator may hydrocarbons in measurable quantities, not have the potential to flow demonstrate, based on geologic and provided that you submit adequate hydrocarbons in measurable quantities engineering analyses, that there could documentation (such as, but not limited as they are penetrated. be zones below the surface casing that However, because geologic conditions to, risk modeling data, off-set well data, are not hydrocarbon-bearing or that are not uniformly normally pressured analog data, seismic data), with your have minimal or no potential to flow throughout the Arctic OCS, BSEE is APD, demonstrating that you will not hydrocarbons in measurable quantities maintaining the existing requirement to encounter any abnormally high- during drilling operations. In many have the relief rig staged when drilling pressured zones or other geological cases, operators do not anticipate or or working below the surface casing. At hazards. The Regional Supervisor will encounter flowable hydrocarbons in the same time, BSEE does not want to base the determination on any measurable quantities until the target discount the possibility that future documentation you provide as well as productive formation is reached. For projects would not need to have the any other available data and example, a surface casing shoe setting relief rig staged until reaching the last information.’’ depth for an Arctic OCS exploration casing point prior to penetrating a zone BSEE would also add new language at well could be only 1,500 feet deep, but capable of flowing hydrocarbons. the beginning of existing paragraph (b) the hydrocarbon bearing formation may The criteria BSEE proposes to rely that says ‘‘Relief Rig. If you choose to be thousands of feet deeper below that on—that the operator can demonstrate satisfy this requirement by having point. The existing regulations require to BSEE that it will not encounter access to a relief rig, you must have the operator to stage its relief rig when ‘‘abnormally high-pressured zones or access to your relief rig at all times drilling or working below the surface other geologic hazards’’—to determine when you are drilling below or working casing, even though geologic and whether to grant an exception accounts below the surface casing during Arctic engineering risk analyses the operator for those downhole risks that could lead OCS exploratory drilling operations.’’ must submit as part of their APD may to a blowout and may require the use of This language would simply clarify that indicate that there is little or no a relief rig. With respect to abnormally if the operator chooses to use a relief rig potential for hydrocarbons to escape the high-pressured zones, BSEE is to comply with proposed § 250.472, it formation and flow into the well prior concerned that there could be a case must have access to its relief rig at all to reaching the targeted productive where a kick (an influx, or flow, of times when drilling below or working formation. In such circumstances, the formation fluid from the high-pressured below the surface casing. The changes operator could safely drill for thousands zone entering into the wellbore) is not described in this paragraph would be of feet below the surface casing without controlled and could lead to a blowout. shown as a general requirement in any identifiable need for a relief rig. While there are means of mitigating the proposed paragraph (b). This proposed change would, when risk of a kick, (i.e., overbalanced BSEE’s proposed revisions to appropriate, eliminate the need for the drilling), the relief rig needs to be paragraph (b) would potentially provide operator to stage its relief rig while readily available if heavier weight an opportunity for the operator to adjust drilling through low risk, non- drilling muds, the BOP and SSID, if the point in time during its operations productive sections of the well below applicable, fail to control the well. when it must stage its relief rig. If the the surface casing. Arctic regional pore There could be other geologic operator is able to demonstrate to BSEE pressure modeling conducted by BOEM hazards, such as fractured or high that the operations it plans to conduct for an area in the Beaufort Sea identifies permeability zones, that may also pose below the surface casing would not a general uniformity following an a risk, particularly if those zones encounter any abnormally high- average pressure gradient (i.e., normally contain hydrocarbons. It is possible that pressured or other geologic hazards pressured) up to approximately 7,500 normally pressured zones may be highly before reaching the last casing point feet to 8,500 feet, subsea. The typical permeable or contain fractures, in which prior to penetrating a zone capable of reservoirs targeted for exploration in the lost circulation can occur. This could flowing hydrocarbons in measurable Arctic are usually located at less than cause a dynamic effect where drilling quantities, then BSEE would allow the 8,000 feet. In the GOM, there are many mud flows into the permeable formation

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00033 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79298 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

and causing the circulating pressure to be used to demonstrate the absence of contemplating, as part of this regulatory decrease below the zone’s pore pressure abnormally pressured zones or other option, a clarification that the Regional resulting in formation fluids flowing geologic hazards, and how burden on Supervisor may require the operator to into the well bore. This may lead to a the operator could change—increase or stage its relief rig prior to drilling below loss of well control. The relief rig needs decrease—if BSEE were to require its or working below the last casing point to be readily available if heavier weight submission. prior to penetrating a zone capable of drilling muds, the BOP, and the capping At the APD stage, BSEE would flowing hydrocarbons in measurable stack, fail to control the well. evaluate the operator’s documentation quantities if BSEE determines there is However, if the operator is able to along with other accompanying geologic insufficient G&G or analogous well data. demonstrate that a highly permeable or and engineering information/analyses For example, there may be fractured zone is predicted to only that must be submitted as part of their insufficient G&G or analogous well data contain water, BSEE would consider APD. BSEE would also take into in cases where there have been a limited allowing the operator to delay the consideration any other available G&G number of wells drilled within staging of its relief rig. Under this information, such as information proximity to the planned well. In most scenario, the operator would be able to gathered from prior drilling operations cases, G&G and analogous well data are use the diverter system in conjunction in the area (e.g., well log and pressure gathered from multiple sources. with the BOP system to maintain safety testing information), and any other However, the same sets and amounts of and environmental protection because it applicable geophysical information (e.g., data and information may not be would be unlikely for hydrocarbons to seismic data). BSEE makes clear in its available for each area, well, or project. be released into the environment. The proposed regulatory language that the There is no single set of criteria for diverter system consists of a mechanical Regional Supervisor will base the determining the sufficiency of G&G or device similar to a BOP annular determination for whether to allow the analogous well data. The more data that preventer. The diverter system is used operator to delay staging of its relief rig are available from sources near to the to divert gases, fluids, and other on the documentation the operator proposed drilling location, the greater materials flowing from the well, away submits as well as any other available confidence BSEE will have in the G&G from facilities and personnel. Also, an data and information. interpretations. BSEE wants to ensure operator would pump fluid loss BSEE is also considering an the operator has the most accurate data materials into the well to bridge the alternative regulatory approach whereby to make determinations about where the formation to reduce its permeability and the Bureau would instead revise zones capable of flowing hydrocarbons allow drilling muds to isolate the existing paragraph (b) by replacing in measurable quantities are located. formation from the well. To ‘‘surface casing’’ with ‘‘last casing point This alternative regulatory option permanently address the incident, the prior to penetrating a zone capable of would maintain the same level of safety operator could also install a liner or set flowing hydrocarbons in measurable and environmental protection in a new casing point at the interval where quantities.’’ This option would adjust comparison to BSEE’s proposed that highly permeable or fractured zone the point in time during operations regulatory change. The decision on is located. As requested in the section- when the operator must stage its relief whether it is appropriate to delay by-section discussion of § 250.471, rig. This alternative regulatory change positioning of the capping stack below BSEE would like to know whether there would, instead, require the operator to the surface casing resides with BSEE. are more appropriate criteria, other than stage its relief rig before drilling below BSEE, ultimately, may not allow the ‘‘abnormally high-pressured zones or or working below the last casing point operator to delay staging of the relief rig other geologic hazards,’’ the Bureau prior to penetrating a zone capable of if there are potential risks below the should use to determine whether to flowing hydrocarbons in measurable surface casing that may require allow the operator to delay its staging of quantities. immediate relief rig deployment. the relief rig. Under this regulatory option, BSEE However, the distinction under this BSEE’s proposed regulatory language would evaluate the geologic and regulatory option is that the operator describing the types of documentation it engineering information/analysis the would not need to specifically would consider adequate to demonstrate operator must submit as part of its APD, demonstrate that abnormally high- that abnormally high-pressured zones or while also taking into consideration any pressured zones or other geologic other geologic hazards would not be other available G&G information the hazards would be encountered above encountered before reaching the last Bureau may have (e.g., off-set well data, last casing point prior to penetrating a casing point prior to penetrating a zone such as well logs and pressure testing zone capable of flowing hydrocarbons in capable of flowing hydrocarbons in information, or geophysical information, measurable quantities. BSEE would be measurable quantities— ‘‘such as, but such as seismic data). Based on these responsible for making that not limited to, risk modeling data, off- different sources of information, BSEE determination. set well data, analog data, seismic would determine whether there may be BSEE is specifically soliciting data’’—is not meant to be an exhaustive a need for the operator to position the comments about its views of the benefits list. BSEE would accept any other types capping stack at an interval earlier than or disadvantages of this regulatory of documentation the operator may last casing point prior to penetrating a option and the need for the operator to provide that will help its demonstration. zone capable of flowing hydrocarbons in verify on a case-by-case basis which BSEE does not anticipate this measurable quantities. zones are incapable of flowing submission requirement would lead to a There may be cases where the hydrocarbons in measurable quantities. significant information collection operator or BSEE may not have Æ Expected Seasonal Ice burden on the operator because it is sufficient G&G or analogous well data Encroachment at the Drill Site normal practice for operators to gather during the permit review process on a In the 2015 proposed Arctic these types of information in order to proposed project to provide an adequate Exploratory Drilling Rule, BSEE develop and design an offshore level of certainty regarding anticipated determined that, because Arctic OCS exploration drilling project in the Arctic formations that may be encountered exploratory drilling operations from a OCS. BSEE is requesting comment on prior to reaching the targeted productive MODU take place only during the open what other types of information could formation. Therefore, BSEE is also water season (i.e., that period of time in

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00034 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79299

the summer and early fall when ice regulations at proposed § 550.220(c)(1), seeking comment on whether there are hazards can be physically managed and BOEM would require the operator to other appropriate approaches to well there is no continuous ice layer over the submit a description of how all vessels control operations in the Arctic, water), it was critical to ensure that and equipment will be designed, built, including alternative equipment/ drilling (including relief well drilling) and/or modified to account for Arctic technology or performance standards. and other operations affected by sea ice OCS conditions and how such activities For example, although the NPC 2019 are concluded before ice encroachment. will be managed and overseen as an Report recommends accepting the use of Ice encroachment may complicate or integrated endeavor. This preamble an SSID in place of the requirement for prevent drilling, transit, and oil spill discusses this proposed regulatory SSRW capability, it also recommends response operations. However, the change in more detail later. Collectively, replacing the relief rig and SSRW analysis from the Bratslavsky and this information provided in an EP requirements with requirements that SolstenXP study shows that the sea ice would allow BOEM (in conjunction specify the desired outcome (i.e., to stop capabilities of an ice class MODU and with BSEE) to evaluate the capability of the flow of a well and allow the operator its support vessels can extend the the operator’s equipment, including its to propose equivalent technology and currently available open-water operating vessels and procedures to manage and demonstrate its capabilities). (NPC 2019 seasons in the Chukchi and Beaufort mitigate risks associated with Arctic Report at 30). BSEE assumes that the Seas, depending on the drilling location OCS conditions. NPC recommends specifying a desired within each planning area (id. at 143). At the APD stage, BSEE would also performance-based outcome in the Therefore, BSEE proposes to eliminate review the capabilities of the operator’s regulations that would allow the the reference to ‘‘expected seasonal ice MODU and associated supporting operator to propose and demonstrate encroachment’’ at the drill site in vessels. Existing paragraph (a)(2) of technologies capable of meeting that existing paragraph (b). BSEE, however, § 250.470, What additional information standard at the permitting stage, rather would retain the requirement clarifying must I submit with my APD for Arctic than prescribing a particular technology, that the relief rig must be different than OCS exploratory drilling operations? such as a relief rig. the operator’s primary drilling rig and requires the operator to describe how it Subpart G—Well Operations and that the relief rig must be staged in a plans to prepare its equipment, Equipment location such that it can arrive on site, materials, and drilling unit for service in drill a relief well, kill and abandon the the environmental, meteorological, and When and how must I secure a well? original well, and abandon the relief oceanic conditions it expects to (§ 250.720) well no later than 45 days after the loss encounter at the well site and how its drilling unit will be in compliance with BSEE proposes to delete the last of well control. This proposed sentence in existing paragraph (c)(2) regulatory change would effectively the requirements of existing § 250.713, What must I provide if I plan to use a that states ‘‘BSEE may approve an extend the drilling season in those cases equivalent means that will meet or where the operator’s MODU and Mobile Offshore Drilling Unit (MODU) for well operations. Paragraph (d) of exceed the level of safety and associated support vessels are capable of environmental protection provided by a safely operating beyond the period § 250.713 requires the operator, when using a MODU for well operations, to mudline cellar if the operator can show when seasonal sea ice begins to that utilizing a mudline cellar would encroach at a drill site. The operator provide the current Certificate of Inspection (for U.S.-flag vessels) or compromise the stability of the rig, would no longer need to plan for their Certificate of Compliance (for foreign- impede access to the well head during well operations to end in time to flag vessels) from the USCG, as well as a well control event, or otherwise create complete a relief well prior to the date a Certificate of Classification. The operational risks.’’ In its place, BSEE when sea ice is expected to encroach on operator must also provide current proposes to insert a new sentence that the drill site. The operator would, documentation of any operational states ‘‘You may request, and the instead, have to plan to end its limitations imposed by an appropriate Regional Supervisor may approve, an operations with sufficient time to classification society. As discussed alternate procedure or equipment in complete its relief well prior to the earlier in this section, the Bratslavsky accordance with §§ 250.141 and anticipated date when sea ice and SolstenXP study notes that a 250.408.’’ BSEE, however, would conditions at the drill site are vessel’s capabilities are identified by the preserve the basic requirement in in approaching the ice classification ice classification for the vessel, which is paragraph (c)(2) for the operator to use capability and rating limits of the provided by marine classification a mudline cellar or an equivalent means operator’s vessels. societies such as ABS and DNV GL. if there is indication of ice scour. The BSEE and BOEM would evaluate the BSEE would evaluate the information regulatory change BSEE is proposing in ice classification capabilities and required under existing §§ 250.470(a)(2) this section would make clear that BSEE limitations of the operator’s MODU and and 250.713(d), together with BOEM’s could approve the equivalent means of associated support vessels using approval of the operator’s end-of-season doing so in accordance with §§ 250.141, existing permitting and review date(s) in the EP, to verify whether the May I ever use alternate procedures or processes. For example, through vessels’ capabilities and limitations can equipment? and 250.408, May I use BOEM’s EP review process, the operator support extending operations beyond alternate procedures or equipment is required under existing when seasonal ice is expected to arrive during drilling operations? § 550.220(c)(6) to specify when it at the drill site. However, in no case will The new language that BSEE proposes anticipates completing onsite operations BSEE approve a permit that proposes to to insert reiterates longstanding and when it anticipates terminating use a vessel that does not meet the regulatory provisions contained in drilling operations. In addition, existing requirements of § 250.713, §§ 250.141 and 250.408 that describe § 550.220(c)(1) requires the operator to including providing a current certificate what procedures the operator must describe how it will design and conduct of inspection or compliance from the follow and standards it must meet to its exploratory drilling activities in a USCG. receive BSEE’s approval of a request to manner that accounts for Arctic OCS Finally, while BSEE is proposing use alternate procedures or equipment conditions. Furthermore, in the EP these revisions to § 250.472, BSEE is to those required by regulation. Section

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00035 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79300 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

250.141 allows the BSEE District B. Key Revisions Proposed by BOEM subject to agency approval. BOEM Manager or Regional Supervisor to developed the IOP requirement based Title 30, Chapter V, Subchapter B, Part on the Report to the Secretary of the approve the use of any alternate 550, Subpart B—Plans and Information Interior, Review of Shell’s 2012 Alaska procedures or equipment that the Definitions. (§ 550.200) operator may propose if the proposal Offshore Oil and Gas Exploration provides a level of safety and BOEM is proposing to eliminate the Program, prepared by DOI (60-Day 50 environmental protection that equals or definition of the term ‘‘Integrated Report), March 2013, which Operations Plan,’’ consistent with the 51 surpasses BSEE’s current requirements. included the following proposal to eliminate the requirement recommendation: It also describes the types of information for the operator to submit an IOP for the All phases of an offshore Arctic program— the operator must submit or present to reasons listed immediately below. BSEE when requesting to use alternate including preparations, drilling, maritime and emergency response operations—must be procedures or equipment. Section Removal of the IOP Requirement (§ 550.204) integrated and subject to strong operator 250.408 requires the operator to identify management and government oversight. (60- and discuss their proposed alternate The 2016 Arctic Exploratory Drilling day report, p. 3). procedures or equipment in their APD. Rule discussed how commenters The information provided in the IOP Since the issuance of the 2016 Arctic generally criticized the IOP provision as was intended to facilitate the prompt Exploratory Drilling Rule, BSEE learned being duplicative or redundant of sharing of information among the existing requirements (see 81 FR at that there is an industry misconception relevant Federal agencies (e.g., BOEM, 46492–46493). In 2016, when the rule that the last sentence in existing BSEE, USFWS, USCG, NMFS, U.S. was adopted, BOEM disagreed with Army Corps of Engineers, and EPA). paragraph (c)(2) means that the operator these commenters and published would be required to use a mudline Standing BOEM practice (LP–SOP–06 responses to the commenters in the Standard Operating Procedure for cellar in all cases, except when the preamble. In its responses, BOEM Exploration Plans) in the Anchorage, operator can prove that the mudline discussed how the IOP was distinct Alaska OCS Office is to inform other cellar would present an operational from existing regulations, the agencies about an operator’s EP, well in risk—effectively narrowing the scope of importance of contractor management as advance of the completeness review §§ 250.141 and 250.408 in this context. it related to the IOP provisions, and the (i.e., the deemed submitted However, BSEE did not intend that BOEM Regional Director’s ability to determination) for the EP. BOEM language to constrain the contexts in waive submission of required successfully did so prior to the 2016 which operators could seek approval of information in the EP that was already implementation of the IOP requirement. provided in the IOP. Circumstances alternatives to the mudline cellar The IOP requirement does not have changed since the IOP requirement requirement. Rather, in response to supersede or supplant the operator’s was originally adopted. The various commenters expressing concern that use obligation to comply with all other Federal agencies have improved their of a mudline cellar may create applicable Federal agency requirements. coordination to such an extent that operational risks in certain contexts, As described in the 2016 Arctic BOEM believes there is no need for BSEE introduced that language to make Exploratory Drilling Rule, the IOP operators to create and submit a clear that alternate approaches were process does not provide a mechanism separate IOP for that purpose. Much of available in those contexts, while at the for agencies to approve or disapprove the required content of the two same time highlighting the general the operator’s proposed activities. documents overlaps, and in the 2016 flexibility available under § 250.141, BOEM has no authority under the IOP rulemaking itself BOEM added provision other than to make May I ever use alternate procedures or requirements that the EP include unenforceable suggestions to the equipment? (see 81 FR 46507 and additional information that made this operator. If BOEM or another agency 46510). The last sentence in existing overlap even greater. BOEM is now determined that an operator was failing paragraph (c)(2) was not intended to, proposing to keep two important to engage in the needed integrated and did not, restrict or preclude use of provisions from the IOP and incorporate planning in advance of EP submission, the longstanding options for seeking them into the requirements for EPs. The BOEM could only compel an operator to approval of alternate procedures or first provision would reinforce BOEM’s do so through the EP review process. equipment under §§ 250.141 and commitment to operational safety, while 250.408, which do not necessarily The 2016 Arctic Exploratory Drilling the second provision would require the Rule added informational requirements require a demonstration of operational operator to provide details of how its for EPs to address key concerns that risk. Thus, this proposed change would operations would conform to the unique motivated the IOP, as shown in Table 1, clarify that the operator has more circumstances of the Arctic OCS. Taken ‘‘Crosswalk between the IOP provisions flexibility to propose alternate solutions together, the enhancements to BOEM’s proposed for removal and existing EP to the mudline cellar requirement under regulations made in connection with the regulations and review practices.’’ a broader range of circumstances than 2016 Arctic Exploratory Drilling Rule Because this information is required in those described in the last sentence of and the retention of these key the EP, operators should be aware that existing § 250.720(c)(2). An operator provisions from the IOP make the IOP they must plan for how they will could still base such a request on the unnecessary and redundant. manage contractors to reduce same grounds that BSEE described in For these reasons, BOEM proposes to eliminate the requirement for preparing the language that we propose to delete 50 Available at: https://www.doi.gov/sites/doi.gov/ (i.e., that installation of a mudline cellar and submitting the IOP. In doing so, files/migrated/news/pressreleases/upload/Shell- BOEM would delete all of § 550.204, in a specific case would cause report-3-8-13-Final.pdf. and remove corresponding references to 51 Report to the Secretary of the Interior, Review operational risks). the IOP from §§ 550.200 and 550.206. of Shell’s 2012 Alaska Offshore Oil and Gas Exploration Program, prepared by DOI (60-Day Currently, BOEM requires the operator Report), March 2013, available at: https:// to submit an IOP at least 90 days before www.doi.gov/sites/doi.gov/files/migrated/news/ filing an EP with BOEM. The IOP is not pressreleases/upload/Shell-report-3-8-13-Final.pdf.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00036 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79301

operational risks and address the As part of the 2016 Arctic Exploratory and socioeconomic information must challenges associated with operations Drilling Rule, BOEM expanded the accompany the EP?, existing paragraphs on the Arctic OCS. The EP regulations regulatory criteria for EPs to include (a) and (b) of § 550.219, What oil and are clear that the operator must plan to information important for planning hazardous substance spills information coordinate the work of a number of Arctic exploratory drilling. Specifically, must accompany the EP?, existing contractors to ensure that time pressure, BOEM expanded requirements for: paragraphs (b), (c)(2) and (5) of or other contractor complications, do Emergency plans at existing § 550.220, If I propose activities in the not undermine safe and § 550.220(a), the EP’s suitability for Alaska OCS Region, what planning environmentally responsible operations. Arctic OCS conditions at proposed information must accompany the EP?, In particular, proposed § 550.220(c)(1) § 550.220(c)(1), ice and weather proposed paragraph (c)(1) of § 550.220, would require the operator to describe management at existing § 550.220(c)(2), existing paragraph (a) of § 550.224, in the EP how it will design and SCCE capabilities at existing What information on support vessels, conduct its exploratory drilling § 550.220(c)(3), deployment for a relief offshore vehicles, and aircraft you will activities, and how it will manage and rig at proposed § 550.220(c)(4), resource- use must accompany the EP?, and oversee these activities as an integrated sharing at existing § 550.220(c)(5), and existing paragraph (b)(7) of § 550.227, endeavor. BOEM does not need, and anticipated end of seasonal operation What environmental impact analysis nothing in OCSLA requires, an operator dates at existing § 550.220(c)(6). (EIA) information must accompany the to inform Federal agencies about its BOEM’s EP and environmental impact EP? require the operator to address planning on these issues in advance of analysis (EIA) requirements at existing issues that the operator also needs to an EP. The EP, however, will make § 550.202, What criteria must the consider in preparing the IOP. The evident whether the operator has done Exploration Plan (EP), Development and following table provides a detailed so, and if the EP does not address the Production Plan (DPP), or Development analysis of how the key operational operators’ planning on all the required Operations Coordination Document provisions of the IOP are addressed in elements, BOEM will return the EP to (DOCD) meet?, existing paragraphs (a) BOEM’s existing regulations, and why the operator to include the requisite and (c) of § 550.211, What must the EP the key safety provisions of the IOP will information in accordance with existing include?, existing paragraph (c) of continue to be fully addressed by other § 550.231(b). § 550.216, What biological, physical, provisions within BOEM’s regulations:

TABLE 1—CROSSWALK BETWEEN THE IOP PROVISIONS PROPOSED FOR REMOVAL AND EXISTING EP REGULATIONS AND REVIEW PRACTICES

Coverage in BOEM’s continuing regulations, operator EPs, and IOP provision review practices

§ 550.204(a)—The operator describes how vessels and equip- § 550.220 (c)(1)—The operator describes how drilling activities account for Arc- ment were designed for Arctic OCS conditions; tic OCS conditions. § 550.204(b)—The operator includes a schedule of the explor- § 550.211(a)—The operator includes a schedule and discussion of objectives atory program; for its exploration program. § 550.204(c)—The operator describes how its plans account for § 550.220 (c)(1)—The operator describes how drilling activities account for Arc- Arctic OCS conditions; tic OCS conditions. § 550.220(c)(2)—The operator describes weather and ice forecasting and man- agement plans. § 550.224(a)—The operator describes vessels and aircraft it would use during exploration, including storage capacity of fuels. § 550.202—BOEM must review plans to ensure they are safe and do not cause undue or serious harm or damage to the human, marine, or coastal environment. § 550.204(d)—The operator describes general abandonment § 550.211(a)—The operator includes a schedule and discussion of objectives plans for wells; for its exploration program. § 550.220 (c)(1)—The operator describes how drilling activities account for Arc- tic OCS conditions. § 550.220(c)(2)—The operator describes weather and ice forecasting and man- agement plans. § 550.220(c)(6)(ii) (proposed)—The operator would describe the termination of drilling operations consistent with the well control planning requirements under § 250.472 of this title. § 550.204(e)—The operator describes its plans for responding § 550.220(c)(2)—The operator describes weather and ice forecasting and man- and managing ice hazards and weather events; agement plans. § 550.220(b)—The operator would describe critical operations and curtailment procedures. § 550.204(f)—The operator describes work to be performed by § 550.220 (c)(1)—The operator describes how drilling activities account for Arc- contractors; tic OCS conditions. § 550.220(c)(2)—The operator describes weather and ice forecasting and man- agement plans. § 550.202—BOEM must review plans to ensure they are safe and do not cause undue or serious harm or damage to the human, marine, or coastal environment. § 550.204(g)—The operator describes how it will ensure oper- § 550.211(c)—The operator would describe the drilling unit, associated equip- ational safety; ment, safety features, and storage of fuels and oils. § 550.220 (c)(1)—The operator describes how drilling activities account for Arc- tic OCS conditions.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00037 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79302 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

TABLE 1—CROSSWALK BETWEEN THE IOP PROVISIONS PROPOSED FOR REMOVAL AND EXISTING EP REGULATIONS AND REVIEW PRACTICES—Continued

Coverage in BOEM’s continuing regulations, operator EPs, and IOP provision review practices

§ 550.204(h)—The operator describes oil spill response plans; § 550.219 (a) and § 550.219 (b)—The operator would describe its oil spill re- sponse plan and associated spill modeling report. § 550.204(i)—The operator describes efforts to minimize im- § 550.216 (c)—the operator must analyze socioeconomic resources associated pacts to local community infrastructure; with its exploratory program. § 550.227 (b)(7)—The operator must describe socioeconomic resources includ- ing employment and subsistence resources and harvest practices. § 550.204(j)—The operator describes how it could rely on local § 550.220 (c)(5)—The operator describes agreements it has with third parties communities for parts of its exploratory drilling program. in the event of an oil spill or emergency. § 550.219 (a) and § 550.219 (b)—The operator would describe its oil spill re- sponse plan and associated spill modeling report. § 550.227 (b)(7)—The operator must describe socioeconomic resources includ- ing employment and subsistence resources and harvest practices.

The following information that was requirements, is proposed to be added previously required as part of the IOP to the relevant sections of the EP: submission, but not included in the EP

Existing regulation text New provision

§ 550.204(a)—The operator describes how vessels and equip- § 550.220(c)(1)—The operator describes how the exploratory drilling (including ment were designed for Arctic OCS conditions; vessels and equipment) would account for Arctic OCS conditions, including any allowances or limitations its vessels have from a classification society and/or the USCG. § 550.204(g)—The operator describes how it will ensure oper- § 550.211(b)—the operator describes how it will ensure operational safety. ational safety;

To the extent that there is not an exact coordination between BOEM, the Description, objectives, and schedule, correlation between the information operator, and other agencies prior to and (c), Drilling unit of this section. required in the IOP and that required in submission, will result in fewer Paragraph (c) requires the operator to the EP, BOEM and BSEE believe that the unexpected issues overall. In practice, describe the drilling unit, associated additional information required in the the entire planning process from initial equipment, safety features, and storage IOP that is not in the EP is not necessary concept to actual drilling should be the of fuels and oils. and certainly not necessary in advance same, with or without an IOP. What is Without the current IOP provisions, of the EP. more important in terms of timeline, is the applicant would already need to Furthermore, the BOEM Anchorage, the detailed work the operator would have the information required by this Alaska OCS Office meets with members conduct in preparing and submitting a paragraph in order to comply with of the Interagency Working Group on well-crafted EP. BSEE’s regulations that currently Alaska Energy Permitting and other How do I submit the EP, DPP, or DOCD? require operators to develop, relevant agencies, before an EP is (§ 550.206) implement, and maintain a safety and submitted or deemed submitted. environmental management system Although BOEM previously argued that BOEM proposes to delete all (SEMS) program (Subpart S, §§ 250.1900 the IOP would not delay, but in fact, references to the IOP in this section. The to 250.1933), and as a result, moving speed development by encouraging substantive provisions of this section this requirement from §§ 550.204 to earlier review and coordination between that relate to EPs, DPPs, and DOCDs 550.211 does not add any burden. regulatory agencies, BOEM no longer would remain unchanged. Retaining this important provision as believes that is the case. While it is true What must the EP include? (§ 550.211) part of the requirements for exploratory that the IOP might speed up BOEM’s drilling on the Arctic OCS ensures review and approval of an EP, by BOEM proposes to move existing consistency with the goals of this encouraging earlier review and § 550.204(g) to § 550.211 as a new rulemaking and to better align BOEM’s coordination among agencies, such paragraph (b). All other provisions of rules with those of BSEE. The following acceleration would not shorten the § 550.211 would remain unchanged. is a description of the provision that is overall planning process undertaken by The addition of the provision from being retained. The section describes the operator to prepare and submit an § 550.204 into § 550.211 is designed to how an operator will ensure operational EP. The operator should conduct the describe operational safety procedures safety while working in Arctic OCS same degree of planning with or without that the operator has developed specific conditions, including but not limited to: an IOP, because such planning is to conditions relevant on the Arctic necessitated by the EP requirements. OCS. These requirements were (1) The safety principles that it The IOP merely shifts some of the previously included in the IOP and not intends to apply to itself and its agency review to earlier in the process. specifically enumerated as part of the contractors; With or without a prescriptive requirements for an EP, although (2) The accountability structure requirement for an IOP, the operator’s similar, more general requirements are within its organization for thorough advance planning and already part of paragraphs (a), implementing such principles;

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00038 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79303

(3) How it will communicate such suitability of vessels for Arctic supporting reasons and data for your principles to its employees and conditions. These vessels may have or responses. contractors; and acquire classification from a (i) Well Design When Using an SSID (4) How it will determine successful ‘‘recognized organization’’ under the (§ 250.472(a))—BSEE is seeking implementation of such principles. USCG’s Alternative Compliance comments on how well design could be The text of this transferred regulation Program (ACP).52 This specification better addressed in this rulemaking to provision is identical to what it was in provides the operator with guidance on enhance the overall safety of operations § 550.204(g). As such, this addition to what information the EP should contain on the Arctic OCS. More specifically, § 550.211 will not impose any new to show that its vessels would be able BSEE would like to know whether the burden on lessees or operators. BOEM to operate safely in the Arctic OCS. The well design requirement in proposed believes that retaining this important specification would also show that § 250.472(a) is adequate to address safety and environmental protection is a BOEM is not duplicating regulations situations the operator may encounter if necessary part of ensuring that energy from USCG by acknowledging that the a well is shut-in with an SSID over an exploration and development activity is flag state, USCG, and/or the entire winter season (e.g., six to nine safe and environmentally responsible. classification society have authority for months). These situations could include If I propose activities in the Arctic OCS approvals, allowances, and limitations cases where the wellbore pressure Region, what planning information must placed upon modified vessels. For these profile may increase to reservoir accompany the EP? (§ 550.220) reasons, this change would impose no pressures at the top of the well over the material additional burden on lessee or course of the winter season. BSEE BOEM proposes to revise paragraphs operators beyond that which already would also like to know whether there (c)(1) and (4), and (c)(6)(ii) of § 550.220 exists and which has already been are other scenarios that may occur in a to conform to BSEE’s proposed changes accounted for in the information shut-in well over the ice season. to § 250.472, What are the additional collection burden for this section. (ii) SSID Efficacy Relative to the Relief well control equipment or relief rig To ensure consistency with BSEE’s Rig and SSRW—BSEE is proposing to requirements for the Arctic OCS? proposed regulatory changes, BOEM is revise the relief rig and SSRW Existing paragraph (c)(1) of § 550.220 proposing to revise paragraphs (c)(4) requirement with the intent to minimize would be revised to add text to account and (c)(6)(ii) by requiring the operator to environmental damage due to a for the text in existing § 550.204(a), provide a general description of how prolonged ongoing well control event. which would be removed. With the they will comply with § 250.472, When drilling a relief well, there is a elimination of § 550.204, BOEM including a description of the delay in stopping the uncontrolled flow proposes to combine the requirements termination of their operations. BSEE is of oil and other fluid into the marine of these two sections into a revised proposing to revise § 250.472 to provide environment while relief well drilling § 550.220(c)(1) that would require the the operator with the option to either operations are taking place. When operator to describe how its exploratory use an SSID or have access to a relief properly functioning as designed, there drilling (including vessels and rig, as an additional means to secure the is usually no delay for operational use equipment) would account for Arctic well in the event of a loss of well of an SSID compared to the process of OCS conditions, including any control, if the operator will be utilizing the relief rig or capping stack. allowances or limitations its vessels conducting exploratory drilling If the SSID does not initially function, have from a classification society and/ operations from a MODU. the SSID may still be activated through or the USCG. the ROV intervention equipment and BOEM is proposing to add a new III. Additional Comments Solicited capabilities that BSEE is proposing as a informational requirement for modified To assist BSEE and BOEM in these SSID design requirement. The SSID vessels. BOEM is seeking to confirm that revisions, we are requesting public would operate independently from the the operator meets the requirements of comments on specific issues discussed BOP. By having two independent, other entities with authority over in the preamble. We will consider these redundant components, as part of the vessels, not to impose requirements on comments while developing final well control system, the overall those vessels. Although this revised regulations. To provide necessary reliability and effectiveness of the entire paragraph would appear to add new context, we included the requests for system increases. BSEE would like to requirements, in fact this revision public comments in appropriate know of any cases or data, in addition would simply clarify and formalize the locations throughout the preamble. For to what we have already discussed in existing arrangements between BOEM ease of commenting, we consolidated the preamble, regarding the performance and these other entities. This provision the requests for comments in this and reliability of the SSID and its is proposed in order to avoid any section of the preamble. While BSEE effectiveness compared to drilling a potential confusion that might and BOEM are soliciting comment on relief well. otherwise arise regarding the specific topics associated with the (iii) NPC Report and Bratslavsky and incorporation of the existing IOP proposed rule, the bureaus welcome the SolstenXP Study—The NPC 2019 Report requirements into the EP and how they public to submit information or and the Bratslavsky and SolstenXP may relate to the regulations and comment on any other topics relevant to study have been valuable tools that were jurisdiction of the United States Coast this rulemaking that may not necessarily not available when promulgating the Guard, or the flag state of the vessel. pertain to the bureaus’ specific 2016 Arctic Exploratory Drilling Rule. According to this proposed revision, for solicitation. At this stage, the bureaus BSEE requests the public to provide vessel modifications, the operator are open to considering any option that additional information or clarification would describe any approvals from the would improve the regulatory changes related to those portions of these reports flag state and vessel classification proposed, including maintaining the that the Bureau relied upon in this society and include in that description original requirement as part of the final rulemaking. any allowances or limitations placed rule. In all cases, please provide (iv) SSID Capability to Preserve upon the vessel by the classification Isolation Over the Winter Season society and/or USCG. Vessel 52 33 U.S.C. 3316 and 46 CFR part 8 implement (§ 250.472(a)(1)(iv))—BSEE proposes to modifications may include the the USCG’s ACP. require that the SSID must be capable of

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00039 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79304 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

preserving isolation through the winter requirements?, or whether there are there could be cases where the operator season without solely relying on the more appropriate and reliable testing or BSEE may not have sufficient G&G or elastomer elements of the rams (e.g., by methods for SSIDs. BSEE would like to analogous well data on a proposed using a well cap) and allow re-entry receive information on what testing project to confidently identify the during the following open-water season. procedures have been used in the past location of the first formation that the BSEE understands that the operator is to test an SSID when it was deployed, operator may encounter that is capable able to achieve long-term isolation by or what testing procedures are being of flowing hydrocarbons in measurable installing a well cap (i.e., a metal-to- developed for future projects. quantities. BSEE is soliciting the metal cap) on the SSID before leaving (viii) Relief Rig Staging and Capping public’s comments about this regulatory the device on the seafloor over the Stack Positioning Requirements—BSEE approach. BSEE is also soliciting winter season. BSEE would like to know proposes to revise the staging and comment about the need for the if there are means by which isolation positioning requirement for the relief rig operator to verify, on a case-by-case would be preserved through the winter and capping stack, respectively, by basis, zones not capable of flowing season in cases where a late-season providing an opportunity to the operator hydrocarbons in measurable quantities. emergency situation may not provide to adjust the point in time during its (x) Installing and Operating an SSID adequate time or ability to access the operations when it must stage or in a Mudline Cellar—BSEE is requesting SSID to install a well cap. position these pieces of equipment, more information about whether there (v) SSID Dual Shear Requirement in from ‘‘when drilling below or working are any operational or installation Proposed § 250.472(a)(2)(i)—The NPC below the surface casing’’ to ‘‘when challenges the operator may encounter 2019 Report describes the SSID used in drilling below or working below the last in attempting to operate the SSID when the Kara Sea Project as having dual casing point prior to penetrating a zone it is installed in a mudline cellar. In blind shear rams. BSEE does not capable of flowing hydrocarbons in areas of ice scour, BSEE’s current propose requiring the SSID to be measurable quantities.’’ If the operator regulations at §§ 250.734(a)(13) and equipped with dual blind shear rams. is able to demonstrate to BSEE that the 250.738(h) require placement of subsea However, BSEE is seeking comment on operations it plans to conduct below the BOP systems in mudline cellars. In the advantages or disadvantages surface casing would not encounter any addition, proposed § 250.720(c)(2) between dual blind shear rams and abnormally high-pressured or other requires placement of the wellhead in a using dual shear rams, with ram locks, geologic hazards before reaching the last mudline cellar in areas of ice scour. with one ram being a blind shear ram. casing point prior to penetrating a zone Proposed § 250.472(a)(4)(i) would (vi) SSID Redundant Control System capable of flowing hydrocarbons in require installation of the SSID below Capabilities (§ 250.472(a)(2)(ii))—BSEE measurable quantities, then BSEE would the BOP. proposes to require the SSID to use a allow the operator to delay staging of its (xi) Operating an SSID with a Subsea redundant control system that includes relief rig or positioning of its SCCE until BOP Installed on the Seafloor— ROV capabilities and a control station reaching that point. BSEE would like to Historically, drilling in the Beaufort Sea on the rig that is independent from the know whether there are more and the Chukchi Sea has occurred in BOP control system. BSEE is appropriate criteria, other than waters less than 167 feet deep, and as contemplating whether it may be more ‘‘abnormally high-pressured zones or recent as April 2020,53 there were active appropriate to require the SSID’s other geologic hazards,’’ that should be leases in the Beaufort Sea where an redundant control system capabilities to used to determine whether to allow the SSID could have been deployed. If the be separate from its ROV’s capabilities, operator to delay positioning of the operator installs all well control systems and to be consistent with the fully capping stack and relief rig. BSEE is also on the seafloor (subsea BOP systems and redundant control system requirements requesting comment on what types of SSIDs), there could be as much as 128 described in API Spec. 16D, information, other than what is listed in feet of water column taken up by these Specification for Control Systems for proposed § 250.471(a) and § 250.472 systems and a ship’s hull (if a drillship Drilling Well Control Equipment and (b)—risk modeling data, off-set well is used). BSEE would like to know what Control Systems for Diverter Equipment, data, analog data, and seismic data, challenges operators could face in cases Second Edition, July 2004, reaffirmed could be used to demonstrate the where there is little room to operate. August 2013; incorporated by reference absence of abnormally pressured zones BSEE would also like to know how at § 250.198(e)(90); (e.g., yellow pod and or other geologic hazards, and how operators addressed those challenges in blue pod). In addition to meeting the burden on the operator could change— the past, or how such challenges could ROV requirements in existing increase or decrease—if BSEE were to be addressed in future operations. § 250.734(a)(5), BSEE is also considering require submission of that information (xii) Fail-Safe Mechanisms Used on whether there should be an additional in its APD. an SSID—BSEE is seeking comment on manual method (separate from the (ix) Alternative Regulatory Approach what fail-safe mechanisms exist that redundant control system) to close the to the Relief Rig and Capping Stack could be applied to an SSID in cases SSID’s rams with the ROV and whether Positioning Requirements—BSEE is where a subsea BOP system is used. it may be appropriate to require a considering an alternative regulatory BSEE is contemplating whether it may standby or tending vessel with an ROV. approach in which BSEE would revise be necessary to require mechanisms, There could be cases where the SSID’s the staging and positioning requirement such as autoshear or deadman for the control system on the drilling rig is not for the relief rig and capping stack, SSID, to address emergency situations, available (e.g., due to failure or an respectively, by adjusting the point in such as a sunken MODU, where the evacuation of the rig). time during its operations when it must (vii) SSID Testing Requirements stage or position these pieces of 53 In April of 2020, the only leases with potential (§ 250.472(a)(5))—BSEE is seeking equipment, from ‘‘when drilling below projects that would be subject to the Arctic OCS’s comment on whether it is appropriate to or working below the surface casing’’ to SSID requirements were relinquished. However, align the SSID’s proposed testing ‘‘when drilling below or working below there are other active leases in the Beaufort Sea located nearer to shore in shallower waters where requirements with BSEE’s existing BOP the last casing point prior to penetrating exploration and development projects are actively testing requirements in § 250.737, What a zone capable of flowing hydrocarbons being pursued (primarily through man-made gravel are the BOP system testing in measurable quantities.’’ However, islands).

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00040 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79305

subsea BOP system may have failed and leaseholding activities due to seasonal technology. Forgone benefits result from the SSID could no longer be functioned conditions. BSEE is seeking comment slight increases in the risks to via the rig or ROV (due to lack of on this regulatory option for the new subsistence hunters and fishermen and access). BSEE currently has fail-safe SOO provision it is proposing in a new wildlife stemming from an increased requirements for subsea BOP systems paragraph (d) of § 250.175, or any other probability of small or catastrophic oil (autoshear and deadman systems), option that could avoid or minimize the spills. The cost savings exceed the which could be applied to SSIDs. additional burdens associated with forgone benefits, leading to the net However, there could be unintended making requests on an annual basis (if benefits summarized in the following consequences from applying these fail- the duration of the suspension needs to paragraphs. safe systems on an SSID when a subsea be longer), but still assure diligent lease This proposed rule would revise BOP system is used. BSEE is seeking exploration and development. regulatory provisions in 30 CFR part comment on what fail-safe mechanisms (xvi) Other Solicited Comments— 250, subparts A, C, D, and G, and 30 could be deployed to address cases BSEE is also requesting comments on CFR part 550, subpart B. BSEE and where the BOP fails and the SSID is the specific costs and operational BOEM have reassessed a number of the inaccessible by an ROV or a MODU implications of each of the regulatory provisions promulgated through the control station. If an autoshear system or changes included in this proposed rule. 2016 Arctic Exploratory Drilling Rule a deadman system are appropriate fail- IV. Procedural Matters and are proposing to revise some safe mechanisms, BSEE is seeking input provisions to reflect performance-based on what criteria should be used to A. Regulatory Planning and Review standards rather than prescriptive function these systems, to ensure they (Executive Orders (E.O.) 12866, 13563, requirements. Other revisions remove do not function at the wrong time or and 13771) redundant regulatory oversight interfere with or impact the subsea Executive Order 12866 provides that provisions and provide regional BOP’s autoshear and deadman systems. the Office of Information and Regulatory flexibility in the administration of (xiii) Autoshear and Deadman System suspensions and associated lease term Requirements for Surface BOPs—BSEE Affairs (OIRA) within OMB will review all significant rules. This proposed extensions, without significantly is contemplating establishing autoshear impacting the current levels of safety and deadman system requirements in action is an economically significant regulatory action that was submitted to and environmental protection. The cases where operators use a surface bureaus sought the best available data BOP. BSEE does not currently require OMB for review, as it would have an annual effect on the economy of $100 and information to analyze the the use of an autoshear or deadman economic impact of these changes. The system with surface BOPs. BSEE is million or more. BSEE and BOEM IRIA for this rulemaking can be found seeking comment on what criteria developed an economic analysis to in the https://www.regulations.gov/ should be established to function the assess the anticipated costs and docket (Docket ID: BSEE–2019–0008). autoshear or deadman systems in potential benefits of the proposed rule. connection with a surface BOP. BSEE Due to uncertainty surrounding the BSEE and BOEM are proposing to welcomes any other comments, outcome of ongoing litigation regarding revise certain regulations promulgated unrelated to autoshear or deadman the availability of Arctic OCS planning through the 2016 Arctic Exploratory systems, which require additional areas for future leasing and energy Drilling Rule based on new information consideration in those cases where a development, BSEE and BOEM generated since the 2016 rule was surface BOP is used. developed two baseline activity level finalized, and to support the goals of the (xiv) Outcome-based Well Control forecasts: (1) Activity levels expected if Administration’s regulatory reform System Requirements—BSEE is seeking the full Beaufort and Chukchi Sea initiatives, while ensuring safety and comment on other appropriate planning areas are reopened (i.e., the environmental protection. This approaches to well-control operations in Full Arctic baseline), and (2) reduced proposed rule would revise certain the Arctic. The NPC 2019 Report activity levels if these areas remain existing regulations—§§ 250.105; recommends accepting the use of an withdrawn from leasing (i.e., the 250.175; 250.198; 250.300(b); SSID in place of the requirement for Restricted Beaufort baseline). Under 250.470(b), (f), and (h); 250.471(a) and SSRW capability. However, it also either scenario, the proposed action (b); 250.472(a), (b), and (c); 250.720(c); recommends replacing the relief rig and would be economically significant as a 550.200; 550.204; 550.206; 550.211; and SSRW requirements with requirements result of the estimated cost savings of 550.220(c). The bulk of the net benefits that specify desired outcomes (i.e., to this proposed rule. BSEE and BOEM are derived from cost savings driven by stop the flow of a well and allow the estimate the amendments proposed in a proposed revision to existing operator to propose equivalent this rulemaking would provide § 250.472(b) and (c), which is discussed technology and demonstrate its annualized net benefits of $142 million below. The analysis suggests forgone capabilities). BSEE assumes that the under the Full Arctic baseline, or $121 benefits are small compared to the cost NPC recommendation would entail a million under the Restricted Beaufort savings, and the primary forgone performance-based approach to the baseline, discounted at 7 percent. benefits are from possible impacts on regulations, in which the operator could Details on the estimated cost savings the environment and subsistence propose and demonstrate new of this proposed rule can be found in hunting and whaling communities, that technologies to meet a stated objective, the rule’s Initial Regulatory Impact could be caused by an oil spill of greater rather than being required to use certain Analysis (IRIA). The net quantified duration and higher discharge volumes technologies, such as a relief rig. benefits for this proposed rule are based in the event the BOP, SSID, and capping (xv) Suspension of Operations—BSEE on cost savings less forgone benefits. stack were to fail in sequence, and a is considering the option of limiting the The cost savings to both government containment dome and flow system period during which a suspension and industry result from removing would be needed to capture oil flowing would remain in effect to the period regulatory redundancies, reduction in from the well while relief-well drilling between one drilling season and the paperwork burdens, provision for operations are underway. These, and the next when the operator is prevented alternative methods of compliance, and other provisions, are discussed in from continuing its drilling or other adoption of improved industry greater detail within the IRIA.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00041 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79306 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

The largest contributor to net benefits assumes operators will prefer this during that delayed period, would be attributable to the proposed rule is the option when using MODUs. This the contributing factor to the proposed proposed revision to existing § 250.472 proposed change would produce an rule’s forgone benefits. However, as paragraphs (a), (b), and (c). As annualized cost savings of $142 million discussed in the IRIA, the probability of promulgated under the 2016 Arctic under the Full Arctic baseline, or $121 a catastrophic spill event (as a result of Exploratory Drilling Rule, this provision million under the Restricted Beaufort the BOP and SSID systems experiencing currently requires the use of a ‘relief rig’ baseline, discounted at 7%. total failures) is low. Coupled with a and adoption of a 45-day shoulder This proposed rule would reduce the scenario in which a BOP, SSID, and season. The relief rig is a secondary burden imposed on industry, while capping stack were all to fail, the drilling vessel that is available and maintaining safety and environmental probability of realizing these forgone capable of drilling an SSRW in the event protection. The forgone benefits of benefits may be even lower. of a loss of well control. The 45-day adopting the proposed rule include Nonetheless, the possibility exists and if ‘‘shoulder season’’ was the maximum possible impacts on the environment, the BOP were to fail and the SSID were time permitted by the regulations to subsistence hunting and whaling to function as designed, there would be mobilize the relief rig to an incident, communities, and an oil spill of greater no forgone benefits in comparison to the drill a relief well, kill and abandon the duration with higher discharge volumes existing regulations (and there might be original well, and abandon the relief in the event a BOP and SSID were to a gained benefit since the SSID would fail. As discussed earlier in the well prior to expected seasonal ice activate immediately). preamble, BSEE proposes to require encroachment at the drill site. This As part of the final rule, BSEE and operators to operate an SSID shoulder season necessarily compresses BOEM are contemplating the independently from the BOP. By having the already short Arctic drilling preparation of a sensitivity analysis for two independent, redundant the Final RIA and are soliciting timeframe and also limits the ability of components (i.e., the BOP and the SSID) comments on ways to make the analysis operators to drill and complete a well in as part of the well control system, the as accurate as possible. The information one season. The proposed revisions to overall reliability and effectiveness of we receive through public input on this § 250.472 would provide the operator the entire system increases. In the event with the option to either use an SSID or both devices were to fail, the capping proposed rule regarding the SSID’s have access to a relief rig, as an stack would still be used as required in performance, reliability, and additional means to secure the well in the permitted timeframe. When a effectiveness may inform the the event of a loss of well control, if the capping stack is used to contain a well, preparation of a sensitivity analysis. operator will be conducting exploratory the relief well can be drilled without an The timeframe of the present analysis drilling operations from a MODU. The ongoing active spill event. If the capping is 24 years, composed of an initial 4 two features of this flexibility driving stack were to fail, the containment dome years with no activity followed by 20 the cost savings are the removal of the and flow system would be used to years of activities beginning in 2024. shoulder season and removal of the capture the oil flowing from the well The two tables below summarize BSEE’s requirement for the secondary drilling while relief-well drilling operations are and BOEM’s estimates of the total and vessel, if the operator elects to install an underway. annual net benefits derived from all SSID to comply with § 250.472. Because Given that the proposed rule would proposed revisions and additions. of the relative cost effectiveness of remove the arrival timing requirement Additional information on the time procuring, and potential well control for these pieces of equipment, there may horizon, compliance costs, savings, advantages of installing an SSID versus be a delay in their arrival, in benefits, and forgone benefits may be mobilizing a relief rig and the necessary comparison to the existing regulations. found in the IRIA published in the rule support vessels and personnel, BSEE The amount of oil flowing from the well docket.

20-YEAR ESTIMATED ANNUALIZED NET BENEFITS ASSOCIATED WITH PROPOSED AMENDMENTS TO 30 CFR PART 250 SUBPARTS A, C, D, AND G, AND 30 CFR PART 550, SUBPART B UNDER FULL-ARCTIC BASELINE ASSUMPTIONS

Discounted to Discounted to Year (2024–2043) 2019 at 3% 2019 at 7%

Annualized (millions) ...... $149.8 $142.2

20-YEAR ESTIMATED ANNUALIZED NET BENEFITS ASSOCIATED WITH PROPOSED AMENDMENTS TO 30 CFR PART 250 SUBPARTS A, C, D, AND G, AND 30 CFR PART 550, SUBPART B UNDER RESTRICTED BEAUFORT BASELINE ASSUMPTIONS

Discounted to Discounted to Year (2024–2043) 2019 at 3% 2019 at 7%

Annualized (millions) ...... $126.0 $120.9

This proposed rule would revise BSEE and BOEM are providing industry the proposed revisions would be multiple provisions in the current flexibility, when practical, to meet the consistent with the policies of the regulations to implement performance- safety or equipment standards, rather applicable E.O.s and the OCSLA. based provisions based upon reasonably than specifying the compliance method. Executive Order 13563 reaffirms the obtainable information on safety, Based on a consideration of the principles of E.O. 12866 while calling technical, economic, and other issues. qualitative and quantitative safety and for improvements in the Nation’s Redundant or unnecessary reporting environmental factors related to the regulatory system to promote requirements are also being eliminated. rule, BSEE and BOEM determined that predictability, to reduce uncertainty,

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00042 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79307

and to use the best, most innovative, Arctic OCS. This proposed rule would disproportionate budgetary effects on and least burdensome tools for directly affect all four Arctic lessees. these governments. BSEE and BOEM achieving regulatory ends. The E.O. Based on the small entity criterion, none have determined the proposed changes directs agencies to consider regulatory of the four businesses are considered a in this rulemaking would result in cost approaches that reduce burdens and small entity. No small companies hold savings annually to regulated entities. maintain flexibility and freedom of leases on the Arctic OCS. Previously, a Therefore, a written statement under the choice for the public where these single small company with only one Unfunded Mandates Reform Act (2 approaches are relevant, feasible, and lease held acreage on the Arctic OCS. U.S.C. 1531 et seq.) is not required. consistent with regulatory objectives. This company relinquished its lease in E.O. 13563 emphasizes that regulations March 2016. D. Takings Implication Assessment must be based on the best available BSEE and BOEM prepared an Initial Under the criteria in E.O. 12630, this science and that the rulemaking process Regulatory Flexibility Analysis (IRFA), proposed rule would not have must allow for public participation and which can be found in Section VII of the significant takings implications. The an open exchange of ideas. Furthermore, IRIA. Given the challenging proposed rule is not a governmental it promotes retrospective review of environment and associated costs of action capable of interference with existing regulations that may be drilling in the Arctic OCS planning constitutionally protected property outmoded, ineffective, insufficient, or areas, no small entities are expected to rights. A Takings Implication excessively burdensome. BSEE and operate in these areas for the foreseeable Assessment is not required. BOEM have reviewed the existing future. Therefore, BSEE and BOEM E. Federalism (E.O. 13132) regulations as amended by the 2016 preliminarily conclude that no small Rule and have developed this proposed entities would be affected by these Under the criteria in E.O. 13132, this rule in a manner consistent with E.O. proposed amendments, however the proposed rule would not have 13563. agency has prepared an IRFA and is federalism implications. This proposed Executive Order 13771 requires seeking public comment on any small rule would not substantially and Federal agencies to take proactive business impacts from the proposed directly affect the relationship between measures to reduce the costs associated amendments. the Federal and State Governments. To with complying with Federal This proposed rule would meet the the extent that State and local regulations. This proposed rule is an E.O. 12866 criteria for an economically governments have a role in OCS E.O. 13771 deregulatory action. significant rule because it would likely activities, this proposed rule would not have an annual effect on the economy affect that role. A Federalism B. Regulatory Flexibility Act and Small of $100 million or more in at least one Assessment is not required. Business Regulatory Enforcement year of the 20-year period analyzed, and Fairness Act BSEE/BOEM comply with the RFA and F. Civil Justice Reform (E.O. 12988) The Regulatory Flexibility Act (RFA), the Small Business Regulatory This proposed rule complies with the 5 U.S.C. 601–612, requires agencies to Enforcement Fairness Act by providing requirements of E.O. 12988. analyze the economic impact of a regulatory flexibility analysis. The Specifically, this rule: regulations when there is likely to be a requirements would apply to all entities 1. Meets the criteria of section 3(a) significant economic impact on a operating on the Arctic OCS regardless requiring that all regulations be substantial number of small entities and of company designation as a small reviewed to eliminate errors and to consider regulatory alternatives that business. For more information on the ambiguity and be written to minimize will achieve the agency’s goals while small business impacts, see the IRFA litigation; and minimizing the burden on small section in the IRIA. Small businesses 2. Meets the criteria of section 3(b)(2) entities. The proposed rule would affect may send comments on the actions of requiring that all regulations be written operators and Federal oil and gas lessees Federal employees who enforce, or in clear language and contain clear legal that could conduct exploratory drilling otherwise determine compliance with, standards. on the Arctic OCS. The RFA defines Federal regulations to the Small G. Consultation With Indian Tribes (E.O. small entities as small businesses, small Business and Agriculture Regulatory 13175) nonprofits, and small governmental Enforcement Ombudsman, and to the jurisdictions. No small nonprofits or Regional Small Business Regulatory Under the criteria in E.O. 13175, small governmental jurisdictions have Fairness Board. The Ombudsman Consultation and Coordination with been identified that would be impacted evaluates these actions annually and Indian Tribal Governments (dated by this rule. rates each agency’s responsiveness to November 6, 2000), DOI’s Policy on Businesses subject to this proposed small business. If you wish to comment Consultation with Indian Tribes and rule fall under North American Industry on actions by employees of BSEE or Alaska Native Corporations (512 Classification System (NAICS) codes BOEM, call 1–888–REG–FAIR (1–888– Departmental Manual 4, dated 211111 (Crude Petroleum and Natural 734–3247). November 9, 2015), and DOI’s Gas Extraction) and 213111 (Drilling Oil Procedures for Consultation with Indian and Gas Wells). For these C. Unfunded Mandates Reform Act of Tribes (512 Departmental Manual 5, classifications, a small business is 1995 (UMRA) dated November 9, 2015), we evaluated defined as one with fewer than 1,250 This proposed rule would not impose the subject matter of this rulemaking employees (NAICS code 211111) and an unfunded Federal mandate on State, and determined that it would have tribal fewer than 1,000 employees (NAICS local, or tribal governments and would implications for Alaska Natives. As code 213111), respectively. A small not have a significant or unique effect described earlier, future Arctic OCS entity is one that is ‘‘independently on State, local, or tribal governments. exploratory drilling activities conducted owned and operated and which is not The requirements in this proposed rule pursuant to this proposed rule could dominant in its field of operation.’’ would apply to Arctic OCS oil and gas affect Alaska Natives, particularly their According to BOEM’s list of Arctic lessees and operators, not to State, local, ability to engage in subsistence and OCS leaseholders, four businesses and tribal governments. Thus, the cultural activities. However, as currently hold lease interests on the proposed rule would not have discussed earlier in Section I.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79308 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

Background, Subsection E. Partner In addition, Alaska Natives may also On September 20, 2018, BSEE and Engagement in Preparation for This be beneficiaries of the proposed rule, to BOEM began reaching out to leaders Proposed Rule, Item 2. Summary of the extent they are partners in any from Alaska Native Tribes, ANCSA Comments Received, BOEM’s exploratory activities. There are Corporations, and municipalities to environmental studies program has additional unquantified benefits in determine which partners were provided nearly $500 million over the situations where a SSID is available to interested in having conversations with last 46 years to scientific research on the immediately shut-in a flowing well BSEE and BOEM about the rulemaking. Alaska OCS, which includes the Arctic rather than waiting for a relief well to Consultations entailed meetings in OCS. Since July 2016, BOEM has be drilled. Alaska, at locations and times BSEE and BOEM are committed to completed 35 environmental studies convenient to the Alaska Native regular and meaningful consultation and has 23 ongoing studies that cover communities and corporations, to and collaboration with Alaska Native the Arctic, totaling nearly $72 million. Tribes and ANCSA Corporations on ensure they can have proper While this proposed rule would change policy decisions that have tribal representation during the meetings. how operators could explore for OCS implications, including, as an initial Accordingly, the timing of these resources in the Arctic, there are ample step, through complete and consistent meetings was critical. BSEE and BOEM opportunities to permit these activities implementation of E.O. 13175, together scheduled the meetings around consistent with ESA, MMPA, NEPA, with related orders, directives, and important traditional subsistence and and consultation with Alaska Native guidance. Therefore, BSEE and BOEM cultural activities, such as whaling, that communities. BOEM’s environmental engaged in Government-to-Government take place during specific times of the studies program provides the tribal consultations, Government-to- year, particularly in the early fall. information that is used to evaluate the ANCSA Corporations consultations, and Between November 29, 2018 and potential environmental effects of meetings with municipal leaders (i.e., January 30, 2019, BSEE and BOEM met leasing OCS lands for exploration and mayors or their respective with a majority of the tribal entities (23 development and helps ensure BOEM representatives), to discuss the subject of 25) originally invited to consult. The and BSEE have the best science matter of the proposed rule and solicit following table lists all 25 invited tribal available for the public, industry, and input in the development of the entities, and the dates and locations of federal permitting decisions. proposed rule. the meetings with the 23 entities.

Tribal entity name Type of entity Meeting date Location

Native Village of Utqiagvik ...... Tribal Government ...... November 29, 2018 ... Anchorage. Native Village of Wainwright ...... Tribal Government. Olgoonik Native Corporation ...... Native Corporation. Doyon Limited ...... Native Corporation. Arctic Slope Regional Corporation ...... Native Corporation ...... December 7, 2018. Native Village of Kotzebue ...... Tribal Government ...... December 10, 2018 ... Kotzebue. Northwest Arctic Borough Mayor ...... Municipal Government. Native Village of Point Hope ...... Tribal Government ...... December 11, 2018 ... Point Hope. Tikigaq Native Corporation ...... Native Corporation. Point Hope Mayor ...... Municipal Government. Alaska Eskimo Whaling Commission ...... Non-tribe that consults on tribe’s behalf ...... December 13, 2018 ... Anchorage. Cully Corporation ...... Native Corporation ...... December 14, 2018. North Slope Borough Mayor ...... Municipal Government ...... December 17, 2018 ... Utqiagvik. City of Utqiagvik Mayor ...... Municipal Government. Native Village of Nuiqsut ...... Tribal Government ...... December 18, 2018 ... Nuiqsut. Kuukpik Corporation ...... Native Corporation. Nuiqsut Mayor ...... Municipal Government. Inupiat Community of the Arctic Slope ...... Non-tribe that consults on tribe’s behalf. Native Village of Kaktovik ...... Tribal Government ...... December 19, 2018 ... Kaktovik. Kaktovik Inupiat Corporation ...... Native Corporation. Kaktovik Mayor ...... Municipal Government. Tanana Chiefs Conference ...... Tribal Government ...... December 20, 2018 ... Fairbanks. Native Village of Point Lay ...... Tribal Government ...... January 30, 2019 ...... Conference Call.

Kikiktagruk Corporation ...... Native Corporation ...... BSEE and BOEM made multiple attempts to contact these corporations. However, the bu- reaus did not receive a response from either organization.

NANA Regional Corporation ...... Native Corporation.

All Alaska Native input provided common comment received was a whaling communities potentially during the meetings was subsequently concern over food security. Subsistence affected by a planned drilling project. provided to DOI in writing and has been resources, including bowhead and Certain tribal representatives and most included in the administrative record beluga whales, other marine mammals, ANCSA corporations were supportive of for this proposed rule. fish, and birds, are a key food source for this proposed rulemaking because it As previously discussed in part E of many people’s diets in the native could help attract more economic the background section in this villages. Another common comment opportunities to their villages. Other preamble, BSEE and BOEM heard a recommended inclusion of a comments provided during the variety of perspectives during their requirement for an oil and gas operator consultation meetings included a meetings with Alaska Natives. The most to establish an agreement with those recommendation to provide broader

VerDate Sep<11>2014 17:45 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00044 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79309

outreach by presenting this rulemaking human health or environmental effect the following OMB control numbers to to the tribal assemblies and to citizens on native, minority, or low-income the current ICs: within the communities. One of the communities because its provisions are • 1014–0025 (BSEE), 30 CFR part 250, ANCSA corporations also recommended designed to maintain environmental Applications for Permit to Drill (APD that this rulemaking take into account protection and minimize any impact of and revised APD) (expires 06/30/2023), the NPC 2019 Report. Please refer to the exploration drilling on subsistence and in accordance with 5 CFR 1320.10, discussions above in Part E (Partner activities and Alaska Native community an agency may continue to conduct or Engagement in Preparation for This resources and infrastructure. sponsor this collection of information Proposed Rule) of the background while the renewal submission is I. Paperwork Reduction Act (PRA) section of this preamble for a pending at OMB. description of how BSEE and BOEM are This proposed rule contains existing • 1010–0151 (BOEM), 30 CFR part addressing this input during the and new information collection (IC) 550, subpart B Plans and Information rulemaking process. BSEE and BOEM requirements for both BSEE and BOEM (exp. 06/30/2021), and in accordance intend to continue consultation with with 5 CFR 1320.10, an agency may affected tribes and ANCSA Corporations regulations, and a submission to OMB for review under the Paperwork continue to conduct or sponsor this following publication of this proposed collection of information while the rule. Reduction Act of 1995 (44 U.S.C. 3501 et seq.) is required. Therefore, each renewal submission is pending at OMB. H. Effects on Environmental Justice for bureau will submit an IC request to The IC aspects affecting each bureau Minority and Low-Income Populations OMB for review and approval. We may are discussed separately. Additionally, (E.O. 12898) not conduct, or sponsor, and you are not BOEM is seeking to renew these E.O. 12898 requires Federal agencies required to respond to a collection of information collections for three years to make achieving environmental justice information unless it displays a with this rulemaking. Instructions on part of their mission by identifying and currently valid OMB control number. how to comment follow those addressing disproportionately high and OMB has previously reviewed and discussions. adverse human health or environmental approved the existing information The following table details proposed effects of their programs, policies, and collection requirements associated with changes to the annual estimated hour activities on minority and low-income Outer Continental Shelf drilling burdens and non-hour costs; as well as populations. DOI has determined that permits, plans, and related information associated wage cost changes for both this proposed rule would not have a collection, which would be altered by BSEE and BOEM information disproportionately high or adverse this proposed rule. OMB has assigned submission activities described below: BSEE

Existing regulations Proposed rule Total changes Requirement Number of Number of Number of Number of Change of Change of Changes in responses burden hours responses burden hours responses burden hours wage cost

Submit signed SSID and Well Design certification § 250.470(h) ...... 0 0 2 6 +2 +6 +$848 Submit request to delay access to your SCCE—§ 250.471(a) and § 250.472(b) ...... 0 0 2 2 +2 +2 +$286

There are no changes to non-hour costs for BSEE requirements. BOEM

Existing regulations Proposed rule Total changes Requirement Number of Number of Number of Number of Change of Change of Changes in responses burden hours responses burden hours responses burden hours wage cost

Submit IOP, including all required in- formation § 550.204 ...... 1 2,880 0 0 (1) (2,880) ($316,800) Submit required Arctic-specific infor- mation with EP § 550.220 ...... 1 350 1 400 ...... +50 +5,500

There are no changes to non-hour environmentally responsible Arctic OCS current requirements retained in the costs for BOEM requirements. oil and gas exploration in an APD. BSEE proposed rule, we used OMB’s would use the information in our efforts approved estimated hour and non-hour BSEE Information Collection—30 CFR to protect life and the environment, cost burdens. Part 250 conserve natural resources, and prevent As discussed in the Preamble Section- The proposed regulations would waste. by-Section above, and in the supporting establish new and/or revise current The following provides a breakdown statement available at RegInfo.gov, this requirements and the submission of of the paperwork and non-hour cost proposed rule would modify language information for safe and burdens for this proposed rule. For the in §§ 250.175(d), 250.300(b),

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00045 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79310 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

250.470(f)(3), and 250.720(c)(2); other geological hazards before that operators and holders of pipeline rights- however, there would be no change in casing point (+ 2 responses and 2 hours of-way. hour burden or non-hour costs per request). Total Estimated Number of Annual associated with these revisions. Because not all APDs submitted to Respondents: Currently there are In § 250.470(h), we would add a BSEE would involve Arctic OCS approximately 60 Oil and Gas Drilling requirement to submit with an APD a exploration drilling, we are separating and Production Operators in the OCS. certification signed by a registered the Arctic-specific requirements and Not all the potential respondents would professional engineer that your SSID burdens from the national APD submit information at any given time, and well design (including casing and requirements. The burden table below and some may submit multiple times. cementing program) meet the design outlines the revised requirements and Total Estimated Number of Annual requirements in § 250.472 (+ 2 burdens associated with this proposed Responses: 11,331. responses and 6 hours for PE rulemaking. Estimated Completion Time per Certification). Title of Collection: Revisions to the In §§ 250.471(a) and 250.472(b), we Response: Varies from 1 hour to 2,800 Requirements for Exploratory Drilling hours depending on activity. would add a requirement for operators on the Arctic Outer Continental Shelf— Total Estimated Number of Annual to submit, with an APD, documentation Application for Permit to Drill (APD, Burden Hours: 77,945. demonstrating that having access to Revised APD). SCCE and the relief rig can be safely OMB Control Number: 1014–0025. Respondent’s Obligation: Most delayed until the last casing point prior Form Number: BSEE–0123 (APD) and responses are mandatory, while others to penetrating a zone capable of flowing BSEE–0123S (Supplemental APD). are required to obtain or retain benefits. hydrocarbons in measurable quantities. Type of Review: Revision of a Frequency of Collection: Generally, on BSEE will grant this approval if the currently approved collection. occasion and as required in the operator adequately demonstrates to the Respondents/Affected Public: regulations. Bureau that it will not encounter any Potential respondents comprise Federal Total Estimated Annual Nonhour abnormally high-pressured zones or OCS oil, gas, and sulfur lessees/ Burden Cost: $4,400,470.

BURDEN TABLE [Changes due to the proposed rule shown in bold]

Citation 30 CFR 250; Annual application for permit to drill Reporting or recordkeeping requirement * Hour burden Average number burden hours (APD) of responses (rounded)

Non-hour cost burden

Subparts A, C, D, E, G, H, P .... Apply for permit to drill, sidetrack, bypass, or 1 190 applications...... 190 deepen a well submitted via Forms BSEE– 0123 (APD) and BSEE–0123S (Supplemental APD). (This burden represents only the filling out of the forms, the requirements are listed separately below.).

$2,113 fee × 190 = $401,470

Subparts D, E, G ...... Obtain approval to revise your drilling plan or 1 730 submittals...... 730 change major drilling equipment by submitting a Revised APD and Supplemental APD [no cost recovery fee for Revised APDs]. (This burden represents only the filling out of the forms, the requirements are listed separately below.).

Subtotal ...... 920 responses ...... 920

$401,470 non-hour cost burdens

Subpart A

125 ...... Submit evidence of your fee for services receipt Exempt under 5 CFR 1320.3(h)(1) 0

197 ...... Written confidentiality agreement ...... Exempt under 5 CFR 1320.5(d)(2) 0

Subpart C

300(b)(1), (2) ...... Obtain approval to add petroleum-based sub- 150 1 request...... 150 stance to drilling mud system or approval for method of disposal of drill cuttings, sand, & other well solids, including those containing Naturally Occurring Radioactive Material (NORM).

Subpart C subtotal ...... 1 response ...... 150

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00046 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79311

BURDEN TABLE—Continued [Changes due to the proposed rule shown in bold]

Citation 30 CFR 250; Annual application for permit to drill Reporting or recordkeeping requirement * Hour burden Average number burden hours (APD) of responses (rounded)

Subpart D

408; 414(h)...... Request approval of alternate procedures or Burden covered under subpart A, 1014– 0 equipment during drilling operations. 0022

409 ...... Request departure approval from the drilling re- 1 370 approvals...... 370 quirements specified in this subpart; identify and discuss.

410(b); 417(b); 713 ...... Reference well and site-specific information in 8 1 submittal...... 8 case it is not approved in your Exploration Plan, Development and Production Plan, De- velopment Operations Coordination Document. Burdens pertaining to EPs, DPPs, DOCDs are covered under BOEM 1010–0151.

410(d) ...... Submit to the District Manager: An original and 0.5 380 submittals ...... 190 two complete copies of APD and Supple- R–0.5 380 submittals ...... 190 mental APD; separate public information copy of forms per § 250.186.

411; 412 ...... Submit plat showing location of the proposed 2 380 submittals...... 760 well and all the plat requirements associated with this section.

411; 413; 414; 415; 420 ...... Submit design criteria used and all description 15 707 submittals...... 10,605 requirements; drilling prognosis with descrip- tion of the procedures you will follow; and cas- ing and cementing program requirements.

411; 416; 731 ...... Submit diverter and BOP systems descriptions 11 380 submittals...... 4,180 and all the regulatory requirements associated with this section.

411; 713 ...... Provide information for using a MODU and all 10 682 submittals...... 6,820 the regulatory requirements associated with this section.

411; 418 ...... Additional information required when providing 20 380 submittals...... 7,600 an APD include, but not limited to, rated ca- pacities of drilling rig and equipment if not al- ready on file; drilling fluids program, including weight materials; directional plot; H2S contin- gency plan; welding plan; and information we may require per requirements, etc.

414(c) ...... Request preapproval to use alternative equiva- 1 15 requests...... 15 lent downhole mud weight prior to submitting APD.

420(a)(7) ...... Include signed registered professional engineer 3 1,034 certifications...... 3,102 certification and related information.

423(c) ...... Submit for approval casing pressure test proce- 3 527 procedures & cri- 1,581 dures and criteria. On casing seal assembly teria. ensure proper installation of casing or liner (subsea BOP’s only).

428(b) ...... Submit to District Manager for approval revised 125 1 submittal...... 125 casing setting depths or hole interval drilling depth; include certification by PE.

428(k) ...... Submit a description of the plan to use a 125 1 submittal...... 125 valve(s) on the drive pipe during cementing operations for the conductor casing, surface casing, or liner.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00047 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79312 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

BURDEN TABLE—Continued [Changes due to the proposed rule shown in bold]

Citation 30 CFR 250; Annual application for permit to drill Reporting or recordkeeping requirement * Hour burden Average number burden hours (APD) of responses (rounded)

432 ...... Request departure from diverter requirements; 8 53 requests...... 424 with discussion and receive approval.

460(a) ...... Include your projected plans if well testing along 17 2 plans...... 34 with the required information.

462(c) ...... Submit a description of your source control and 125 1 submittal...... 125 containment capabilities to the Regional Su- pervisor and receive approval; all required in- formation.

470(h) ...... Submit certification signed by PE that SSID 3 2 certs...... 6 and well design meet requirements of § 250.472. (Alaska only).

471(a); 472(b) ...... Submit, to Regional Supervisor, a request to 1 2 requests ...... 2 delay access to your SCCE and relief rig, if applicable, including adequate documenta- tion (such as, but not limited to, risk mod- eling data, off-set well data, analog data, seismic data). Demonstrate you will not en- counter any abnormally high-pressured zones or other geologic hazards. (Alaska only).

490(c) ...... Request to classify an area for the presence of 3 91 requests...... 273 H2S.

Support request with available information such 3 73 submittals...... 219 as G&G data, well logs, formation tests, cores and analysis of formation fluids.

Submit a request for reclassification of a zone 1 4 requests...... 4 when a different classification is needed.

Alaska Region: 410; 412 thru Due to the difficulties of drilling in Alaska, along 2,800 1 request...... 2,800 418; 420; 442; 444; 449; 456; with the shortened time window allowed for 470; 471; 472. drilling, Alaska hours are done here as stand- alone requirements. Also, note that these spe- cific hours are based on the first APD in Alas- ka in more than 10 years.

Subpart D subtotal ...... 5,467 responses ...... 39,558

Subpart E

513 ...... Obtain written approval to begin well completion 3 288 requests ...... 864 operations. If completion is planned and the R–3 1 request ...... 3 data are available you may submit on forms.

Submit description of well-completion, sche- 18.5 295 submittals ...... 5,458 matics, logs, any H2S.. R–26 1 submittal ...... 26

Subpart E subtotal ...... 585 responses ...... 6,351

Subpart G

701; 720 ...... Identify and discuss your proposed alternate pro- Burden covered under subpart A, 1014– 0 cedures or equipment. 0022

702 ...... Identify and discuss departure requests...... Burden covered under subpart A, 1014– 0 0022

713(b) ...... Submit plat of the rig’s anchor pattern for a 125 1 submittal...... 125 moored rig approved in your EP, DPP, or DOCD.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79313

BURDEN TABLE—Continued [Changes due to the proposed rule shown in bold]

Citation 30 CFR 250; Annual application for permit to drill Reporting or recordkeeping requirement * Hour burden Average number burden hours (APD) of responses (rounded)

713(e) ...... Provide contingency plan for using dynamically 10 682 submittals...... 6,820 positioned MODU and all the regulatory re- quirements associated with this section.

713(g) ...... Describe specific current speeds when imple- 45 1 submittal...... 45 menting rig shutdown and/or move-off proce- dures for water depths > 400 meters; discus- sion of specific measures you will take to cur- tail rig operations/move-off location.

720(b) ...... Request approval to displace kill-weight fluid; in- 5 518 approval requests .. 2,590 clude reasons why along with step-by-step procedures.

721(g)(4) ...... Submit test procedures and criteria for a suc- 2.5 R–4 355 submittals, 1 8,884 cessful negative pressure test for approval. If change. any change, submit changes for approval.

731 ...... Submit complete description of BOP system and 114 129 submittals...... 14,706 components; schematic drawings; certification by ITP (additional I3P if BOP is subsea, in HPHT, or surface on floating facility); autoshear, deadman, EDS systems.

$31,000 × 129 submittal = $3,999,000

733(b) ...... Describe annulus monitoring plan; and how the 67 1 submittal...... 67 well will be secured if leak is detected.

734(b) ...... Submit verification report from ITP documenting R–64 1 report...... 64 repairs and that BOP is fit for service.

734(c) ...... Submit revision, including all verifications re- R–66 1 submittal...... 66 quired, before drilling out surface casing.

737(a) ...... Request approval from District Manager to omit 1 358 casing/liner info ...... 358 BOP pressure test. Indicate which casing strings and liners meet the criteria for this re- quest.

737(b)(2) ...... Request approval of test pressures (RAM BOPs) 2 353 requests ...... 706

737(b)(3) ...... Request approval of pressure test (annular 2 380 requests...... 760 BOPs).

737(d)(2) ...... Submit test procedures for approval for surface 2.5 507 submittals...... 1,268 BOP.

737(d)(3); (d)(4) ...... Submit test procedures, including how you will 2 507 submittals...... 1,014 test each ROV intervention function, for ap- proval (subsea BOPs only).

737(d)(12) ...... Submit test procedures (autoshear and deadman 2.5 507 submittals...... 1,268 systems) for approval. Include documentation of the controls/circuitry system used for each test; describe how the ROV will be utilized during this operation.

738(b) ...... Submit a revised permit with a written statement .5 50 submittals...... 25 from an independent third party documenting the repairs, replacement, or reconfiguration and certifying that the previous certification in § 250.731(c) remains valid.

738(m) ...... Request approval to use additional well control 66 1 request...... 66 equipment, including BAVO report; as well as other information required by District Manager.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79314 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

BURDEN TABLE—Continued [Changes due to the proposed rule shown in bold]

Citation 30 CFR 250; Annual application for permit to drill Reporting or recordkeeping requirement * Hour burden Average number burden hours (APD) of responses (rounded)

738(n) ...... Submit which pipe/variable bore rams have no 64 1 submittal...... 64 current utility or well control purposes.

Subpart G subtotal ...... 4,177 response ...... 16,396

Subpart H

807(a) ...... Submit detailed information that demonstrates 13 1 submittal...... 13 the SSSVs and related equipment are capable of performing in HPHT.

Subpart H subtotal ...... 1 response ...... 13

Subpart P

Note that for Sulfur Operations, while there may be 49 burden hours listed, we have not had any sulfur leases for numerous years, therefore, we have submitted minimal burden.

1605(b)(3) ...... Submit information on the fitness of the drilling 6 1 submittal...... 6 unit.

1617 ...... Submit fully completed application (Form BSEE– 40 1 submittal...... 40 0123) include rated capacities of the proposed drilling unit and of major drilling equipment; as well as all required information listed in this section.

1622(b) ...... Submit description of well-completion or 3 1 submittal...... 3 workover procedures, schematic, and if H2S is present.

Subpart P subtotal ...... 3 responses ...... 49

Total Burden for APD ...... 11,331 Responses ...... 77,945

$4,400,470 Non Hour Cost Burden * In the future, BSEE may require electronic filing of some submissions.

In addition, the PRA requires agencies other than to provide information or the Interior at OMB–OIRA at (202) 395– to estimate the total annual reporting keep records for the Government; or (4) 5806 (fax) or via the RegInfo.gov portal and recordkeeping non-hour cost as part of customary and usual business (online). You may view the information burden resulting from the collection of or private practices. collection request(s) at http:// information, and we solicit your As part of our continuing effort to www.reginfo.gov/public/do/PRAMain. comments on this item. For reporting reduce paperwork and respondent Please provide a copy of your comments and recordkeeping only, your response burdens, we invite the public and other to the BSEE Information Collection should split the cost estimate into two Federal agencies to comment on any Clearance Officer (see the ADDRESSES components: (1) Total capital and aspect of this information collection, section). You may contact Kye Mason, startup cost component and (2) annual including: BSEE Information Collection Clearance operation, maintenance, and purchase (1) Whether the collection of Officer at (703) 787–1607 with any information is necessary, including of service component. Your estimates questions. Please reference Revisions to whether the information will have the Requirements for Exploratory should consider the cost to generate, practical utility; Drilling on the Arctic Outer Continental maintain, and disclose or provide the (2) The accuracy of our estimate of the Shelf (OMB Control No. 1014–0025), in information. You should describe the burden for this collection of your comments. methods you use to estimate major cost information; factors, including system and (3) Ways to enhance the quality, BOEM Information Collection—30 CFR technology acquisition, expected useful utility, and clarity of the information to Part 550 life of capital equipment, discount be collected; and This proposed rule would add and rate(s), and the period over which you (4) Ways to minimize the burden of remove requirements related to incur costs. Generally, your estimates the collection of information on submitting exploration plans and other should not include equipment or respondents. information before conducting oil and services purchased: (1) Before October Send your comments and suggestions gas exploration drilling activities on the 1, 1995; (2) to comply with on this information collection by the Arctic OCS. If final regulations become requirements not associated with the date indicated in the DATES section to effective, the information collection information collection; (3) for reasons the Desk Officer for the Department of burdens for this rulemaking would be

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00050 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79315

consolidated into the existing collection conditions relevant on the Arctic OCS These changes would result in a net for Subpart B, Control Number 1010– in the EP. These requirements were decrease of 2,830 annual burden hours. 0151, and will be adjusted as necessary. previously included in the IOP Because not all EPs submitted to BOEM is requesting OMB approve the requirements that are removed from this BOEM would involve Arctic OCS modified collections of information for rulemaking. Retaining this provision exploration drilling, we are separating OMB Control Number 1010–0151 with would lessen the 2,880-burden hour the burden associated with the Arctic- the final rule publication. decrease by 50 annual burden hours specific requirements and burdens from Pertaining to this proposed (i.e., by retaining 50 annual burden the national EP requirements. The rulemaking, BOEM would collect the hours). burden table that follows this paragraph information to ensure that planned BOEM proposes to revise outlines the revised requirements and operations will be safe; will not § 550.220(c)(1) to require a description burdens associated with this adversely affect the marine, coastal, or of how exploratory drilling will be rulemaking. BOEM has not identified human environments; will respond to designed and conducted, including how any non-hour cost burdens associated the special conditions on the Arctic all vessels and equipment will be with these proposed requirements. OCS; and will conserve the resources of designed, built, and/or modified, to Title of Collection: Revisions to the the Arctic OCS. BOEM would use the account for Arctic OCS conditions and Requirements for Exploratory Drilling information to ensure, through how such activities will be managed on the Arctic Outer Continental Shelf— advanced planning, that operators are and overseen as an integrated endeavor, 30 CFR part 550, subpart B, Plans and capable of safely operating in the unique and in the description of vessel Information. environmental conditions of the Arctic modifications, a description of any OMB Control Number: 1010–0151. and to make informed decisions on approvals from the flag state and the Form Number: whether to approve EPs as submitted or vessel classification society, including • BOEM–0137, OCS Plan Information whether modifications are necessary. any allowances or limitations placed Form BOEM proposes to remove the upon the vessel by the classification • BOEM–0138, EP Air Quality Integrated Operations Plan (IOP) society and/or the USCG. Vessel Screening Checklist regulations by deleting § 550.204 and modifications may include the • BOEM–0139, DOCD/DPP Air removing the corresponding references suitability of vessels for Arctic Quality Screening Checklist. to the IOP from §§ 550.200 and 550.206. conditions. These vessels may have or • BOEM–0141, ROV Survey Report. BOEM’s existing requirement to submit acquire classification from a • BOEM–0142, Environmental Impact the IOP at least 90 days before the lessee ‘‘recognized organization’’ under the Analysis Worksheet. or operator files an EP would be USCG’s Alternative Compliance Type of Review: Revision of a eliminated. The data and information Program (ACP).54 BOEM is seeking to currently approved collection. requested in the IOP is largely confirm that the operator meets the Respondents/Affected Public: unnecessary in light of the information requirements of other entities with Respondents are Federal oil and gas or already collected in the EP. The current authority over vessels, not to impose sulfur lessees or operators. approval for OMB Control Number requirements on those vessels. BOEM Total Estimated Number of Annual 1010–0151 counts the similar burdens believes that this change would not Response: 4,265 respondents. associated with IOPs and EPs in both. impose any material additional burdens Total Estimated Number of Annual Therefore, BOEM would remove the on the lessees or operators. BOEM is Burden Hours: 433,608 hours. burdens attributed to the IOPs, and keep also proposing to revise § 550.220(c)(4) Respondent’s Obligation: Some the burdens attributed to EPs. Removing and (6) by requiring the operator to responses to the information collection the IOP provision would decrease the provide a general description of how are required to obtain or retain a benefit, annual burden hours by 1 response and they will comply with § 250.472, and some are mandatory. 2,880 hours (- 1 response and 2,880 including a description of the Frequency of Collection: The annual burden hours). termination of their operations. frequency of the response varies, but The proposed rule would add a BOEM estimates that the proposed primarily responses are required only requirement to § 550.211(b) to describe revisions would remove 2,880 annual on occasion. operational safety procedures that the burden hours that correlate to the Total Estimated Annual Nonhour operator has developed specific to removal of the existing IOP requirement. Burden Cost: $3,939,435.

BURDEN BREAKDOWN [Current requirements in regular font; proposed expanded requirements shown in italic font]

Citation 30 CFR 550 Average number of subpart B and NTLs Reporting & recordkeeping requirement Hour burden annual responses Burden hours

Non-hour costs

200 thru 206...... General requirements for plans and information; Burden included with specific requirements 0 fees/refunds, etc. below.

201 thru 206; 211 thru BOEM posts EPs/DPPs/DOCDs on FDMS and re- Not considered IC as defined in 5 CFR 0 228: 241 thru 262. ceives public comments in preparation of EAs. 1320.3(h)(4).

Subtotal ...... 0 ...... 0

54 33 U.S.C. 3316 and 46 CFR part 8 implement the USCG’s ACP.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00051 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79316 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

BURDEN BREAKDOWN—Continued [Current requirements in regular font; proposed expanded requirements shown in italic font]

Citation 30 CFR 550 Average number of subpart B and NTLs Reporting & recordkeeping requirement Hour burden annual responses Burden hours

Non-hour costs

Ancillary Activities

208; NTL 2009–G34* ...... Notify BOEM in writing, and if required by the Re- 11 61 notices...... 671 gional Supervisor notify other users of the OCS before conducting ancillary activities.

208; 210(a) ...... Submit report summarizing & analyzing data/infor- 2 61 reports...... 122 mation obtained or derived from ancillary activities.

208; 210(b) ...... Retain ancillary activities data/information; upon re- 2 61 records...... 122 quest, submit to BOEM.

Subtotal ...... 183 responses ...... 91

Contents of Exploration Plans (EP)

209; 231(b); 232(d); 234; Submit new, amended, modified, revised, or supple- 150 345 changed plans3 ...... 51,750 235; 281; 283; 284; 285; mental EP, or resubmit disapproved EP, including NTL 2015–N01. required information; withdraw an EP.

209; 211 thru 228; NTL Submit EP and all required information (including, 600 163 ...... 97,800 2015–N01. but not limited to, submissions required by BOEM Forms 0137, 0138, 0142; lease stipulations; re- ports, including shallow hazards surveys, H2S, G&G, archaeological surveys & reports (§ 550.194) ***, in specified formats. Provide notifi- cations.

$3,673 × 163 EP surface locations = $598,699

210; 220(a)–(c); 291; 292 For existing Arctic OCS exploration activities: revise 700 1 ...... 700 and resubmit Arctic-specific information, as re- quired.

202; 211; 216; 219, For new Arctic OCS exploration activities: submit re- 400 1 ...... 400 220(a)–(c); 224, 227;. quired Arctic-specific information with EP.

Subtotal ...... 510 responses ...... 150,650

$598,699 Non-hour costs

Review and Decision Process for the EP

235(b); 272(b); ...... Appeal State’s objection ...... Burden exempt as defined in 5 CFR 0 281(d)(3)(ii) ...... 1320.4(a)(2), (c).

Contents of Development and Production Plans (DPP) and Development Operations Coordination Documents (DOCD)

209; 266(b); 267(d); Submit amended, modified, revised, or supple- 235 353 changed plans ...... 82,955 272(a); 273; 281; 283; mental DPP or DOCD, including required informa- 284; 285; NTL 2015– tion, or resubmit disapproved DPP or DOCD. N01.

241 thru 262; 209; NTL Submit DPP/DOCD and required/supporting infor- 700 268 ...... 187,600 2015–N01. mation (including, but not limited to, submissions required by BOEM Forms 0137, 0139, 0142; lease stipulations; reports, including shallow haz- ards surveys, archaeological surveys & reports (§ 550.194)), in specified formats. Provide notifica- tion.

$4,238 × 268 DPP/DOCD wells = $1,135,784.

Subtotal ...... 621 responses ...... 270,555

$1,135,784 Non-hour costs

VerDate Sep<11>2014 17:34 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00052 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79317

BURDEN BREAKDOWN—Continued [Current requirements in regular font; proposed expanded requirements shown in italic font]

Citation 30 CFR 550 Average number of subpart B and NTLs Reporting & recordkeeping requirement Hour burden annual responses Burden hours

Non-hour costs

Review and Decision Process for the DPP or DOCD

267(a) ...... Once BOEM deemed DPP/DOCD submitted; Gov- Not considered IC as defined in 5 CFR 0 ernor of each affected State, local government of- 1320.3(h)(4). ficial; etc., submit comments/recommendations.

267(b) ...... General public comments/recommendations sub- Not considered IC as defined in 5 CFR 0 mitted to BOEM regarding DPPs or DOCDs. 1320.3(h)(4).

269(b) ...... For leases or units in vicinity of proposed develop- 3 1 response...... 3 ment and production activities RD may require those lessees and operators to submit information on preliminary plans for their leases and units.

Subtotal ...... 1 response ...... 3

Post-Approval Requirements for the EP, DPP, and DOCD

280(b) ...... In an emergency, request departure from your ap- Burden included under 1010–0114. 0 proved EP, DPP, or DOCD.

281(a) ...... Submit various BSEE applications for approval and Burdens included under appropriate sub- 0 submit permits. part or form (1014–0003; 1014–0011; 1014–0016; 1014–0018).

282 ...... Retain monitoring data/information; upon request, 4 150 records...... 600 make available to BOEM.

Prepare and submit monitoring plan for approval ..... 2 6 plans ...... 12

282(b) ...... Prepare and submit monitoring reports and data (in- 3 12 reports...... 36 cluding BOEM Form 0141 used in GOMR).

284(a) ...... Submit updated info on activities conducted under 4 56 updates...... 224 approved EP/DPP/DOCD.

Subtotal ...... 224 responses ...... 872

Submit CIDs

296(a); 297...... Submit CID and required/supporting information; 375 14 documents...... 5,250 submit CID for supplemental DOCD or DPP.

$27,348 × 14 = $382,872

296(b); 297 ...... Submit a revised CID for approval ...... 100 13 revisions ...... 1,300

Subtotal ...... 27 responses ...... 6,550

$382,872 Non-hour costs

Seismic Survey Mitigation Measures and Protected Species Observer Program NTL

NTL 2016–G02; 211 thru Submit to BOEM observer training requirement ma- 1.5 hours 2 sets of material ...... 3 228; 241 thru 262. terials and information.

Training certification and recordkeeping ...... 1 hour 1 new trainee ...... 1

During seismic acquisition operations, submit daily 1.5 hours 344 reports ...... 516 observer reports semi-monthly.

If used, submit to BOEM information on any passive 2 hours 6 submittals ...... 12 acoustic monitoring system prior to placing it in service.

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00053 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79318 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

BURDEN BREAKDOWN—Continued [Current requirements in regular font; proposed expanded requirements shown in italic font]

Citation 30 CFR 550 Average number of subpart B and NTLs Reporting & recordkeeping requirement Hour burden annual responses Burden hours

Non-hour costs

During seismic acquisition operations, submit to 1.5 hours 1,976 reports ...... 2,964 BOEM marine mammal observation report(s) semi-monthly or within 24 hours if air gun oper- ations were shut down.

During seismic acquisition operations, when air 1.5 hours 344 reports ...... 516 guns are being discharged, submit daily observer reports semi-monthly.

Observation Duty (3 observers fulfilling an 8-hour 3 observers × 8 hrs × 365 days = 8,760 hours × 4 vessels shift each for 365 calendar days × 4 vessels = observing = 35,040 man-hours × $52/hr = $1,822,080. 35,040 man-hours). This requirement is con- tracted out; hence the non-hour cost burden.

Subtotal ...... 2,673 responses ...... 4,012

$1,822,080 Non-hour costs

Vessel Strike Avoidance and Injured/Protected Species Reporting NTL

NTL 2016–G01; 211 thru Notify BOEM within 24 hours of strike, when your 1 hour 1 notice ...... 1 228; 241 thru 262. vessel injures/kills a protected species (marine mammal/sea turtle).

Subtotal ...... 1 response ...... 1

General Departure

200 thru 299 ...... General departure and alternative compliance re- 2 25 requests...... 50 quests not specifically covered elsewhere in Sub- part B regulations.

Subtotal ...... 25 responses ...... 50

Total Burden ...... 4,265 responses ...... 433,608

$3,939,435 Non-hour costs * The identification number of NTLs may change when NTLs are reissued periodically to update information.

In addition, the PRA requires agencies requirements not associated with the Send your comments and suggestions to estimate the total annual reporting information collection; (3) for reasons on this information collection by the and recordkeeping non-hour cost other than to provide information or date indicated in the DATES section to burden resulting from the collection of keep records for the Government; or (4) the Desk Officer for the Department of information, and we solicit your as part of customary and usual business the Interior at OMB–OIRA at (202) 395– comments on this item. For reporting or private practices. 5806 (fax) or via the portal at and recordkeeping only, your response As part of our continuing effort to RegInfo.gov (online). You may view the should split the cost estimate into two reduce paperwork and respondent information collection request(s) at components: (1) Total capital and burdens, we invite the public and other http://www.reginfo.gov/public/do/ startup cost component and (2) annual Federal agencies to comment on any PRAMain. Please provide a copy of your operation, maintenance, and purchase aspect of this information collection, comments to the BOEM Information of service component. Your estimates including: Collection Clearance Officer (see the (1) Whether the collection of ADDRESSES section). You may contact should consider the cost to generate, information is necessary, including Anna Atkinson, BOEM Information maintain, and disclose or provide the whether the information will have Collection Clearance Officer at (703) information. You should describe the practical utility; 787–1025 with any questions. Please methods you use to estimate major cost (2) The accuracy of our estimate of the reference Revisions to the Requirements factors, including system and burden for this collection of for Exploratory Drilling on the Arctic technology acquisition, expected useful information; Outer Continental Shelf (OMB Control life of capital equipment, discount (3) Ways to enhance the quality, No. 1014–0151), in your comments. rate(s), and the period over which you utility, and clarity of the information to incur costs. Generally, your estimates be collected; and J. National Environmental Policy Act of should not include equipment or (4) Ways to minimize the burden of 1969 (NEPA) services purchased: (1) Before October the collection of information on BSEE and BOEM developed a draft 1, 1995; (2) to comply with respondents. Environmental Assessment (EA) to

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00054 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79319

determine whether this proposed rule List of Subjects and you satisfy one of the following would have a significant impact on the conditions: 30 CFR Part 250 quality of the human environment (1) You are conducting drilling under the NEPA. The draft EA is Administrative practice and operations from a Mobile Offshore available for review in conjunction with procedure, Continental shelf, Drilling Unit (MODU), but you are not this proposed rule at Environmental impact statements, able to safely continue leaseholding www.regulations.gov (in the Search box, Environmental protection, Government operations due to the presence of enter BSEE–2019–0008). contracts, Incorporation by reference, seasonal ice; Investigations, Oil and gas exploration, (2) You are conducting drilling K. Data Quality Act Penalties, Pipelines, Public lands– operations from an artificial gravel In developing this proposed rule, we mineral resources, Public lands—rights island or a gravity-based structure, but did not conduct or use a study, of-way, Reporting and recordkeeping you are not able to safely continue experiment, or survey requiring peer requirements, Sulphur. leaseholding operations due to review under the Data Quality Act (44 temporary seasonal restrictions in your 30 CFR Part 550 U.S.C. 3516 note). approved oil spill response plan; or Administrative practice and (3) You are conducting drilling L. Effects on the Nation’s Energy Supply procedure, Continental shelf, operations from an artificial ice island, (E.O. 13211) Environmental impact statements, but you are not able to safely continue Although this proposed rule is a Environmental protection, Mineral leaseholding operations due to seasonal significant regulatory action under E.O. resources, Oil and gas exploration, temperature changes. 12866, it is not a significant energy Pipelines, Reporting and recordkeeping ■ 4. Amend § 250.198 by revising action under the definition of that term requirements, Sulfur. paragraph (e)(73) to read as follows: in E.O. 13211 because: Katharine MacGregor, 1. It is not likely to have a significant § 250.198 Documents incorporated by adverse effect on the supply, Deputy Secretary, U.S. Department of the reference. Interior. distribution or use of energy; and * * * * * 2. It has not been designated as a For the reasons stated in the (e) * * * significant energy action by the preamble, BSEE and BOEM amend 30 (73) API RP 17H, Remotely Operated Administrator of OIRA. CFR parts 250 and 550 as follows: Tools and Interfaces on Subsea Production Systems, Second Edition, Thus, a Statement of Energy Effects is Title 30—Mineral Resources not required. June 2013; Errata, January 2014; While offshore Arctic OCS oil and gas CHAPTER II—BUREAU OF SAFETY AND incorporated by reference at studies indicate the potential of vast ENVIRONMENTAL ENFORCEMENT, §§ 250.472(a) and 250.734(a); resources, there is currently little DEPARTMENT OF THE INTERIOR * * * * * exploration activity and very little SUBCHAPTER B—OFFSHORE ■ 5. Amend § 250.300 by revising production of oil and gas on the Arctic paragraphs (b)(1) and (2) to read as OCS, largely due to the inherent PART 250—OIL AND GAS AND follows: practical difficulties of exploration and SULPHUR OPERATIONS IN THE § 250.300 Pollution prevention. production in the area. The only OUTER CONTINENTAL SHELF existing oil production from the Arctic * * * * * ■ OCS is through the Northstar Island 1. The authority citation for 30 CFR (b)(1) The District Manager may facility. part 250 continues to read as follows: restrict the rate of drilling fluid Authority: 30 U.S.C. 1751, 31 U.S.C. 9701, discharges or prescribe alternative M. Clarity of Regulations 33 U.S.C. 1321(j)(1)(C), 43 U.S.C. 1334. discharge methods. The District We are required by E.O. 12866, E.O. ■ 2. Amend § 250.105 by revising the Manager may also restrict the use of 12988, and by the Presidential definition of ‘‘Capping stack’’ to read as components that could cause Memorandum of June 1, 1998, to write follows: unreasonable degradation to the marine all rules in plain language. This means environment. No petroleum-based that each rule we publish must: § 250.105 Definitions. substances, including diesel fuel, may 1. Be logically organized; * * * * * be added to the drilling mud system 2. Use the active voice to address Capping stack means a mechanical without prior approval of the District readers directly; device that can be installed on top of a Manager. For Arctic OCS exploratory 3. Use clear language rather than subsea or surface wellhead or blowout drilling, you must capture all jargon; preventer to stop the uncontrolled flow petroleum-based mud to prevent its 4. Be divided into short sections and of fluids into the environment. discharge into the marine environment. sentences; and * * * * * (2) You must obtain approval from the 5. Use lists and tables wherever ■ 3. Amend § 250.175 by adding District Manager of the method you plan possible. paragraph (d) to read as follows: to use to dispose of drill cuttings, sand, If you believe we have not met these and other well solids. For Arctic OCS requirements, send us comments by one § 250.175 When may the Regional exploratory drilling, you must capture of the methods listed in the ADDRESSES Supervisor grant an SOO? all cuttings from operations that use section. To better help us revise the * * * * * petroleum-based mud to prevent their rule, your comments should be as (d) For leases or units on the Arctic discharge into the marine environment. specific as possible. For example, you OCS, you may request, and the Regional * * * * * should tell us the numbers of the Supervisor may grant, an SOO when ■ 6. Amend § 250.470 by: sections or paragraphs that you find you have conducted leaseholding ■ a. Revising paragraphs (b)(11) and unclear, which sections or sentences are operations during the drilling season (12); too long, or the sections where you immediately preceding the period for ■ b. Adding paragraph (b)(13); believe lists or tables would be useful. which you are seeking a suspension, ■ c. Revising paragraph (f)(3); and

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00055 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 79320 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules

■ d. Adding paragraph (h). which it is intended under expected the calculated worst case discharge rate The revisions and additions read as wellbore conditions. referenced in your BOEM-approved EP; follows: ■ 7. Amend § 250.471 by revising and paragraph (a) introductory text, and (3) A containment dome that can be § 250.470 What additional information paragraphs (a)(2) and (3) and (b) to read must I submit with my APD for Arctic OCS deployed as directed by the Regional exploratory drilling operations? as follows: Supervisor pursuant to paragraph (h) of * * * * * § 250.471 What are the requirements for this section. The containment dome (b) * * * Arctic OCS source control and must have the capacity to pump fluids (11) Pick up the oil spill prevention containment? without relying on buoyancy. booms and equipment; * * * * * (b) You must conduct a monthly (12) Offload the drilling crew; and (a) If you use a MODU, you must have stump test of dry-stored capping stacks. (13) Recover the subsea isolation access to the SCCE as described in * * * * * device (SSID), where applicable. paragraphs (a)(1) through (3) of this * * * * * section capable of controlling and ■ 8. Revise § 250.472 to read as follows: (f) * * * containing the flow from an out-of- § 250.472 What are the additional well (3) Where applicable, proof of control well when drilling below or control equipment or relief rig requirements contracts or membership agreements working below the surface casing. for the Arctic OCS? with cooperatives, service providers, or However, the Regional Supervisor will other contractors who will provide you approve delaying access to your SCCE If you will be conducting exploratory with the necessary SCCE or related until your operations have reached the drilling operations from a Mobile supplies and services if you do not last casing point prior to penetrating a Offshore Drilling Unit (MODU), you possess them. The contract or zone capable of flowing hydrocarbons in must either use a Subsea Isolation membership agreement must include measurable quantities, provided that Device (SSID) or have access to a relief provisions for ensuring the availability you submit adequate documentation rig as an additional means to secure the of the personnel and/or equipment on a (such as, but not limited to, risk well in the event of a loss of well 24-hour per day basis while you are modeling data, off-set well data, analog control. If you satisfy this requirement drilling below or working below the data, seismic data), with your APD, through use of an SSID, you must meet surface casing, or before the last casing demonstrating that you will not the requirements in paragraph (a) in this point prior to penetrating a zone capable encounter any abnormally high- section. If you satisfy this requirement of flowing hydrocarbons in measurable pressured zones or other geologic through maintaining access to a relief quantities, as approved by the Regional hazards. The Regional Supervisor will rig, you must meet the requirements in Supervisor. base the determination on any paragraph (b) in this section. * * * * * documentation you provide as well as (a) Subsea Isolation Device (SSID). If (h) If you plan to install a subsea any other available data and you use an SSID to satisfy this isolation device (SSID) on your well in information. requirement, your SSID and well accordance with § 250.472(a), a * * * * * (including the casing and cementing certification signed by a registered (2) A cap and flow system that can be program) must be designed to achieve a professional engineer that your SSID deployed as directed by the Regional full shut-in, without causing an and well design (including casing and Supervisor pursuant to paragraph (h) of underground blowout or having cementing program) meet the design this section. The cap and flow system reservoir fluids broach to the seafloor. requirements in § 250.472 and the must be designed to capture at least the Your SSID must also meet the following design is appropriate for the purpose for amount of hydrocarbons equivalent to requirements:

TABLE 1 TO PARAGRAPH (a)

Your SSID must

(1) Be designed to: ...... (i) Close and seal the wellbore, independent of the BOP; (ii) Perform under the maximum environmental and operational conditions anticipated to occur at the well; (iii) Be left on the wellhead in the event the drilling rig is moved off location (e.g., due to storms, ice incursions, or emergency situations); (iv) Preserve isolation through the winter season without relying on the elastomer elements of the rams (e.g., by using a well cap) and allow re-entry during the following open-water sea- son; and (v) In the event of a loss of well control, preserve isolation until other methods of well interven- tion may be completed, including the need to drill a relief well. (2) Include the following equipment: (i) Dual shear rams, including ram locks; one ram must be a blind shear ram; (ii) A redundant control system, independent from the BOP control system, that includes ROV capabilities and a control station on the rig; (iii) Independent, dedicated subsea accumulators with the capacity to function all components of the SSID; and (iv) Two side inlets for intervention; one inlet must be located below the lowest ram on the SSID. (3) Include ROV intervention equipment and ca- (i) Be able to close each shear ram under MASP conditions, as defined for the operation; pabilities. Your ROV equipment and capabili- ties must: (ii) Include an ROV panel that is compliant with API RP 17H (as incorporated by reference in § 250.198); (iii) Meet the ROV requirements in § 250.734(a)(5); and (iv) Have the ability to function the SSID in any environment (e.g., when in a mudline cellar).

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00056 Fmt 4701 Sfmt 4702 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Proposed Rules 79321

TABLE 1 TO PARAGRAPH (a)—Continued

Your SSID must

(4) Be installed: ...... (i) Below the BOP; (ii) At or before the time that you first install your BOP; and (iii) To provide protection from deep ice keels, in the event it must remain in place over the winter season (e.g., installed in a mudline cellar). (5) Be tested: ...... According to the BOP testing requirements in § 250.737.

(b) Relief Rig. If you choose to satisfy equipment in accordance with (b) A description of how you will this requirement by having access to a §§ 250.141 and 250.408. ensure operational safety while working relief rig, you must have access to your * * * * * in Arctic OCS conditions, including but relief rig at all times when you are not limited to: drilling below or working below the CHAPTER V—BUREAU OF OCEAN ENERGY MANAGEMENT, DEPARTMENT OF (1) The safety principles that you surface casing during Arctic OCS THE INTERIOR intend to apply to yourself and your exploratory drilling operations. contractors; However, the Regional Supervisor will SUBCHAPTER B—OFFSHORE approve delaying access to your relief (2) The accountability structure rig until your operations have reached PART 550—OIL AND GAS AND within your organization for the last casing point prior to penetrating SULPHUR OPERATIONS IN THE implementing such principles; OUTER CONTINENTAL SHELF a zone capable of flowing hydrocarbons (3) How you will communicate such in measurable quantities, provided that ■ 10. The authority citation for 30 CFR principles to your employees and you submit adequate documentation part 550 continues to read as follows: contractors; and (such as, but not limited to, risk Authority: 30 U.S.C. 1751; 31 U.S.C. 9701; (4) How you will determine modeling data, off-set well data, analog 43 U.S.C. 1334. successful implementation of such data, seismic data), with your APD, principles. demonstrating that you will not § 550.220 [Amended] encounter any abnormally high- ■ 11. Amend § 550.200 by removing the * * * * * pressured zones or other geologic words ‘‘IOP means Integrated ■ 15. Amend § 550.220 by revising the hazards. The Regional Supervisor will Operations Plan.’’ in paragraph (a). section heading, paragraphs (c)(1) and base the determination on any ■ 12. Remove and reserve § 550.204. (4), and (c)(6)(ii) to read as follows: documentation you provide as well as any other available data and § 550.204 [Reserved] § 550.220 If I propose activities in the information. Your relief rig must be ■ 13. Amend § 550.206 by revising the Arctic OCS Region, what planning different from your primary drilling rig, section heading, paragraph (a) information must accompany the EP? staged in a location, such that it would introductory text, and paragraphs (a)(3), * * * * * be available to arrive on site, drill a (b), and (c) to read as follows: (c) * * * relief well, kill and abandon the original § 550.206 How do I submit the EP, DPP, or (1) A description of how your well, and abandon the relief well no DOCD? later than 45 days after the loss of well exploratory drilling will be designed control. (a) Number of copies. When you and conducted, (including how all submit an EP, DPP, or DOCD to BOEM, vessels and equipment will be designed, (1) Your relief rig must comply with you must provide: built, and/or modified) to account for all other requirements of this part Arctic OCS conditions and how such pertaining to drill rig characteristics and * * * * * activities will be managed and overseen capabilities, and it must be able to drill (3) Any additional copies that may be as an integrated endeavor. In your a relief well under anticipated Arctic necessary to facilitate review of the EP, OCS conditions. DPP, or DOCD by certain affected States description of vessel modifications, and other reviewing entities. describe any approvals from the flag (2) In the event of a loss of well (b) Electronic submission. You may state and the vessel classification control, the Regional Supervisor may submit part or all of your EP, DPP, or society, including any allowances or direct you to drill a relief well using a DOCD and its accompanying limitations placed upon the vessel by relief rig that is able to kill and information electronically. If you prefer the classification society and/or the permanently plug an out-of-control well to submit your EP, DPP, or DOCD United States Coast Guard. as described in your APD. electronically, ask the Regional * * * * * ■ 9. Amend § 250.720 by revising Supervisor for further guidance. paragraph (c)(2) to read as follows: (c) Withdrawal after submission. You (4) Additional well control equipment may withdraw your proposed EP, DPP, requirements for the Arctic OCS. A § 250.720 When and how must I secure a general description of how you will well? or DOCD at any time for any reason. Notify the appropriate BOEM Regional comply with § 250.472 of this title. * * * * * Office if you do. (6) * * * (c) * * * ■ 14. Amend § 550.211 by redesignating (ii) The termination of drilling (2) In areas of ice scour, you must use paragraphs (b) through (d) as paragraphs a well mudline cellar or an equivalent operations consistent with the well (c) through (e), respectively, and adding control planning requirements under means of minimizing the risk of damage new paragraph (b) to read as follows: to the well head and wellbore. You may § 250.472 of this title. request, and the Regional Supervisor § 550.211 What must the EP include? [FR Doc. 2020–25818 Filed 12–8–20; 8:45 am] may approve, an alternate procedure or * * * * * BILLING CODE 4310–VH–P; 4310–MR–P

VerDate Sep<11>2014 16:49 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00057 Fmt 4701 Sfmt 9990 E:\FR\FM\09DEP2.SGM 09DEP2 jbell on DSKJLSW7X2PROD with PROPOSALS2 Vol. 85 Wednesday, No. 237 December 9, 2020

Part III

Department of Labor

Office of Federal Contract Compliance Programs 41 CFR Part 60–1 Implementing Legal Requirements Regarding the Equal Opportunity Clause’s Religious Exemption; Final Rule

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79324 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

DEPARTMENT OF LABOR participation in this rulemaking, and the Court unanimously upheld this agency has revised certain aspects of expansion of the religious exemption to Office of Federal Contract Compliance this regulation in response to all activities of religious organizations Programs commenters’ concerns. against an Establishment Clause As stated in the NPRM, on July 2, challenge. See Corp. of the Presiding 41 CFR Part 60–1 1964, President Lyndon B. Johnson Bishop of the Church of Jesus Christ of signed the landmark Civil Rights Act of RIN 1250–AA09 Latter-day Saints v. Amos, 483 U.S. 327, 1964. See Public Law 88–352, 78 Stat. 330 (1987).2 Implementing Legal Requirements 241. This legislation prohibited One year after President Johnson Regarding the Equal Opportunity discrimination on various grounds in signed the Civil Rights Act, he signed Clause’s Religious Exemption many of the most important aspects of E.O. 11246, requiring equal employment civic life. Its Title VII extended these opportunity in federal government AGENCY: Office of Federal Contract protections to employment opportunity, contracting. The order mandated that all Compliance Programs, Labor. prohibiting discrimination on the basis government contracts include a ACTION: Final rule. of race, color, religion, sex, or national provision stating that ‘‘[t]he contractor origin. In Title VII, Congress also will not discriminate against any SUMMARY: The U.S. Department of provided a critical accommodation for employee or applicant for employment Labor’s (DOL’s) Office of Federal religious employers. Congress permitted because of race, creed, color, or national Contract Compliance Programs (OFCCP) religious employers to take religion into origin.’’ Exec. Order No. 11246, § 202, publishes this final rule to clarify the account for employees performing 30 FR 12319, 12320 (Sept. 28, 1965). scope and application of the religious religious activities: ‘‘This title shall not Two years later, President Johnson exemption. These clarifications to the apply . . . to a religious corporation, expressly acknowledged Title VII of the religious exemption will help association, or society with respect to Civil Rights Act when expanding E.O. organizations with federal government the employment of individuals of a 11246 to prohibit, as does Title VII, contracts and subcontracts and federally particular religion to perform work discrimination on the bases of sex and assisted construction contracts and connected with the carrying on by such religion. See Exec. Order No. 11375, § 3, subcontracts better understand their corporation, association, or society of its 32 FR 14303–04 (Oct. 17, 1967). In 1978, obligations. religious activities . . . .’’ Public Law the responsibilities for enforcing E.O. DATES: Effective Date: These regulations 88–352, 702(a), 78 Stat. 241, 255 11246 were consolidated in DOL. See are effective January 8, 2021. (codified as amended at 42 U.S.C. Exec. Order No. 12086, 43 FR 46501 2000e–1(a)). Congress provided a FOR FURTHER INFORMATION CONTACT: (Oct. 5, 1978). In its implementing Tina similar exemption for religious Williams, Director, Division of Policy regulations, DOL imported Title VII’s educational institutions. See id. exemption for religious educational and Program Development, Office of § 703(e)(2), 78 Stat. at 256 (codified at Federal Contract Compliance Programs, institutions. See 43 FR 49240, 49243 42 U.S.C. 2000e–2(e)(2)). (Oct. 20, 1978) (now codified at 41 CFR 200 Constitution Avenue NW, Room Title VII’s protections for religious C–3325, Washington, DC 20210. 60–1.5(a)(6)); cf. 42 U.S.C. 2000e– organizations were expanded by 2(e)(2). In 2002, President George W. Telephone: (202) 693–0104 (voice) or Congress in 1972 into their current (202) 693–1337 (TTY). Bush amended E.O. 11246 by expressly form. Congress added a broad definition importing Title VII’s exemption for SUPPLEMENTARY INFORMATION: of ‘‘religion’’: ‘‘The term ‘religion’ religious organizations, which likewise includes all aspects of religious I. Executive Summary has since been implemented by DOL’s observance and practice, as well as regulations. See Exec. Order No. 13279, On August 15, 2019, OFCCP issued a belief, unless an employer demonstrates § 4, 67 FR 77143 (Dec. 16, 2002) (adding notice of proposed rulemaking (NPRM) that he is unable to reasonably E.O. 11246 § 202(c)); 68 FR 56392 (Sept. to clarify the scope and application of accommodate to an employee’s or 30, 2003) (codified at 41 CFR 60– Executive Order 11246’s (E.O. 11246) prospective employee’s religious religious exemption consistent with 1.5(a)(5)); cf. 42 U.S.C. 2000e–1(a). observance or practice without undue Because the exemption administered recent legal developments. 84 FR 41677. hardship on the conduct of the by OFCCP springs directly from the During the 30-day public comment employer’s business.’’ Equal Title VII exemption, it should be given period, OFCCP received 109,726 Employment Opportunity Act of 1972, a parallel interpretation, consistent with comments on the proposed rule.1 This Public Law 92–261, 2(7), 86 Stat. 103 the Supreme Court’s repeated counsel total included over 90,000 comments (codified at 42 U.S.C. 2000e(j)). that the decision to borrow statutory generated by organized comment- Congress also added educational text in a new statute is a ‘‘strong writing efforts. Comments came from institutions to the list of those eligible indication that the two statutes should individuals and from a wide variety of for section 702’s exemption. In addition, be interpreted pari passu.’’ Northcross v. organizations, including religious Congress broadened the scope of the Bd. of Educ. of Memphis City Sch., 412 organizations, universities, civil rights section 702 exemption to cover not just and advocacy organizations, contractor religious activities, but all activities of a U.S. 427, 428 (1973) (per curiam). associations, legal organizations, labor religious organization: ‘‘This title [VII] OFCCP thus generally interprets the organizations, and members of shall not apply . . . to a religious nondiscrimination provisions of E.O. Congress. Comments addressed all corporation, association, educational 11246 consistent with the principles of aspects of the NPRM. OFCCP institution, or society with respect to the Title VII. Because OFCCP regulates appreciates the public’s robust employment of individuals of a federal contractors rather than private particular religion to perform work employers generally, OFCCP must apply 1 Of the 109,726 comments, 35 comments were connected with the carrying on by such Title VII principles in a manner that inadvertently posted on Regulations.gov before corporation, association, educational redactions were made. The posted comments were 2 Justice White wrote the majority opinion for five withdrawn, redacted, and then reposted. When the institution, or society of its activities.’’ justices. Justices O’Connor, Blackmun, and Brennan comments were reposted, the number of comments Id. § 3, 86 Stat. at 104 (codified at 42 (with Justice Marshall joining) wrote opinions on Regulations.gov increased to 109,761. U.S.C. § 2000e–1(a)). The Supreme concurring in the judgment.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79325

best fit its unique field of regulation, for which she worked). Recent executive professionals association commented including when applying the religious orders have done the same. See Exec. that Congress has repeatedly declined to exemption. Order No. 13831, 83 FR 20 715 (May 8, extend the Title VII exemption to With that said, there has been some 2018); Exec. Order No. 13798, 82 FR 21 government-funded entities. A lesbian, variation among federal courts of 675 (May 9, 2017). Additional decisions gay, bisexual, and transgender (LGBT) appeals in interpreting the scope and from the Supreme Court, issued after the rights advocacy organization application of the Title VII religious NPRM, have likewise extended Title commented that, at the time Title VII exemption, and many of the relevant VII’s protections while affirming the was enacted, Congress could not have Title VII court opinions predate importance of religious freedom. See envisioned that religious organizations Supreme Court decisions and executive Bostock, 140 S. Ct. at 1754 (holding that would qualify for the Title VII orders that shed light on the proper Title VII’s prohibition on discrimination exemption would also seek to contract interpretation. The purpose of this final because of sex prohibits ‘‘fir[ing] an with the federal government, ‘‘let alone rule is to clarify the contours of the E.O. individual merely for being gay or be given a broad right to discriminate 11246 religious exemption and the transgender’’); Little Sisters of the Poor based on religion while accepting related obligations of federal contractors Saints Peter & Paul Home v. federal funding.’’ and subcontractors to ensure that Pennsylvania, 140 S. Ct. 2367, 2379–84 In a related vein, OFCCP also received OFCCP respects religious employers’ (2020) (holding the Departments of comments objecting generally to the free exercise rights, protects workers Labor, Health and Human Services, and provision of a religious exemption for from prohibited discrimination, and the Treasury had authority to federal contractors or specifically to defends the values of a pluralistic promulgate religious and conscience OFCCP’s proposal. Most of these society. See, e.g., Bostock v. Clayton exemptions from the Affordable Care commenters characterized the religious Cnty., 140 S. Ct. 1731, 1754 (2020) Act’s contraceptive mandate); Espinoza exemption as taxpayer- or government- (‘‘[T]he promise of the free exercise of v. Mont. Dep’t of Revenue, 140 S. Ct. funded discrimination that was contrary religion . . . lies at the heart of our 2246 (2020) (a state ‘‘cannot disqualify to the purpose of E.O. 11246. For pluralistic society.’’). This rule is some private schools [from a subsidy example, an affirmative action intended to correct any misperception program] solely because they are professionals association commented that religious organizations are religious’’ without violating the Free that ‘‘[t]he Federal Government should disfavored in government contracting by Exercise clause); and Our Lady of not be in the business of funding setting forth appropriate protections for Guadalupe Sch. v. Morrissey-Berru, 140 employment discrimination’’ and their autonomy to hire employees who S. Ct. 2049, 2069 (2020) (holding the emphasized that religious organizations will further their religious missions, ministerial exception applies ‘‘[w]hen a should not expect to maintain autonomy thereby providing clarity that may school with a religious mission entrusts and independence from the government expand the eligible pool of federal a teacher with the responsibility of when they solicit and accept contractors and subcontractors. educating and forming students in the government contracts. An international Recent Supreme Court decisions have faith’’). These decisions are discussed in labor organization submitted a similar addressed the freedoms and the final rule’s analysis as appropriate comment, stating that organizations that antidiscrimination protections that must and applicable. choose to accept government funding be afforded religion-exercising In this final rule, OFCCP has sought through government contracts should organizations and individuals under the to follow the principles articulated by not be allowed to conduct what it U.S. Constitution and federal law. See, these recent decisions and orders, and described as discrimination against e.g., Masterpiece Cakeshop, Ltd. v. Colo. has interpreted older federal appellate- qualified job applicants and employees. Civil Rights Comm’n, 138 S. Ct. 1719, level case law in light of them as Relatedly, a public policy research 1731 (2018) (holding the government applicable. OFCCP has chosen a path and advocacy organization commented violates the Free Exercise Clause of the consistent with the Supreme Court’s that no one should be disqualified from First Amendment when its decisions are religion and Title VII jurisprudence as a taxpayer-funded job because they are based on hostility to religion or a well as what OFCCP views to be the the ‘‘wrong’’ religion or do not adhere religious viewpoint); Trinity Lutheran more persuasive reasoning of the federal to any religion. A technology company Church of Columbia, Inc. v. Comer, 137 courts of appeals in these areas of the commented that the proposal conflicted S. Ct. 2012, 2022 (2017) (holding the law. with the spirit of nondiscrimination government violates the Free Exercise law. A group of U.S. Senators Clause of the First Amendment when it A. Title VII and the EEOC Generally commented: ‘‘The government cannot decides to exclude an entity from a Some commenters on the NPRM use religious exemptions as a pretext to generally available public benefit agreed that OFCCP’s proposal was permit discrimination against or harm because of its religious character, unless appropriately consistent with Title VII others.’’ that decision withstands the strictest principles. For example, a faith-based Some religious organizations were scrutiny); Burwell v. Hobby Lobby advocacy organization commented that among the commenters that opposed the Stores, Inc., 573 U.S. 682, 719 (2014) the religious employer exemption in provision of a religious exemption for (holding the Religious Freedom federal contracting regulations is federal contractors. One religious Restoration Act applies to federal modeled on Title VII, and should organization commented that, in line regulation of the activities of for-profit therefore be understood ‘‘in the strong with its commitment to religious closely held corporations); Hosanna- way’’ the Title VII exemptions have freedom, it opposed granting Tabor Evangelical Lutheran Church & traditionally been understood. government contracts to organizations Sch. v. EEOC, 565 U.S. 171, 196 (2012) Other commenters asserted that that, in its words, discriminate against (holding the ministerial exception, OFCCP’s proposal was inconsistent with qualified individuals based on their grounded in the Establishment and Free Title VII overall. Some of these practices and beliefs. One religious Exercise clauses of the First commenters stated that the proposal’s organization commented that barring Amendment, bars an employment- interpretation of the exemption was people from taxpayer-funded jobs based discrimination suit brought on behalf of contrary to congressional intent. For on their faith violates principles of a minister against the religious school example, an affirmative action equality and meritocracy. Another faith-

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79326 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

based organization cited First intent or that such an exemption is exemption. Those commenters—the Amendment separation of church and misplaced in the government ones who would actually need to state principles, and commented that, contracting context, that question is not negotiate the purportedly two different while some religious organizations hire at issue in this rulemaking. The standards—were by and large staff based on religion, accommodations religious exemption was added to E.O. supportive of the rule and did not raise for religious hiring should not be 11246 almost twenty years ago, and this concern. For another, OFCCP applied broadly in the federal contracts OFCCP’s implementing regulations are believes that this rule, which context, as federal contracts are not nearly as old. The existence of the incorporates many recent Supreme provided to advance religious ends. exemption itself is not at issue in this Court decisions and other case law and Other commenters stated that the rulemaking. is in accord with recent Executive proposal’s expansion of the exemption Regarding comments that the rule Orders and guidance from the was contrary to Title VII case law or deviates from the EEOC’s interpretation Department of Justice, offers clarity as principles. For example, an of the Title VII religious exemption or compared to less recent guidance from international labor organization creates two separate standards, OFCCP EEOC that does not incorporate these commented that, in its view, the believes these concerns are unfounded. more recent developments. proposed rule mischaracterized federal This rule is restricted to the application case law in order to transform of the religious exemption. The vast B. The Relevance of Recent Supreme provisions designed to protect workers majority of contractors and their Court Cases from religious discrimination into employees, as well as OFCCP’s Commenters both supported and exemptions that would allow federally enforcement program, will be unaffected opposed OFCCP’s acknowledgement of funded employers to discriminate by this rule. As for the religious recent Supreme Court cases granting against workers for religious reasons. exemption specifically, OFCCP has antidiscrimination protections for Some commenters stated that the followed the Title VII case law it finds persons bringing religious claims in a proposal was inconsistent with the most persuasive, especially in light of variety of contexts. These cases interpretation of Title VII by the EEOC, the principles of religious equality and included Hobby Lobby, Trinity the agency primarily responsible for autonomy reinforced by recent Lutheran, and Masterpiece Cakeshop. enforcing Title VII. A group of state executive orders and Supreme Court Supreme Court decisions in attorneys general commented that decisions. OFCCP has also adapted Title employment and religion cases issued OFCCP should not undermine the VII principles to ensure a proper fit in after the proposed rule’s publication are EEOC’s efforts, ‘‘as would occur under the government contracting context. addressed elsewhere in the preamble as the Proposed Rule, which takes OFCCP’s specific choices in this regard appropriate. positions contrary to the EEOC.’’ The and how they compare to the EEOC’s state attorneys general asserted that the stated views are explained more fully in Some commenters expressed support proposal would not increase clarity the section-by-section discussion and a for OFCCP’s interpretations of these because it would create two separate section at the end of this preamble. Supreme Court cases and their legal standards for federal contractors OFCCP has also made some revisions to application to the proposal in general. and OFCCP staff—one under Title VII align this rule even more closely with For example, a group of members of the and one under E.O. 11246. A contractor Title VII. But even assuming any U.S. House of Representatives noted association asserted that ‘‘federal variation with the EEOC as to the approvingly that the proposed rule was contractors could face the Hobson’s exemption, this rule does not create a consistent with these cases, each of choice of determining whether ‘‘Hobson’s choice’’ for government which ‘‘came with the cost’’ of religious compliance with an OFCCP regulation contractors. The exemption, to describe Americans shouldering the material, will result in liability under Title VII.’’ it most broadly, is an optional emotional, and spiritual burdens Other commenters stated that the accommodation for religious associated with litigating issues related overall proposal departed from OFCCP’s organizations, not a requirement to their faith. Discussing Masterpiece prior interpretation, which they asserted mandating compliance. In the rare, Cakeshop, a religious public policy had been consistent with the EEOC’s hypothetical instance where a women’s organization commented that interpretation of Title VII prior to contractor would be entitled to the E.O. the Supreme Court in that case August 2018, when OFCCP issued 11246 exemption but not the Title VII acknowledged ‘‘the blatant, systematic Directive 2018–03, concerning the exemption, the contractor would not government bias’’ against the owner of religious exemption in section 204(c) of face conflicting liability regardless of its Masterpiece Cakeshop for refusing to E.O. 11246. For example, a public choice: Rather, it would face potential participate in a same-sex wedding policy research and advocacy liability under one enforcement scheme ceremony, noting that the owner organization asserted that, until August rather than two. OFCCP acknowledges continues to be harassed for his faith ‘‘to 2018, the Department consistently that it is often helpful to regulated this day.’’ The commenter stated that interpreted the E.O. 11246 religious parties for regulators to try to harmonize this and other such cases prove that exemption narrowly to permit their approaches when enforcing related further clarification regarding existing preferences for coreligionists by certain legal requirements. OFCCP believes its First Amendment protections are religious organizations, and applied the approach here is consistent with Title necessary. Addressing Trinity Lutheran, ‘‘motivating factor’’ test to evaluate VII and religious-accommodation a religious public policy advocacy claims of discrimination. principles, adapted appropriately to its organization asserted that the Supreme OFCCP agrees with the comments own regulatory context and the Court in that case made clear that stating that the rule will provide government contracting community. Trinity Lutheran Church’s status as a necessary clarity for contractors and OFCCP also is not concerned about church did not prevent it from potential contractors about the scope of this rule purportedly decreasing clarity participating on an equal playing field the E.O. 11246 religious exemption. by creating two standards for additional with secular organizations in seeking Regarding comments that a religious reasons. For one, it was not a concern government grants. The commenter exemption protecting government primarily raised by commenters who continued that OFCCP’s proposed rule contractors is contrary to congressional may qualify for the E.O. 11246 religious simply reaffirmed a principle the

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79327

Supreme Court had held to be association described it—and asserted racial discrimination are precisely tailored to consistent with the First Amendment. that the decision was therefore achieve that critical goal. Other commenters criticized OFCCP’s inapplicable to OFCCP’s proposal. Some Hobby Lobby, 573 U.S. at 733. For reliance on these Supreme Court cases. of these commenters pointed to a example, a city public advocate argued Many of these commenters stated that footnote in the Court’s opinion limiting that the Hobby Lobby decision affirmed the cases were inapplicable because it to ‘‘express discrimination based on that securing equal access to workplace they did not involve federal contractors. religious identity with respect to participation is a compelling interest. A For example, a secular humanist playground resurfacing.’’ Trinity civil liberties and human rights legal advocacy organization criticized the Lutheran, 137 S. Ct. at 2024 n.3. Many advocacy organization commented that proposed rule for its reliance on case commenters stated that there are legally the Court in Hobby Lobby expressly law unrelated to employment significant distinctions between declined to promulgate a rule discrimination laws or the text of E.O. government grant programs and authorizing for-profit corporations that 11246. Many of the commenters stated government contracts. A labor union willingly enter into contracts with the that the cases cited, if interpreted argued, regarding the Supreme Court’s federal government to discriminate properly, did not provide support for decision, that it would have been against workers ‘‘because of who they OFCCP’s proposal. For example, a labor perfectly lawful for the government to are.’’ A contractor organization union commented that the decisions deny grants to religious applicants who commented that it is ‘‘not at all clear’’ cited did not authorize ‘‘the expansive restricted access to their playgrounds on that Hobby Lobby supports the idea that view that the Proposed Rule seeks to the basis of sexual orientation, for religious rights override any other legal support.’’ A group of U.S. Senators example. The union also asserted that rights, given that the decision concerns commented: ‘‘The Court has long held ‘‘Federal contracting is not a generally only the availability of government federally-funded employers cannot use available public benefit, but a programs. religion to discriminate. Each of the reticulated system for the funding and Finally, some commenters criticized cases cited in the proposed rule are delivery of governmental functions and OFCCP’s discussion of Hosanna-Tabor. consistent with that approach.’’ services by private parties.’’ A religious Many of these commenters pointed out Many of the commenters who organization commented that Trinity criticized OFCCP’s discussion of that this case applied the Lutheran did not address whether a (constitutionally grounded) ministerial Masterpiece Cakeshop pointed to this religious institution can discriminate sentence from the Court’s opinion: exception developed by courts and not with public funds, and stressed that the the (statutory) Title VII religious ‘‘While . . . religious and philosophical government’s interest in prohibiting objections are protected, it is a general exemption enacted by Congress. Some discrimination in taxpayer-funded jobs commenters expressed doubt that the rule that such objections do not allow is ‘‘of the highest order.’’ A group of business owners and other actors in the ministerial exception was applicable to state attorneys general commented that economy and in society to deny federal contractors. For example, a the Court’s decision drew a careful protected persons equal access to goods transgender legal professional distinction between situations where a and services under a neutral and organization commented that, though benefit is denied to an entity based generally applicable public the ministerial exception bars ministers solely that entity’s religious identity and accommodations law.’’ 138 S. Ct. at from pursuing employment situations involving neutral and 1727. A labor union asserted that discrimination cases, most federal generally applicable laws that restrict an Masterpiece Cakeshop was irrelevant in contractors are unlikely to employ entity’s actions. The group asserted that the ‘‘entirely secular’’ context of federal ministers or others who ‘‘preach or E.O. 11246’s anti-discrimination contracting, and argued that the teach the faith.’’ Other commenters Establishment Clause dictates that provisions are directed toward the expressed concern that OFCCP intended federal contracting must be entirely latter. An LGBT rights advocacy to broaden the scope of the religious secular. A transgender civil rights organization commented that, because exemption to mimic the ministerial organization commented that, in the the decision involved a religious grant exception and asserted that Hosanna- proposed rule, OFCCP did not suggest applicant that had agreed to abide by Tabor did not support such an that its existing requirements or prior certain nondiscrimination provisions, expansion. For example, a labor union conduct reflect the sort of hostility to its holding was inapplicable in the commented that the decision could not religious beliefs that the Court was federal contracting context where be read to extend the ministerial concerned with in Masterpiece funding is awarded on a competitive exception to lay people employed by Cakeshop, and noted that, on the basis, as well as in situations where the religious institutions, or to private for- contrary, ‘‘EEO requirements for federal contractor has no intention of profit businesses whose owners may contractors fall squarely within the complying with governing also hold religious beliefs. ‘general rule’ stated by the Court.’’ A nondiscrimination rules. OFCCP believes the critical comments group of state attorneys general Some commenters similarly criticized here are misplaced because OFCCP did commented that, if anything, OFCCP’s discussion of Hobby Lobby. not acknowledge these Supreme Court Masterpiece Cakeshop stands for the Many of these commenters quoted or cases for the propositions that proposition that overly broad religious paraphrased the following paragraph commenters said the agency did. OFCCP objections to civil rights laws of general from the Supreme Court’s decision: acknowledged in the NPRM that these Supreme Court cases did not applicability are inappropriate. The principal dissent raises the possibility specifically address government Commenters also criticized OFCCP’s that discrimination in hiring, for example on discussion of Trinity Lutheran. Many of the basis of race, might be cloaked as contracting. And indeed, with the these commenters read the decision religious practice to escape legal exception of Hosanna-Tabor, they did narrowly—as holding that ‘‘the state sanction.... Our decision today provides not specifically address employment violated the First Amendment by no such shield. The Government has a law, Title VII, or E.O. 11246. Rather, denying a public benefit to an otherwise compelling interest in providing an equal OFCCP noted the recent Supreme Court eligible recipient solely on account of its opportunity to participate in the workforce cases for the general and commonsense religious status,’’ as one contractor without regard to race, and prohibitions on propositions that the government must

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79328 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

be careful when its actions may infringe needs of the communities they serve religious organizations to help the private persons’ religious beliefs and and predicted that the proposal would public through these programs was that it certainly cannot target religious allow religious contractors to better abysmally small—0.0025%.’’ The persons for disfavor. These principles ‘‘order[ ] their affairs.’’ A religious organization cited the concern of are not new, but these recent cases show convention commission approved of the religious organizations that their right to that those principles remain vital. That rule on the basis that the government hire members of their faith would be is especially important when should not be in the business of judging eroded as one of the reasons for this government at times has been callous in theology or privileging certain religious discrepancy. its treatment of religious persons.3 beliefs over others. Many commenters expressed Those general themes of caution, A few commenters expressed support skepticism that religious organizations permissible accommodation, and for the proposal specifically because have been reluctant to participate as equality for religious persons have they believed it would exempt religious federal contractors because of the lack of informed the policy approach in this organizations from the prohibitions on clarity or perceived narrowness of the rule. Where specific holdings or discrimination based on sexual religious exemption. Most of these language in these Supreme Court orientation and gender identity that commenters stated that OFCCP had decisions—and additional Supreme were added when E.O. 11246 was provided no evidence to support its Court decisions issued since—suggest amended by Executive Order 13672 claim. For example, a legal think tank answers to specific aspects of this rule, (E.O. 13672). 79 FR 42971 (July 23, commented that the proposal was ‘‘a they are noted in the section-by-section 2014). For example, a faith-based regulation in search of a problem,’’ and analysis. Comments on those more advocacy organization praised OFCCP criticized OFCCP for failing to provide specific issues are addressed there as for ‘‘the important positive precedent data regarding the number of religious well. that will be set by the proposed strong organizations reluctant to enter into protection of the religious staffing federal contracts, the number of C. Clarity and Need for the Rule freedom in the context of the contractors that have invoked the The NPRM noted that prior to its requirement of no sexual-orientation or Section 204(c) exemption in the past, publication, some religious gender-identity employment and the number of contractors expected organizations provided feedback to discrimination in federal contracting.’’ to avail themselves of the ‘‘expanded OFCCP that they were reluctant to An evangelical chaplains’ advocacy exemption’’ in the proposed rule. A participate as federal contractors organization commented that ‘‘E.O. labor union commented: ‘‘[T]here is no because of uncertainty regarding the 13672 . . . prohibited military evidence that the current, settled scope of the religious exemption chaplains from selecting religious interpretation of the E.O. 11246 contained in section 204(c) of E.O. support contractors who did not affirm religious exemption has deterred 11246 and codified in OFCCP’s sexual orientation, same-sex marriage organizations from submitting regulations. The NPRM also noted that and gender identity’’ in violation of competitive bids for federal contracts or while ‘‘only a subset of contractors and these chaplains’ free exercise rights. prevented them from obtaining such would-be contractors may wish to seek Some commenters agreed with contracts. At best, the Proposed Rule is this exemption, the Supreme Court, OFCCP’s observation that religious an unjustified rulemaking solution in Congress, and the President have each organizations have been reluctant to search of a problem.’’ affirmed the importance of protecting provide the government with goods or A few commenters stated that the religious liberty for those organizations services as federal contractors because proposal was unnecessary given the who wish to exercise it.’’ 84 FR at of the lack of clarity or perceived applicability of Title VII case law. For narrowness of the E.O. 11246 religious 41679. The NPRM also noted example, a contractor association exemption. One individual commenter throughout OFCCP’s desire to provide commented that the extent to which who identified himself as a legal adviser clarity in this area of regulation. religious employers can condition to federal contractors noted that OFCCP received numerous comments employment on religion has been imposing ‘‘pass through’’ contracting addressing the need for the proposed addressed by a long line of Title VII obligations on subcontractors can be rule. Some commenters stated that the cases, rendering an executive challenging, as religious subcontractors proposal was necessary to ensure that rulemaking on this topic unnecessary. often fear that complying with federal religious entities could contract with the Some commenters cited evidence that anti-discrimination laws will require federal government without federal contracts are being awarded to them to compromise their religious compromising their religious identities faith-based organizations. For example, integrity. Two other commenters offered a group of state attorneys general cited or missions. Many of these commenters examples or evidence of religious noted the important services provided the 2016 congressional testimony of organizations’ reluctance to participate Oklahoma Representative Steve Russell, by religious organizations. For example, in other contexts, such as federal grants. a religious school association who explained that more than 2,000 A religious medical organization cited a federal government contracts were being encouraged the federal government to survey suggesting that many individuals protect religious staffing ‘‘in all forms of awarded to religious organizations and working in faith-based organizations contractors per year. As examples of federal funding,’’ asserting that doing so (FBOs) overseas feel that the would enable religious organizations to faith-based organizations that were government is not inclined to work with awarded contracts in the previous year, expand the critical services they FBOs, and called for outreach programs provide. A religious liberties legal the state attorneys general listed the to correct this perception. following: organization likewise commented that A religious legal organization religious organizations are often referenced an audit of the Department of Army World Service Office ($27.5 million), uniquely equipped to respond to the Justice’s Office of Justice Programs (OJP) Mercy Hospital Springfield ($14.4 million), Young Women’s Christian Association of which revealed that, though religious 3 See, e.g., Nat’l Inst. of Family & Life Advocates Greater Los Angeles California ($10.2 v. Becerra, 138 S. Ct. 2361, 2368 (2018); organizations were interested in million), City of Faith Prison Ministries ($5.2 Masterpiece Cakeshop, 138 S. Ct. at 1729–30; Holt participating in many programs, ‘‘the million), Riverside Christian Ministries, Inc. v. Hobbs, 574 U.S. 352, 359 (2015). percentage of OJP funds distributed to ($2.7 million), Jewish Child and Family

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79329

Services ($2.1 million), Catholic Charities, sexual orientation or gender identity, disagrees that the rule will introduce various affiliates (over $1 million in sum OFCCP repeats here as it did many confusion. OFCCP anticipates this rule total), to name a few.4 times in the NPRM that the religious will have no effect on the vast majority In addition, several commenters cited a exemption does not permit of contractors or the agency’s regulation report from a progressive policy discrimination on the basis of other of them, since they do not and would institute noting that some religious protected categories. The section-by- not claim the religious exemption. As organizations continue to be federal section analysis of Particular religion commenters noted, religious contractors despite their objections to a addresses the application of the organizations do not appear to be a large lack of an expanded religious exemption religious exemption and other legal portion of federal contractors. While in E.O. 13672. requirements to E.O. 11246’s other this rule may add clarity that Some commenters expressed protections including those pertaining encourages more religious organizations skepticism that the proposal would to sexual orientation and gender to seek to become federal contractors encourage participation in federal identity, and the application of the and subcontractors, OFCCP does not contracting because, they asserted, the Religious Freedom Restoration Act believe the increase will greatly rule as proposed would increase rather (RFRA) in certain situations. influence the composition or behavior than reduce confusion. For example, a Regarding comments that the rule is of the contractor pool that it regulates. contractor association commented that unnecessary because religious The exemption is a helpful OFCCP’s proposal would create more organizations are not presently deterred accommodation for this small minority confusion than clarity for federal from contracting with the government, of religious organizations that may seek contractors. An atheist civil liberties OFCCP believes that clarifying the law its protection. For them specifically, the organization echoed this concern, for current contractors is a valuable goal rule is intended to bring clarity. For commenting that the proposal would in itself, regardless of whether more instance, as explained below, this rule increase confusion because, in its view, religious organizations would provides a clear three-part test for the proposed rule deviated from participate as federal contractors or determining whether an entity can decades of Title VII law. Other subcontractors. The disputes among qualify for the exemption. Contrary to commenters stated that the proposal commenters over the proper the assertions of some commenters, and would have negative effects because of interpretation of the Title VII case law as described more fully below, Title VII increased uncertainty about or suggests as well that the guidance case law offers differing tests on a expansion of the exemption. These provided by this rule would be valuable jurisdiction-by-jurisdiction basis, and commenters stated that the proposal to the contracting community. And in some of those tests provide little would undercut other entities’ fact, as just noted, other commenters guidance at all. As another example, enforcement of nondiscrimination offered evidence that faith-based this rule provides a clear approach to obligations, increase EEOC enforcement organizations have indeed been determining when a religious employer actions, increase contractors’ reluctant to contract with the federal is appropriately taking action on the noncompliance, and strain OFCCP’s government because of the lack of basis of an employee’s particular resources. For example, a group of state certainty about the religious exemption. religion, another area where the case attorneys general commented that, given The fact that some faith-based law is not uniform. the prevalence of workplace organizations have been willing to enter OFCCP also disagrees that this rule discrimination, expanding E.O. 11246’s into federal contracts or subcontracts will impede the agency’s enforcement religious organization exemption to does not mean that other faith-based efforts. OFCCP promulgates this rule lessen OFCCP’s oversight could result in organizations have not been reluctant to from a position of familiarity with its employers claiming the exemption in do so. Admittedly, OFCCP cannot own enforcement resources, priorities, bad faith when faced with charges of perfectly ascertain how many religious and budget. For the reasons just stated discrimination. The state attorneys organizations are government above, OFCCP does not see this rule as general commented that the proposed contractors, or would like to become significantly affecting the vast majority rule had the potential to strain OFCCP’s such, and how those numbers compare of its work. OFCCP also does not limited resources due to employers to the whole of the contracting pool. But anticipate a flood of employers claiming requesting determinations of whether neither does OFCCP find persuasive the exemption in bad faith when faced they are exempt, and challenging the commenters’ assertions that faith-based with discrimination claims. That has applicability of OFCCP enforcement organizations are already well- not been the experience under the Title actions already underway. represented among government VII exemption thus far: The number of OFCCP appreciates the comments contractors, when those assertions are reported cases involving the exemption supporting its view that clarity based on examples showing contracting since 1964 are in the dozens, not the regarding the exemption would be awards to them totaling only tens of thousands. And in those cases, the useful, and notes their accounts of millions, when the federal government employer may or may not have religious organizations that are hesitant expended $926.5 billion on contractual succeeded in claiming the exemption or to participate as government services in fiscal year 2019 5 and, defending against a discrimination contractors, as well as their evidence of according to one estimate, faith-based claim, but in nearly all the employer did a perception among faith-based organizations account for hundreds of not appear to invoke the exemption organizations that the federal billions of dollars of economic activity nefariously, in bad faith. OFCCP is also government could do more to annually in the United States.6 OFCCP optimistic given the federal demonstrate that it will select the best government’s experience under the organizations for its partners, whether 5 See USA Spending, Spending Explorer (select RFRA. This law provides generous faith-based or not. Given certain Object Class, Fiscal Year 2019), https:// _ accommodation for religious claims and statements by these commenters www.usaspending.gov/#/explorer/object class. 6 See Brian J. Grim and Melissa E. Grim, ‘‘The regarding discrimination on the basis of Socio-economic Contribution of Religion to revenues of faith-based charities, congregations, American Society: An Empirical Analysis,’’ healthcare networks, educational institutions, and 4 The commenter cited USASPENDING.GOV, Interdisciplinary Journal of Research on Religion, other organizations), www.religjournal.com/pdf/ https://www.usaspending.gov/#/recipient. vol. 12 (2016), article 3, p. 10, 25, (describing ijrr12003.pdf.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79330 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

strict boundaries for the federal the final rule, as explained below. contractors in understanding the government, yet neither the courts nor Second, this final rule adds several exemption. OFCCP have been inundated with illustrative examples within the Other commenters argued that claims.7 definition of Religious corporation, importing the definition from Title VII OFCCP appreciates all comments association, educational institution, or is inappropriate because the context of received, and for the reasons stated society to better illustrate which Title VII is protection of an employee’s believes that proceeding with a final organizations qualify for the religious individual religious beliefs in the rule clarifying the religious exemption exemption. Third, this final rule adds a workplace, not those of the employer. A is warranted. For the small minority of severability clause. legal professional organization raised current and potential federal contractors the concern that this definition is and subcontractors interested in the A. Section 60–1.3 Definitions overbroad as applied to the employer, exemption, this will help them The definitions added to § 60–1.3 are particularly where it could allow a understand its scope and requirements interrelated, so they are discussed below government-funded employer to make and may encourage a broader pool of in a particular order. This order is faith-based employment decisions organizations to compete for different from that presented in the beyond those currently allowed under government contracts, which will inure NPRM. The change in order is not Title VII and E.O. 11246. Commenters to the government’s benefit. For the vast substantive. The change is intended also objected to the omission of the majority of contractors, OFCCP does not only to make the rule as a whole easier second part of the Title VII definition, expect this rule to affect their operations to understand. arguing that the weighing of the burden or OFCCP’s monitoring and 1. Definition of Religion that an employee’s request for religious enforcement. accommodations places on an employer This final rule is an Executive Order OFCCP’s proposed definition of is an important limitation on Congress’s 13771 (E.O. 13771) deregulatory action Religion provided that the term is not intent to accommodate religion in the because it is expected to reduce limited to religious belief but also workplace. Commenters stated that, in compliance costs and potentially the includes all aspects of religious their view, an employee’s requested cost of litigation for regulated entities. observance and practice. The proposed accommodations may impose no more Pursuant to the Congressional Review definition was identical to the first part than a de minimis burden on the Act (5 U.S.C. 801 et seq.), OIRA of the definition of ‘‘religion’’ in Title employer. Commenters argued that determined that this rule is not a ‘‘major VII: ‘‘The term ‘religion’ includes all OFCCP’s proposed definition is broader rule,’’ as defined by 5 U.S.C. 804(2). aspects of religious observance and than Congress intended in that it does Details on the estimated costs of this practice, as well as belief . . . .’’ 42 not consider the burden the employer’s rule can be found in the economic U.S.C. 2000e(j). The proposed definition assertion of the religious exemption analysis below. omitted the second portion of the Title would impose on employees, thus VII definition, which refers to an II. Section-by-Section Analysis allowing religious employers to take employer’s accommodation of an adverse actions against employees based The NPRM proposed five new employee’s religious observance or on religious belief no matter the definitions to clarify key terms used in practice, because that would have been hardship it causes them. Some OFCCP’s religious exemption: Exercise redundant with OFCCP’s existing commenters argued that partially of religion; Particular religion; Religion; regulations. OFCCP’s regulations at 41 importing the Title VII definition would Religious corporation, association, CFR part 60–50, Guidelines on ‘‘muddy the waters’’ rather than provide educational institution, or society; and Discrimination Because of Religion or clarity. Sincere. The regulatory codification of National Origin, contain robust religious Other commenters requested the underlying exemption itself—which protections for employees, including clarification on the proposed definition is not at issue in this rulemaking—is accommodation language substantially of Religion. Specifically, some found at 41 CFR 60–1.5(a)(5). The new the same as that in the portion of the commenters proposed that the final rule definitions were proposed to be placed Title VII definition omitted here. clarify that ‘‘observance and practice’’ with the rest of the regulations’ Compare 42 U.S.C. 2000e(j), with 41 includes refraining from certain generally applicable definitions at 41 CFR 60–50.3. Those provisions continue activities. Another commenter noted CFR 60–1.3. The NPRM also proposed to govern contractors’ obligations to that the proposed rule did not explain adding a rule of construction to § 60–1.5 accommodate employees’ and potential the extent to which it might displace to provide the maximum legally employees’ religious observance and employees’ right to reasonable permissible protection of religious practice. accommodation of their religious beliefs exercise. The proposed definition of Religion is and practices if such accommodation This final rule retains the same basic used by other agencies. It is identical to conflicts with the contractor’s religion. structure as the NPRM, with a few the definition used by the Department of For the reasons described above and changes. First, there have been some Justice in grant regulations in the NPRM, and considering the modifications to some of the definitions, implementing section 815(c) of the comments received, OFCCP is finalizing and one proposed definition, for Justice System Improvement Act of the proposed definition of Religion Exercise of religion, is not included in 1979. See 28 CFR 42.202(m). The Small without modification. No change is Business Administration has used the needed to make clear that inaction or 7 See 42 U.S.C. 2000bb(a)(5) (‘‘[T]he compelling same definition as well in its grant omission can be a form of ‘‘observance interest test as set forth in prior Federal court regulations. See 13 CFR 113.2(c). and practice.’’ See, e.g., Emp’t Div., rulings is a workable test for striking sensible balances between religious liberty and competing Some commenters generally Dep’t of Human Res. of Or. v. Smith, prior government interests.’’); Holt, 574 U.S. at 368 supported the proposed definition, 494 U.S. 872, 877 (1990) (holding the (rejecting the argument that the only workable rule noting that it is legally sound, as it ‘‘exercise’’ of religion protected by the is one of no exceptions); Gonzales v. O Centro tracks the Title VII definition and First Amendment ‘‘involves not only Espı´rita Beneficente Unia˜ o do Vegetal, 546 U.S. 418, 436 (2006) (rejecting ‘‘slippery-slope provides broad protection for religious belief and profession but the argument’’ that RFRA-mandated exceptions would entities. Commenters also noted that the performance of (or abstention from) become unworkable). definition is sensible and will aid physical acts’’); see also Espinoza, 140

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00008 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79331

S. Ct. at 2277 (Gorsuch, J., concurring) religious exemption at 42 U.S.C. 2000e– the public as carrying out that religious (‘‘The right to be religious without the 1(a). The definition as proposed would purpose. The third and fourth prongs right to do religious things would hardly apply to a corporation, association, reflect Judge Kleinfeld’s view. See id. at amount to a right at all.’’). educational institution, society, school, 748 (Kleinfeld, J., concurring). OFCCP disagrees with commenters college, university, or institution of Regarding the third prong, Judge who argued that the definition of learning.8 O’Scannlain would have employed a Religion is overbroad and would permit As explained in the NPRM, clarity on broader formulation, requiring that the contractors to make faith-based this topic is essential because federal employer engage ‘‘in activity consistent employment decisions beyond those courts of appeals have used a confusing with, and in furtherance of, those permitted by law. The definition is the variety of tests, and the tests themselves [founding] religious purposes.’’ Id. at same as that used in other federal often involve unclear or constitutionally 734 (O’Scannlain, J., concurring). As to regulations and the same as that used in suspect criteria. The NPRM favored, the fourth prong, Judge Kleinfeld Title VII when read in conjunction with with some modifications, the test used restricted the exemption to the rest of OFCCP’s regulations. The by the U.S. Court of Appeals for the organizations that charge little or definition must also be construed in Ninth Circuit in Spencer v. World nothing for their goods or services, harmony with those regulations, the Vision, Inc., 633 F.3d 723 (9th Cir. 2011) regardless of their formal incorporation requirements of which remain in force (per curiam). This was for several as a nonprofit organization. See id. at just as strongly as before this reasons, including because the World 745–47 (Kleinfeld, J., concurring). Judge regulation’s promulgation. Vision test generally prevents invasive O’Scannlain would have broadened the OFCCP also disagrees that it should inquiries into matters of faith, the fourth prong (in most instances) by import the second half of Title VII’s uncertainty and subjectivity of a requiring nonprofit status, including definition of religion into its general list multifactor balancing test, and the nonprofit organizations that charge of definitions in § 60–1.3. OFCCP’s inherently difficult and constitutionally market rates for their goods or services. regulations in part 60–50 governing suspect exercise of measuring the See id. at 734 (O’Scannlain, J., protection of employees’ religion and quantum of an organization’s religiosity. concurring). national origin already contain this See 84 FR 41681–84. The NPRM proposed to follow a language and remain in force, and The controlling per curiam opinion in modified World Vision test. The NPRM employers must continue to comply World Vision offered a four-pronged test proposed adopting the first two prongs with them. The definition of Religion for determining an entity’s qualification of the per curiam opinion. The NPRM added to § 60–1.3 is intended to apply for the religious exemption: favored Judge O’Scannlain’s formulation generally, to both employers and an entity is eligible for the . . . exemption, of the second prong given the significant employees. at least, if it is [1] organized for a religious constitutional difficulties that Regarding comments about burden on purpose, [2] is engaged primarily in carrying accompany determining whether an employees’ exercise of religion, OFCCP out that religious purpose, [3] holds itself out organization is ‘‘primarily’’ religious. looks to the functioning of the religious to the public as an entity for carrying out that The NPRM also proposed to revise exemption. E.O. 11246, like Title VII, religious purpose, and [4] does not engage primarily or substantially in the exchange of Judge O’Scannlain’s phraseology, that requires employers to accommodate the entity be engaged ‘‘in activity’’ employees’ religious practices to a goods or services for money beyond nominal amounts. consistent with those religious prescribed extent. But the religious purposes, with the requirement that the exemption is precisely that: An World Vision, 633 F.3d at 724 (per entity be engaged ‘‘in exercise of exemption that relieves ‘‘religious curiam). religion’’ consistent with a religious organizations from Title VII’s [or E.O. This four-pronged test reflects the purpose. No material change was 11246’s] prohibition against overlap of agreement between the two intended by this adjustment; it was discrimination in employment on the judges in the majority, Judges meant to capture in succinct regulatory basis of religion.’’ Amos, 483 U.S. at O’Scannlain and Kleinfeld, who also text Judge O’Scannlain’s lengthy 329. That logically includes a lesser each wrote separate concurrences that discussion that the kind of activity exemption from the duty to laid out their own preferred tests. Both contemplated under this prong is accommodate religious practice. While judges agreed on the first two prongs, religious exercise. See 84 FR at 41683; religious organizations can that the entity be organized for a 9 see also World Vision, 633 F.3d at 737– accommodate employees’ religious religious purpose and hold itself out to 38 (O’Scannlain, J., concurring). Finally, practices, and in many instances may the NPRM proposed not to adopt the 8 The words ‘‘school, college, university, or find that desirable, under the fourth prong of the test, on grounds that exemption, they are not required to do institution of learning’’ also appear in 41 CFR 60– 1.5(a)(6), the exemption for religious educational a no-charging rule would exclude many so. See Kennedy v. St. Joseph’s organizations. They were included in the definition bona fide religious organizations, Ministries, Inc., 657 F.3d 189, 194 (4th to make clear that the definition’s listing of especially in the government Cir. 2011). ‘‘educational institution’’ includes schools, colleges, universities, and institutions of learning. contracting context, and that an absolute 2. Definition of Religious Corporation, Depending on the facts, an educational organization bar on for-profit organizations was Association, Educational Institution, or may qualify under the § 60–1.5(a)(5) exemption, the tenuous given other court decisions and Society § 60–1.5(a)(6) exemption, both, or neither. The the Supreme Court’s more recent inclusion of educational organizations is One of the primary objectives of this maintained in the final rule. decision in Hobby Lobby. See 84 FR at rulemaking is to clarify the conditions 9 To be precise, Judge O’Scannlain’s formulation was that the entity be ‘‘organized for a self- (Kleinfeld, J., concurring). Judge Kleinfeld wrote of eligibility for the religious exemption. identified religious purpose (as evidenced by that this ‘‘narrowness problem may be repairable by Thus the NRPM proposed a definition of Articles of Incorporation or similar foundational a tweak in the test,’’ id., which may be why the per Religious corporation, association, documents).’’ World Vision, 633 F.3d at 734 curiam opinion does not include Judge educational institution, or society. This (O’Scannlain, J., concurring). Judge Kleinfeld noted O’Scannlain’s parenthetical referring to Articles of that some people organize in religious bodies ‘‘with Incorporation. The difference is slight—a ‘‘tweak.’’ term is used in E.O. 11246 section no corporate apparatus’’ and expressed concerns OFCCP’s approach to this first factor, including the 204(c) and 41 CFR 60–1.5(a)(5), and it about the exemption being defeated by an necessary evidence to satisfy it, is discussed below is the same term used in the Title VII ‘‘[a]bsence of corporate papers.’’ Id. at 745 in this preamble.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79332 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

41684. The proposed rule could also be agreed that OFCCP should reject non- Vision involved the removal of two viewed as essentially following Judge World Vision tests based on these employees by a religious organization O’Scannlain’s concurrence save for his shortcomings. For example, a religious based on the employees’ failure to requirement that the entity be nonprofit legal organization commented that the adhere to the organization’s religious to qualify for the exemption. proposed test ‘‘eliminates the views. Therefore, according to the In response to comments and a subjectivity inherent in the LeBoon association, the World Vision test subsequent reevaluation of World Vision tests. It further eliminates the should not apply to for-profit and other case law, OFCCP is revising Establishment Clause violation present organizations holding themselves out as the proposed regulatory text in this final when a court determines whether an religiously motivated. A group of U.S. rule. The final rule’s test can be viewed organization is ‘religious enough,’ and it Senators criticized the proposal not only as generally adopting Judge also prevents inter-religion for adopting the test set forth in the O’Scannlain’s concurrence in World discrimination.’’ concurrence, but also for modifying part Vision, including by adopting a fourth Some commenters who supported of that test. prong. Satisfaction of this test will be OFCCP’s proposed definition A legal think tank asserted that sufficient to qualify for the exemption, commented that it provided important OFCCP appeared to have created its and OFCCP believes that this is the clarification that would be helpful to own test, designed to qualify more types means by which most organizations religious organizations in meeting their of contractors for the exemption. This interested in the exemption will qualify. missions. For example, a religious commenter went on to say that the However, OFCCP acknowledges that in school association commented that the ‘‘exceedingly more expansive criteria’’ certain rare circumstances, an proposal is especially important proposed by OFCCP are untethered to organization might not satisfy the non- considering that local control and Title VII case law and not in line with profit prong of the World Vision test yet leadership are central to many of its the ‘‘measured’’ exemption required by still present strong evidence that it participating schools’ beliefs. A the Establishment Clause, quoting possesses a substantial religious religious charities organization Cutter v. Wilkinson, 544 U.S. 709, 722 purpose. Thus the regulatory text commented that the proposed definition (2005) (‘‘Our decisions indicate that an includes an alternative means of would help it advance its mission of accommodation [of religious satisfying the fourth prong: When an providing essential services to people in observances] must be measured so that organization does not operate on a not- need—a mission rooted in its religious it does not override other significant for-profit basis, it must present ‘‘other convictions. interests.’’). strong evidence that it possesses a Other commenters disagreed with As explained in the NPRM, OFCCP substantial religious purpose.’’ The final OFCCP’s characterization of the existing believes that a LeBoon-type test invites rule also adds several examples to religious employer tests in Title VII case subjectivity and uncertainty. See illustrate how the test will be applied. law. For example, a legal professional LeBoon v. Lancaster Jewish Cmty. Ctr. The final rule also adds a clarifying organization noted that courts have Ass’n, 503 F.3d 217 (3d Cir. 2007). That provision regarding the meaning of generally agreed that the following is problematic in any circumstance, but ‘‘consistent with and in furtherance of’’ factors are relevant in deciding whether especially so in the context of a religious purpose, a phrase used in an organization qualifies for the government contracting, where parties’ one of the test’s prongs. The Department religious exemption: (1) The purpose or obligations should be as clear as does not anticipate many for-profit mission of the organization; (2) the possible. OFCCP also declines to organizations claiming the exemption, ownership, affiliation, or source of attempt to write a definition that and as explained through the examples financial support of the organization; (3) purports to synthesize all the Title VII and their accompanying discussion, it requirements placed upon staff and case law on this subject. OFCCP is may be quite difficult for such members of the organization; and (4) the doubtful that such a task could be done, organizations to do so. extent of religious practices in or the especially given Judge O’Scannlain’s This section of the preamble religious nature of products and services observation (with which Judge Kleinfeld addresses this topic as well as other offered by the organization. agreed) that several factors used by comments regarding OFCCP’s proposed Other commenters opposed the other courts are constitutionally definition of Religious corporation, proposed definition because they suspect, including, contrary to the association, educational institution, or viewed it as too broad and unsupported commenter’s suggestion above, an society. OFCCP believes its definition is by Title VII case law. For example, an assessment of the religious nature of an reasonable in light of Title VII and organization that advocates separation organization’s products and services. Supreme Court case law and that it will of church and state asserted that the See World Vision, 633 F.3d at 730–32 contribute to one of OFCCP’s primary definition in the proposed rule has not (O’Scannlain, J., concurring); id. at 741 goals in this rulemaking, which is to been proposed or used by any federal (Kleinfeld, J., concurring). OFCCP’s increase economy and efficiency in court and represents an attempt by approach in the final rule, like World government contracting by providing for OFCCP to vastly expand the scope of the Vision, instead requires consideration of a broader pool of government existing narrow exemption. A labor a discrete set of factors that can be contractors and subcontractors. Issues organization likewise commented that, reliably ascertained in each case. specific to the EEOC’s view on this in its view, the definition in the OFCCP acknowledges that the matter are also discussed below and proposed rule is contrary to law and definition it is promulgating here later in a separate part of this preamble. does not reflect the Title VII definition. modifies the World Vision test in some Some commenters objected generally respects, or alternatively can be viewed a. The Selection of World Vision as the to OFCCP’s selection or modification of as following Judge O’Scannlain’s Basis for the Religious Organization Test the World Vision test. For example, one concurrence with one addition. OFCCP OFCCP received numerous public contractor association commented that describes those modifications in more comments on its proposed definition, the proposed rule removes critical limits detail below along with its reasons for including comments on OFCCP’s on the standard set forth by Judge making them, including the need to discussion of the shortcomings in some O’Scannlain. Another contractor provide clarity to contractors and Title VII case law. Some commenters association emphasized that World enforcement staff. OFCCP disputes the

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79333

relevance of commenters’ assertions that Commenters expressed a variety of analysis when even the courts struggle these modifications are being made for views on the NPRM’s proposed to do so. The commenter requested the purpose of qualifying more approach. Some were supportive. For more specific examples of how the organizations for the exemption. OFCCP instance, a religious legal organization proposed test will apply and asked that acknowledges that the modifications commented that Judge O’Scannlain’s the contractor community be consulted may allow marginally more test requires little judicial ‘‘‘trolling’ before a test is adopted. organizations to qualify for the through’’ an organization’s religious OFCCP appreciates these comments exemption and that the final rule is beliefs, because it is based exclusively and has re-reviewed World Vision and intended to increase the pool of federal on information the organization makes other relevant case law in light of them. contractors. But, as described herein, public. Relatedly, the same commenter World Vision and its antecedent cases in OFCCP believes the test adopted by this observed that OFCCP staff can easily the Ninth Circuit, as well as LeBoon in final rule is appropriately measured and and consistently apply the test, with the Third Circuit, begin from the serves the purpose of qualifying only positive implications for the rule of law. premise that the religious exemption genuinely religious organizations for the Other commenters objected generally to should cover only organizations that exemption. OFCCP’s description of how it would are, in fact, primarily religious. But determine whether a contractor had met courts have labored over how to b. OFCCP’s Application of the the test. For example, a civil liberties operationalize that requirement into a Definition Generally organization expressed concern that set of factors that can be applied The NPRM proposed how OFCCP OFCCP would not enforce baseline neutrally, objectively, and with minimal would apply the factors in its proposed evidentiary standards in determining constitutional entanglement. See World test for religious organizations. The whether an entity meets the test’s Vision, 633 F.3d at 729 (O’Scannlain, J., NPRM stated ‘‘that it would be factors. A contractor association concurring) (‘‘Though our precedent inappropriate and constitutionally commented that the modified World provides us with the fundamental suspect for OFCCP to contradict a claim, Vision test ‘‘is unclear on its face and question—whether the general picture found to be sincere, that a particular problematic in application.’’ A of World Vision is primarily religious— activity or purpose has religious transgender civil rights organization we must assess the manner in which we meaning’’; that ‘‘all the factors . . . are commented that the test relies on ill- are to answer that question in the case determined with reference to the defined criteria that must be measured at hand.’’); LeBoon, 503 F.3d at 226. contractor’s own sincerely held view of from the perspective of the employer. That does not mean that courts have its religious purposes and the religious Many of the commenters who dispensed with an organization’s need meaning (or not) of its practices’’; and opposed the proposed definition to present evidence in order to claim the that the proposed three-factor test expressed concern that it would have exemption. Rather, it means that the would be exclusive ‘‘stand-alone negative consequences. For example, a evidence required must be of a kind that components and not factors guiding an legal professional association asserted courts are competent to evaluate and ultimate inquiry into whether an that the proposal would allow even that avoids entanglement. See World organizations is ‘primarily religious’ or nominally religious entities to Vision, 633 F.3d at 730–33 secular as a whole.’’ 84 FR at 41682–83. discriminate on the basis of religion in (O’Scannlain, J., concurring); cf. NLRB The NPRM proposed this approach hiring, potentially exposing them to v. Catholic Bishop of Chi., 440 U.S. 490, for several reasons. The NPRM relied on legal liability under federal and state 502 & n.10 (1979); id. at 507–08 World Vision’s concerns about courts’ law despite their ability to retain their (appendix). Indeed, one of the purposes substituting their own judgment for status as federal contractors. A group of of Congress’s expansion of the Title VII what has religious meaning when the state attorneys general stated that religious exemption to cover all of an question is disputed: ‘‘The very act of OFCCP’s proposed test represents a employer’s activities, rather than simply making that determination . . . runs sharp departure from precedent and its religious activities, was to avoid counter to the ‘core of the constitutional thus would be difficult for OFCCP staff difficult line-drawing between religious guarantee against religious and adjudicators to apply. The attorneys and secular activities and the establishment.’ ’’ World Vision, 633 F.3d general also commented that the test interference with religious organizations at 731 (O’Scannlain, J., concurring) would likely cause non-compliance by that could result. See Amos, 483 U.S. at (quoting New York v. Cathedral Acad., increasing legal uncertainty about 336. In OFCCP’s view, World Vision 434 U.S. 125, 133 (1977)). ‘‘[I]nquiry which organizations qualify. generally, and Judge O’Scannlain’s into . . . religious views . . . is not only Other commenters requested clarity. concurrence in particular, has done the unnecessary but also offensive. It is well Regarding the NPRM’s statement that best job of formulating a test that meets established . . . that courts should the three factors would be standalone the competing and delicately balanced refrain from trolling through a person’s provisions rather than factors guiding an goals of giving the exemption only its or institution’s religious beliefs.’’ Id. ultimate ‘‘primarily religious’’ inquiry, a proper reach while employing useable (alterations in original) (quoting contractor association commented that, and constitutionally proper inquiries. Mitchell v. Helms, 530 U.S. 793, 828 in its view, the statement was unclear With that in mind, OFCCP clarifies (2000) (plurality opinion) (internal and did not lend credence to OFCCP’s here its general approach to applying quotation marks omitted)). Further, such assertion that the test would be easy to the exemption, addresses the particular inquiries could lead to discrimination apply or likely to be consistent in evidence needed for each factor, and among religions. See id. at 732 & n.8. application. The commenter asked for adds to the regulatory text examples The NPRM also drew on Supreme Court clarification as to how OFCCP would with accompanying explanation to and Title VII case law showing the apply the factors of the test as further illustrate its approach. First, constitutional and practical difficulties standalone factors, rather than as factors OFCCP acknowledges the need to clarify of determining whether a particular leading to the ultimate determination and revise its statement that the factors religious belief is ‘‘central’’ to one’s faith whether the contractor is primarily are ‘‘stand-alone components and not or whether an organization is religious or secular. The commenter factors guiding an ultimate inquiry’’ in ‘‘primarily’’ religious. See 84 FR at sought explanation from OFCCP as to order to make clear the agency’s intent. 41682–83. how it could easily conduct the required 84 FR at 41683. OFCCP agrees with

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79334 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

commenters that the aim of any test in 1344 (D.C. Cir. 2002); see also Duquesne Bayamon v. NLRB, 793 F.2d 383, 401 this context is to determine whether the Univ. of the Holy Spirit v. NLRB, 947 (1st Cir. 1985) (finding no NLRB organization qualifies as a religious F.3d 824, 831 (D.C. Cir. 2020). jurisdiction when, among other things, organization, and that any components It is true that in applying the World an educational institution’s mission had are intended to guide or define that Vision factors, OFCCP will not ‘‘admittedly religious functions but ultimate inquiry. The NPRM’s statement substitute its own judgment for a whose predominant higher education was intended to mean that OFCCP contractor’s view—found to be sincere— mission is to provide . . . students with would apply the proposed three factors that a particular activity, purpose, or a secular education’’). A religious as the exclusive elements for belief has religious meaning. For purpose can be shown by articles of ascertaining whether an organization instance, OFCCP would not contradict a incorporation or other founding qualifies for the religious exemption, drug-rehabilitation center’s view, found documents, but that is not the only type rather than as mere considerations to be to be sincere, that its work is a religious of evidence that can be used. See World weighed along with other facts and healing ministry by stating that its work Vision, 633 F.3d at 736 (O’Scannlain, J., circumstances. is merely secular healthcare delivery. concurring); id. at 745 (Kleinfeld, J., OFCCP affirms that approach here as See Amos, 483 U.S. at 344 (Brennan, J., concurring) (noting that some religious the predominant path by which concurring) (finding religious entities have ‘‘no corporate apparatus’’). organizations are anticipated to qualify organizations ‘‘often regard the And finally, ‘‘the decision whether an for the exemption. This approach is provision of [community] services as a organization is ‘religious’ for purposes consistent with World Vision. The per means of fulfilling religious duty’’); cf. of the exemption cannot be based on its curiam opinion and both concurrences World Vision, 633 F.3d at 745 conformity to some preconceived notion provided slightly different factors, but (Kleinfeld, J., concurring) (‘‘Religious of what a religious organization should in each instance the factors were missionaries and Peace Corps do, but must be measured with presented as sufficient to determine an volunteers both perform humanitarian reference to the particular religion organization’s entitlement to the work, but only the latter is secular.’’). identified by the organization.’’ Id. at exemption. See World Vision, 633 F.3d Any other course would risk severe 735–36 (O’Scannlain, J., concurring) at 724 (per curiam) (holding ‘‘an entity constitutional difficulties. ‘‘The (quoting LeBoon, 503 F.3d at 226–27). is eligible for the . . . exemption, at prospect of church and state litigating in Some commenters objected that this least, if it’’ meets four factors (emphasis court about what does or does not have factor, as described in the NPRM and added)); id. at 734 (O’Scannlain, J., religious meaning touches the very core summarized above, was too relaxed or concurring) (holding ‘‘a nonprofit entity of the constitutional guarantee against that OFCCP was proposing to accept qualifies for the . . . exemption if it religious establishment . . . .’’ New insufficient evidence. Many of these establishes that it’’ satisfies three factors York v. Cathedral Acad., 434 U.S. 125, commenters stated that the proposal (footnote omitted)); id. at 748 (Kleinfeld, 133 (1977). But a contractor must prove was inconsistent with Judge J., concurring) (‘‘To determine whether its sincerity, which is a question of fact O’Scannlain’s requirement of an entity is a ‘religious corporation, to be proved or disproved in the same demonstrating religious purpose association, or society,’ determine manner as any other question of fact. through ‘‘Articles of Incorporation or whether it [satisfies the four factors].’’). And questions about religious similar foundational documents.’’ Id. at Second, the World Vision-derived test characterization apply to only some 734. For example, a labor union asserted promulgated here is not a subjective aspects of the test. For instance, whether that OFCCP’s implementation of this one. OFCCP shares commenters’ an organization operates on a nonprofit factor would be ‘‘more lax than Judge concern about contractors attempting to basis is a factual determination to which O’Scannlain’s concurrence.’’ A claim the exemption with little evidence religious characterizations have little if contractor association stated that the other than their own testimony that any relevance. Similarly, as clarified in test was vague and overly simple. An theirs is a religious organization. this final rule, an organization’s holding individual commenter requested more (Though OFCCP is also skeptical that itself out as religious requires an guidance as to what types of evidence many contractors would attempt to do objective evidentiary showing. Finally, OFCCP would accept to prove a so. As noted above, bad-faith claims to OFCCP does not defer to any contractor’s organization for a religious the Title VII exemption have been rare.) contractor’s assessment that it is entitled purpose. An organization that advocates The World Vision factors have been to the exemption itself. Whether an separation of church and state selected because they provide objective organization is a religious corporation, commented that an organization that criteria for determining an association, educational institution, or fails to document a religious purpose in organization’s religious status without society under E.O. 11246 is a legal any of its foundational documents was the need for intrusive religious determination based on whether the likely not organized for a religious inquiries. See id. at 733 (O’Scannlain, J., organization satisfies the relevant purpose. concurring) (holding where religious factors. OFCCP appreciates these comments activities or purposes are ‘‘hotly OFCCP next addresses specific issues and is revising its approach in response. contested, . . . we should stay our hand related to each factor, including the OFCCP agrees that additional clarity is and rely on considerations that do not evidence necessary to satisfy each needed here and that this factor should require us to engage in constitutionally factor. require documentary evidence of an precarious inquiries’’). The World organization’s religious purpose in its Vision factors are similar to a test used c. The First Factor: The Organization’s foundational documents. Judge in the National Labor Relations Act Religious Purpose O’Scannlain’s concurrence examined context, which similarly ‘‘avoids . . . As stated in the NPRM, to qualify for World Vision’s Articles of constitutional infirmities’’ while the religious exemption, a contractor Incorporation, bylaws, core values, and providing ‘‘some assurance that the must be organized for a religious mission statement. See id. at 736. An institutions availing themselves of the purpose, meaning that it was conceived organization may have other Catholic Bishop exemption are bona with a self-identified religious purpose. foundational documents, such as a fide religious institutions.’’ Univ. of This need not be the contractor’s only statement of faith, company code of Great Falls v. NLRB, 278 F.3d 1335, purpose. Cf. Universidad Cent. de conduct, business policies, or other

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00012 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79335

governance documents demonstrating a As explained in the NPRM, OFCCP evidence. Many of these commenters religious purpose. No one particular proposed not to follow the World Vision stated that the incorporation of document is necessary. For instance, per curiam opinion’s formulation of this ‘‘exercise of religion’’ as defined in some federal contractors may be factor for both practical and legal RFRA into this factor further loosened unincorporated proprietorships or reasons. The per curiam opinion would the standard. For example, a group of partnerships and thus not have formal require a contractor to be ‘‘engaged state attorneys general asserted that corporate-formation documents. But the primarily in carrying out [its] religious incorporation of the RFRA standard organization must be able to show a purpose.’’ Id. at 724 (per curiam) revealed confusion on the part of religious purpose in documents that are (emphasis added). But such a OFCCP as to the fundamental difference central to the organization’s identity and formulation would invite OFCCP to between the religious organization purpose. OFCCP believes this balance things that cannot be balanced exemption and RFRA. The state requirement for documentary evidence consistently and leave contractors attorneys general stated that the will reduce uncertainty, provide without the kind of clarity that ought to religious organization exemption is objective means for the agency to prevail in contractual relations. Further, triggered only when an organization’s confirm an organization’s satisfaction of the Supreme Court and lower courts exercise of religion is so significant that this factor of the test, and help have cautioned against drawing lines the organization’s overall identity contractors better understand the kind between religious activity or belief that becomes religious and criticized the of showing they will need to make to is ‘‘central’’ or ‘‘primary’’ and religious proposed rule for focusing instead on satisfy this factor. activity or belief that is not. See 84 FR whether an organization engages in OFCCP emphasizes that it will not at 41682, 41683. exercises of religion generally. A civil Also as explained in the NPRM, challenge a sincere claim characterizing liberties organization characterized the OFCCP proposed to use the phrase a document’s statements as religious in preamble as mistakenly stating that ‘‘engages in exercise of religion’’ rather the contractor’s view. See id. at 735–36. inquiry into the religious nature of than Judge O’Scannlain’s phrase, But OFCCP will rarely be able to find a entities’ actions is impermissible. A ‘‘engages in activity.’’ See World Vision, claim of religious purpose to be sincere labor union commented that this aspect 633 F.3d at 734 (O’Scannlain, J., of OFCCP’s proposal could lead where the documents themselves are no concurring) (‘‘engaged in activity businesses to feign religiosity solely for different from standard corporate consistent with, and in furtherance of, the purpose of cloaking discriminatory documents or where an organization those religious purposes’’). No material activity. adds a religious purpose to its change was intended by this Some commenters also criticized the documents after it becomes aware of adjustment; it was meant to capture in exclusion from OFCCP’s proposed test potential discrimination liability or succinct regulatory text Judge of the requirement that a contractor be government scrutiny, including through O’Scannlain’s lengthy discussion that ‘‘primarily religious,’’ or ‘‘engaged an OFCCP compliance review. Sincerity the kind of activity contemplated under primarily in carrying out that religious is a factual determination, so each case this prong is religious exercise. See 84 purpose.’’ Some of these comments where sincerity is at issue will turn on FR at 41683; see also World Vision, 633 stated that OFCCP did not persuasively 10 its own particular circumstances. F.3d at 737–38. explain why it was excluding this d. The Second Factor: Engages in OFCCP received many comments on element from the definition. A Activity Consistent With, and in this aspect of the NPRM. A religious contractor association commented that Furtherance of, Its Religious Purpose organization asked OFCCP to clarify that Title VII’s religious organization ‘‘consistent’’ as used in the third factor exception has traditionally been limited Second, the contractor must engage in does not mean that OFCCP will be to institutions whose ‘‘purpose and activity consistent with, and in assessing ‘‘the coherence or consistency character are primarily religious,’’ and furtherance of, its religious purpose. of the contractor’s religious beliefs, see that OFCCP has no basis to depart from Here too, ‘‘religious purpose’’ means Thomas v. Review Bd., 450 U.S. 707 this principle. An anti-bigotry religious religious as ‘‘measured with reference to (1981) (forbidding such an inquiry), but organization commented that OFCCP the particular religion identified by the only [making] a determination that the should consider all relevant contractor.’’ Id. This factor is adopted contractor is engaged in activity circumstances in determining whether a from Judge O’Scannlain’s World Vision reflecting a religious, as opposed to a contractor is indeed religious, as OFCCP concurrence rather than the per curiam secular, purpose.’’ OFCCP confirms that proposed to do for Sincere (that is, opinion. Cf. id. at 734. The regulatory its intent in including this element is to taking into account all relevant facts). text of the final rule has been slightly determine whether the contractor’s The organization commented that the revised from the proposed language to exercise of religion is consistent with its Supreme Court in Hosanna-Tabor more closely reflect Judge O’Scannlain’s religious purpose, not to test the reviewed the employee’s religious and formulation. This factor is now the internal consistency of a contractor’s secular functions, undermining second factor in the test rather than the religious beliefs. To make this point as OFCCP’s claim that it cannot engage in third. No material change is intended. clear as possible, OFCCP has added a similar type of balancing. This factor also now states that the regulatory text explaining that OFCCP disagrees with the idea that organization must exercise religion ‘‘[w]hether an organization’s this factor, either as proposed or as consistent with, and in furtherance of, engagement in activity is consistent adopted in the final rule, confuses the ‘‘its’’ religious purpose, rather than ‘‘a’’ with, and in furtherance of, its religious religious exemption with RFRA. An religious purpose. OFCCP does not view purpose is determined by reference to organization that exercises religion this change as significant, since a the organization’s own sincere under RFRA may not satisfy this factor religious organization is quite unlikely understanding of its religious tenets.’’ of the test, yet even if it did, that alone to further a religious purpose other than As with other factors, some would not satisfy the other factors of the its own. commenters asserted that this factor, as test necessary to claim the E.O. 11246 described in the NPRM and summarized religious exemption. Further, as will be 10 As noted in the proposed rule, see 84 FR at above, was too relaxed or that OFCCP discussed shortly, OFCCP has revised 41685, sincerity is often not at issue. was proposing to accept insufficient this prong to adhere to Judge

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00013 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79336 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

O’Scannlain’s formulation, which organization’s religious activity under comparison between the amount of should alleviate any confusion this factor must be shown to ‘‘constitute religious and secular activity at an regarding RFRA.11 a comprehensive religious identity.’’ organization. In essence, the OFCCP agrees with commenters that That is simply a rephrasing of the organization must engage in a greater activity consistent with the contractor’s ultimate inquiry underlying the World quantum of religious activity than religious purpose must be a substantial Vision test. This factor has a crucial role secular activity, though without aspect of the contractor’s operations. to play in that inquiry, but it should not specifying whether the ratio must be Insofar as the NPRM could be read to be mistaken for the whole of it. One of 51:49, 70:30, or 99:1. However, any suggest that a one-time or de minimis the most useful aspects of the World attempt to so compare religious and amount of religious activity would be Vision test is that it provides a step-by- secular activity leads to additional sufficient, OFCCP clarifies that step framework for assessing an problems: Some activities do not clearly understanding here. The need for a organization’s religious nature, fall on one side of the line or the other, material amount of religious activity including this factor, rather than leaving and a court’s or an agency’s attempts to flows from the text used in the the inquiry an open-ended assessment determine on which side of the line regulation, that the entity ‘‘engage in in which a religious organization is those activities fall can lead to religious activity.’’ To engage is ‘‘[t]o simply known when it is seen. Cf. constitutionally intrusive inquiries. See, employ or involve oneself; to take part Jacobellis v. State of Ohio, 378 U.S. 184, e.g., Cathedral Acad., 434 U.S. at 133 in; to embark on,’’ Black’s Law 197 (1964) (Stewart, J., concurring). (observing the ‘‘excessive state Dictionary (11th ed. 2019), or to Regarding comments that applying involvement in religious affairs’’ that ‘‘involve oneself or become occupied; Judge O’Scannlain’s concurrence rather may result from litigation over ‘‘what participate,’’ American Heritage than a ‘‘primarily engaged’’ factor is an does or does not have religious Dictionary (5th ed. 2020). It suggests unjustified departure from Title VII meaning’’). Moreover, even when all more than occasional or half-hearted jurisprudence or reflects an overly activities are properly categorized, it is efforts. The case law further illustrates prophylactic view of religious inquiry, unclear what weight each should have. that there must be a significant level of OFCCP respectfully disagrees. OFCCP’s See, e.g., Univ. of Great Falls, 278 F.3d religious activity. For instance, World position requires being mindful of the at 1343 (observing that a test that Vision easily satisfied that requirement distinction between the test’s requires ascertaining an entity’s since activity consistent with its underlying inquiry and the factors used ‘‘substantial religious character’’ or lack religious purpose was ‘‘essentially all to ascertain the answer to that inquiry. thereof ‘‘boils down to ‘is it sufficiently World Vision appears to do.’’ World The test’s underlying inquiry is whether religious?’’’). OFCCP avoids these Vision, 633 F.3d at 737–38 an organization’s ‘‘purpose and problems by adopting Judge (O’Scannlain, J., concurring). The character are primarily religious.’’ See, O’Scannlain’s formulation of this prong. examples added to the final regulatory e.g., World Vision, 633 F.3d at 726 OFCCP agrees with commenters that text also help illustrate the religious (O’Scannlain, J., concurring). But World some courts have nonetheless activity needed to qualify for the Vision operationalized that inquiry into undertaken the task of comparing exemption. four factors. Thus any constitutional or secular and religious activity when OFCCP disagrees with commenters to practical problems regarding the examining the religious exemption. See the extent they argue that an inquiry’s ‘‘primarily religious’’ LeBoon, 503 F.3d 217; Kamehameha organization must engage solely in formulation are academic because Sch., 990 F.2d 458; Boydston v. Mercy religious activity (and explains below OFCCP will be answering the inquiry by Hosp. Ardmore, Inc., No. CIV–18–444– that such an inquiry would be difficult means of applying the factors. That is G, 2020 WL 1448112 (W.D. Okla. Mar. and constitutionally imprudent). When one of the reasons why OFCCP prefers 25, 2020). OFCCP disagrees that it also an organization engages in other, the World Vision test to other must do so when Judge O’Scannlain’s secular, activities, that alone does not formulations. concurrence provides a viable diminish its ability to satisfy this factor When it comes to those four factors, alternative. That alternative is especially of the test. See LeBoon, 503 F.3d at 229; however, the World Vision per curiam attractive to OFCCP as an enforcement cf. Univ. of Great Falls, 278 F.3d at opinion carried forward a ‘‘primarily’’ agency and as a regulator of government 1342. This is made clear by the text of inquiry in two of the factors: The contractors. In both instances a factor the religious exemption. The Title VII organization must be ‘‘engaged that offers more clarity than another exemption was expanded in 1972 (and primarily in carrying out [its] religious gives better notice to contractors, better that expanded language is used in E.O. purpose’’ and must ‘‘not engage guidance to field staff, and crisper lines 11246) to cover religious organizations’ primarily or substantially in the to the bargain between the two parties. employees engaged in any of the exchange of goods or services for money organization’s activities, rather than beyond nominal amounts.’’ Id. at 724 e. The Third Factor: Holding Itself Out only employees engaged in the (per curiam). Judge O’Scannlain’s well- as Religious organization’s religious activities. Thus reasoned concurrence used an Third, the contractor must hold itself the exemption contemplates that alternative formulation that avoids the out to the public as carrying out a religious organizations will engage in ‘‘primarily’’ questions. OFCCP believes religious purpose. Again here, and as activities that are not religious, and it the better choice is to adopt the explained in the NPRM, ‘‘religious makes clear that religious organizations concurrence. The main problem with purpose’’ ‘‘must be measured with do not forfeit the exemption simply determining whether an organization is reference to the particular religion because they do. ‘‘primarily’’ engaged in its religious identified by the contractor.’’ World OFCCP also disagrees with purpose—as opposed to substantially or Vision, 633 F.3d at 736 (O’Scannlain, J., commenters who argued that the materially or genuinely engaged in its concurring). The NPRM proposed that a religious purpose—is not that it requires contractor could satisfy this requirement 11 Because of this change, the phrase ‘‘exercises a determination that the organization is in a variety of ways, including by religion’’ no longer appears in this prong. Thus, as engaged in significant religious activity, evidence of a religious purpose on its explained later in this preamble, the definition for Exercise of religion is no longer needed and has something that can be ascertained easily website, publications, advertisements, been removed from the final rule. enough, but rather that it requires letterhead, or other public-facing

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00014 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79337

materials, or by affirming a religious required references to its Christian marketplace; 12 religiously oriented purpose in response to inquiries from a identity in all external communications; hospitals, senior-living facilities, and member of the public or a government and its employment guidelines hospices may engage in substantial and entity. See 84 FR at 41683. expressly required subscription to frequent financial exchanges; 13 the Again, some commenters stated that particular Christian beliefs. See id. at religious exemption in E.O. 11246 this factor, as described in the NRPM 738–40. Very recently, a district court pertains to government contracting, an and summarized above, was too relaxed held that a Catholic hospital and its economic activity in which most or that OFCCP was proposing to accept affiliates satisfied the requirement when participants are for-profit entities; 14 insufficient evidence. Many of these they held ‘‘themselves out to the public other courts have not considered commenters criticized OFCCP’s as sectarian through their display of dispositive an organization’s for-profit proposal for allowing a contractor to religious symbols in their facilities and or nonprofit status, or the volume or meet this requirement by declaring its through their sectarian mission amount of its financial transactions; religious purpose in response to an statement and values statements Amos left open the question of whether inquiry from a government entity such displayed on [their] public website.’’ for-profit organizations could qualify for as OFCCP itself. Commenters asserted Boydston, 2020 WL 1448112, at *5. In the exemption; and the Supreme Court’s that, as a result, almost any employer the analogous NLRA context, a more recent decision in Hobby Lobby, could designate itself a religious university satisfied the test when, ‘‘in its which held that for-profit organizations organization. Commenters also stated course catalogue, mission statement, can exercise religion, counseled against that taxpayers, employees, and student bulletin, and other public an absolute prohibition on allowing for- applicants therefore would not documents, it unquestionably holds profit organizations to qualify for the necessarily have notice that the itself out to students, faculty, and the exemption. religious exemption could be applied. broader community as providing an OFCCP received a wide variety of Commenters stated that this factor education that, although primarily comments on this aspect of the NPRM. would thus not serve as the ‘‘market secular, is presented in an overtly Some commenters agreed with OFCCP’s check’’ that Judge O’Scannlain religious, Catholic environment.’’ Univ. reasons for declining to require that a envisioned. World Vision, 633 F.3d at of Great Falls, 278 F.3d at 1345. The contractor ‘‘not engage primarily or 735 (O’Scannlain, J., concurring) university also filled its campus, substantially in the exchange of goods (quoting Univ. of Great Falls, 278 F.3d classrooms, and offices ‘‘with Catholic or services for money beyond nominal at 1344). A group of state attorneys icons, not merely as art, but it claims as amounts.’’ For example, a religious general, for example, criticized OFCCP’s an expression of faith.’’ Id. liberties organization commented that proposal for purportedly relaxing Judge In short, a contractor satisfies this federal contractors typically engage in O’Scannlain’s ‘‘ ‘market check’ that requirement when the contractor makes substantial exchanges of goods and would come from requiring an it reasonably clear to the public that it services, and therefore religious organization to hold itself out to the has a religious purpose. As noted in the organizations would be categorically public as religious,’’ which ‘‘could come NPRM, evidence of a religious purpose denied the section 204(c) exemption if at a cost in terms of broader public can come from the contractor’s website, they became federal contractors. Other support.’’ One contractor association publications, advertisements, letterhead, commenters opposed the exclusion of remarked that, under the proposed rule, or other public-facing materials, and in the requirement that a contractor ‘‘not a federal contractor could satisfy this statements to members of the public. engage primarily or substantially in the factor simply by responding to an Evidence can also include religiously exchange of goods or services for money OFCCP inquiry, whereas World Vision inspired logos, mottos, or the like; and beyond nominal amounts.’’ A group of had always identified itself as a religious art, texts, music, or other U.S. Senators commented that the Christian organization, requiring its displays of religion in the workplace. existence of a financial motive descriptor statement on all its Statements to the government in the constitutes strong evidence that the communications. Another contractor ordinary course of business, such as exercise of religion is not the objective association commented: ‘‘Making such a corporate documents or tax filings, can of the entity. Some of these commenters showing [for example, in response to an also be probative. Such statements stated that OFCCP did not persuasively inquiry] is very easy and may or may should be distinguished from statements explain why it was excluding this not actually align with actual corporate to the government made in the course of element from the definition. purpose.’’ an investigation or litigation in which OFCCP declines to restrict the OFCCP appreciates these comments the contractor’s religious purpose is at exemption to those religious entities and, here too, is clarifying its approach issue. No one piece of evidence is that charge little or nothing for their in response. OFCCP agrees that a required or, most likely, sufficient. But services. Contra World Vision, 633 F.3d contractor could not satisfy this factor together the evidence must show that at 724 (per curiam); id. at 747 (Kleinfeld, simply by affirming a religious purpose the contractor is presenting itself to the J., concurring). First, E.O. 11246 governs in response to one public or government outside world as religious. federal contractors, not grantees. inquiry, if that was all the contractor Contractors by definition charge for could put forward as evidence. More f. The Fourth Factor: Operating on a Not-for-Profit Basis would be needed to show that the 12 See Brian J. Grim and Melissa E. Grim, ‘‘The public was on notice of the OFCCP proposed not to adopt the Socio-economic Contribution of Religion to organization’s religious nature. fourth factor set out in World Vision: American Society: An Empirical Analysis,’’ Interdisciplinary Journal of Research on Religion, How much more is a factual question That the entity seeking exemption ‘‘not vol. 12 (2016), article 3, pp. 10, 24, http:// that cannot be defined with complete engage primarily or substantially in the www.religjournal.com/pdf/ijrr12003.pdf. specificity, but the case law provides exchange of goods or services for money 13 See id. at 7. some guideposts. World Vision easily beyond nominal amounts.’’ 633 F.3d at 14 See General Service Administration, System for satisfied this requirement: Its logo was 724 (per curiam). The NPRM proposed Award Management, Advanced Search—Entity (listing 410,021 active for-profit entities and 99,781 a stylized cross; religious artwork and this course for several reasons: Many nonprofit and/or other-not-for-profit entities), texts were displayed throughout its religious entities may operate discount sam.gov/SAM/pages/public/searchRecords/ campus; its communications guidelines retail stores or otherwise engage in the advancedEMRSearch.jsf (last accessed Oct. 2, 2020).

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79338 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

their goods and services, even if they are Other commenters opposed the Some commenters specifically nonprofits. E.O. 11246’s religious proposal not to make nonprofit status a objected to OFCCP’s reliance on Hobby exemption would be a virtual nullity determinative factor. For example, an Lobby as justifying or requiring the were it restricted to contractors that do anti-bigotry religious organization proposed removal of the nonprofit not charge. Second, OFCCP agrees with emphasized that Judge O’Scannlain’s status factor. Most of these commenters Judge O’Scannlain that nonprofit status concurrence in World Vision focused on stated that Hobby Lobby was is a sufficiently reliable proxy for whether the employer’s purpose is non- inapplicable because it centered not on religious identity,15 without the need to pecuniary, while Judge Kleinfeld’s the Title VII religious exemption but on restrict this factor further to only those analysis focused on whether the RFRA, specifically on that statute’s organizations that do not charge. Judge employer provided services at no cost or definition of ‘‘person.’’ For example, a O’Scannlain explained that nonprofit for a nominal fee. The organization civil liberties organization commented status, and its restrictions on monetary criticized the proposed rule for rejecting that the Supreme Court in Hobby Lobby gain, is reliable evidence that the both factors. Commenters asserted that focused its analysis on the definition of organization has religious aims rather OFCCP’s proposal not to make nonprofit the word ‘‘person’’ in RFRA and offered than purely pecuniary ones, see id. at status a determinative factor would no insight into the definition or scope 734–35 (O’Scannlain, J., concurring), unacceptably broaden the exemption. A of the phrase ‘‘religious corporation’’ in and OFCCP agrees. Plus, the narrower religious organization asserted that the the religious exemption context. A formulation would exclude many bona proposed rule would allow for-profit gender equality advocacy organization fide religious organizations, like certain corporations to exploit faith in order to commented that RFRA goes far beyond hospitals and care facilities, that engage justify discrimination, and that the what is constitutionally required by in substantial and frequent market spirit of religious institutions would be subjecting any laws burdening religious transactions, including by charging diminished if houses of worship were exercise to strict scrutiny and, thus, the sums to beneficiaries of their goods and placed in the same category as for-profit question of RFRA’s application should services. And while religious institutions. not dictate a company’s eligibility for a educational institutions have their own Some commenters stated that the Title VII religious exemption. particular exemption, it would seem proposal would allow discrimination by Some commenters also stated that odd to think that their charging for contractors that should not be entitled Hobby Lobby has not been applied in books, tuitions, and dormitories would to the religious exemption. A labor subsequent Title VII religious call into question their religious status. organization commented that even for- exemption cases. These commenters Third, one of the reasons OFCCP is profit companies, whose primary typically cited Garcia v. Salvation promulgating this rule is to encourage purpose is, by definition, to make a Army, 918 F.3d 997 (9th Cir. 2019). In broader participation in government profit, could protect themselves from that case, the Ninth Circuit found that contracting and subcontracting. discrimination claims by claiming to the Salvation Army satisfied the Restrictions that would unduly restrict have a religious purpose. requirement that it ‘‘not engage the exemption’s availability could affect Some commenters stated that the primarily or substantially in the the size of the pool, to the detriment of proposed removal of the nonprofit exchange of goods or services for money the government’s interests in a requirement was inconsistent with Title beyond nominal amounts’’ both because competitive and diverse field of VII case law interpreting the same term, it is a nonprofit (Judge O’Scannlain’s potential contractors. including Judge O’Scannlain’s own test. approach) and because it gives away or OFCCP also received many comments Many of these commenters stated that charges only nominal fees for its on its proposal to remove the OFCCP had not cited any Title VII cases services (Judge Kleinfeld’s approach). requirement that organizations be in which a court had found a for-profit Id. at 1004. nonprofit to qualify for the exemption. entity to qualify for the religious In addition to distinguishing Hobby As mentioned above, OFCCP has exemption. For example, a contractor Lobby on the ground that it addressed substantially revised this aspect of the association commented that Judge RFRA and not the Title VII religious rule in response to commenters’ O’Scannlain considered non-profit exemption, commenters also stated that concerns. Some commenters agreed status to be an ‘‘especially significant’’ key limitations present in Hobby Lobby with the proposal that it was not consideration, which was consistent were not reflected in OFCCP’s proposal. necessary for a contractor to ‘‘be with the reasoning in numerous Title In particular, they stated, Hobby Lobby nonprofit.’’ For example, a religious VII cases. Some commenters stated that held that only closely held for-profit civil rights organization commended the the proposed removal of the nonprofit corporations could invoke RFRA, but proposal for affirming that the owners of requirement was inconsistent with OFCCP’s proposal included no such for-profit entities do not have to forfeit guidance from the EEOC or was a limitation, and the Court in Hobby their religious convictions. Those reversal of OFCCP’s previous position. Lobby considered harms an exemption commenters agreed with OFCCP’s Many of these commenters stated that would impose on third parties, but explanation that Hobby Lobby counsels OFCCP gave inadequate reasons for the OFCCP did not consider third-party against a stark distinction between deviation. For example, a group of state harms the commenters believed the nonprofit and for-profit corporations. attorneys general commented that the proposal would cause. Commenters also For example, a religious legal proposed reversal was not justified by stated that Hobby Lobby did not address organization commented: ‘‘[A]s the the executive branch’s contracting government contractors. For example, a Supreme Court noted in Hobby Lobby, authority, which ‘‘must be exercised women’s rights advocacy organization a for-profit corporation substantially within the boundaries of Title VII’s commented that, while Hobby Lobby engaged in an exchange of goods and prohibitions.’’ A contractor association dealt with a general requirement on all services can exercise religion.’’ commented that omitting a legal non-grandfathered insurance plans, the requirement because it could be difficult proposed rule deals with businesses that 15 In the next few paragraphs, this preamble to apply does not align with OFCCP’s willingly enter contracts with the explains further why and how OFCCP is limiting the exemption to nonprofit organizations in most stated commitment to follow the rule of federal government. According to the circumstances. law and to apply Title VII principles. organization, ‘‘[a]n entity does not have

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79339

a right to a contract that it is unwilling status as ‘‘especially significant’’ requires that the organization, if for- to perform.’’ because of its evidentiary value. He profit, present ‘‘other strong evidence In consideration of these comments, wrote that nonprofit status ‘‘bolsters a that it possesses a substantial religious OFCCP is revising the definition of claim that [an organization’s] purpose is purpose.’’ This formulation attempts to Religious corporation, association, nonpecuniary,’’ ‘‘provides strong synthesize the various statements in educational institution, or society in the evidence that its purpose is purely World Vision and Amos as to the final rule. OFCCP recognizes that, as nonpecuniary,’’ ‘‘makes colorable a quantum of religious purpose an Judge O’Scannlain observed, nonprofit claim that it is not purely secular in organization must have, and recognizes status is ‘‘strong evidence’’ that an orientation,’’ and ‘‘bolster[s] a their reasoning that nonprofit status organization has a nonpecuniary ‘contention that an entity is not serves as a valuable evidentiary proxy purpose. World Vision, 633 F.3d at 734– operated simply in order to generate for religious purpose. Thus the final rule 35 (O’Scannlain, J., concurring); see also revenues ..., but that the activities requires a for-profit organization to put Amos, 483 U.S. at 344 (1987) (Brennan, themselves are infused with a religious forward strong evidence to demonstrate J., concurring). Nonprofit status also purpose.’ ’’ World Vision, 633 F.3d at that it does indeed have a substantial allows a determination of religious 734–35 (O’Scannlain, J., concurring) religious commitment rather than serve purpose to be made objectively and (quoting Amos, 483 U.S. at 344 solely as a vehicle to facilitate profit- without engaging in a more searching (Brennan, J., concurring)).16 OFCCP making or other secular ends. This inquiry. With that said, OFCCP agrees with these observations, which is formulation recognizes that an recognizes that, in certain rare why it has adopted nonprofit status as organization may have more than one circumstances, an organization might be a sufficient means for satisfying this purpose, but its religious one must be for-profit yet still be fairly considered a factor of the test. substantial. It would not be enough, for religious rather than secular There may be rare situations, instance, that an organization feature a organization. however, where an organization is scriptural quote in marketing materials Thus the final rule adds a fourth legally constituted as a for-profit or make a brief reference to religious requirement: That the contractor either enterprise yet infused with religious values on its ‘‘About Us’’ web page. The ‘‘(A) operates on a not-for-profit basis; or purpose. In those situations, the examples in the regulatory text may be (B) presents other strong evidence that organization would need to come instructive to readers on this point. it possesses a substantial religious forward with strong evidence that its This new regulatory text is also purpose.’’ Paragraph (A) has been goals are religious rather than consistent with Hobby Lobby’s written in a manner that covers federal pecuniary—evidence comparable in observation that a corporation need not contractors that do not have formal tax- probative weight to nonprofit status. choose absolutely between financial exempt status under 26 U.S.C. 501(c)(3) OFCCP has added examples within the objectives and other objectives: but operate in substantial compliance regulatory definition of Religious with 501(c)(3)’s requirements. See corporation, association, educational While it is certainly true that a central World Vision, 633 F.3d at 745 objective of for-profit corporations is to make institution, or society to illustrate some money, modern corporate law does not (Kleinfeld, J., concurring) (noting the of these rare instances, including a require for-profit corporations to pursue need for a small adjustment to the test contractor that provides chaplaincy profit at the expense of everything else, and to cover small groups that do not services to the military and a kosher many do not do so. . . . If for-profit formally incorporate). Paragraph (A) caterer that supplies meals for federal corporations may pursue such worthy meets the goals of certainty and clarity events. OFCCP doubts that an entity that objectives [as supporting charitable causes, in contracting for what OFCCP believes is not closely held could ever satisfy environmental measures, or working will be the vast majority of contractors this requirement, especially since such conditions beyond those required by law], interested in the exemption. Paragraph an entity would have multiple and there is no apparent reason why they may not further religious objectives as well. (B) is a helpful contingency for disparate shareholders. See Hobby situations where a contractor may not Lobby, 573 U.S. at 717 (‘‘[T]he idea that Hobby Lobby Stores, 573 U.S. at 711. satisfy this prong of the test but in all unrelated shareholders—including OFCCP believes that the approach fairness should be considered a institutional investors with their own promulgated here, which has been qualifying religious organization. This set of stakeholders—would agree to run modified from that in the NPRM, is alternative test is consistent with World a corporation under the same religious consistent with Title VII case law. Vision and the more recent Ninth beliefs seems improbable.’’). OFCCP Again, World Vision set out a four-factor Circuit case highlighted by commenters, likewise doubts that an entity could test that, if satisfied, is sufficient for Salvation Army, 918 F.3d 997. World qualify if it predominantly provides organizations to qualify for the Vision’s brief per curiam opinion stated undifferentiated marketplace goods or exemption. But as Salvation Army and that an organization is eligible for the services that are not associated with an other cases show, there are other ways exemption ‘‘at least’’ when it meets the expressly religious purpose or a to qualify for the exemption. See four factors. 633 F.3d at 724 (per charitable, educational, humanitarian, Salvation Army, 918 F.3d 997; EEOC v. curiam) (emphasis added). Judge or other eleemosynary purpose. Townley Eng’g & Mfg. Co., 859 F.2d 610 O’Scannlain’s opinion stated that other OFCCP has also modified the NPRM’s (9th Cir. 1988). In these other cases, factors may be relevant in other cases. definition of Religious corporation, nonprofit or for-profit status has been See id. at 729–30 (O’Scannlain, J., association, educational institution, or treated as an important factor, but not as concurring). In Salvation Army, the society to reflect these considerations. dispositive. That is similar to this final court applied an ‘‘all significant Unlike the proposed rule, which stated rule’s approach. religious and secular characteristics’’ only that a religious organization need For the same reason, OFCCP disagrees standard as well as noted that the not be nonprofit, the final rule now that its approach is an unjustified Salvation Army satisfied the World change in agency position. Until this Vision test. See Salvation Army, 918 16 These varying statements span the range from rulemaking, OFCCP had not set forth the ‘‘not purely secular’’ to ‘‘purely nonpecuniary.’’ specific factors it would use to decide F.3d at 1003–04. OFCCP’s regulatory text attempts to strike a balance In his World Vision concurrence, down the middle, using the phrase ‘‘possesses a which organizations qualify for E.O. Judge O’Scannlain described nonprofit substantial religious purpose.’’ 11246’s religious exemption; rather, in

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00017 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79340 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

withdrawn subregulatory guidance under the religious exemption. Hobby The Supreme Court has applied this OFCCP stated that it would follow Lobby does not demand a result one way principle to allow accommodations that EEOC and court interpretations of Title or the other on that issue, but OFCCP litigants claimed caused significant VII and apply an all-facts-and- has found the case to be an important third-party harms. For example, the circumstances test. To the extent that data point in support of its approach Supreme Court upheld the Title VII withdrawn statement could be here. exemption for religious employers— considered the position of the agency, Regarding commenters’ concerns that discussed in Section 8—despite the for the reasons stated in this preamble, a removal of the nonprofit requirement alleged significant harms of expressly OFCCP now believes such a test is too would unacceptably broaden the permitting discrimination against indeterminate and involves potential exemption, OFCCP has revised the employees on the basis of religion. See legal infirmities, and that a more- regulatory text as described above. Tex. Monthly, 489 U.S. 1, 18 n.8 (1989) defined test will give better clarity to OFCCP does not anticipate many for- (citing Amos). This is consistent with contractors and foster a broader pool of profit organizations seeking to qualify Hobby Lobby, which expressly held that potential contractors and for the exemption, and those that do a burden lawfully may be removed from subcontractors. It is certainly true, as will need to satisfy the other three a religious organization even if it allows commenters asserted, that OFCCP’s prongs—which themselves contain such a religious objector to withhold a general position is to follow Title VII significant evidentiary requirements— benefit from third parties. Hobby Lobby, principles when interpreting E.O. plus provide strong evidence of their 573 U.S. at 729 n.37 (‘‘Nothing in the 11246. For the reasons stated in this religious nature. OFCCP believes this text of RFRA or its basic purposes preamble OFCCP believes its approach test will ensure that only bona fide supports giving the Government an is consistent with Title VII principles religious organizations will qualify. entirely free hand to impose burdens on and Supreme Court case law, and better Finally, regarding comments about so- religious exercise so long as those furthers the goals of this rulemaking. called third-party harms, OFCCP burdens confer a benefit on other The minor differences between the recognizes that Cutter v. Wilkinson individuals.’’). Ultimately, government EEOC’s approach to determining which stated that government must adequately action that removes such a benefit organizations can claim the exemption account for accommodations’ burdens merely leaves the third party in the and OFCCP’s definition of Religious same position in which it would have on others. 544 U.S. 709, 720 (2005). corporation, association, educational been had government not regulated the OFCCP believes it has adequately institution, or society are addressed later religious objector in the first place. accounted for any burdens on others in this preamble. Otherwise, any accommodation could that this rule may cause, and on balance OFCCP also disagrees with be framed as burdening a third party. believes that the vindication of the law’s commenters who argued that Hobby That would ‘‘render[ ] RFRA religious protections, the need for Lobby is irrelevant to this issue. meaningless.’’ Hobby Lobby, 573 U.S. at clarity in this area of contracting, and Certainly Hobby Lobby was not a Title 729 n.37. ‘‘[F]or example, the the potential expansion of the VII case. But Hobby Lobby’s holding that Government could decide that all government’s contracting pool justify for-profit corporations qualify as supermarkets must sell alcohol for the ‘‘persons’’ who can exercise religion any burdens on third parties. See infra convenience of customers (and thereby under RFRA is hard to square with a section III.B.5. exclude Muslims with religious rule that a for-profit entity can never be Further, under controlling Supreme objections from owning supermarkets), a religious organization eligible for E.O. Court precedent, the Establishment or it could decide that all restaurants 11246’s religious exemption. And much Clause allows accommodations that must remain open on Saturdays to give of its reasoning has broader remove a burden of government rules employees an opportunity to earn tips implications. The Supreme Court from religious organizations, reduce the (and thereby exclude Jews with observed that furthering the religious chilling on religious conduct, or reduce religious objections from owning freedom of corporations, whether for- government entanglement. See Amos, restaurants).’’ Id.; see also Attorney profit or nonprofit, furthers individual 483 U.S. at 334–39. Any third party General’s Memorandum, Principle 15, religious freedom. See Hobby Lobby, burdens that might result from such 82 FR at 49670. 573 U.S. at 707. The Supreme Court accommodations are attributable to the Finally, OFCCP views these found no reason to distinguish between organization that benefits from the comments as addressed more to the for-profit sole proprietorships—which accommodation, not to the government, religious exemption itself, which is not had brought Free Exercise claims before and, as a result, do not violate the at issue here, than to this rule. Congress the Supreme Court in earlier cases—and Establishment Clause. Id. at 337 n.15. In decided in enacting Title VII, and the for-profit closely held corporations. See the Sherbert line of Free Exercise Clause President decided in amending E.O. id. at 709–10. And as just stated, the cases that later became the basis of 11246, that preserving the integrity of Supreme Court noted that every U.S. RFRA, dissents and concurrences religious organizations merited an jurisdiction permits corporations to be routinely pointed to such burdens on exemption from the religious-neutrality formed ‘‘for any lawful purpose or third parties but did not persuade the requirements that would otherwise business,’’ id. at 711 (internal quotation majorities of any Establishment Clause apply to their employees. OFCCP does marks omitted), including a religious violation.17 not and could not question those one, see id. at 710–11. judgments. Further, insofar as OFCCP is required to give some 17 See, e.g., Thomas, 450 U.S. at 723 n.1 commenters argued that the test consideration to that language in (Rehnquist, J., dissenting) (citing several burdens on the system and other beneficiaries, including that expands the number of contractors that formulating its own test here. If for- ‘‘[w]e could surely expect the State’s limited funds might qualify for the exemption, that profit corporations can exercise religion allotted for unemployment insurance to be quickly fact alone does not show any third-party and further religious objectives as well depleted’’); Wisconsin v. Yoder, 406 U.S. 205, 240 harm. Indeed, among the rule’s intended as pecuniary ones, then OFCCP should (1972 (White, J., concurring) (outlining the state’s legitimate interest in educating Amish children, purposes is expanding the pool of consider carefully whether they should especially ones that leave their community but be categorically excluded from finding the evidence of harm insufficient); Yoder, that the decision ‘‘imperiled’’ the ‘‘future’’ of the qualification as religious organizations 406 U.S. at 245 (Douglas, J., dissenting) (arguing Amish children, not their parents).

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00018 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79341

contractors while avoiding religious defined in the Religious Land Use and above, there is no need for the final rule entanglement. No contractor is Institutionalized Persons Act (RLUIPA), to define the term. RFRA and RLUIPA compelled to seek the exemption, and 42 U.S.C. 2000cc–5(7). RLUIPA, in turn, are well-established laws regarding no contractor so exempted is compelled defines ‘‘religious exercise’’ as including religious freedom that are broadly by receipt of the exemption to take any ‘‘any exercise of religion, whether or not applicable, and they provide a familiar particular employment action. See compelled by, or central to, a system of framework that will assist OFCCP in Amos, 337 n.15. To the contrary, the religious belief.’’ This definition is well- assessing both whether a contractor is Title VII case law confirms that religious established and prevents problematic engaging ‘‘in activity consistent with, employers have flexibility to inquiries into the ‘‘centrality’’ of a and in furtherance of,’’ its religious accommodate employees’ religious religious practice, which are discussed purpose and whether its employment preferences if they so choose. See later in this preamble. However, the action has a religious basis. Kennedy, 657 F.3d at 194. Additionally, phrase ‘‘exercise of religion’’ in the 4. Definition of Sincere OFCCP discusses below, regarding the proposed rule appeared only as part of scope of the exemption, how this rule the proposed definition of Religious The principles discussed above with interacts with other protected classes corporation, association, educational regard to the definition of Exercise of and the proper balance between institution, or society. That definition religion are incorporated in the employers’ and employees’ freedoms has been changed to adhere more definition of Sincere that OFCCP and rights. OFCCP believes it has closely to Judge O’Scannlain’s proposed. In line with court precedent provided an accommodation that concurrence in World Vision, and the and OFCCP’s principles, the critical reasonably addresses these interests. words ‘‘exercise of religion’’ no longer inquiry for OFCCP is whether a appear in that prong of the definition. particular employment decision was in g. Other Features Thus there is no need for regulatory text fact a sincere exercise of religion. The final rule retains two proposed to define them. With that said, OFCCP Consistent with that inquiry, and for the non-determinative features in the will look to general principles of First reasons explained above, the final rule’s definition of Religious corporation, Amendment law and the RFRA– definition of Particular religion specifies association, educational institution, or RLUIPA definition of ‘‘exercise of that the religious tenets the contractor society. Those are the statements that religion’’ when assessing whether an applies to its employees must be the organization ‘‘may or may not’’ organization is engaging ‘‘in activity ‘‘sincere.’’ OFCCP, like courts, ‘‘merely ‘‘have a mosque, church, synagogue, consistent with, and in furtherance of,’’ asks whether a sincerely held religious temple, or other house of worship’’ or its religious purpose, and when belief actually motivated the ‘‘be supported by, be affiliated with, assessing whether its employment institution’s actions.’’ Geary v. identify with, or be composed of action has a religious basis. Therefore, Visitation of Blessed Virgin Mary Parish individuals sharing, any single religion, OFCCP addresses below the comments Sch., 7 F.3d 324, 330 (3d Cir. 1993). The sect, denomination, or other religious received on the proposed definition of religious organization’s burden ‘‘to tradition.’’ With regard to these features, Exercise of religion. explain is considerably lighter than in a some commenters expressed support, Several commenters generally non-religious employer case,’’ since the and other commenters expressed approved of the definition for the organization, ‘‘at most, is called upon to opposition. For example, one religious reasons stated in the NPRM, while explain the application of its own education association commented, in others generally opposed the proposed doctrines.’’ Id. ‘‘Such an explanation is support of the absence of a requirement definition. Those generally opposed no more onerous than is the initial that the contractor ‘‘[h]ave a mosque, asserted that RFRA was not a relevant burden of any institution in any First church, synagogue, temple, or other authority given that it is a different Amendment litigation to advance and house of worship’’ that religious schools statute, that the borrowed provision was explain a sincerely held religious belief that are controlled by a body of religious vague and did not provide clarity but as the basis of a defense or claim.’’ Id.; leaders directly connected to the school rather represented an attempt to ‘‘create see United States v. Seeger, 380 U.S. are no less ‘‘controlled by a religious new law,’’ and that the breadth of the 163, 185 (1965) (holding whether a organization’’ than are schools definition did not provide ‘‘guardrails belief is ‘‘truly held’’ is ‘‘a question of controlled by hierarchical religious for the manner in which employers can fact’’). The sincerity of religious exercise denominations. OFCCP continues to require their employees to adhere to is often undisputed or stipulated. See, believe that requiring these features certain principles.’’ Others commenters e.g., Hobby Lobby, 573 U.S. at 717 (‘‘The could lead the agency to discriminate raised more specific issues. A group of companies in the cases before us are among religions, which could violate state attorneys’ general noted that the closely held corporations, each owned the First Amendment’s Establishment broad definition of religious exercise in and controlled by members of a single Clause. See World Vision, 633 F.3d at RFRA is moderated by its substantial family, and no one has disputed the 732 & n.9 (O’Scannlain, J., concurring). burden requirement, which the sincerity of their religious beliefs.’’); For these reasons and the reasons proposed definition did not include. Holt, 574 U.S. at 361 (‘‘Here, the described in the preamble to the Others noted issues with the term in the religious exercise at issue is the growing proposed rule, see 84 FR at 41684, context of the ‘‘engages in’’ language of a beard, which petitioner believes is OFCCP agrees with the commenters directly preceding it; some believed the a dictate of his religious faith, and the who stated that it is appropriate not to two in tandem were vague and Department does not dispute the require that contractors have these overbroad, while one commenter sought sincerity of petitioner’s belief.’’). features to be deemed religious. specific guidance in the final rule that Further, as the Supreme Court has ‘‘religious speech’’ could be an exercise repeatedly counseled, ‘‘religious beliefs 3. Definition of Exercise of Religion of religion. need not be acceptable, logical, OFCCP proposed to define Exercise of OFCCP has considered these consistent, or comprehensible to others religion as the term is defined for comments and continues to believe that in order to merit First Amendment purposes of RFRA. RFRA, in 42 U.S.C. the RFRA–RLUIPA definition of protection.’’ Church of the Lukumi 2000bb–2(4), defines ‘‘exercise of ‘‘exercise of religion’’ is relevant in this Babalu Aye, Inc. v. City of Hialeah, 508 religion’’ to mean ‘‘religious exercise’’ as context, although, for the reasons stated U.S. 520, 531 (1993) (quoting Thomas,

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00019 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79342 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

450 U.S. at 714) (internal quotation precedent regarding sincerity and the rather than consistency across similarly marks omitted); see also, e.g., United compelling government interest in situated employees, OFCCP cannot States v. Ballard, 322 U.S. 78, 86 (1944) preventing discrimination will survive assess the ‘‘relative severity of (‘‘[People] may believe what they cannot without excessive government [religious] offenses’’ or otherwise weigh prove. They may not be put to the proof involvement. doctrinal matters, for that would of their religious doctrines or beliefs.’’). Many other commenters opposed the ‘‘violate the First Amendment.’’ Curay- To merit protection, religious beliefs proposed, arguing that it would not Cramer v. Ursuline Acad. of must simply be ‘‘sincerely held.’’ E.g., require entities to be internally Wilmington, Del., Inc., 450 F.3d 130, Frazee v. Ill. Dep’t of Emp’t Sec., 489 consistent in applying their self- 139 (3d Cir. 2006). U.S. 829, 834 (1989); Seeger, 380 U.S. at proclaimed religious tenets to various OFCCP will also evaluate any 185. Courts have appropriately relied on groups. For instance, a group of U.S. evidence that indicates an insincere the ‘‘sincerely held’’ standard when Senators asserted that the proposed sham, such as acting ‘‘in a manner evaluating religious discrimination definition ‘‘does not require consistency inconsistent with that belief’’ or claims in the Title VII context. See, e.g., in the application of policy based upon ‘‘evidence that the adherent materially Davis v. Fort Bend Cnty., 765 F.3d 480, religious tenets’’ such that an entity gains by fraudulently hiding secular 485 (5th Cir. 2014); Philbrook v. opposed to body modification, for interests behind a veil of religious Ansonia Bd. of Educ., 757 F.2d 476, instance, could ignore tenets regarding doctrine.’’ Philbrook, 757 F.2d at 482 481–82 (2d Cir. 1985); Redmond v. GAF tattoos but fire a transgender worker for (quoting Int’l Soc’y for Krishna Corp., 574 F.2d 897, 901 n.12 (7th Cir. seeking health care without triggering Consciousness, Inc. v. Barber, 650 F.2d 1978). In such cases, a court must scrutiny. An LGBT rights advocacy 430, 441 (2d Cir. 1981)) (internal ‘‘vigilantly separate the issue of organization echoed this concern. Some quotation marks omitted); cf., e.g., sincerity from the factfinder’s commenters also opposed OFCCP’s Hobby Lobby, 573 U.S. at 717 n.28 (‘‘To perception of the religious nature of the statement that ‘‘the sincerity of religious qualify for RFRA’s protection, an [employee’s] beliefs.’’ EEOC v. Union exercise is often undisputed or asserted belief must be ‘sincere’; a Independiente de la Autoridad de stipulated’’ because, they stated, it corporation’s pretextual assertion of a Acueductos y Alcantarillados, 279 F.3d raised concerns regarding the depth of religious belief in order to obtain an 49, 57 (1st Cir. 2002) (alteration in OFCCP’s inquiry under the proposed exemption for financial reasons would original) (quoting Patrick v. LeFevre, definition. A state civil rights fail.’’); United States v. Quaintance, 608 745 F.2d 153, 157 (2d Cir. 1984)) organization commented, for instance, F.3d 717, 724 (10th Cir. 2010) (Gorsuch, (internal quotation marks omitted). that this portion of the preamble seemed J.) (‘‘[T]he record contains additional, Some commenters opposed requiring to signal that OFCCP will not inquire overwhelming contrary evidence that only that exercise of religion be about sincerity, despite the fact that the [defendants] were running a ‘‘sincere,’’ which they characterized as whether a belief is sincerely held can commercial marijuana business with a broadening the exemption. They warned only be determined by weighing the religious front . . . .’’). OFCCP’s that this expands exercise of religion strength of evidence. Likewise, an application of the religious exemption is beyond its current meaning and that organization that advocates separation described in more detail below. sincerity cannot be reasonably applied. of church and state commented that the Despite these assurances, several For example, a labor union stated that preamble’s discussion, particularly its commenters who opposed the proposed ‘‘sincerity’’ is not a concept that can ‘‘equivocal views’’ on policies aimed at definition said that it is vague or sensibly be applied to organizations, determining the sincerity of an adverse unworkable in practice. For instance, a much less to for-profit businesses that employment action, creates uncertainty group of state attorneys general would be included in the scope of the as to whether OFCCP will actually expressed concern that the definition religious exemption under the Proposed weigh factors intended to determine may increase confusion among Rule. A group of state attorneys general sincerity. An LGBT rights advocacy contractors seeking to claim religious commented that, by requiring only organization expressed substantially exemptions because the question of how sincerity, OFCCP ‘‘seeks to expand identical concerns. a for-profit organization can RFRA’s already broad definition of As noted in the NPRM, in assessing demonstrate the sincerity of its religious ‘exercise of religion.’’’ An individual sincerity, OFCCP will take into account beliefs is largely untested. Thus, commenter wrote that the proposal all relevant facts, including whether the according to the attorneys general, would grant large for-profit government contractor had a preexisting basis for its contractors will have to contend with a contractors a hiring exemption as long employment policy and whether the high level of uncertainty in addition to as they could articulate any strongly policy has been applied consistently to their obligations under Title VII. A held belief. comparable persons, although absolute religious legal organization that Other commenters expressed support uniformity is not required. See Kennedy, otherwise supported the proposed rule for a sincerity test. For example, a 657 F.3d at 194 (noting that the Title VII highlighted the fact that the proposed religious liberties legal organization religious exemption permits religious definition of sincere is ‘‘simply what wrote: ‘‘Attempts to use religion to hide organizations to ‘‘consider some attempt courts determine ‘when ascertaining the discriminatory intent are generally not at compromise’’); LeBoon, 503 F.3d at sincerity of a party’s religious exercise successful.’’ OFCCP agrees with these 229 (‘‘[R]eligious organizations need not or belief.’’’ The commenter expressed commenters. Other commenters also adhere absolutely to the strictest tenets skepticism that courts could arrive at a expressed general support for the of their faiths to qualify for Section 702 concise and uniform test for the proposed definition, stating that it will protection.’’); see also Killinger v. meaning of the term without more help ensure that important protections Samford Univ., 113 F.3d 196, 199–200 specific guidance from OFCCP. against discrimination remain in place (11th Cir. 1997). But despite OFCCP disagrees that ascertaining the while at the same time preventing commenters’ focus on the need for sincerity of an organization’s religious government overreach and protecting ‘‘internal consistency’’ in religious exercise, even a for-profit one, will religious practice. For instance, the organizations’ doctrine—such as a rule foster confusion or that it presents same religious liberties legal that if tattoos are permitted, transgender insurmountable practical difficulties. organization commented that legal medical procedures must be as well— Religious sincerity is a familiar and

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00020 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79343

well-developed legal principle. It has head of a religious congregation,’’ nor some adjustments in its explanation been applied in regards to a religious subject to ‘‘a rigid formula for deciding regarding how it views and will apply organization’s decisions under the Title when an employee qualifies as a this definition. These include changing VII religious exemption. See, e.g., Little minister’’). to a motivating factor standard of v. Wuerl, 929 F.2d 944, 946 (3d Cir. For the reasons described above and causation and providing additional 1991) (‘‘Little does not challenge the in the NPRM, and considering the clarification, particularly on the sincerity of the Parish’s asserted comments received, OFCCP finalizes the interaction of the religious exemption religious doctrine.’’). And the Supreme proposed definition without with other protected categories, Court rejected a similar argument ‘‘that modification. including the importance of RFRA. As Congress could not have wanted RFRA 5. Definition of Particular Religion to the regulatory text, the word to apply to for-profit corporations ‘‘sincere’’ has been inserted into the because it is difficult as a practical In the NPRM, OFCCP proposed to phrase ‘‘acceptance of or adherence to matter to ascertain the sincere ‘beliefs’ define Particular religion to clarify that sincere religious tenets as understood by of a corporation.’’ Hobby Lobby, 573 the religious exemption allows religious the employer as a condition of U.S. at 717. Here, as there, questions of contractors not only to prefer in employment,’’ to make clear both the corporate religious beliefs are likely to employment individuals who share requirement of sincerity and, by arise only for closely held corporations, their religion, but also to condition reference to the definition of Sincere, and ‘‘[s]tate corporate law provides a employment on acceptance of or how sincerity is tested. Otherwise the ready means for resolving any conflicts adherence to religious tenets as definition is being finalized as . . . .’’ Id. at 718. understood by the employing proposed. OFCCP also acknowledges the contractor. The NPRM explained that Insofar as OFCCP’s view expressed constitutional and prudential this definition flows directly from the here and in the proposed rule is a limitations on its inquiry that may come broad definition of Religion, discussed change from its prior position as to the into play when religious matters are above, to include all aspects of religious definition of Particular religion under involved. OFCCP will not compare belief, observance, and practice as the exemption and the permissible religious doctrines or practices in understood by the employer, which practices of contractors and evaluating sincerity. See, e.g., Curay- would clarify past statements from subcontractors who qualify as religious Cramer, 450 F.3d at 139 (‘‘[A]ssess[ing] OFCCP suggesting that the exemption organizations, OFCCP believes the the relative severity of [religious] was restricted solely to hiring change is justified for all the reasons offenses . . . would violate the First coreligionists. The NPRM stated that the stated in the proposed rule and directly Amendment.’’); Hall v. Baptist Mem’l proposed definition was consistent with below. A broader view of the religious Health Care Corp., 215 F.3d 618, 626 Title VII case law as well as Supreme exemption is also consistent with one of (6th Cir. 2000) (‘‘[T]he First Amendment Court case law holding that the OFCCP’s primary goals in this does not permit federal courts to dictate government burdens religious exercise rulemaking, which is to increase to religious institutions how to carry out when it conditions benefits on the economy and efficiency in government their religious missions or how to surrender of religious identity. contracting by providing for a broader enforce their religious practices.’’). Nor The NPRM noted that the religious pool of government contractors and will OFCCP require contractors to exemption does not permit religious subcontractors. Issues specific to the adhere to strict, uniform procedures to employers to discriminate on other EEOC’s view on this matter are demonstrate sincerity. See Kennedy, 657 protected bases. The NPRM described discussed further in a separate part of F.3d at 194; LeBoon, 503 F.3d at 229. how courts have used a variety of this preamble. And where ‘‘it is impossible to avoid approaches and doctrines to distinguish a. Burdens on Religious Organizations inquiry into a religious employer’s claims of religious discrimination from in Contracting religious mission or the plausibility of other claims of discrimination while its religious justification for an avoiding entangling inquiries under the As described in the NPRM, OFCCP’s employment decision,’’ then OFCCP First Amendment, and that OFCCP approach here is consistent with will apply the E.O. 11246 religious proposed to do the same. See 84 FR at Supreme Court decisions emphasizing exemption. Curay-Cramer, 450 F.3d at 41679–81. that ‘‘condition[ing] the availability of 141. In a later part of the NPRM describing benefits upon a recipient’s willingness Some commenters objected to the proposed terms Exercise of religion to surrender his religiously impelled OFCCP’s stated commitment to applying and Sincere, OFCCP gave additional status effectively penalizes the free the ministerial exception. For instance, detail on its proposed approach for exercise of his constitutional liberties.’’ a city public advocate observed that applying the religious exemption. The Trinity Lutheran, 137 S. Ct. at 2022 OFCCP’s claim that it will evaluate any NPRM noted that sincerity is the (alterations omitted) (quoting McDaniel factors that indicate insincerity is ‘‘touchstone’’ of religious exercise and v. Paty, 435 U.S. 618, 626 (1978) undermined by the proposed rule’s that OFCCP would take into account all (plurality opinion)). These decisions commitment to the ministerial relevant facts when determining naturally extend to include the right to exception. Nevertheless, OFCCP whether a sincere religious belief compete on a level playing field for respects and must apply the ministerial actually motivated an employment federal government contracts. See id. exception. The ministerial exception is decision. The NRPM also proposed (holding the government burdens an application of the Establishment and applying a but-for standard of causation religious exercise when it so conditions Free Exercise clauses of the First when evaluating claims of ‘‘a benefit or privilege,’’ ‘‘eligibility for Amendment. See Our Lady of discrimination by religious office,’’ ‘‘a gratuitous benefit,’’ or the Guadalupe, 140 S. Ct. at 2060; Hosanna- organizations based on protected ability ‘‘to compete with secular Tabor, 565 U.S. at 189–90 (finding that characteristics other than religion. See organizations for a grant’’ (quoted the ministerial exception bars ‘‘an 84 FR at 41684–85. sources omitted)); accord E.O. 13831 § 1 employment discrimination suit brought OFCCP received comments on all (‘‘The executive branch wants faith- on behalf of a minister’’ and observing these aspects of its proposal. In response based and community organizations, to that the exception ‘‘is not limited to the to the comments, the agency has made the fullest opportunity permitted by

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79344 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

law, to compete on a level playing field extensive social welfare and charitable adherence to religious tenets—to ensure for . . . contracts . . . and other Federal activities, such as operating soup kitchens their employees are committed to the funding opportunities.’’). and day care centers or providing aid to the religious organization. In some A few commenters praised OFCCP’s poor and the homeless. Even where the instances, as described below, RFRA content of such activities is secular—in the reliance on Trinity Lutheran to establish sense that it does not include religious may also come into play to require the principle that benefits cannot be teaching, proselytizing, prayer or ritual—the accommodations. conditioned on surrendering religious religious organization’s performance of such Regarding the comment that the rule status. For example, a religious public functions is likely to be ‘‘infused with a violates the Establishment Clause by policy women’s organization stated that religious purpose.’’ Amos, 483 U.S. at 342 funding positions that require specific no one should be forced to abandon (Brennan, J., concurring). And churches and religious beliefs or customs, that is a their faith when operating their business other religious entities ‘‘often regard the criticism of the E.O. 11246 religious or participating in government provision of such services as a means of exemption itself, which has been part of fulfilling religious duty and of providing an federal law for nearly twenty years and programs. Similarly, a religious liberty example of the way of life a church seeks to legal organization commented that foster.’’ Id. at 344 (footnote omitted). In other is not at issue in this rulemaking. This religious contractors should be allowed words, the provision of ‘‘secular’’ social is addressed more below. to serve on equal terms as all other services and charitable works that do not b. The Exemption’s Scope: contractors, without having to involve ‘‘explicitly religious content’’ and are Coreligionists compromise their faith-based identities. not ‘‘designed to inculcate the views of a A few commenters stated that Trinity particular religious faith,’’ Bowen v. As explained in the NPRM, the Lutheran and other Supreme Court Kendrick, 487 U.S. 589, 621 (1988), religious exemption is not restricted to cases discussed in the preamble to the nevertheless may well be ‘‘religiously a purely denominational preference. inspired,’’ id., and play an important part in The religious exemption allows NPRM do not support or require the the ‘‘furtherance of an organization’s proposed definition. For example, an religious contractors not only to prefer religious mission.’’ Amos, 483 U.S. at 342 in employment individuals who share organization that advocates separation (Brennan, J., concurring). of church and state commented that their religion, but also to condition 31 O.L.C. 162, 172 172–73 (2007) employment on acceptance of or religious organizations are already Second, this burden exists even when eligible to compete for government adherence to religious tenets as not imposed directly. The Office of understood by the employing contracts, which is all that is required Legal Counsel, in the same opinion, by Trinity Lutheran. In addition, a contractor. This definition flows further recognized that a burden on directly from the broad definition of religious organization commented that religious organizations’ free exercise of ‘‘the rule violates the Establishment Religion, discussed above, to include all religion can occur not only through aspects of religious belief, observance, Clause of the First Amendment by direct imposition of requirements but funding positions which require specific and practice as understood by the through conditions on grants or other employer. It is also consistent with Title religious beliefs and customs.’’ OFCCP benefits, citing many of the same cases believes, however, that its interpretation VII case law holding that ‘‘the cited in Trinity Lutheran for that permission to employ persons ‘of a of the scope of the religious exemption proposition. See 31 O.L.C. at 174–75; is consistent with the principles of particular religion’ includes permission Trinity Lutheran, 137 S. Ct. at 2022. to employ only persons whose beliefs religious freedom articulated in Trinity Those concerns about burdening Lutheran and other Supreme Court and conduct are consistent with the religious exercise through conditions employer’s religious precepts.’’ Little, cases. naturally extend to conditions on First, restricting religious 929 F.2d at 951; see also, e.g., Kennedy, contracts as well. See Office of the Att’y organizations’ ability to employ those 657 F.3d at 194 (‘‘Congress intended the Gen., Memorandum for All Executive aligned with their mission burdens their explicit exemptions to Title VII to Departments and Agencies: Federal Law religious exercise, even when those enable religious organizations to create Protections for Religious Liberty at 2, 6, employees do not engage in expressly and maintain communities composed 8, 14a–16a (Oct. 6, 2017), available at religious activity. As the Supreme Court solely of individuals faithful to their www.justice.gov/opa/press-release/file/ recognized in Amos, the religious doctrinal practices, whether or not every 1001891/download. Third, the exemption’s protection for all activities individual plays a direct role in the definition of Particular religion of religious organizations alleviates the organization’s ‘religious activities.’ ’’ promulgated here attempts to alleviate burden of government interference with (quoting Little, 929 F.2d at 951)); Hall, that burden by permissibly those religious organizations’ missions. 215 F.3d at 624 (‘‘The decision to accommodating religious organizations. See Amos, 483 U.S. at 336. And as the employ individuals ‘of a particular ‘‘[T]he government may (and sometimes Department of Justice’s Office of Legal religion’ under [42 U.S.C.] § 2000e–1(a) must) accommodate religious practices Counsel has concluded: and § 2000e–2(e)(2) has been interpreted and . . . may do so without violating to include the decision to terminate an [T]he Court’s opinion in Amos, together with the Establishment Clause. . . . There is employee whose conduct or religious Justice Brennan’s concurring opinion in the ample room under the Establishment beliefs are inconsistent with those of its case, indicates that prohibiting religious Clause for ‘benevolent neutrality which organizations from hiring only coreligionists employer.’’ (citing, inter alia, Little, 929 can ‘ ‘‘impose a significant burden on their will permit religious exercise to exist F.2d at 951)); Killinger, 113 F.3d at 200 exercise of religion, even as applied to without sponsorship and without (‘‘[T]he exemption [in 42 U.S.C. 2000e– employees in programs that must, by law, interference.’ ’’ Amos, 483 U.S. at 344 1(a)] allows religious institutions to refrain from specifically religious (quoting Walz v. Tax Comm’n, 397 U.S. employ only persons whose beliefs are activities.’ ’’ The .’’ Mem. for Brett 664, 673 (1970)). See also E.O. 13279 consistent with the employer’s when the Kavanaugh, Assoc. Counsel to the Pres., from § 4; 68 FR at 56393 (codified at 41 CFR work is connected with carrying out the Sheldon T. Bradshaw, Deputy Ass’t Att’y 60–1.5(a)(5)). This rule relieves religious Gen., Office of Legal Counsel further institution’s activities.’’). explained:, Re: Section 1994A (Charitable organizations of government This approach is also consistent with Choice) of H.R. 7, The Community Solutions interference by permitting them to take Supreme Court decisions emphasizing Act at 4 (June 25, 2001) .... Many religious into account their employees’ particular that ‘‘condition[ing] the availability of organizations and associations engage in religion—including acceptance of or benefits upon a recipient’s willingness

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79345

to surrender his religiously impelled overly narrow, to include acceptance of further than a coreligionist preference status effectively penalizes the free or adherence to religious tenets as a for several reasons. exercise of his constitutional liberties.’’ condition of employment. Many of these First, a coreligionist preference could Trinity Lutheran, 137 S. Ct. at 2022 commenters agreed with OFCCP that the be construed narrowly, as some (alterations omitted) (quoting McDaniel, definition as proposed was necessary to commenters seemed to urge, as allowing 435 U.S. at 626 (plurality opinion)). ensure that religious organizations religious organizations to prefer those These decisions naturally extend to could carry out their missions without who share a religious identity in name include the right to compete on a level losing their identities. For example, a but nothing more. OFCCP disagrees that playing field for federal government religious school association commented the exemption should be construed to contracts. See id. (holding the that being able to ensure that applicants permit religious employers to prefer government burdens religious exercise and employees concur with its schools’ fellow members of their faith—or people when it so conditions ‘‘a benefit or religion-based conduct expectations is who profess to be members of their privilege,’’ ‘‘eligibility for office,’’ ‘‘a essential to fulfilling the schools’ faith—but forbid requiring their gratuitous benefit,’’ or the ability ‘‘to religious mission. Similarly, a religious adherence to that faith’s tenets in word compete with secular organizations for civil rights organization commented that and deed. Religious employers can a grant’’ (quoted sources omitted)); the entire ‘‘raison d’eˆtre’’ of religious require more than nominal membership accord E.O. 13831 § 1 (‘‘The executive non-profits would be undermined if from their employees, as shown by branch wants faith-based and employees could subvert their religious Amos, where the plaintiffs were community organizations, to the fullest missions. Other commenters, including discharged for failing to qualify for a opportunity permitted by law, to a religious medical organization, a certificate showing that they were compete on a level playing field for . . . religious liberty coalition, and a state members of the employer’s church and contracts . . . and other Federal funding religious public policy organization, met certain standards of religious opportunities.’’). echoed these sentiments in support of conduct. See 483 U.S. at 330 n.4; Amos OFCCP believes this clarification will the proposal. A private religious v. Corp. of Presiding Bishop of Church assist contractors that have looked for university further asserted that the of Jesus Christ of Latter-Day Saints, 594 guidance on the religious exemption in proposed definition would increase F. Supp. 791, 796 (D. Utah 1984) OFCCP’s past statements. These past religious diversity, because its (describing plaintiffs’ failure to meet statements may have suggested that the protections are not limited to hiring church worthiness requirements), rev’d, exemption permits qualifying decisions based on co-religiosity but 483 U.S. 327; see also Killinger, 113 organizations only to prefer members of also allow organizations to hire based their own faith in their employment F.3d at 198–200 (holding despite on applicants’ support for their religious plaintiff’s claim that he subscribed to practices. See, e.g., OFCCP, Compliance missions. Webinar (Mar. 25, 2015), available at university’s ‘‘legitimate religious https://www.dol.gov/ofccp/LGBT/FTS_ Many commenters asserted that the requirements,’’ including the TranscriptEO13672_PublicWebinar_ES_ proposed definition conflicts with the requirement to ‘‘subscribe to the 1963 QA_508c.pdf (‘‘This exemption allows EEOC’s interpretation, OFCCP’s Baptist Statement of Faith and religious organizations to hire only previous interpretation, or both. For Message,’’ he was permissibly removed members of their own faith.’’). OFCCP example, a civil liberties organization from a teaching post in the divinity based such statements on guidance from commented that the EEOC interprets the school ‘‘because he did not adhere to the EEOC, the agency primarily text of the Title VII religious exemption and sometime[s] questioned the responsible for enforcing Title VII. See, to mean that religious organizations may fundamentalist theology advanced by e.g., EEOC, EEOC Compliance Manual give employment preference to members the [school’s] leadership’’ (first § 12–I.C.1 (July 22, 2008) (‘‘Under Title of their own religion. Several alteration in original)). Any other course VII, religious organizations are commenters referred to OFCCP’s would entangle OFCCP in deciding permitted to give employment previous interpretation as reflected in between competing views of a religion’s preference to members of their own its 2015 answers to FAQs regarding the requirements—in essence, deciding for religion.’’). However, with this final E.O. 13672 Final Rule.18 For example, a example, ‘‘who is and who is not a good rule, OFCCP is clarifying that it applies legal think tank noted that in 2015, Catholic.’’ Maguire v. Marquette Univ., the principles discussed above, OFCCP issued guidance mirroring the 627 F. Supp. 1499, 1500 (E.D. Wis. permitting qualifying employers to take EEOC’s interpretation of the Title VII 1986) (holding despite plaintiff’s claim religion—defined more broadly than religious exemption and confirming that to be Catholic, a Catholic religious simply preferring coreligionists—into the plain text of section 204(c) is limited university permissibly declined to hire account in their employment decisions. to religious organizations with hiring her ‘‘because of her perceived hostility The case law makes clear that qualifying preferences for coreligionists and to the to the institutional church and its employers ‘‘need not enforce an across- ministerial exemption. Other teachings’’), aff’d in part, vacated in the-board policy of hiring only commenters, including an LGBT legal part, 814 F.2d 1213 (7th Cir. 1987). coreligionists.’’ LeBoon, 503 F.3d at 230; services organization, a reproductive OFCCP is not permitted to make such Killinger, 113 F.3d at 199–200 (‘‘We are rights organization, and a public policy determinations. See Our Lady of also aware of no requirement that a research and advocacy organization, Guadalupe, 140 S. Ct. at 2068–69 religious educational institution engage made similar points. (‘‘[D]etermining whether a person is a in a strict policy of religious OFCCP appreciates the various ‘co-religionist’ will not always be easy. discrimination—such as always comments received on this topic. After See Reply Brief 14 (‘Are Orthodox Jews preferring Baptists in employment careful consideration, OFCCP disagrees and non-Orthodox Jews coreligionists? decisions—to be entitled to the with the comments arguing that the . . . Would Presbyterians and Baptists exemption.’’). religious exemption should extend no be similar enough? Southern Baptists Some commenters expressed support and Primitive Baptists?’). Deciding such for OFCCP’s proposal to extend the 18 These 2015 FAQs are archived at https:// questions would risk judicial definition beyond preferring web.archive.org/web/20150709220056/http:/ entanglement in religious issues.’’); coreligionists, which they viewed as www.dol.gov/ofccp/LGBT/LGBT_FAQs.html. Hall, 215 F.3d at 626–27 (‘‘If a particular

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79346 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

religious community wishes to with the precepts of the Lutheran observance and practice as understood differentiate between the severity of community sponsoring the school’’). by the employer,’’ it would permit the violating two tenets of its faith, it is not Beyond compromising the integrity of subjective viewpoint of the employer to the province of the federal courts to say religious organizations, OFCCP would determine what constitutes religion. that such differentiation is be wary of drawing a line here between Similarly, a reproductive rights discriminatory and therefore warrants coreligionist employees and other organization claimed that the proposed Title VII liability.’’ (quoted source employees for other reasons. As rule would expand the scope of the omitted)); Presbyterian Church in U.S. illustrated by the cases declining to exemption in violation of federal law. v. Mary Elizabeth Blue Hull Mem’l decide ‘‘who is and who is not a good As explained above in the discussion Presbyterian Church, 393 U.S. 440, 449– Catholic,’’ OFCCP does not believe it of the definition of Religion, OFCCP has 50 (1969) (‘‘Plainly, the First should or could in disputed cases Amendment forbids civil courts from decide who is a coreligionist. This chosen a definition that is well- playing such a role [in interpreting would be especially difficult when the established in federal law, including in particular church doctrines and their employer has no particular the text of Title VII. See 42 U.S.C. importance to the religion].’’). denomination, as there would be no 2000e(j). And as explained above in the discussion of the definition of Religious In addition, some commenters argued simple denominational match between corporation, association, educational that the religious exemption might the employer and employee. Cases like institution, or society, OFCCP has allow religious employers to require World Vision and Little v. Wuerl show that a religious organization may require significant constitutional and practical faithfulness of a coreligionist employee, that its employees subscribe to certain concerns about substituting its own but the exemption does not permit them precepts regardless of their particular to impose religious requirements on judgment for a contractor’s view—found religious affiliation, if they have any their other employees. OFCCP declines to be sincere—that a particular activity, affiliation at all. OFCCP must, and to so narrow its interpretation of the purpose, or belief has religious meaning. should, treat these religious exemption. The exemption was It bears repeating: Any other course organizations equally with those that expanded decades ago to include would risk ‘‘[t]he prospect of church have a defined denominational employees engaged not just in the and state litigating in court about what membership. See World Vision, 633 organization’s religious activities, but in does or does not have religious meaning F.3d at 731 (O’Scannlain, J., [, which] touches the very core of the any of its activities. And the purpose of concurring). the religious exemption is to preserve constitutional guarantee against OFCCP also views an artificial line religious establishment.’’ Cathedral ‘‘the ability of religious organizations to between coreligionists and non- define and carry out their religious Acad., 434 U.S. at 133. OFCCP will coreligionists as presenting an refrain from resolving disputes between missions.’’ Amos, 483 U.S. at 335. As unwelcome either-or dilemma for employers and employees as to what other commenters stated, some religious religious organizations. By declining to has religious meaning or not, when the organizations hire employees outside draw such a line, a religious employer proves its sincere belief that their faith tradition yet require those organization would be permitted to employees to follow at least some require certain religious practices or something does have religious meaning. religious standards in order to preserve conduct from its coreligionist However, as explained in more detail the organization’s integrity Courts have employees, but not from its non- below, just because an employment recognized the legitimacy of that view. coreligionist employees; yet the practice is religiously motivated does See Kennedy, 657 F.3d at 190–91 religious organization would also be not mean that it is always protected by (holding a religious nursing-care facility permitted to, for instance, decline to the exemption. affiliated with the Roman Catholic hire or promote that same non- This leads to a separate set of issues Church was protected by the religious coreligionist altogether. In other words, raised by commenters. Many exemption when it took action against a religious organization could commenters who opposed the proposed an employee of a different faith who discriminate against a non-coreligionist definition stated that it is inconsistent refused to change her own religiously altogether in hiring or promotion, but with Title VII in one or more respects. inspired garb); Little, 929 F.2d at 951 could not instead offer a job or For example, a group of state attorneys (‘‘[I]t does not violate Title VII’s promotion contingent on adherence to general stated that the proposed prohibition of religious discrimination certain mission-oriented religious definition is contrary to the text of Title for a parochial school to discharge a criteria. Religious organizations should VII and congressional intent. Catholic or a non-Catholic teacher who be, and under this rule continue to be, Specifically, the group pointed out that has publicly engaged in conduct permitted to use this middle ground. the plain language of the exemption regarded by the school as inconsistent See Kennedy, 657 F.3d at 194. covers only employer preferences based with its religious principles.’’ (emphasis on a ‘‘particular religion,’’ meaning that added)). This view is also consistent c. The Exemption’s Scope: Employment religious employers cannot broadly with guidance from the U.S. Department Practices of Justice. See Office of the Att’y Gen., In a related vein, commenters also discriminate on the basis of religion by, Memorandum for All Executive shared their views on not only which for instance, adopting policies such as Departments and Agencies: Federal Law employees should be covered by the ‘‘Jews and Muslims Need Not Apply.’’ Protections for Religious Liberty (Oct. 6, exemption, but also which employment Some commenters stated that the 2017), www.justice.gov/opa/press- practices of religious organizations proposed definition is unsupported by release/file/1001891/download (stating should be protected by the exemption. Title VII case law. For example, a civil that, under the Title VII religious Some of these commenters asserted that liberties organization criticized OFCCP exemption, ‘‘a Lutheran secondary the proposed definition was too broad. for not citing to court decisions holding school may choose to employ only For example, a transgender civil rights that the Title VII exemption is intended practicing Lutherans, only practicing organization commented that, because to shield employers from all religiously Christians, or only those willing to the proposed definition encompasses motivated discrimination, as opposed to adhere to a code of conduct consistent ‘‘all aspects of religious belief, discrimination that is ‘‘on the basis of

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00024 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79347

religion alone.’’ 19 A city commented 1(a)] allows religious institutions to connected to the organization’s religious that OFCCP’s reliance on Little, 929 F.2d employ only persons whose beliefs are activities to employees who perform 944; Kennedy, 657 F.3d 189; Hall, 215 consistent with the employer’s when the work connected to any of the F.3d 618; and Killinger, 113 F.3d 196, is work is connected with carrying out the organization’s activities. As the misplaced and misleading because, in institution’s activities.’’); accord Att’y Supreme Court observed, this expansion each of those cases, the courts found Gen., Memorandum for All Executive was aimed toward relieving religious that a religious institution with a Departments and Agencies: Federal Law organizations of the kind of burden substantiated religious purpose could Protections for Religious Liberty (Oct. 6, sought by the commenters: discriminate against an employee 2017), www.justice.gov/opa/press- [I]t is a significant burden on a religious performing work connected in some release/file/1001891/download organization to require it, on pain of manner to the institution’s religious (‘‘[R]eligious organizations may choose substantial liability, to predict which of its mission. to employ only persons whose beliefs activities a secular court will consider The NPRM did not suggest that the and conduct are consistent with the religious. The line is hardly a bright one, and religious exemption would permit organizations’ religious precepts.’’). an organization might understandably be religious organizations to single out concerned that a judge would not understand These cases were grounded in the its religious tenets and sense of mission. other religions for disfavor. No basic principle that these religious employer OFCCP is aware of holds such employment criteria are permitted Amos, 483 U.S. at 336 an exclusionary policy; no commenter because they are necessary for the OFCCP shares the same concerns identified such an employer; and such religious organization’s integrity. See about requiring contractors to justify a policy would run contrary to the Little, 929 F.2d at 950 (‘‘[T]he legislative otherwise-protected employment country’s experience under the Title VII history . . . suggests that the sponsors decisions as additionally furthering the religious exemption, where no litigant of the broadened exception were organization’s mission. Difficulties to OFCCP’s knowledge has asserted solicitous of religious organizations’ could arise were OFCCP to draw such a policy. Instead, the mine run of desire to create communities faithful to distinctions between religiously cases have involved a church, religious their religious principles.’’); Kennedy, motivated employment decisions that educational institution, or religious 657 F.3d at 193 (finding the religious further an employer’s religious mission nonprofit raising the defense that it is organization exemption ‘‘ ‘reflect[s] a and those that do not. Amos observed only requiring employees or decision by Congress that the that difficulty, in which the district applicants—whether strictly defined as court had drawn an at-least questionable coreligionists or not 20—to follow its government interest in eliminating religious discrimination by religious distinction between the termination of a own religiously inspired standards of truck driver at a church-affiliated belief or conduct. The exemption organizations is outweighed by the rights of those organizations to be free workshop (protected) with the historically has been a shield, not a termination of a building engineer at a sword, and it remains so under this rule. from government intervention.’ ’’ (alteration in original) (quoting Little, church-affiliated gymnasium (not OFCCP also believes it has relied protected). See id. at 330, 333 n.13, 336 properly on cases like Little and 929 F.2d at 951)); Killinger, 113 F.3d at 201 (‘‘[F]ederal court[s] must give n.14. The exemption does not require Kennedy. As stated in the NPRM, these such hair-splitting—indeed, it appears cases hold that the religious exemption disputes about what particulars should or should not be taught in theology to forbid it—and OFCCP sees no useful ‘‘includes permission to employ only reason to attempt drawing such persons whose beliefs and conduct are schools a wide-berth. Congress, as we distinctions. See also Little, 929 F.2d at consistent with the employer’s religious understand it, has told us to do so for 951 (‘‘Congress intended the explicit precepts.’’ Little, 929 F.2d at 951; see purposes of Title VII.’’); Hall, 215 F.3d exemptions to Title VII to enable also, e.g., Kennedy, 657 F.3d at 194 at 623 (‘‘In recognition of the religious organizations to create and (‘‘Congress intended the explicit constitutionally-protected interest of maintain communities composed solely exemptions to Title VII to enable religious organizations in making of individuals faithful to their doctrinal religious organizations to create and religiously-motivated employment practices, whether or not every maintain communities composed solely decisions . . . Title VII has expressly individual plays a direct role in the of individuals faithful to their doctrinal exempted religious organizations from organization’s ‘religious activities.’ ’’). practices, whether or not every the prohibition against discrimination individual plays a direct role in the on the basis of religion . . . .’’). That d. The Exemption’s Scope: Other organization’s ‘religious activities.’ ’’) means that the religious employer must Protected Bases (quoting Little, 929 F.2d at 951); Hall, explain how its sincere religious beliefs i. Comments 215 F.3d at 624 (‘‘The decision to translate into particular religious employ individuals ‘of a particular requirements for its employees and As is made clear by the text of section religion’ under [42 U.S.C.] § 2000e–1(a) applicants. Cf. Geary, 7 F.3d at 330 204(c) of E.O. 11246 and the and § 2000e–2(e)(2) has been interpreted (‘‘The institution, at most, is called corresponding regulation at 41 CFR 60– to include the decision to terminate an upon to explain the application of its 1.5(a)(5), the religious exemption itself employee whose conduct or religious own doctrines.’’). But the exemption does not exempt or excuse a contractor beliefs are inconsistent with those of its does not require the religious employer from complying with other applicable employer.’’ (citing, inter alia, Little, 929 to further prove that a particular requirements. See E.O. 11246 § 204(c) F.2d at 951)); Killinger, 113 F.3d at 200 employee or applicant’s adherence to (‘‘Such [religious] contractors and (‘‘[T]he exemption [in 42 U.S.C. 2000e– those religious requirements is subcontractors are not exempted or necessary, in any contested instance, to excused from complying with other 19 This point is addressed more fulsomely in the further the religious organization’s requirements contained in this Order.’’); next section regarding E.O. 11246’s other protected mission. That added burden would be 41 CFR 60–1.5(a)(5) (same). Thus, bases. contrary to the 1972 amendment of the religious employers are not exempted 20 For the reasons discussed earlier, OFCCP does not believe restricting the exemption to a purely Title VII religious exemption, which from E.O. 11246’s requirements coreligionist preference is required or the most expanded the exemption from regarding antidiscrimination and reasonable approach. employees who perform work affirmative action, generally speaking;

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00025 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79348 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

notices to applicants, employees, and reproductive rights organization, cited employee’s sexual orientation and/or labor unions; compliance with OFCCP’s cases in which, they asserted, courts gender identity would prevail under the implementing regulations; the prohibited religious employers from proposed regulations. A pastoral furnishing of reports and records to the discriminating on bases other than membership organization stated that if government; and flow-down clauses to religion. For example, the civil liberties the terms ‘‘sexual orientation’’ and subcontractors. See E.O. 11246 §§ 202– organization commented that courts ‘‘gender identity’’ include conduct, it is 203. have consistently prohibited religious difficult to determine whether the Although Title VII does not contain a organizations from discriminating on prohibition on discrimination based on corresponding proviso, courts have other bases, including sex, even where sexual orientation and gender identity generally interpreted the Title VII that discrimination is motivated by the or the protection for religiously- religious exemption to be similarly organization’s sincere religious beliefs motivated conduct applies. precise, so that religious employers are (citing Rayburn, 772 F.2d at 1166; Many of these commenters criticized not exempted from Title VII’s other Kennedy, 657 F.3d at 192; EEOC v. Pac. the proposal for not clearly stating how provisions protecting employees. See, Press Publ’g Ass’n, 676 F.2d 1272, 1277 OFCCP would resolve the perceived e.g., Kennedy, 657 F.3d at 192; Rayburn (9th Cir. 1982), abrogated on other contradiction between its assertion that v. Gen. Conference of Seventh-Day grounds by Alcazar v. Corp. of Catholic religious contractors would not be Adventists, 772 F.2d 1164, 1166 (4th Archbishop of Seattle, 598 F.3d 668 (9th permitted to discriminate on other Cir. 1985); cf. Hobby Lobby, 573 U.S. at Cir. 2010); Elbaz v. Congregation Beth protected bases and its inclusion in the 733 (rejecting ‘‘the possibility that Judea, Inc., 812 F. Supp. 802, 807 (N.D. proposed definition of ‘‘acceptance of or discrimination in hiring, for example on Ill. 1992); Dolter v. Wahlert High Sch., adherence to religious tenets as the basis of race, might be cloaked as 483 F. Supp. 266, 269 (N.D. Iowa 1980); understood by the employer as a religious practice to escape legal accord McClure v. Salvation Army, 460 condition of employment.’’ For sanction’’); Bob Jones Univ. v. United F.2d 553, 558 (5th Cir. 1972)). example, the legal think tank asserted States, 461 U.S. 574, 604 (1983) (‘‘[T]he Some commenters argued that that OFCCP does not explain how it will Government has a fundamental, religion has long been used as a way to apply these two provisions in cases in overriding interest in eradicating racial justify discrimination. For example, an which they appear to conflict, and discrimination in education . . . .’’). affirmative action professionals observed that the proposed regulatory Many commenters nevertheless association asserted that religious text does not limit its definition of assumed that OFCCP would apply the freedom has historically been invoked ‘‘religious tenets’’ to tenets defined proposed definition to allow religious to defend slavery, the denial of women’s without reference to race, color, sex, contractors to discriminate on bases suffrage, Jim Crow laws, and sexual orientation, gender identity, or other than religion. Most of these segregation. That commenter cited a national origin. A state’s attorney commenters stated that doing so would recent news story in which a mixed-race general asserted that, because the be contrary to E.O. 11246, and they couple was allegedly denied the use of proposed rule fails to define or limit the argued that OFCCP lacks authority to a hall for a wedding because of the type of ‘‘conduct’’ that can form the expand the existing exemption or grant owner’s religious beliefs. basis of permissible discrimination by any new exemption. For example, a Several commenters expressed religious entities, it allows contractors civil liberties organization commented concern specifically about the effect of to discriminate based on any arbitrary that the preamble indicates that OFCCP the proposal on E.O. 11246’s protections characteristic. intends to authorize discrimination from discrimination based on sexual Many supportive commenters based even on other protected bases like orientation and gender identity. For recommended that OFCCP resolve the sex or race, contrary to the text of E.O. example, an LGBT rights advocacy perceived conflict by clarifying that the 11246. Similarly, a group of U.S. organization commented that it was non-discrimination requirements of Senators commented that the proposed troubled by the fact that OFCCP failed Title VII and E.O. 11246 do not apply rule would allow employers to to cite sexual orientation and gender under the corresponding religious discriminate against employees on bases identity in the proposed rule as the exemptions. For example, an other than religion by, for instance, protected characteristics most likely to anonymous commenter suggested that permitting employers to justify sex be impacted by the rule. And a legal OFCCP clarify that religious discrimination based on their religious professional organization expressed organizations are permitted to tenets. concern that OFCCP may interpret E.O. discriminate on the bases of sexual These commenters pointed to the 11246 to allow federal contractors to orientation and gender identity because, second sentence of section 204(c) of discriminate based on sexual orientation in the commenter’s view, an action that E.O. 11246 as supporting their criticism. as long as they cite sincere religious falls within the religious exemption For example, a legal think tank reasons for doing so. would be outside the bounds of Title VII commented that it was unclear how the On the other hand, as noted above, and E.O. 11246, ‘‘regardless of whether proposed rule’s ‘‘expansive definition of other commenters expressed support for it would otherwise be prohibited by ‘particular religion’ ’’ could be the proposal because they believed it other provisions.’’ Other supportive reconciled with its insistence that ‘‘an would exempt religious organizations commenters offered a similar view, employer may not . . . invoke religion from the prohibitions on discrimination stating that the proposed definition to discriminate on other bases protected based on sexual orientation and gender provided helpful clarification. For by law.’’ identify, which would provide them example, a religious liberties legal Other commenters also stated that it protection to staff their organizations organization criticized ‘‘the suggestion would be inconsistent with Title VII consistent with their sincere religious from the Obama administration’’ that case law to allow religious contractors beliefs. the exemption should be limited to to discriminate on bases other than Some commenters requested guidance ‘‘religious people cannot be religion. These commenters, including a to resolve the perceived conflict. For discriminatory for hiring only members legal think tank, a group of state example, an individual commenter of their own religion’’ rather than ‘‘non- attorneys general, a labor union, a civil asked whether protection for a client’s discrimination law does not apply in liberties organization, and a religion or protection for an applicant or religious contexts’’ as provided under

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00026 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79349

the Civil Rights Act, and praised the government contractors or because of animus borne of the proposed rule for affirming that subcontractors, they too must comply employee’s country of birth or skin requiring adherence to an employer’s with all of E.O. 11246’s color, would violate E.O. 11246. Courts religious tenets does not constitute nondiscrimination requirements except in the Title VII context have engaged in discrimination. Similarly, a U.S. Senator in some narrow respects under some careful, fact-bound inquiries to commented that the proposed helpfully reasonable circumstances recognized by determine whether a religious clarifies that religious employers that law. This rule provides clarity on those organization’s action was based on contract with the federal government circumstances, consistent with OFCCP’s religion or instead on a prohibited retain the right to hire employees that obligations and desire to also respect basis.22 For instance, courts may inquire support their religious mission, and accommodate the free exercise of whether a plaintiff was subjected to consistent with Title VII. Some religion. adverse employment action because of supportive commenters also noted that his or her sex or because of a violation the proposed definition was consistent ii. Legal Principles of religious tenets. See, e.g., Cline v. with the First Amendment and Title VII OFCCP acknowledges first and Catholic Diocese of Toledo, 206 F.3d case law. For example, a religious legal foremost the United States’ deeply 651, 655–56, 658 (6th Cir. 2000); cf. association and an association of rooted tradition of respect for religion EEOC v. Miss. Coll., 626 F.2d 477, 485– evangelical churches and schools and religious institutions. Religious 86 (5th Cir. 1980) (holding if religious commented that the principle that individuals and organizations operate organization shows that its decision was religious employers should be allowed within and contribute to civil society based on religion, the religious to require their employees to conduct and do not relinquish their religious exemption prohibits a further inquiry themselves in accordance with the freedom protections when they into pretext). To that extent, courts are employers’ code of moral conduct has participate in the public square.21 virtually uniform in the view that the been ‘‘almost universally’’ accepted by With respect to commenters’ concerns religious exemption does not permit courts, who have relied alternatively on and questions here, many relate to the discrimination on bases other than Section 702(a) of Title VII, the First interaction of two well-established Title religion.23 Amendment’s Religion Clauses, and VII principles: First, that religious The question posed here, however, is other considerations recognizing that organizations can take religion into the interaction of those two principles: ‘‘religious organizations may have account when making employment Specifically, the outcome when a legitimate, nondiscriminatory reasons’’ decisions; and second, that religious religion organization’s action is based for practicing their religious beliefs organizations cannot discriminate on on and motivated by the employee’s through employment decisions. other protected bases. Each of those two adherence to religious tenets yet In a joint comment, a religious legal principles taken by itself has clear implicates another category protected by association and an association of answers. Where an employment E.O. 11246. OFCCP concludes, as evangelical churches and schools decision made on the basis of religion explained in detail below, that the commented that Section 204(c) of E.O. also implicates another protected basis, religious exemption itself, as interpreted 11246 should be construed to exempt however, the law is less clear. by the courts, has left the question open, religious organizations from the As to the first principle, virtually all but that such activity would also give nondiscrimination mandates of Section commenters agreed with what the plain rise to an inquiry under RFRA, which 202, except to the extent that a religious text of the exemption provides: That must be assessed based on applicable organization’s employment decision is religious organizations can consider an case law and the specific facts based on race. employee’s particular religion when presented. To address these comments, OFCCP taking employment action. As discussed At the federal appellate court level, here first discusses the applicable Title the question of the religious elsewhere in this rule’s preamble, VII principles established by case law, exemption’s interaction with other commenters disagreed as to the scope of including how those principles may protected bases was left open in, for that exemption—which employees it apply where religious organizations instance, EEOC v. Mississippi College, applies to, and which employer maintain sincerely held beliefs where an EEOC subpoena did ‘‘not actions—but the basic principle was not regarding matters such as marriage and clearly implicate any religious practices disputed. intimacy, which may implicate of the College.’’ 626 F.2d at 487. The As to the second principle, as many protected classes under E.O. 11246. court noted that the college had a commenters recognized, E.O. 11246’s OFCCP then discusses its recognition scripturally rooted policy of hiring only other employment protections apply to that religious organizations in men to teach courses in religion, but religious organizations. Protections on appropriate circumstances will be stated that ‘‘[b]efore the EEOC could the basis of race, color, sex, sexual entitled to relief under the Religious require the College to alter that practice, orientation, gender identity, and Freedom Restoration Act. the College would have an opportunity national origin do not categorically The public should bear in mind that to litigate in a federal forum whether disappear when the employer is a this discussion is restricted solely to [the religious exemption] exempts or the religious organization. Thus the these difficult and sensitive questions first amendment protects that particular raised by commenters. This rule does religious exemption does not permit not affect the overwhelming majority of religious organizations to engage in 22 See below for a more fulsome discussion of federal contractors and subcontractors, prohibited discrimination when there is how courts have determined the applicability of the which are not religious, and OFCCP no religious basis for the action. For religious exemption. 23 remains fully committed to enforcing all instance, a religious organization that This is separate from the question of whether declined to promote a non-ministerial application of Title VII in any particular instance E.O. 11246 nondiscrimination is tolerable under the First Amendment or other requirements, including those employee not for religious reasons, but law, such as where the employee is a minister, see protecting employees from Our Lady of Guadalupe, 140 S. Ct. 2049, or where 21 See Office of the Att’y Gen., Memorandum for the employment relationship is otherwise ‘‘so discrimination on the bases of sexual All Executive Departments and Agencies: Federal pervasively religious’’ that it raises First orientation and gender identity. Even Law Protections for Religious Liberty 1–2 (Oct. 6, Amendment concerns, see DeMarco v. Holy Cross for religious organizations that serve as 2017). High Sch., 4 F.3d 166, 172 (2d Cir. 1993).

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79350 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

practice.’’ Id. The Seventh Circuit has and as a constitutional matter noted that furthering that interest. [42 U.S.C.] similarly characterized the question of ‘‘[e]liminating the employment policy § 2000bb–1.’’ Id. Moreover, ‘‘[b]ecause whether ‘‘the religious-employer involved here would not interfere with RFRA operates as a kind of super exemptions in Title VII [are] applicable religious belief and only minimally, if at statute, displacing the normal operation only to claims of religious all, with the practice of religion.’’ Id. at of other federal laws, it might supersede discrimination’’ as ‘‘a question of first 1366, 1368. Title VII’s commands in appropriate impression in this circuit.’’ Herx v. The Supreme Court also has not cases. [42 U.S.C.] § 2000bb–3.’’ Id.25 Diocese of Fort Wayne-South Bend, Inc., answered whether an employment Concerns raised by supportive 772 F.3d 1085, 1087 (7th Cir. 2014). action motivated by religion but commenters in this rulemaking have Other courts have indicated that the implicating a protected classification alerted the agency that application of religious exemption may be preeminent violates Title VII. The Court’s cases offer E.O. 11246 may substantially burden in such a situation. See Little, 929 F.2d no clear conclusion whether the their religious exercise, especially if the at 951 (‘‘[T]he permission to employ religious exemption should be read so religious exemption does not clearly persons ‘of a particular religion’ narrowly that its protections are protect their ability to maintain includes permission to employ only overcome by the rest of E.O. 11246’s (or employees faithful to their practices and persons whose beliefs and conduct are Title VII’s) protections when they are beliefs. The ministerial exception offers consistent with the employer’s religious both at issue. For example, in Bostock religious organizations broad freedom in precepts.’’); see also Kennedy, 657 F.3d v. Clayton County, 140 S. Ct. 1731 the selection of ministers, but that is at 194 (‘‘Congress intended the explicit (2020), the Court held that Title VII’s only a subset of their employees. See exemptions to Title VII to enable prohibition on discrimination because generally Our Lady of Guadalupe, 140 religious organizations to create and of sex includes discrimination on the S. Ct. 2049. In contrast, the religious maintain communities composed solely basis of sexual orientation and exemption applies to all of a religious of individuals faithful to their doctrinal transgender status. That holding itself is organization’s employees, but the scope practices.’’ (quoting Little, 929 F.2d at not particularly germane to OFCCP’s of its protections is not settled when 951)). enforcement of E.O. 11246, which has religious tenets implicate other The only two federal appellate-level expressly protected sexual orientation protected classes. Thus, the Department cases with fact patterns involving the and gender identity since 2015. What is should consider RFRA, since in some precise issue are a pair of Ninth Circuit certainly germane is the Court’s circumstances neither the ministerial cases from the 1980s. The first, EEOC v. recognition of the ‘‘fear that complying exception nor the religious exemption Pacific Press Publishing Association, with Title VII’s requirement in cases may alleviate E.O. 11246’s burden on held as a statutory matter that Title VII’s like [Bostock] may require some religious exercise. See Little Sisters of prohibitions on sex discrimination and employers to violate their religious the Poor, 140 S. Ct. at 2383–84 (holding on retaliation applied to a religious convictions’’ and its assurance that it, agencies should consider RFRA when it organization. See 676 F.2d 1272, 1277 too, was ‘‘deeply concerned with is an important aspect of the problem (9th Cir. 1982). But the court preserving the promise of the free involved in the rulemaking). determined that the practice at issue exercise of religion enshrined in our The discussion below addresses in that resulted in sex discrimination Constitution; that guarantee lies at the general terms how OFCCP views its ‘‘does not and could not conflict with heart of our pluralistic society.’’ Id. at obligations under RFRA in the specific [the employer’s] religious doctrines, nor 1753–54. The Court then noted that situation raised by commenters and does it prohibit an activity rooted in Title VII contains ‘‘an express statutory addressed here: Where the religious religious belief.’’ Id. at 1279. Regarding exception for religious organizations,’’ organization takes employment action retaliation, the court held as a but did not explain whether an regarding an applicant or an employee, constitutional matter that Title VII’s employment action motivated by the employment action is motivated anti-retaliation provision should apply religion that implicates a protected solely on the employee’s adherence to a to the religious organization even when classification violates Title VII. Id. at sincere religious tenet, yet that tenet the employee was dismissed for 1754. also implicates an E.O. 11246 protected violating church doctrine that Regardless, OFCCP ultimately does category other than race (which is prohibited members from bringing not need to answer this open question discussed separately). RFRA requires a lawsuits against the church. See id. at on the proper interpretation of the fact-specific analysis, so the discussion 1280. religious exemption in E.O. 11246, and here of necessity can speak only to The second decision, EEOC v. declines to do so, because RFRA can OFCCP’s general approach; specific Fremont Christian School, 781 F.2d guide the agency’s determination if and situations involving specific parties will 1362 (9th Cir. 1986), is less instructive. when a particular case presents a require consideration of any additional, It held in relevant part that Title VII situation where a religiously motivated unique facts. And of course the could be applied to prohibit a employment action implicates a contractor or subcontractor involved religiously grounded health benefits classification protected under the will need to demonstrate its religious program that benefited one sex more Executive Order. As noted in Bostock, sincerity and burden so that it falls than the other. However, as a statutory RFRA ‘‘prohibits the federal government within this rubric. Nonetheless, OFCCP matter, the court held that the religious from substantially burdening a person’s believes its RFRA analysis here will exemption was not implicated because exercise of religion unless it provide clarity for religious contractors the employment practice did not demonstrates that doing so both furthers and subcontractors, regardless of how concern the selection of employees a compelling governmental interest and future cases may interpret the interplay based on their religion—the text of the represents the least restrictive means of of the religious exemption in and of exemption refers to ‘‘employment of itself with other protected classes under 24 agrees that the policy in Fremont would not be individuals of a particular religion’’ — covered by the religious exemption because it did Title VII or E.O. 11246. not pertain to the employee’s particular religion. 24 As explained elsewhere in this preamble, the Nothing about the employee’s religious beliefs or 25 RFRA was not raised before the Court in religious exemption is more than a mere hiring conduct would affect the policy—only his or her Bostock. Thus, the Court left that ‘‘question[ ] for preference for coreligionists. OFCCP nonetheless sex. future cases.’’ 140 S. Ct. at 1754.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00028 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79351

iii. Application of the Religious questions is yes, then the regulation religion exists. While the compulsion Freedom Restoration Act substantially burdens the exercise of may be indirect, the infringement upon ‘‘Congress enacted RFRA in 1993 in religion. free exercise is nonetheless order to provide very broad protection On the first question, noncompliance substantial.’’). Thomas, 450 U.S. at 717– of religious liberty.’’ Hobby Lobby, 573 with the nondiscrimination 18. U.S. at 693. RFRA responded to requirements of E.O. 11246 could have On the second question, the Supreme ‘‘Employment Division v. Smith, 494 substantial adverse consequences on Court emphasized in Hobby Lobby that, U.S. 872 (1990) [in which] the Supreme religious organizations that participate in determining whether compliance Court virtually eliminated the in government contracting. One private with a particular mandate would requirement that the government justify religious university supportive of the substantially burden the objecting burdens on religious exercise imposed proposed rule stated that it is ‘‘a large party’s ability to operate in accordance by laws neutral toward religion’’ under research university with dozens of with its religious beliefs, the federal the First Amendment, and restored by active federal contracts at any given government must ‘‘not presume to statute ‘‘the compelling interest test as time,’’ while another stated that determine the plausibility of a religious set forth in Sherbert v. Verner, 374 U.S. ‘‘religious organizations have long been claim.’’ Hobby Lobby, 573 U.S. at 724 398 (1963) and Wisconsin v. Yoder, 406 significant participants in federal (quoting Smith, 494 U.S. at 887). It is U.S. 205 (1972).’’ 42 U.S.C. procurement programs.’’ not for a court, or for OFCCP, to say 2000bb(a)(4), (b)(1); see Hobby Lobby, Noncompliance with E.O. 11246 can whether a particular set of religious 573 U.S. at 693–95. result in awards of back pay and other beliefs is ‘‘mistaken or insubstantial.’’ Under RFRA, the federal government make-whole relief to affected employees Hobby Lobby, 573 U.S. at 725. may not ‘‘substantially burden a and applicants, cancellation or Furthermore, religious exercise means person’s exercise of religion.’’ 42 U.S.C. suspension of the contract, and even more than being able to express 2000bb–1(a). Government is excepted suspension or debarment. See E.O. particular views—a right to freedom of from this requirement only if it 11246 § 202(7); 41 CFR 60–1.26. That is religion requires the right to act in ‘‘demonstrates that application of the substantial pressure. Indeed, it is a conformance with that religion. See burden to the person—(1) is in substantial burden for the government Espinoza, 140 S. Ct. at 2277 (Gorsuch, furtherance of a compelling to compel someone ‘‘to choose between J., concurring) (‘‘The right to be religious governmental interest; and (2) is the the exercise of a First Amendment right without the right to do religious things least restrictive means of furthering that and participation in an otherwise would hardly amount to a right at all.’’). compelling government interest.’’ Id. available public program.’’ Thomas, 450 It is this right to engage in conduct 2000bb–1(b). U.S. at 716; Sherbert, 374 U.S. at 404 consistent with sincerely held belief— RFRA ‘‘applies to all Federal law, and (‘‘It is too late in the day to doubt that and a right to be free of demands to the implementation of that law, whether the liberties of religion and expression engage in conduct conflicting with those statutory or otherwise, and whether may be infringed by the denial of or sincerely held beliefs—that RFRA adopted before or after November 16, placing of conditions upon a benefit or protects. See Little Sisters of the Poor, 1993,’’ Id. 2000bb–3(a), including privilege.’’). ‘‘Governmental imposition 140 S. Ct. at 2390. agency regulations, see Little Sisters of of such a choice puts the same kind of Compliance with the the Poor, 140 S. Ct. at 2383. As ‘‘Federal burden upon the free exercise of religion nondiscrimination provisions in E.O. law, and the implementation of that as would a fine imposed’’ for engaging 11246, if interpreted to apply when an law,’’ E.O. 11246 fits within that scope in religious action. Sherbert, 374 U.S. at employment action is motivated by as well. 404. ‘‘Where the state conditions receipt religion yet also implicates a protected of an important benefit upon conduct classification, could force religious (1) Substantial Burden proscribed by a religious faith, or where organizations to violate their sincerely The question of whether government it denies such a benefit because of held religious beliefs or to compromise action substantially burdens an conduct mandated by religious belief, their religious integrity or mission by employer’s exercise of religion can be thereby putting substantial pressure on placing substantial pressure on them to separated into two parts. See Hobby an adherent to modify his behavior and violate or modify their religious tenets Lobby, 573 U.S. at 720–26; Little Sisters to violate his beliefs, a burden upon related to their employees and their of the Poor, 140 S. Ct. at 2389 (Alito, J., religious communities. The comments concurring). First, the government must violate its religious beliefs. Instead, substantial on the proposed rule made this clear. pressure on a party to modify its religiously For example, a private religious ask whether the consequences of motivated practice is also sufficient to establish a noncompliance put substantial pressure substantial burden. See, e.g., Archdiocese of Wash. university noted the importance for on the objecting party to comply. See v. Wash. Metro. Area Transit Auth., 897 F.3d 314, religious employers to be able to Hobby Lobby, 573 U.S. at 720–23. 333 (D.C. Cir. 2018) (defining ‘‘substantial burden’’ ‘‘employ[ ] persons whose beliefs and under RFRA as ‘‘substantial pressure on an conduct are consistent with [their] Second, the government must ask adherent to modify his behavior and to violate his whether compliance with the regulation beliefs’’) (quoting Thomas v. Review Bd., 450 U.S. religious precepts.’’ Similarly, a would violate or modify the objecting 707, 718 (1981)); EEOC v. Catholic Univ. of Am., nationwide ecclesiastical organization party’s sincerely-held religious exercise 83 F.3d 455, 467 (D.C. Cir. 1996) (finding that stated in its comment that faith-based government’s interest in eliminating employment organizations should be able to (as the objecting party understands that discrimination at Catholic university was exercise and any underlying beliefs), outweighed by university’s right of autonomy in its ‘‘lawfully prefer for employment those own domain); Jolly v. Coughlin, 76 F.3d 468, 477 who, by word and conduct, accept and including the party’s ‘‘ability . . . to (2d Cir. 1996) (finding that right to free exercise of conduct business in accordance with adhere to that faith as the organization religion is ‘‘substantially burdened’’ within understands it, regardless of the [its] religious beliefs.’’ Hobby Lobby, 573 meaning of RFRA where state puts substantial applicant’s or employee’s religious U.S. at 724; see also Sherbert, 374 U.S. pressure on adherent to modify his behavior and to violate his beliefs); In re Young, 82 F.3d 1407, 1418 affiliation.’’ An association of religious at 405–06.26 If the answer to both (8th Cir. 1996) (‘‘[D]efining substantial burden universities echoed these sentiments, broadly to include religiously motivated as well as stating that ‘‘[o]ur schools are 26 Case law is clear that RFRA’s substantial religiously compelled conduct is consistent with burden test does not insist that a challenged the RFRA’s purpose to restore pre-Smith free committed to upholding their religion- government action require an objecting party to exercise case law.’’). based standards by aligning

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00029 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79352 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

employment expectations exclusively provided leeway under federal religious exemption permits religious with applicants and employees who constitutional and statutory law in organizations to prefer ‘‘coreligionists’’ concur with these expectations. These regulating the sexual conduct of those in in employment decisions. In that case, expectations are essential to fulfilling their employ in keeping with their religious organizations would draw our religious mission.’’ While the religious views’’); Dolter v. Wahlert strict lines by stating that certain commenter explained that generally its High Sch., 483 F. Supp. 266, 270 (N.D. behaviors, beliefs, or statements are associated ‘‘schools do not accept direct Iowa 1980) (‘‘Nor does the court quarrel anathema to the religion and take one government funding,’’ it highlighted the with defendant’s contention that it can outside the religious community. That importance for its members that ‘‘no define moral precepts and prescribe a way, employment action would be more organization should be excluded by the code of moral conduct that its teachers readily identified as resting solely on government from competing for . . . must follow.’’).27 religious grounds as a preference against contracts or other funds simply because Of particular concern here as well is a non-coreligionist. See Mississippi the religious organization is serious that ‘‘[f]ear of potential liability might College, 626 F.2d at 484–85; cf. Amos, about maintaining its religious identity affect the way an organization carried 483 U.S. at 343 (Brennan, J., concurring) and religious practices.’’ out what it understood to be its religious (‘‘A religious organization therefore The case law also indicates that mission.’’ Amos, 483 U.S. at 336; cf. would have an incentive to characterize certain E.O. 11246 obligations may Hosanna-Tabor, 565 U.S. at 197 as religious only those activities about impose a burden on religious (Thomas, J., concurring) (‘‘[U]ncertainty which there likely would be no dispute, organizations. Bostock expressly about whether its ministerial even if it genuinely believe that designation will be rejected, and a acknowledged that enforcing certain religious commitment was important in corresponding fear of liability, may nondiscrimination provisions could performing other tasks as well.’’). Here, cause a religious group to conform its pose challenges for religious employers the religious burden would be beliefs and practices regarding under RFRA. See 140 S. Ct. at 1754. government pressure on how the ‘ministers’ to the prevailing secular And many cases show instances of religious organization defines who is understanding.’’). Here, out of fear of religious employers seeking to apply and who is not a member of its religious violating E.O. 11246’s requirements, a community. religiously inspired codes of conduct religious organization might simply Demonstrating burden is necessarily that pertain to matters of marriage and choose to forsake certain of its religious fact-dependent. There may be instances sexual intimacy. See Little, 929 F.2d at tenets related to employment. That is a where the organization sincerely 946 (upholding termination of employee religious burden in itself. And that believes as a religious matter that it can for violations of ‘‘Cardinal’s Clause,’’ change could in turn result in the tolerate some kinds of religious which included ‘‘entry by the teacher organization hiring and retaining noncompliance from some of its into a marriage which is not recognized employees who, by word or deed, employees without seriously by the Catholic Church’’ (emphasis in undermine the religious organization’s compromising its religious mission or original)); Cline, 206 F.3d at 666 character and purpose—but which the identity. That may be the case especially (holding fact issue remained as to organization would feel compelled to for employees in less prominent roles or whether plaintiff was terminated for accept rather than risk liability. That is who have little interaction with pregnancy or for whether she had a second religious burden, which in students or the public. But there may be ‘‘violated her clear duties as a teacher by particular may pose a risk to smaller or other instances where, in the sincere engaging in premarital sex’’); Boyd v. nontraditional religious groups. Cf. view of the organization, a non- Harding Acad. of Memphis, Inc., 88 Hosanna-Tabor, 565 U.S. at 197 ministerial employee must adhere to the F.3d 410, 414 (6th Cir. 1996) (upholding (Thomas, J., concurring) (noting that a organization’s religious tenets as an district court’s determination that the bright-line test or multifactor analysis important part of furthering the defendant ‘‘articulated a legitimate, non- for the definition of ‘‘minister’’ ‘‘risk[s] organization’s religious mission and discriminatory reason for plaintiff’s disadvantaging those religious groups maintaining its religious identity, and termination when it stated that plaintiff whose beliefs, practices, and where strict enforcement of certain E.O. was fired not for being pregnant, but for membership are outside of the 11246 requirements would substantially having sex outside of marriage in ‘mainstream’ or unpalatable to some,’’ burden those aims. violation of Harding’s code of conduct’’ including by ‘‘caus[ing] a religious and rejecting claim of pretext when (2) Compelling Interest group to conform its beliefs and school’s president ‘‘had terminated at Many courts have recognized the practices regarding ‘ministers’ to the least four individuals, both male and importance of the government’s interest prevailing secular understanding’’). female, who had engaged in extramarital Alternatively, to avoid this problem, in enforcing Title VII’s sexual relationships that did not result the religious organization might nondiscrimination provisions. See, e.g., in pregnancy’’); Gosche v. Calvert High consider drawing stricter lines around Rayburn, 772 F.2d at 1169; Pacific Sch., 997 F. Supp. 867, 872 (N.D. Ohio those it considers ‘‘coreligionists,’’ for Press, 676 F.2d at 1280. The following 1998) (dismissing Title VII claim of even the narrowest reading of the RFRA analysis does not address plaintiff fired for having affair and OFCCP’s enforcement program broadly, concluding that ‘‘[w]hatever Plaintiff’s 27 Amos also implicated such facts. The appellee including the context of a religious own post-hoc claims may be regarding had been discharged for failing to ‘‘qualify for a organization’s discriminating on the the relevance of her sexual conduct to temple recommend, that is, a certificate that he is basis of a protected characteristic other her employment at a Catholic school, it a member of the Church and eligible to attend its than religion for non-religious reasons. temples,’’ which ‘‘are issued only to individuals is clear that the Diocese and Parish who observe the Church’s standards in such matters OFCCP will continue to fully enforce considered her sexual conduct to be as regular church attendance, tithing, and E.O. 11246’s requirements in those relevant to her employment’’); Ganzy v. abstinence from coffee, tea, alcohol, and tobacco.’’ contexts. Rather, the compelling-interest Allen Christian Sch., 995 F. Supp. 340, Amos, 483 U.S. at 330 & n.4. The plaintiffs below analysis here focuses solely on the had alleged that those standards necessitated 359–60 (E.D.N.Y. 1998) (noting in case employer inquiries into their ‘‘sexual activities’’ questions raised by commenters with similar facts and holding as Cline and ‘‘moral cleanliness and purity.’’ Amos, 594 F. regarding a situation in which a that ‘‘[r]eligious institutions . . . are Supp. at 830. religious organization takes employment

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79353

action based solely on sincerely held 2000bb–1(a))). When ‘‘[t]he proffered Sandy and Katrina,’’ 28 and OFCCP has religious tenets that also implicate a objectives are not pursued with respect granted temporary exemptions from protected classification. to analogous nonreligious conduct,’’ some E.O. 11246 requirements in To satisfy RFRA, OFCCP must do those exceptions suggest that ‘‘those response to more recent national more than assert a generalized interests could be achieved by narrower disasters. OFCCP has similarly granted compelling interest on a ‘‘categorical’’ ordinances that burdened religion to a an exemption during the COVID–19 basis. O Centro, 546 U.S. at 431. Instead, far lesser degree.’’ Holt, 574 U.S. at 367. pandemic. See OFCCP, National Interest ‘‘RFRA requires the Government to The President has granted OFCCP Exemptions, https://www.dol.gov/ demonstrate that the compelling interest broad authority and discretion to agencies/ofccp/national-interest- test is satisfied through application of exempt contracts from the requirements exemption. And the National Interest the challenged law ‘to the person’—the of E.O. 11246. Most prominent is Exemptions that OFCCP has granted can particular claimant whose sincere section 204(a) of E.O. 11246, which be quite broad, applying, for example, to exercise of religion is being authorizes the Secretary of Labor to all new contracts providing coronavirus substantially burdened.’’ Id. at 430–31 grant exemptions from any or all of the relief during the applicable time period. (quoting 42 U.S.C. 2000bb–1(b)). This equal opportunity clause’s requirements See OFCCP, Coronavirus National requires ‘‘look[ing] beyond broadly ‘‘when the Secretary deems that special Interest Exemption Frequently Asked formulated interests justifying the circumstances in the national interest so Questions, https://www.dol.gov/ general applicability of government require.’’ This is not the kind of agencies/ofccp/faqs/covid-19#Q1. mandates and scrutiniz[ing] the asserted language government typically uses OFCCP has also issued a final rule harm of granting specific exemptions to when it seeks a policy of absolute effecting a permanent exemption from particular religious claimants.’’ Id. at enforcement. Rather, it is the kind of all OFCCP authority for healthcare 431. language government uses when providers that participate in the Thus OFCCP must demonstrate that it granting highly discretionary power. Cf. TRICARE program and have no has a compelling governmental interest Webster v. Doe, 486 U.S. 592, 600 (1988) otherwise covered contracts. The final in enforcing a nondiscrimination (removing an employee ‘‘whenever the rule expressed OFCCP’s view that a requirement against ‘‘particular Director ‘shall deem such termination 2011 statute removed whatever religious claimants’’ (e.g., particular necessary or advisable in the interests of authority OFCCP may have had over contractors who qualify for the religious the United States’ ’’ is a standard that TRICARE providers and did not replace exemption) when doing so places a ‘‘fairly exudes deference to the Director’’ it with a separate nondiscrimination substantial burden on the ability of (quoting National Security Act § 102(c)). provision; Congress’ action indicates those particular contractors to freely The Executive Order contains many that OFCCP’s interest is less than exercise their religion. Id. This statutory other exceptions as well. Section 204(b) compelling interest. See 85 FR 39834, requirement is reflected in OFCCP’s authorizes the Secretary to exempt 39837–39 (July 2, 2020). Additionally, current RFRA policy, under which contracts that are to be performed the final rule exempted TRICARE ‘‘OFCCP will consider’’ a contractor’s outside the United States, contracts that providers on the alternative ground of a request for ‘‘an exemption to E.O. 11246 are for standard commercial supplies or national interest exemption, citing its pursuant to RFRA . . . based on the raw materials, contracts that do not concern that ‘‘the prospect of exercising facts of the particular case.’’ OFCCP, meet certain thresholds (dollar amounts authority over TRICARE providers is Religious Employers and Religious or numbers of employees), and affecting or will affect the government’s Exemption, www.dol.gov/agencies/ subcontracts below a specified tier. ability to provide health care to ofccp/faqs/religious-employers- Section 204(d) authorizes the Secretary uniformed service members, veterans, exemption. As explained below, OFCCP and their families,’’ a determination that has determined on the basis of several to exempt a contractor’s facilities that ‘‘pursuing enforcement efforts against independent reasons that it has less are separate and distinct from activities TRICARE providers is not the best use than a compelling interest in enforcing related to the performance of the of its resources’’ given a history of nondiscrimination requirements— contract, as long as ‘‘such an exemption litigation and legal uncertainty in the except for protections on the basis of will not interfere with or impede the area, and the need to ‘‘provide race—when enforcement would effectuation of the purposes of this uniformity and certainty in the health seriously infringe the religious mission Order.’’ OFCCP’s implementing care community with regard to legal or identity of a religious organization. regulations contain exemptions as well. Exceptions provided other OFCCP has implemented section 204(b) obligations concerning participation in contractors. OFCCP’s general interest in to the maximum extent possible by TRICARE.’’ Id. at 39839. enforcing E.O. 11246 is less than exempting all contracts and The various exemptions that OFCCP compelling in the religious context subcontracts for work performed outside can and does provide in secular settings addressed here, given the numerous the United States by employees not show that its interest in enforcing E.O. exceptions from its nondiscrimination recruited in the United States. See 41 11246’s requirements can give way to requirements it has authority to grant, CFR 60–1.5(3). OFCCP’s regulations also other considerations. Many of those and has granted, in nonreligious contain a religious exemption for same considerations exist here, so contexts. Granting accommodations in religious educational institutions and OFCCP’s enforcement interest should nonreligious contexts strongly suggests permit a preference for ‘‘Indians living similarly give way to religious that OFCCP does not have a compelling on or near an Indian reservation in accommodation. For example, many of interest in disfavoring religious connection with employment the same reasons underlying OFCCP’s contractors by refusing to grant opportunities on or near an Indian exemption for TRICARE providers apply accommodations in religious contexts. reservation.’’ 41 CFR 60–1.5(6)–(7). here as well: Conservation of resources See O Centro, 546 U.S. at 436 (‘‘RFRA On several occasions OFCCP has used in an area that could lead to protracted operates by mandating consideration, its power to exempt contracts ‘‘in the national interest.’’ ‘‘Prior 28 OFCCP, ‘‘Coronavirus National Interest under the compelling interest test, of Exemption Frequently Asked Questions,’’ Question exceptions to ‘rule[s] of general administrations granted [national #12, https://www.dol.gov/agencies/ofccp/faqs/ applicability.’ ’’ (quoting 42 U.S.C. interest exemptions] for Hurricanes covid-19#Q12.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79354 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

litigation; the need to bring clarity to a that also implicate a protected (emphasis added) (quoting Hosanna- group of potential contractors under a classification, other than race. OFCCP Tabor, 565 U.S. at 186 (opinion for the cloud of legal uncertainty; and a goal of has determined that, in these court)); see also Hosanna-Tabor, 565 improving the government’s access to circumstances, it should instead U.S. at 197 (Thomas, J., concurring) certain services. In the TRICARE rule, appropriately accommodate religion, (‘‘These are certainly dangers that the the goal was to foster access to care for especially when doing so (as with First Amendment was designed to guard veterans and their families. In this rule, national interest exemptions) would against.’’). In essence, such an approach it is the goal of fostering the equal foster a more competitive pool of could have the unfortunate consequence participation of religious organizations government contractors. See Boyle v. of pushing religious organizations to in government contracting and United Techs. Corp., 487 U.S. 500, 506 extremes to avoid liability. Religious subcontracting in order to increase the (1988) (noting that ‘‘the Federal organizations could do so either by contracting pool’s competition and Government’s interest in the forsaking their religiously based diversity and thus improve economy procurement of equipment is requirements for employment, or by and efficiency in procurement. Likewise implicated’’ where ‘‘[t]he imposition of engaging in more definitive religious OFCCP’s limited exemptions during liability on Government contractors’’ actions to demonstrate their religious emergencies and the pandemic will cause the contractors to ‘‘decline to disassociation from someone who demonstrate the agency’s judgment that manufacture’’ a good or to ‘‘raise its breaches a religiously based securing services for the government price’’). requirement for employment. OFCCP can override aspects of E.O. 11246’s Establishment Clause concerns. also has concerns about inter-religious obligations. Here, too, a limited OFCCP’s interest in enforcing E.O. discrimination, since some bona fide religious accommodation may 11246 is attenuated when doing so religious organizations require encourage religious organizations to seriously risks violating the adherence to a common set of beliefs or begin or continue participating in Establishment Clause. But as noted tenets but do not have a formal government contracting and earlier, strict application of all E.O. membership structure, see World subcontracting. And like those other 11246 requirements to religious Vision, 633 F.3d at 728 (O’Scannlain, J., exemptions, a religious accommodation organizations could, in some instances, concurring), so they may have more here would be limited. It would be chill their protected religiously based difficulty than traditional churches in limited to employment action grounded requirements for employment out of fear showing that an employee or applicant in a sincere religious belief with respect of liability. It could also chill religious is not (or is no longer) a coreligionist. to the employee’s religion. It would not organizations from taking employment OFCCP cannot avoid this excuse religious organizations from action despite an employee, by word or Establishment Clause problem by their antidiscrimination obligations deed, undermining the religious attempting to determine whether a otherwise and never on the basis of race, organization’s tenets and purposes. religious organization’s decision to nor from their affirmative-action Alternatively, it could incentivize deem someone a non-coreligionist was obligations, reporting requirements, or religious organizations, because of the motivated by discriminatory animus other requirements under E.O. 11246. risk that the government might rather than a sincere application of E.O. 11246’s many available misunderstand the organization’s religious tenets. Unlike the fact-finding exemptions, and OFCCP’s history of motivations, to draw stricter lines to determine the reason for an recognizing exemptions, also undercuts around who it considers a coreligionist. employment decision, which does not the idea that individualized religious In this situation, the religious always raise Establishment Clause exemptions would undermine the organization would first take some form concerns, this would be fact-finding to agency’s overall enforcement of E.O. of purely religious action against an determine the reason for a religious 11246 or that their denial would be employee to designate the employee as decision on community membership. equitable to religious organizations. See no longer a part of the religious Testing the basis of that decision would Holt, 574 U.S. at 368 (‘‘At bottom, this community, and then take employment most likely violate the First argument is but another formulation of action, so that employment action Amendment. It would violate the the ‘classic rejoinder . . . : If I make an would be more readily identified as religious organization’s right to choose exception for you, I’ll have to make one resting solely on grounds of religious its membership free of government for everybody, so no exceptions.’ We preference. And it poses a risk to influence, and the process of inquiry have rejected a similar argument in smaller or nontraditional religious alone into such a sensitive area ‘‘would analogous contexts, and we reject it groups, whose membership practices risk judicial entanglement in religious again today.’’) (internal citations may not be as readily understood by the issues.’’ Our Lady of Guadalupe, 140 S. omitted) (quoting O Centro, 546 U.S. at government. Cf. Hosanna-Tabor, 565 Ct. at 2069; see Catholic Bishop, 440 436); Fraternal Order of Police Newark U.S. at 197 (Thomas, J., concurring). U.S. at 502. Lodge No. 12 v. City of Newark, 170 Such government pressure on The absence of a clear command. F.3d 359, 365 (3d Cir. 1999) (‘‘[W]e religious organizations’ membership Finally, a compelling interest ought to conclude that the Department’s decision and doctrinal decisions would raise be one that is clearly spelled out by the to provide medical exemptions while serious concerns under not only the government. For instance, in his refusing religious exemptions is Free Exercise Clause, but the concurrence in Little Sisters of the Poor, sufficiently suggestive of discriminatory Establishment Clause as well. ‘‘[T]he Justice Alito observed that it was highly intent so as to trigger heightened Religion Clauses protect the right of significant that Congress itself had not scrutiny.’’). churches and other religious institutions treated free access to contraception as a Recognizing the value that religious to decide matters ‘of faith and doctrine’ compelling government interest. See contractors provide, OFCCP has without government intrusion. . . . Little Sisters of the Poor, 140 S. Ct. at determined that it has less than a [A]ny attempt by government to dictate 2392–93 (Alito, J., concurring). Here, compelling interest in enforcing E.O. or even to influence such matters would however, the scope of the religious 11246 when a religious organization constitute one of the central attributes of exemption is unsettled. As discussed takes employment action solely on the an establishment of religion.’’ Our Lady above, courts have consistently basis of sincerely held religious tenets of Guadalupe, 140 S. Ct. at 2060 interpreted the religious exemption to

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79355

prohibit religious organizations from employment actions based on sincere center of the Harris case was not a discriminating on bases other than religious tenets; employees remain religious organization. See 884 F.3d at religion. But Bostock left open the scope protected from discrimination 581. Unlike the religious employers that of the exemption’s protection for motivated by animus or any other non- are OFCCP’s focus here, the funeral religious discrimination, and only two religious reason, and employment home had ‘‘virtually no religious federal court of appeal decisions have actions based on race always remain characteristics,’’ id. at 582: No addressed a fact pattern in which a prohibited. religiously inspired code of conduct, no religious organization’s religious tenets doctrinal statement, and no other conflicted with a non-religious Title VII (4) The Harris Case religious requirement for employees. protection. See Fremont, 781 F.2d at OFCCP does not view the Sixth Nor did the funeral home through its 1368 (finding challenged religious Circuit’s opinion in EEOC v. R.G. &. work seek to advance the values of a practice outside the scope of the G.R. Harris Funeral Homes, Inc., 884 particular religion. See id. Indeed, the religious exemption and changing the F.3d 560 (6th Cir. 2018), aff’d, Bostock funeral home was clearly outside the practice would pose little interference v. Clayton Cnty., 140 S. Ct. 1731 (2020), scope of OFCCP’s religious exemption— with the organization’s religious belief as requiring a different analysis here. In which exists to prevent E.O. 11246’s and practice); Pacific Press, 676 F.2d at that case (one of three consolidated in nondiscrimination provisions from 1279 (determining that the EEOC’s Bostock), an employee of a funeral home interfering with a religious action ‘‘does not and could not conflict informed the funeral home’s owner of organization’s freedom to employ with [the employer’s] religious the employee’s intention to present as a ‘‘individuals of a particular religion’’— doctrines, nor does it prohibit an member of the opposite sex while at and furthermore the funeral home’s own activity rooted in religious belief’’). work. The owner stated that he would testimony indicated that its conduct was Without stronger legal evidence that the violate his religious beliefs were he to motivated by commercial rather than religious exemption’s protections are permit the employee to do so and religious concerns. See id. at 576 n.5, cabined by E.O. 11246’s other terminated the employee. See id. at 568– 586, 589 n.10. protections (and thus may seriously 69. In the ensuing litigation, the funeral Bearing those key factual differences infringe religious freedom), OFCCP is home raised a RFRA defense. The Sixth in mind, OFCCP disagrees that, at least hesitant to describe that theory as Circuit held that Title VII as applied to religious organizations furthering a compelling government discrimination claims ‘‘will necessarily regulated by OFCCP, ‘‘tolerating’’ interest. defeat’’ RFRA defenses to such employee conduct that is contrary to the organization’s sincerely held religious (3) Least Restrictive Means discrimination. Id. at 595. The court addressed each element of RFRA. tenets can never constitute a substantial In the third step of the RFRA analysis, Regarding substantial burden, the court burden under RFRA, as the court held OFCCP assesses whether its application held in relevant part that the employer’s in Harris. Id. at 588. That holding is, at of the religious burden to the person ‘‘is mere toleration of the employee’s the very least, in tension with Little the least restrictive means of furthering conduct to comply with Title VII is not Sisters of the Poor, Hobby Lobby, and that compelling government interest.’’ an endorsement of it, so it was not a the Free Exercise Clause precedents 42 U.S.C. 2000bb–1(b)(2). Because substantial burden. Regarding the they rested on. See Hobby Lobby, 573 OFCCP believes that it has less than a furtherance of a compelling interest, the U.S. at 723–25; see also Little Sisters of compelling interest in enforcing E.O. court held that failure to enforce Title the Poor, 140 S. Ct. at 2383 (‘‘[In Hobby 11246 in the circumstances VII would result in the employee Lobby,] we made it abundantly clear contemplated for purposes of this suffering discrimination, ‘‘an outcome that, under RFRA, the Departments general RFRA analysis it need not directly contrary to the EEOC’s must accept the sincerely held consider whether that foreclosed compelling interest in combating complicity-based objections of religious enforcement would be by the least discrimination in the workforce.’’ Id. at entities.’’); id. at 2390 (Alito, J., restrictive means. When the Supreme 592. Regarding least-restrictive means, concurring) (observing that ‘‘federal Court has found a regulation violated the court held that enforcement of Title courts have no business addressing RFRA, the Court has permitted the VII is itself the least-restrictive means whether the religious belief asserted in regulatory agency to determine the for eradicating employment a RFRA case is reasonable,’’ including correct remedy. See, e.g., Hobby Lobby, discrimination on the basis of sex. See religious beliefs underlying complicity- 573 U.S. at 726, 731, 736; 79 FR 51118 based objections). When government id. at 593–97. (Aug. 27, 2014) (proposed modification requires conduct proscribed by religious The defendant in Harris did not raise in light of Hobby Lobby). As a result, faith on pain of substantial penalty, the RFRA issue to the Supreme Court, OFCCP has discretion to determine an there is a burden upon religious but the Court in Bostock nonetheless appropriate accommodation without exercise. See Sherbert, 374 U.S. at 404. having to also determine the least observed that, ‘‘[b]ecause RFRA operates Additionally, the burden is even restrictive alternative. As Justice Alito as a kind of super statute . . . it might clearer for an objecting religious recently explained, RFRA ‘‘does not supersede Title VII’s commands in 29 organization than it was for the funeral require . . . that an accommodation of appropriate cases.’’ Bostock, 140 S. Ct. home in Harris. Unlike a secular religious belief be narrowly tailored to at 1754. To the extent Harris remains employer, a religious organization has a further a compelling interest. . . . good law, OFCCP does not view the religious foundation and purpose and Nothing in RFRA requires that a Sixth Circuit’s RFRA analysis as may select its employees on the basis of violation be remedied by the narrowest applicable here, as the facts of the case their religious adherence. Requiring permissible corrective.’’ Little Sisters of are readily distinguishable from this religious employers to maintain the Poor, 140 S. Ct. at 2396 (Alito, J., rule’s protections for religious employees who disregard the concurring). OFCCP further believes the organizations. The funeral home at the organization’s religious tenets thus more RFRA approach outlined here is an seriously threatens to undermine the 29 The Court also observed that ‘‘other employers appropriate accommodation, which in other cases may raise free exercise arguments organization’s mission and integrity. applies only to bona fide religious that merit careful consideration.’’ Bostock, 140 S. This gives even more credence to a employers and which permits only Ct. at 1754. claim that forcing a religious employer

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00033 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79356 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

to maintain such an employee would religious accommodations may be important governmental objectives and substantially burden its religious necessary in certain other contexts must be substantially related to exercise. regarding considerations of sex, achievement of those objectives.’’); id. at OFCCP also does not view Harris’s ‘‘discrimination on the basis of race, 218 (Rehnquist, J., dissenting) (referring treatment of the compelling-interest ‘odious in all aspects, is especially to the majority approach as prong of RFRA as persuasive when pernicious in the administration of ‘‘intermediate’’ scrutiny), and the applied to religious organizations justice.’ ’’ Id. (quoting Rose v. Mitchell, ‘‘rational-basis scrutiny’’ that the Court regulated by OFCCP. First, because the 443 U.S. 545, 555 (1979)). has sometimes applied to classifications defendant was not a religious The Supreme Court has elsewhere based on sexual orientation, see organization, the Harris court did not recognized the government’s unique Lawrence v. Texas, 539 U.S. 558, 578 consider the antecedent question of interest in eradicating racial (2003); Romer v. Evans, 517 U.S. 620, whether the government has a discrimination. In Hobby Lobby, the 631–32 (1996). The Supreme Court has compelling interest in applying Court considered ‘‘the possibility that further recognized that traditional views nondiscrimination laws to a religious discrimination in hiring, for example on on marriage do not suggest bigotry or organization when doing so would the basis of race, might be cloaked as invidious discrimination but instead are threaten to compromise the religious practice to escape legal held ‘‘in good faith by reasonable and organization’s integrity or mission, with sanction,’’ but explained that ‘‘[t]he sincere people here and throughout the its attendant more-severe infringements Government has a compelling interest in world.’’ Obergefell v. Hodges, 576 U.S. on religious free exercise and providing an equal opportunity to 644, 657 (2015).30 The Constitution, as establishment problems. As discussed participate in the workforce without interpreted by the Supreme Court, is above, there are instances where that regard to race, and prohibitions on more protective of race than other could occur, so accordingly in that racial discrimination are precisely protected classifications. Thus, the situation the RFRA analysis is different. tailored to achieve that critical goal.’’ Court’s long-established Equal Additionally, E.O. 11246 contains 573 U.S. at 733. In Bob Jones University, Protection jurisprudence supports the additional and discretionary exceptions the Court similarly concluded that the conclusion that although the that Title VII does not have, which government had a ‘‘compelling’’ government has an interest in further alter the compelling-interest interest—described as ‘‘a fundamental eradicating discrimination on the bases balance. overriding interest’’—‘‘in eradicating of all protected classes, the racial discrimination,’’ and further (5) OFCCP’s Compelling Interest in governmental interest in eradicating explained the ‘‘governmental interest’’ Prohibiting Racial Discrimination racial discrimination is particularly in eradicating racial discrimination strong. This final rule is consistent with In response to commenters who raised ‘‘substantially outweighs whatever that framework. the issue, OFCCP reiterates here that it burden’’ the government action in that has a compelling interest in eradicating case ‘‘place[d] on petitioners’ exercise of e. Application of the Religious racial discrimination, even as against their religious beliefs.’’ Bob Jones, 461 Exemption religious organizations. To be sure, U.S. at 604; see also Newman v. Piggie As explained in the proposed rule, OFCCP is currently unaware of any Park Enters., Inc., 390 U.S. 400, 402 n.5 when evaluating allegations of contractor contending that its religious (1968) (describing as ‘‘patently discrimination on bases other than beliefs required it to take employment frivolous’’ the argument that a religion against employers that are actions that implicate race, and prohibition on racial discrimination entitled to the Title VII religious commenters supplied no evidence of ‘‘was invalid because it contravenes the exemption, courts carefully evaluate that occurring. Nonetheless, in response will of God and constitutes an whether the employment action was to commenters’ broader concerns, interference with the free exercise of the permissibly based on the ‘‘particular OFCCP makes clear here that its Defendant’s religion’’) (internal religion’’ of the employee. The overwhelming interest in eradicating quotation marks omitted). particulars vary. In the absence of direct racial discrimination would defeat The government’s heightened interest evidence of discrimination on a RFRA claims in the context addressed in eradicating racial discrimination is protected basis other than religion, in this section of the rule’s preamble. further exhibited by the Supreme courts generally invoke the burden- OFCCP will enforce E.O. 11246 against Court’s jurisprudence regarding the shifting framework of McDonnell any contractor or subcontractor that Equal Protection Clause of the Douglas Corp. v. Green, 411 U.S. 792 takes employment actions on the basis Fourteenth Amendment. In Equal (1973), to determine whether a religious of race, even if religiously motivated. At Protection Clause cases, the Court employer’s invocation of religion (or a least one commenter that strongly applies ‘‘strict scrutiny’’ to instances of religiously motivated policy) in making supported the proposed rule likewise race-based classifications, meaning that an employment decision was genuine recognized that the religious exemption ‘‘all racial classifications, imposed by or, instead, was merely a pretext for should not protect ‘‘a religious whatever federal, state, or local discrimination prohibited under Title organization’s employment decision governmental actor . . . are VII. See Cline, 206 F.3d 651; Boyd, 88 . . . based on racial status.’’ constitutional only if they are narrowly F.3d 410; cf. Geary, 7 F.3d 324 (applying OFCCP treats racial discrimination as tailored measures that further McDonnell Douglas in assessing unique because the Constitution does as compelling governmental interests.’’ religious-exemption defense to claim well. The Supreme Court recognizes Adarand Constructors, Inc. v. Pena, 515 under the Age Discrimination in that ‘‘[r]acial bias is distinct.’’ Pena- U.S. 200, 227 (1995). Strict scrutiny Employment Act). At least one other Rodriguez v. Colorado, 137 S. Ct. 855, presents a more pressing standard than 868 (2017). Indeed, a long history of the the ‘‘intermediate scrutiny’’ that the 30 Cf. Masterpiece Cakeshop, 138 S. Ct. at 1727 Court’s ‘‘decisions demonstrate that Court applies in Equal Protection Clause (stating that a clergy member’s refusal to perform racial bias implicates unique historical, cases to instances of sex-based a gay marriage ‘‘would be well understood in our constitutional order as an exercise of religion, an constitutional, and institutional classifications, see, e.g., Craig v. Boren, exercise that gay persons could recognize and concerns.’’ Id. (emphasis added). 429 U.S. 190, 197 (1976)) accept without serious diminishment to their own Although this final rule recognizes that (‘‘[C]lassifications by gender must serve dignity and worth’’).

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00034 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79357

case has noted that ‘‘[o]ne way’’ to show (internal quotation mark omitted); cf., (quoting Serbian E. Orthodox Diocese v. discriminatory intent using e.g., Hobby Lobby, 573 U.S. at 117 n.28 Milivojevich, 426 U.S. 696, 720 (1976))). circumstantial evidence ‘‘is through the (‘‘To qualify for RFRA’s protection, an Some commenters, such as a religious burden-shifting framework set out in asserted belief must be ‘sincere’; a legal association and an association of McDonnell Douglas,’’ but another way is corporation’s pretextual assertion of a evangelical churches and schools, to ‘‘show enough non-comparison religious belief in order to obtain an agreed with OFCCP that governmental circumstantial evidence to raise a exemption for financial reasons would inquiry into religious employers’ reasonable inference of intentional fail.’’); Quaintance, 608 F.3d at 724 practices could violate the First discrimination.’’ Hamilton v. Southland (Gorsuch, J.) (‘‘[T]he record contains Amendment. A religious legal Christian Sch., Inc., 680 F.3d 1316, 1320 additional, overwhelming contrary organization commended OFCCP for (11th Cir. 2012). evidence that the [defendants] were deferring to religious organizations on In undertaking this evaluation, running a commercial marijuana matters of doctrine and religious OFCCP, like courts, ‘‘merely asks business with a religious front.’’). observance, and commented that doing whether a sincerely held religious belief Other decisions have not used the otherwise could lead to unconstitutional actually motivated the institution’s McDonnell Douglas framework, entanglement with religion. These are actions.’’ Geary, 7 F.3d at 330. The particularly when an inquiry into the constitutional concerns that likewise religious organization’s burden ‘‘to purported pretext would risk entangling constrain courts’ analyses when an employer makes an employment explain is considerably lighter than in a the court in the internal affairs of a decision based on religious criteria, yet non-religious employer case,’’ since the religious organization or require a court organization, ‘‘at most, is called upon to the employee disputes the religious or jury to assess religious doctrine or the explain the application of its own criteria. In those situations, courts have relative weight of religious doctrines.’’ Id. ‘‘Such an explanation is stated that ‘‘if a religious institution . . . considerations. See Geary, 7 F.3d at no more onerous than is the initial presents convincing evidence that the 330–31 (discussing cases). Depending burden of any institution in any First challenged employment practice on the circumstances, such an inquiry Amendment litigation to advance and resulted from discrimination on the explain a sincerely held religious belief by a court or an agency could basis of religion, § 702 deprives the as the basis of a defense or claim.’’ Id.; impermissibly infringe on the First EEOC of jurisdiction to investigate see Seeger, 380 U.S. at 185 (holding Amendment rights of the employer. further to determine whether the whether a belief is ‘‘truly held’’ is ‘‘a This arises most prominently in the religious discrimination was a pretext question of fact’’). The sincerity of context of the ministerial exception, a for some other form of discrimination.’’ religious exercise is often undisputed or judicially recognized exemption Little, 929 F.2d at 948 (quoting stipulated. See, e.g., Hobby Lobby, 573 grounded in the First Amendment from Mississippi College, 626 F.2d at 485). U.S. at 717 (‘‘The companies in the case employment-discrimination laws for Courts have noted the constitutional before us are closely held corporations, decisions regarding employees who dangers of ‘‘choos[ing] between parties’ each owned and controlled by a single ‘‘minister to the faithful.’’ Hosanna- competing religious visions’’ and family, and no one has disputed the Tabor, 565 U.S. at 189; see also Our entangling themselves in deciding sincerity of their religious beliefs.’’); Lady of Guadalupe, 140 S. Ct. at 2060. whether the employer or the employee Holt, 574 U.S. at 361 (‘‘Here, the The exemption ‘‘is not limited to the has the better reading of doctrine, or religious exercise at issue is the growing head of a religious congregation,’’ nor which tenets an employee must follow of a beard, which petitioner believes is subject to ‘‘a rigid formula for deciding or believe to remain in employment. a dictate of his religious faith, and the when an employee qualifies as a Geary, 7 F.3d at 330; see Curay-Cramer, Department does not dispute the minister.’’ Hosanna-Tabor, 565 U.S. at 450 F.3d at 141 (‘‘While it is true that sincerity of petitioner’s belief.’’). In 190; see also Our Lady of Guadalupe, the plaintiff in Little styled her assessing sincerity, OFCCP takes into 140 S. Ct. at 2067. ‘‘The interest of allegation as one of religious account all relevant facts, including society in the enforcement of discrimination whereas [this plaintiff] whether the contractor had a preexisting employment discrimination statutes is alleges gender discrimination, we do not basis for its employment policy and undoubtedly important. But so too is the believe the difference is significant in whether the policy has been applied interest of religious groups in choosing terms of whether serious constitutional consistently to comparable persons, who will preach their beliefs, teach their questions are raised by applying Title although absolute uniformity is not faith, and carry out their mission.’’ VII. Comparing [plaintiff] to other required. See Kennedy, 657 F.3d at 194 Hosanna-Tabor, 565 U.S. at 189. The Ursuline employees who have (noting that the Title VII religious ministerial exception thus bars ‘‘an committed ‘offenses’ against Catholic exemption permits religious employment discrimination suit brought doctrine would require us to engage in organizations to ‘‘consider some attempt on behalf of a minister.’’ Id.; see also just the type of analysis specifically at compromise’’); LeBoon, 503 F.3d at Our Lady of Guadalupe, 140 S. Ct. at foreclosed by Little.’’); Little, 929 F.2d at 229 (‘‘[R]eligious organizations need not 2073. In such a situation, it is 949 (‘‘In this case, the inquiry into the adhere absolutely to the strictest tenets dispositive that the employee is a employer’s religious mission is not only of their faiths to qualify for Section 702 minister; there is no further inquiry into likely, but inevitable, because the protection.’’); see also Killinger, 113 the employer’s motive. See Hosanna- specific claim is that the employee’s F.3d at 199–200. OFCCP will also Tabor, 565 U.S. at 706 (‘‘By imposing an beliefs or practices make her unfit to evaluate any factors that indicate an unwanted minister, the state infringes advance that mission. It is difficult to insincere sham, such as acting ‘‘in a the Free Exercise Clause . . . and the imagine an area of the employment manner inconsistent with that belief’’ or Establishment Clause’’); see, e.g., relationship less fit for scrutiny by ‘‘evidence that the adherent materially Rayburn, 772 F.2d at 1169 (‘‘In secular courts.’’); Maguire, 627 F. Supp. gains by fraudulently hiding secular ‘quintessentially religious’ matters, the at 1507 (‘‘Despite [plaintiff’s] protests interests behind a veil of religious free exercise clause of the First that she is a Catholic, ‘of a particular doctrine.’’ Philbrook, 757 F.2d at 482 Amendment protects the act of decision religion,’ the determination of who fits (quoting Barber, 650 F.2d at 441) rather than a motivation behind it.’’ into that category is for religious

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00035 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79358 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

authorities and not for the government applied in the mine run of Title VII of a religious organization’s community; to decide.’’). cases. In line with those cases, there are whether some religious offenses or Some commenters criticized OFCCP’s indeed aspects of the discrimination requirements are more important than description of the extent to which it inquiry that are necessarily and rightly others and should merit particular would be permissible to inquire into nuanced and fact-dependent, and there employment responses; whether the whether a religious employer’s adverse are aspects where inquiry can infringe employer’s sincerely held religious view employment action was based on upon religious organizations’ autonomy is internally consistent or logically religion or on another protected and are either prohibited or must be appealing; and similar issues. characteristic. Many of these performed with care. The principles set Fifth, OFCCP believes these commenters believed OFCCP’s proposed out in those cases are reiterated below. principles will cover the vast majority of approach is inconsistent with courts’ First, if a contractor raises the defense scenarios, but there may be rare inquiry in Title VII cases. For example, that an employee or applicant is covered instances where an inquiry by a court or a group of state attorneys general by the ministerial exception, OFCCP can an agency into employment practices asserted that, unlike the definition in inquire whether that is in fact so. But if otherwise threatens First Amendment the proposed rule, Title VII so, then that is the end of the inquiry. rights. See DeMarco v. Holy Cross High jurisprudence and case law has required OFCCP will not apply the executive Sch., 4 F.3d 166, 172 (2d Cir. 1993) nuanced and fact-dependent inquiry order in those circumstances. See Our (‘‘There may be cases involving lay into whether a religious employer Lady of Guadalupe, 140 S. Ct. at 2060– employees in which the relationship discriminated against a worker based on 61; Hosanna–Tabor, 565 U.S. at 194–95. between employee and employer is so his or her ‘‘particular religion’’ or on Second, when the ministerial pervasively religious that it is another protected basis. An LGBT rights exception does not apply and the impossible to engage in an age- advocacy organization criticized OFCCP employee or applicant suffers adverse discrimination inquiry without serious for rejecting the traditional burden- employment action by a contractor that risk of offending the Establishment shifting framework set forth in is entitled to the religious exemption, Clause.’’). Commenters argued that this McDonnell Douglas and instead placing OFCCP will apply traditional Title VII final caveat detracted from the clarity of the burden on workers. Some of these tools to ascertain whether the action the proposed rule. OFCCP disagrees. commenters stated that OFCCP’s was impermissible discrimination. In This observation merely notes, as have proposed inquiry would not be the absence of direct evidence of courts, that there may be instances adequately rigorous. For example, a discrimination on a protected basis outside the ministerial exception where civil liberties and human rights legal other than religion, this will typically a discrimination case might involve the advocacy organization asserted that involve application of the familiar kinds of questions prohibited by the OFCCP’s approach as described in the McDonnell Douglas framework, in First Amendment. See id. (finding preamble ‘‘allows religion to serve as a which (1) OFCCP must establish a prima employee’s failed religious duties were pretext for discrimination, and creates facie case of discrimination on a ‘‘easily isolated and defined,’’ so a trial roadblocks for individuals seeking to protected basis other than religion; (2) could be conducted ‘‘without putting bring claims of discrimination against the employer can respond with a into issue the validity or truthfulness of federal contractors.’’ An organization nondiscriminatory reason, such as an Catholic religious teaching’’). Instructive that advocates separation of church and explanation that its action was here are the sorts of questions found state asserted that a more rigorous permitted under the religious exemption constitutionally offensive by the inquiry would not violate the First as pertaining to the individual’s Supreme Court in Catholic Bishop, in Amendment and stated that OFCCP’s particular religion; and (3) OFCCP, to which a hearing officer tested a concerns about impermissible find a violation, must rebut that witness’s memory and knowledge of entanglement are overblown and cannot explanation as a mere pretext. See Catholic liturgies and masses. See justify its refusal to engage in any McDonnell Douglas, 411 U.S. 792. Catholic Bishop, 440 U.S. at 502 & n.10; investigation of religious employers at Third, ascertaining whether unlawful id. at 507–08 (appendix); see also Great all. An anti-bigotry religious discrimination motivated an employer’s Falls, 278 F.3d at 1343. OFCCP believes organization similarly asserted that a action requires consideration of all these cases provide sufficient principles more rigorous inquiry would not violate relevant facts and circumstances. for the agency to properly guide its RFRA, citing Hobby Lobby, 573 U.S. at OFCCP will consider all available inquiry if and when needful. 733. evidence as to whether a religious Some commenters believed the organization’s employment action was f. Causation proposal did not clearly describe the in fact sincerely motivated by the OFCCP proposed to apply a but-for inquiry that OFCCP would undertake to applicant’s or employee’s particular standard of causation when evaluating determine whether an adverse action religion—such as, for instance, their claims of discrimination by religious was based on religion or another adherence to the organization’s religious organizations based on protected protected characteristic. For example, a tenets—or whether that was a mere characteristics other than religion. legal think tank commented that pretext for impermissible Specifically, where a contractor that is OFCCP’s failure to meaningfully address discrimination. entitled to the religious exemption various cases discussing the issue of Fourth, while OFCCP can inquire into claims that its challenged employment pretext on the basis that they ‘‘turn on the sincerity of the employer’s religious action was based on religion, OFCCP their individual facts’’ contravenes belief, it is constitutionally prohibited proposed finding a violation of E.O. OFCCP’s stated goal of ‘‘bringing clarity from refereeing internal religious 11246 only if it could prove by a and certainty to federal contractors.’’ matters of contractors that are entitled to preponderance of the evidence that a OFCCP disagrees with these the religious exemption. Thus OFCCP protected characteristic other than commenters’ characterization of the cannot decide, when the matter is religion was a but-for cause of the NPRM, but reiterates—and to the extent disputed, whether the employer or the adverse action. See Univ. of Tex. Sw. necessary, clarifies for their benefit— employee has the better reading of Med. Ctr. v. Nassar, 570 U.S. 338, 362– that OFCCP intends to apply the religious doctrine; whether an employee 63 (2013); Gross v. FBL Fin. Servs., Inc., religious exemption as it has been should be considered a faithful member 557 U.S. 167, 180 (2009). OFCCP stated

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00036 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79359

that this approach was necessary in interpreting the nondiscrimination discrimination claims based on situations where a religious requirements of E.O. 11246 in a manner identical conduct would be evaluated organization, acting on a sincerely held consistent with Title VII principles. For according to different standards of belief, took adverse action against an instance, a national reproductive rights proof.’’ employee on the basis of the employee’s organization commented that, for Considering the comments received, religion. OFCCP believed that decades, courts have resolved claims of OFCCP will apply the motivating-factor application of the motivating factor employment discrimination by religious analysis to all claims of discrimination, framework in such cases might result in organizations without implicating the including discrimination by religious inappropriate encroachment upon the concerns OFCCP cites. The organization organizations based on protected organization’s religious integrity. added that OFCCP’s concerns about characteristics other than religion. However, the NPRM recognized that in impermissible entanglement are OFCCP agrees that it can avoid prior notice-and-comment rulemaking overblown and unsupported by case impermissible entanglement while implementing Executive Order 13665, law. A transgender legal professional applying a motivating-factor standard of 79 FR 20749 (Apr. 11, 2014) (amending organization expressed similar causation. See, e.g., Curay-Cramer, 450 E.O. 11246 to include pay transparency concerns. F.3d at 139 (‘‘[A]s long as the plaintiff nondiscrimination), OFCCP rejected Relatedly, a number of commenters did not challenge the validity or comments stating that a but-for opposed the proposed but-for standard plausibility of the religious doctrine causation standard was required and on the basis that it conflicts with Title said to support her dismissal, but only instead adopted the motivating factor VII and related case law. Several of questioned whether it was the actual framework as expressed in the Title VII these commenters criticized OFCCP’s motivation, excessive entanglement post-1991 Civil Rights Act for analyzing reliance on Nassar, 570 U.S. at 362–63, questions were not raised.’’) (citing causation. See 80 FR 54934, 54944–46 and Gross, 557 U.S. at 180, and argued Geary, 7 F.3d at 330); DeMarco, 4 F.3d (Sept. 11, 2015). that these cases do not bridge the gap at 170–71)). Where there is a dispute as A few commenters encouraged between the proposed but-for standard to whether an employment action was OFCCP to adopt the proposed but-for and Title VII principles. For instance, a motivated by the employee’s adherence causation standard because they felt it contractor association commented: ‘‘The to religious tenets, or instead was would reduce government Supreme Court has adopted the ‘but for’ motivated by impermissible encroachment on religious autonomy. standard for retaliation claims under discrimination—a ‘‘one or the other’’ For instance, a private religious Title VII (Nassar) and for ADEA claims scenario—OFCCP will apply the university commented that the proposed (Gross); it has not done so for principles just discussed in subsection but-for standard is in line with statutory discrimination claims under Title VII.’’ II.A.5.e, ‘‘Application of the Religious and First Amendment jurisprudence Similarly, an LGBT rights advocacy Exemption.’’ Where instead an requiring the use of the least restrictive organization commented the two cases employment action is motivated by the means to achieve government objectives cited by OFCCP did not adopt a but-for employee’s adherence or non-adherence that impinge on the exercise of religion. causation requirement for Title VII or to religious tenets that implicate another Another private religious university E.O. 11246 cases. protected category, OFCCP will assess echoed this sentiment and added that Additionally, multiple commenters the action on a case-by-case basis in the proposed but-for standard would expressed concern that the proposed accordance with the general RFRA enable religious entities to make but-for standard would run contrary to analysis discussed earlier. The approach employment decisions consistent with E.O. 11246’s prohibition on adopted in this final rule is consistent their sincerely held religious beliefs discrimination and/or OFCCP’s core with OFCCP’s longstanding policy and while still participating fully in the mission of enforcing the Executive practice as well as Title VII principles marketplace. Order. For instance, a group of state and case law. However, the majority of commenters attorneys general commented that the who addressed the proposed but-for proposed but-for standard is contrary to f. Conclusion standard opposed it, and many law and exceeds OFCCP’s authority For the reasons described above and recommended that OFCCP instead because it impermissibly interprets the in the NPRM, and considering the continue to apply the motivating-factor Executive Order’s anti-discrimination comments received, OFCCP finalizes the standard of causation to all claims of provisions. And a national health policy proposed definition of Particular discrimination under E.O. 11246. These organization commented: ‘‘The new religion without modification. commenters cited a wide variety of proposed rule threatens to jeopardize concerns related to the proposed but-for the very mission of OFCCP and the B. Section 60–1.5 Exemptions standard. original intent of the E.O. 11246 to This rule proposed to add paragraph Several commenters stated that the protect workers from discrimination (e) to 41 CFR 60–1.5 to establish a rule proposed standard would be too . . . .’’ of construction for subpart A of 41 CFR deferential to employers and/or impose Finally, several commenters raised part 60–1 that provides for the broadest too heavy a burden on employees. For practical objections to the proposed but- protection of religious exercise instance, a national interfaith for standard. For instance, an atheist permitted by the Constitution and laws, organization commented that, as long as civil liberties organization commented including RFRA. This rule of an employer can cite another plausible that applying different causation construction is adapted from RLUIPA, reason for its actions, an employee standards to cases involving similarly 42 U.S.C. 2000cc–3(g). Significantly, cannot prove that discrimination situated employers would ‘‘make it RFRA applies to all government occurred. The organization noted that challenging for contractors seeking to conduct, not just to legislation or under this standard, employees are far comply with federal law, resulting in regulation. 42 U.S.C. 2000bb–1. less likely to prevail. extra expense and legal confusion for Paragraph (e) is clarifying, since the Other commenters expressed workers and employers.’’ An Constitution and federal law, including skepticism at OFCCP’s proffered organization that advocates separation RFRA, already bind OFCCP. rationale for departing from its of church and state expressed similar Some commenters expressed general established policy and practice of concerns, arguing that ‘‘status-based support for the proposed rule of

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00037 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79360 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

construction based on the importance of create any new legal obligation or promote one interpretation of one protecting religious freedom, including proscription on the rights of workers, religion—namely, evangelical constitutional protections. For example, but rather sought only to reaffirm Christianity—at the expense of religious a religious leadership and policy existing protections found in federal law liberty more broadly. Some commenters organization approved of the fact that that already apply to OFCCP. The stated that the proposal would allow the proposal gives religious freedom due parallel rule of construction in RLUIPA contractors to compel employees to deference by advocating for a broad and has been in place for nearly 20 years follow their religious practices, which robust interpretation of its protections. and has proved to be a workable legal they argued directly violates Title VII In a joint comment, a religious legal standard. OFCCP emphasizes that this and even the Constitution. A group of association and an association of rule of construction provides for broad state attorneys general commented that, evangelical churches and schools protection of both employers’ and under the proposed rule, employers’ commented that the proposed rule of employees’ religious exercise. Moreover, religious freedom would come at the construction reflects longstanding by its terms, the provision limits the cost of the loss of the religious freedom religious freedom principles recognized agency’s interpretation of this protection of employees forced to abide by their by Congress and protected by the First to what is permitted under the U.S. employers’ religious beliefs. A legal Amendment. A pastoral membership Constitution, RFRA, and other professional organization commented organization commented that the applicable laws. It thus reflects the that the proposed rule would protect proposed rule of construction gives Supreme Court’s recognition that, for-profit or nominally religious religious exercise the special protection within the religion clauses of the First employers’ right to require employees to required by the constitutional text and Amendment, there is ‘‘room for play in participate in prayer or other religious history. A religious professional the joints productive of a benevolent practices. A religious organization education association commented that neutrality which will permit religious commented that employers could the proposed rule of construction exercise to exist without sponsorship invoke the religious exemption to coerce provided clarity regarding the meaning, and without interference.’’ Walz, 397 their workers into participating in scope, and application of the religious U.S. at 669. Accordingly, for the reasons certain religious practices under the exemption. Additional supportive described above and in the NPRM, threat of termination. Several other commenters, including an evangelical considering the comments received, commenters, including a legal chaplains’ advocacy organization, stated OFCCP finalizes the proposed rule of professional association, an organization that the rule of construction is construction without modification. that advocates separation of church and consistent with executive orders and the C. Severability state, an anti-bigotry religious Attorney General’s memorandum on organization, and a migrants’ rights religious liberty. The Department has decided to organization, expressed general concern Other commenters opposed the include severability provisions as part that the proposed rule would weaken proposed rule of construction for a of this final rule. To the extent that any religious liberty. variety of reasons, including arguing provision of this final rule is declared that its application in this context invalid by a court of competent OFCCP believes that the final rule’s would actually be inconsistent with the jurisdiction, the Department intends for overall effect will be to promote U.S. Constitution and federal laws. For all other provisions that are capable of religious liberty. See, e.g., Hobby Lobby, example, a labor organization operating in the absence of the specific 573 U.S. at 707 (‘‘[P]rotecting the free- commented that the interpretation goes provision that has been invalidated to exercise rights of corporations like beyond the Constitution and law, remain in effect. Severability clauses Hobby Lobby, Conestoga, and Mardel including RFRA. An anti-bigotry have been added at the end of 41 CFR protects the religious liberty of the religious organization further noted, 60–1.3 and as a new paragraph, 41 CFR humans who own and control those with regard to RFRA, the Supreme 60–1.5(f). companies.’’). The Supreme Court has Court’s holding in Hobby Lobby that described the expansion of the Title VII ‘‘anti-discrimination prohibitions are III. Other Comments religious exemption as ‘‘lifting a the least restrictive means of achieving Numerous commenters raised a regulation that burdens the exercise of the government’s compelling interest in variety of other general points about the religion.’’ Amos, 483 U.S. 327, 338 providing equality in the workplace,’’ proposed rule. (1987). As described above, the proposed definitions have been altered and commented that this principle A. Religious Liberty for Employees applied with greater force to in the final rule to respond to employment by federal contractors. Several commenters opposed the commenters’ concerns that nominally Other commenters, including a group of proposed rule as undermining or failing religious employers might qualify for state attorneys general and a transgender to promote religious liberty. For the exemption, as well as to clarify the advocacy organization, cautioned that instance, a group of U.S. Senators steps OFCCP will take in analyzing construing the religious exemption commented that the proposed rule will claims of discrimination by religious broadly would ‘‘exceed[ ] statutory and allow employers to refuse to interview contractors. To the extent that judicial limits’’ and conflict with the even highly qualified candidates simply commenters believe that the religious purpose and text of federal equal because they do not regularly attend exemption itself increases employers’ employment laws to provide maximum religious services in their employer’s religious liberty at the expense of nondiscrimination protections for faith. According to the Senators, this employees’ religious liberty, OFCCP workers. A talent management could create a situation in which reiterates that it is required to assessment company commented that religious employers are allowed to administer the religious exemption as the ‘‘maximum extent permitted by discriminate against workers ‘‘who part of E.O. 11246. The President, law’’ standard was vague and left too practice their faith differently—a following Congress’s lead, has already much discretion to the agency charged fundamental right guaranteed by the decided how to balance the religious with enforcement. Constitution.’’ A religious women’s liberty of religious employers and their OFCCP did not intend, in proposing organization echoed this concern and employees, and OFCCP cannot modify the rule of construction at § 60–1.5(e), to also stated that the proposed rule would that. Additionally, claiming the

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00038 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79361

religious exemption and taking Other commenters supported the discrimination among religions, or employment action under its proposed rule as consistent with prone to entanglement with religious protections is purely optional for constitutional principles. These activity. See, e.g., Mitchell v. Helms, 530 employers; the government does not commenters stated, among other things, U.S. 793, 828 (2000) (plurality opinion); require any employment action that may that the proposal appropriately respects Colo. Christian Univ. v. Weaver, 534 be protected by the exemption. freedom of religion, helpfully clarifies F.3d 1245, 1261–62 (10th Cir. 2008); B. Establishment Clause and Other that religious hiring protections apply Great Falls, 278 F.3d at 1342–43. We Constitutional Questions even when federal funding is involved, address these points in more detail next. and is consistent with the Establishment 1. Neutrality Toward Religion Several commenters stated that the Clause. A religious liberties legal proposal violates constitutional organization commented, for instance, The rule does not impermissibly favor prohibitions on aiding private actors that the proposed rule adheres to the religion. In Bowen v. Kendrick, 487 U.S. that discriminate. This concern was traditional understanding that ‘‘the 589 (1988), the Supreme Court held that shared by an affirmative action Constitution [does not] require complete a religious organization is not professionals association, a civil separation of church and state; it disqualified from government programs liberties organization, a professional affirmatively mandates accommodation, that fund religious and nonreligious organization of educators, and an not merely tolerance, of all religions, entities alike on a neutral basis. A organization that advocates separation and forbids hostility toward any’’ ‘‘neutral basis’’ means that the criteria of church and state, among others. The (quoting Lynch v. Donnelly, 465 U.S. are neutral and secular, with no civil liberties organization commented, 668, 668 (1984)). A religious leadership preference for religious institutions for instance, that the proposed rule and policy organization commented that because of their religious character. Id.; would permit contractors to the proposal reflects an accurate see also Rosenberger v. Rector & Visitors discriminate with federal funds, thus understanding of the free exercise of of Univ. of Va., 515 U.S. 819 (1995) (‘‘A putting the government’s imprimatur on religion and ‘‘its place in our society.’’ central lesson of our decisions is that a discrimination in violation of the Equal significant factor in upholding Protection and Establishment Clauses. OFCCP agrees with the commenters governmental programs in the face of A variety of commenters opposed the who stated that the proposal is Establishment Clause attack is their proposed rule on the basis that it consistent with constitutional violates the Establishment Clause and/ principles. As noted in the NPRM and neutrality towards religion.’’); U.S. Dep’t or general church-state separation above, OFCCP believes that the final of Justice, Office of Legal Counsel, principles. For instance, an atheist civil rule is supported by recent Supreme Religious Restrictions on Capital liberties organization commented that Court decisions that protect religion- Financing for Historically Black the proposed rule will violate the exercising organizations and individuals Colleges and Universities, 2019 WL Constitution’s religion clauses by under the U.S. Constitution and federal 4565486 (Aug. 15, 2019) (‘‘Religious involving the government in religious law. See, e.g., Little Sisters of the Poor, Restrictions’’) (‘‘The neutrality principle practice, promoting dominant religious 140 S. Ct. 2367; Espinoza, 140 S. Ct. runs throughout the Court’s decisions, practices, burdening unpopular 2246; Our Lady of Guadalupe, 140 S. Ct. and is broadly consistent with a religious practices, and harming third 2049; Masterpiece Cakeshop, 138 S. Ct. tradition of federal support for religious parties. Similarly, a labor union raised 1719; Trinity Lutheran, 137 S. Ct. 2012; institutions that dates from the time of concerns that the rule crosses into Hobby Lobby, 573 U.S. 682; Hosanna- the Founding.’’). territory proscribed by the Tabor, 565 U.S. 171. These decisions This rule is motivated by legitimate Establishment Clause by authorizing make clear, among other constitutional secular purposes: To expand the eligible federal contractors to advance their principles, that ‘‘condition[ing] the pool of federal contractors to include religious preferences and practices availability of benefits upon a religious organizations, so that the through the receipt of federal funds and recipient’s willingness to surrender his federal government may choose from the performance of public functions. religiously impelled status effectively among competing vendors the best Other commenters stated that the penalizes the free exercise of his combination of price, quality, reliability, proposed rule violates separation of constitutional liberties.’’ Trinity and other purely secular criteria; to powers. For instance, an LGBT rights Lutheran, 137 S. Ct. at 2022 (alterations clarify the law for religious advocacy organization stated that since omitted) (quoting McDaniel, 435 U.S. at organizations and thus reduce 2001, Congress has repeatedly rejected 626 (plurality opinion)); see also compliance burdens; to correct any efforts to extend the Title VII exemption Espinoza, 140 S. Ct. at 2256. OFCCP misperception that religious to government-funded entities. believes that the final rule achieves organizations are disfavored in Likewise, a consortium of federal consistency with these landmark government contracting; and ‘‘to contractors and subcontractors asserted Supreme Court decisions and is alleviate significant governmental that it would be inappropriate for constitutionally valid. Moreover, the interference with the ability of religious OFCCP to regulate the religious definitions and rule of construction organizations to define and carry out exemption without direct and actual adopted in the final rule will help their religious missions,’’ Amos, 483 legislative or constitutional guidance. OFCCP avoid the ‘‘constitutional U.S. at 336, by appropriately protecting Finally, several commenters, minefield’’ into which some courts have their autonomy to hire employees who including an anti-bigotry religious fallen when adjudicating Title VII will further their religious missions. The organization and a civil liberties and claims against religious organizations. final rule also has a religion-neutral human rights legal advocacy World Vision, 633 F.3d at 730 effect. Under the final rule, both organization, raised concerns that the (O’Scannlain, J., concurring). The final religious and secular organizations will proposal violates a variety of other rule will enable OFCCP to apply the retain the ability to bid on government constitutional principles, including the religious exemption without engaging in contracts. Proposed vendors will have to no-religious-tests clause, the free speech an analysis that would be inherently compete solely on the basis of secular clause, and the constitutional right of subjective and indeterminate, outside its criteria. The use of sectarian criteria privacy. competence, susceptible to remains forbidden; nothing in the

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00039 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79362 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

proposed rule sanctions the use of government’ secular contracting to compete on equal footing for federal sectarian criteria for contract awards. requirements. Espinoza, 140 S. Ct. at dollars. See Religious Restrictions, 2019 225. The rule simply allows religious WL 4565486. As an initial matter, OLC 2. Secular and Sectarian Activities organizations to compete with secular explained that ‘‘[t]he Establishment Nothing in the final rule sanctions organizations on the basis of secular Clause permits the government to direct federal funding of religious criteria without being forced to include religious institutions, along activities. In Kendrick, the Court forbade compromise their religious purpose. with secular ones, in a generally such direct funding of religious activity Commenters objecting on this basis are available aid program that is secular in but upheld a statute authorizing dissatisfied with the existence of the content. There is nothing inherently payments to religious organizations that exemption. religious in character about loans for sought to eliminate or reduce the social capital improvement projects; this is not 3. Respecting the First Amendment and economic problems caused by a program in which the government is teenage sexuality because the services to Of great significance to OFCCP, the ‘dol[ing] out crosses or Torahs to [its] be provided under the statute were ‘‘not rule’s clarifications and citizens.’ ’’ Id. at *6 (citing Am. Atheists, religious in character.’’ Kendrick, 487 accommodations better comport with Inc. v. City of Detroit Downtown Dev. U.S. at 605; see also U.S. Dep’t of the Free Exercise Clause by affording Auth., 567 F.3d 278, 292 (6th Cir. Justice, Office of Legal Counsel, religious organizations an appropriate 2009)). Because the capital-financing Department of Housing and Urban level of autonomy in their hiring program at issue was a secular, neutral Development Restrictions on Grants to decisions while still permitting them to aid program, it did not violate the Religious Organizations that Provide engage in federal contracting. As the Establishment Clause. On the other Secular Social Services, 12 Op. O.L.C. Court explained in Trinity Lutheran, hand, the government would violate the 190, 199 (1998) (concluding that the 137 S. Ct. at 2022, the government Free Exercise Clause by denying loans government can fund a religious violates the Free Exercise Clause when to an institution ‘‘in which a substantial organization’s secular activities if they it conditions a generally available portion of its functions is subsumed in can be meaningfully and reasonably public benefit on an entity’s giving up a religious mission,’’ because such a separated from the sectarian activities). its religious character, unless that restriction ‘‘discriminates based on the Likewise here, in the relatively rare condition withstands the strictest religious character of an institution.’’ circumstances in which a proposed scrutiny. ‘‘[D]enying a generally OLC concluded that the appropriate vendor both qualifies as a religious available benefit solely on account of balance was to deny loans under the organization and receives a federal religious identity imposes a penalty on program only for facilities that are contract, the federal funds will pay the the free exercise of religion that can be predominantly used for devotional organization to fulfill the terms of the justified only by a state interest of the religious activity, or for facilities that secular contract, not to pray or to highest order.’’ Id.; see also Locke v. offer only programs of instruction proselytize. Davey, 540 U.S. 712 (2004) (holding devoted to vocational religious Moreover, the Establishment Clause government may not deny generally education. does not forbid the federal government available funding to a sectarian Here, some commenters made clear from contracting with religious institution because of its religious that the federal government’s current organizations for a secular purpose, character); Trinity Lutheran, 137 S. Ct. practice presented religious even if the receipt of the contract at 2021 (‘‘The Department’s policy organizations with a dubious choice: incidentally helps the religious expressly discriminates against They may participate in the government organization advance its sectarian otherwise eligible recipients by contracting process or retain their purpose. As Kendrick explained, disqualifying them from a public benefit religious integrity, but not both. As one ‘‘Nothing in our previous cases prevents solely because of their religious commenter noted, ‘‘If the best service Congress from . . . recognizing the character. . . . [S]uch a policy imposes provider or subcontractor happens to be important part that religion or religious a penalty on the free exercise of religion a religious entity, they are often organizations may play in resolving that triggers the most exacting scrutiny.’’ unwilling to comply with the federal certain secular problems. . . . To the (citing Lukumi, 508 U.S. at 546)). When anti-discrimination laws for fear that extent that this congressional the government conditions a program in they will no longer be able to preserve recognition has any effect of advancing this way, the government ‘‘has punished the integrity of their organizations. This religion, the effect is at most ‘incidental the free exercise of religion. ‘‘To is a direct result of the uncertainty in and remote.’ ’’ 487 U.S. at 607; see, e.g., condition the availability of benefits the applicability of the religious Roemer v. Bd. of Pub. Works of Md., 426 . . . upon [a recipient’s] willingness to exemption under the current law.’’ U.S. 736 (1976) (‘‘[R]eligious . . . surrender[] his religiously impelled Similarly, another commenter, an institutions need not be quarantined [status] effectively penalizes the free association of medical professionals, from public benefits that are neutrally exercise of his constitutional liberties.’’ recently surveyed health professional available to all.’’); Barnes-Wallace v. Id. at 2022 (quoting McDaniel, 435 U.S. members working in faith-based City of San Diego, 704 F.3d 1067 (9th at 626 (plurality opinion)); cf. Trinity organizations overseas and found that Cir. 2012) (finding no Establishment Lutheran, 137 S. Ct. at 2022 (citing Ne. almost half, 49%, feel that the U.S. Clause violation where city leased land Fla. Chapter, Associated Gen. government is not inclined to work with to both secular and sectarian Contractors of Am. v. Jacksonville, 508 faith-based organizations. The final rule organizations). Here, as in Kendrick, U.S. 656, 666 (1993) (‘‘[T]he ‘injury in thus removes any such concerns raised nothing in the final rule ‘‘indicates that fact’ is the inability to compete on an by contractors and instead provides a significant proportion of the federal equal footing in the bidding process, not appropriate religious accommodation. funds will be disbursed to ‘pervasively the loss of a contract.’’)). sectarian’ institutions.’’ Kendrick, 487 In a recent opinion, the Department of 4. Use of Federal Funds U.S. at 610. There are also no concerns Justice’s Office of Legal Counsel Some commenters expressed concern that funds will be used for an concluded that the government violates that the rule would allow employers to ‘‘essentially religious endeavor’’; rather, the Free Exercise Clause by denying use federal funds to discriminate against funds will be used to fulfill the sectarian organizations an opportunity job applicants and employees on the

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00040 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79363

basis of religion. That is a critique of the barrier to participation by eroding their identity out of fear of discrimination, E.O. 11246 religious exemption itself, ability to hire members of their and that the proposal would exacerbate not this rule. OFCCP cannot and does particular faith. Generally speaking, this issue. Commenters wrote that not by this rule reopen that then, OFCCP, in line with case law from effects might include LGBTQ determination by the President. Amos to Trinity Lutheran, views this individuals being less inclined to seek Additionally, as noted earlier, claiming rule as merely providing permissible HIV care and services for the aging, as the religious exemption and taking accommodation rather than well as facing increased vulnerability to employment action under its impermissibly establishing religion. trafficking. Others stated that the proposal would permit contractors to protections is purely optional for 5. Effects on Applicants and Employees employers; the government does not discriminate against people in same-sex require any employment action that may Finally, several commenters opposed relationships, including refusing to hire be protected by the exemption. the proposed rule on the basis that it applicants, terminating employees when would increase discrimination against Regardless, as the Department of they marry someone of the same sex, or contractors’ employees and applicants. Justice’s Office of Legal Counsel has denying spousal benefits. Several Some cited historical discrimination pointed out, the federal government has commenters stated that even LGBTQ against disadvantaged groups, warning repeatedly permitted religious people of faith would be discriminated that the proposal would cause a organizations to receive federal funds against. regression in civil rights protections, while also maintaining autonomy over Commenters also asserted that the and stated that religion has often been proposed rule could increase their hiring practices. See 31 O.L.C. 162, used as a way to justify discrimination. discrimination against women and 185–86 (2007); accord Office of the Att’y For example, an affirmative action pregnant people based on religious Gen., Memorandum for All Executive professionals association asserted that beliefs about work, family roles, and Departments and Agencies: Federal Law employment discrimination permitted reproduction. This included the Protections for Religious Liberty at 6 by the proposed rule could eliminate possibility of discrimination against (Oct. 6, 2017), available at the civil rights protections that women for becoming pregnant outside www.justice.gov/opa/press-release/file/ minorities and women have enjoyed for of marriage, using contraception, using 1001891/download. Likewise, the decades. in vitro fertilization, seeking abortions, proposed rule does not run afoul of the Commenters also gave examples of or getting divorced. An organization Establishment Clause merely because of how potential discrimination could play combatting hunger wrote that even the possibility that, in some rare out. For example, an organization facially neutral practices may instance, a court may determine that a advocating for the separation of church ‘‘disproportionately’’ harm women, particular contract award to a religious and state commented that, for instance, because when an employer opposes organization impermissibly endorses an evangelical Christian might refuse to ‘‘sexual practices out of wedlock, those religion. ‘‘[W]hile religious hire a gay man, but agree to hire a twice- who bear the physical evidence— discrimination in employment might be divorced, thrice-married man, even pregnancy—are going to be the ones that germane to the question whether an though both homosexuality and divorce get fired.’’ Several commenters also organization’s secular and religious are prohibited by evangelical stated that employers may discriminate activities are separable in a government- Christianity. An LGBT civil rights against women based on religious funded program, that factor is not organization argued that even a beliefs that women should not work legally dispositive.’’ U.S. Dep’t of construction company, janitorial outside the home. For example, a Justice, Office of Legal Counsel, service, or low-level healthcare provider women and family rights advocacy Memorandum for William P. Marshall could claim a religious mission and organization commented that some from Randolph D. Moss at 20 (Oct. 12, refuse to hire or provide services to employers may refuse to hire women 2000), available at justice.gov/olc/page/ single parents or individuals who altogether, and that women may also be file/936211/download. To the contrary, become pregnant outside marriage or denied health insurance, professional if the government ‘‘is generally within a same-sex relationship. growth opportunities, or other benefits indifferent to the criteria by which a Many commenters warned that because of an employer’s belief that private organization chooses its adoption of the proposed rule would women are not the ‘‘head of the employees and to the identity and increase discrimination against lesbian, household’’ and therefore do not need characteristics of those employees, there gay, bisexual, transgender, and queer such benefits. Additionally, an would be less likelihood that the (LGBTQ) individuals, specifically. Some interfaith policy and advocacy government could reasonably be commenters alleged that the proposed organization commented that an perceived to endorse the organization’s rule was part of a concerted effort to roll employer could cite a belief that women use of religious criteria in employment back the rights of LGBTQ individuals should not be alone with men they are decisions.’’ Id. at 25. And in some and other disadvantaged groups. Several not married to in order to deny female situations, the religious exemption commenters stated that transgender employees access to mentorship, ‘‘might be a permissible religious employees in particular already face training opportunities, and senior accommodation that alleviates special high rates of discrimination and leadership positions in the workplace. burdens rather than an impermissible poverty, and that this proposal would Commenters also asserted that the religious preference.’’ Id. at 30. For leave them even more vulnerable. A proposal would increase discrimination instance, the Office of Legal Counsel transgender civil rights and advocacy against religious minorities and/or concluded that RFRA in one instance organization commented specifically atheists. Many stated that federal required the Department’s grant-making that transgender people are already far contractors should not be permitted to arm to exempt a religious organization more likely to be unemployed, and that categorically exclude applicants of a from the religious nondiscrimination approximately 1 in 4 earn less than particular religion. A transgender civil provisions of Title VII. See id.; see also $24,000 per year. A women and family rights and advocacy organization 31 O.L.C. 162, 190 (2007). Here, several rights advocacy organization wrote that, commented that the proposed rule religious organizations commented that currently, almost half of LGBTQ would promote sectarianism by the current contracting rules erect a workers report actively concealing their allowing people of different faiths to

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00041 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79364 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

discriminate against one another. A organizations maintain, for instance, departure’’ from OFCCP’s previous EEO number of commenters, including a sincerely held religious tenets regarding enforcement. A civil liberties civil liberties advocacy group and an matters such as marriage and intimacy organization commented that the interfaith policy and advocacy which may implicate certain protected ‘‘Department itself has previously organization, commented: ‘‘Federal classes under E.O. 11246. acknowledged the harms of contractors should not be allowed to Some commenters argued that the discrimination to the country as a hang a sign that says ‘Jews, Sikhs, proposed rule would violate the whole, but ignores them entirely in the Catholics, Latter-day Saints need not Establishment Clause specifically Proposed Rule.’’ An LGBT legal services apply.’ ’’ because of the increased discrimination organization commented that the Many commenters asserted that the they believed it would permit. Most of proposed rule indicates that OFCCP will proposal could allow racial these commenters argued that potential not enforce the relevant protections discrimination as well. An organization discrimination will unconstitutionally sufficiently. combatting hunger claimed that burden third parties, including Some commenters noted more discrimination would occur by citing a employees, applicants, and beneficiaries specifically that they believe the 2014 study in their comment which of contracting services. A labor union proposal is inconsistent with the found that only 10% of Americans were wrote that granting employers a broad agency’s rule implementing E.O. 13672, comfortable permitting a small business religious exemption would harm which added sexual orientation and to refuse service to African-Americans employees and applicants based on gender identity to the bases protected by based on a religious reason. their own religious beliefs and practices E.O. 11246. For example, a legal think Commenters including an LGBTQ (or lack thereof), in violation of the tank commented that, in its rule on wellness organization also warned that, Establishment Clause. sexual orientation and gender identity, under the proposal, a religious As noted above, the Supreme Court OFCCP took into account the benefits of contractor will be permitted to upheld Title VII’s religious exemption, nondiscrimination—meaning that it discriminate against interracial couples on which E.O. 11246’s exemption is would be arbitrary and capricious for if it believes that marriage should be modeled, against an Establishment OFCCP to ignore these benefits of non- between a man and a woman of the Clause challenge. Amos, 483 U.S. at discrimination ‘‘in the present same race. A legal think tank 330. It did so in spite of the fact that the rulemaking.’’ A watchdog organization commented that employers could application of the exemption ‘‘had some wrote that ‘‘undoing these protections require employees to join a majority- or adverse effect on those holding or could have adverse long-term effects on exclusively-white church, for instance, seeking employment with those the federal contracting system, or to share particular religious beliefs organizations.’’ Tex. Monthly, Inc. v. including lower-quality goods and that have racial implications and/or are Bullock, 489 U.S. 1, 18 n.8 (1989); cf. services, and impaired federal programs more common among white Christians. Amos, 483 U.S. at 338–39 (rejecting the and missions.’’ Some commenters argued that federal claim that the religious exemption Commenters also criticized the funds should not be used by contractors ‘‘offends equal protection principles by proposal as purportedly inconsistent who may commit hiring discrimination. giving less protection to the employees with OFCCP’s 2016 sex discrimination For example, a transgender advocacy of religious employers than to the rule. A civil liberties organization organization commented that people employees of secular employers’’ in part commented that, in that rule, the agency should not be legally compelled to because the exemption had ‘‘a cited social science research supporting financially support entities that would permissible purpose of limiting the need for effective nondiscrimination refuse to employ them because of their governmental interference with the enforcement. Similarly, a legal think identities, and noted that religious exercise of religion’’). If the E.O. 11246 tank wrote that, in its sex discrimination employers who seek to employ only religious exemption similarly affects rulemaking, OFCCP specifically cited ‘‘their own kind’’ should seek out non- some third parties, it does so to research indicating that employment federal funding. Other commenters ‘‘prevent[ ] potentially serious discrimination against transgender stated that U.S. federal government encroachments on protected religious workers is pervasive. These commenters contracting serves as a model for the freedoms.’’ Texas Monthly, 489 U.S. at asserted that OFCCP ignored such private sector or foreign nations, which 18 n.8. statistics in proposing the current rule. may emulate discriminatory practices Some commenters stated that what OFCCP continues to believe that permitted by this proposal. they viewed as the proposal’s failure to discrimination by federal contractors As explained above, the religious consider the effects of increased generally has a negative impact on the exemption generally speaking does not discrimination made the proposed rule economy and efficiency of government excuse a contractor from complying inconsistent with OFCCP’s previous contracting. Indeed, that is one of the with E.O. 11246’s requirements rulemakings. Multiple commenters primary justifications for E.O. 11246. regarding antidiscrimination and stated that previous rulemakings However, it has long been recognized affirmative action; notices to applicants, identified discrimination as wasteful of that a religious exemption in the employees, and labor unions; taxpayers’ money, and that this proposal Executive Order is also warranted, compliance with OFCCP’s failed to address this issue. For Congress has determined that implementing regulations; the example, a state civil liberties accommodations under RFRA are furnishing of reports and records to the organization commented that, in prior sometimes required, and OFCCP’s government; and flow-down clauses to rules, OFCCP has consistently stated policy is to respect the religious dignity subcontractors. See E.O. 11246 §§ 202– that discrimination in government of employers and employees to the 203. Religious organizations that serve contracting wastes taxpayer funds by maximum extent permissible by law. as government contractors must comply preventing the hiring of the best talent, Further, OFCCP believes that this rule with all of E.O. 11246’s increasing turnover, and decreasing will have a net benefit to the economy nondiscrimination requirements except productivity. In addition, several and efficiency of government in some narrow respects, under some commenters, including a women and contracting. For those current and narrow and reasonable circumstances family rights advocacy organization, potential federal contractors and recognized under law, where religious referred to the rule as an ‘‘abrupt subcontractors interested in the

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00042 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79365

exemption, this rule will help them employment opportunity for American either, which notes that ‘‘[t]he religious understand its scope and requirements workers. OFCCP rejects the idea that organization exemption under Title VII and may encourage a broader pool of this rule would undermine that does not mention nonprofit and for- organizations to compete for longstanding and constructive profit status’’ and states that ‘‘[w]hether government contracts and more of them, partnership. The EEOC reviewed the a for-profit corporation can constitution which will inure to the government’s proposed rule and this final rule. This a religious corporation under Title VII is benefit. final rule applies only to government an open question.’’ 33 The EEOC’s 2008 Commenters’ concerns here are also contractors and subcontractors, not the guidance states that the exception is exaggerated. As explained above, broader swath of U.S. employers that only for organizations that are primarily OFCCP does not anticipate this rule will the EEOC regulates. Within that smaller religious. Its recently proposed guidance affect the vast majority of contractors or segment of employers, it applies only to describes the inquiry as one into the agency’s regulation of them, since that small minority of contractors and ‘‘whether an entity is religious.’’ 34 they do not and would not seek to subcontractors that qualify or may seek OFCCP’s test also seeks to identify qualify for the religious exemption. As to qualify for the religious exemption. organizations that are primarily commenters noted, religious Among that group, they would need to religious—through an appropriately organizations do not appear to be a large have 15 or more employees to be guided, reliable, and objective inquiry. portion of federal contractors. And even covered by the EEOC. And within that The EEOC’s 2008 guidance (and its for them, adherence to E.O. 11246’s group, there would still need to be a proposed guidance) suggests an open- nondiscrimination provisions is situation in which any differences ended set of non-dispositive factors, required except in those circumstances between the views of OFCCP and EEOC while this final rule uses a set of clearly well-established under law, including would cause a different result. In short, defined factors that are sufficient for the religious exemption, the ministerial OFCCP doubts this rule will create any non-profit entities; regarding for-profit exception, and RFRA. OFCCP also systemic disharmony between the entities, additional evidence compatible reemphasizes that the proposed agencies’ enforcement programs. with some of the additional factors definitions have been altered in the final For the small universe of employers listed by the EEOC’s 2008 guidance may rule to respond to commenters’ remaining as defined above, the come into play. Insofar as any difference concerns that nominally religious differences that may exist are minor. At still remains between this final rule and employers might qualify for the the outset, OFCCP notes that EEOC does EEOC’s 2008 guidance, OFCCP believes exemption, as well as to clarify the steps not have substantive rulemaking that difference is tolerable when OFCCP will take in analyzing claims of authority under Title VII, see EEOC v. weighed against the subsequent discrimination by religious contractors. Arabian Am. Oil Co., 499 U.S. 244, 257 developments in the case law, the As explained in more detail in the (1991), and the EEOC statements on this reasoning of which OFCCP finds Regulatory Procedures section below, issue are in nonbinding subregulatory persuasive, and OFCCP’s desire for a OFCCP has considered the possible guidance. As to the specifics of that more structured test, especially given adverse effects of the rule and believes guidance, the differences that do exist OFCCP’s unique contract-based they will be minimal and will be are small. OFCCP has revised its regulatory structure. outweighed by the benefits. approach in the final rule to adopt a Regarding OFCCP’s definition of motivating-factor standard of causation, Particular religion, the same EEOC C. The Equal Employment Opportunity so a difference there, assuming there guidance documents from 2008 state Commission was one, no longer exists. Regarding that the religious exemption ‘‘only Some commenters raised concerns OFCCP’s definition of Religious allows religious organizations to prefer about this rule’s compatibility with the corporation, association, educational to employ individuals who share their positions of the EEOC. Different aspects institution, or society, the EEOC’s religion.’’ It then addresses two of this concern have been described and current subregulatory guidance on this religiously based views that are not addressed in earlier parts of this topic has not been updated since 2008, protected by the exemption: Racial preamble. OFCCP consolidates those before World Vision and Hobby Lobby discrimination and differences in fringe concerns and addresses them here as were decided.31 Contrary to some benefits between men and women. This well. Those concerns included general commenters’ assertions, this guidance final rule is fully compatible with both concerns that the proposed rule would treats for-profit status as a significant those examples. As discussed earlier in undermine the EEOC’s efforts by taking factor, but not as dispositive; this final this preamble, OFCCP always has a positions contrary to the EEOC or that rule does the same. Notably, the EEOC compelling interest in enforcing the proposed rule would introduce very recently issued a proposal to prohibitions on racial discrimination, confusion by subjecting federal update its compliance manual on and OFCCP endorses the result in contractors to conflicting or at least religious discrimination.32 This rule is Fremont, 781 F.2d 1362. This final rule, different legal regimes. Commenters also not inconsistent with the proposal however, does provide an exemption objected to specific aspects of the rule broader than a mere coreligionist hiring on grounds that they differed from the 31 See EEOC, Questions and Answers: Religious preference. OFCCP believes, for the EEOC’s position, including the Discrimination in the Workplace (July 22, 2008), reasons stated earlier in this preamble, www.eeoc.gov/laws/guidance/questions-and- proposed rule’s inclusion of for-profit answers-religious-discrimination-workplace; EEOC, that that view is sufficiently supported entities as among those able to qualify EEOC Compliance Manual § 12–I.C.1 (July 22, by the Title VII case law, and in fact is for the religious exemption, the 2008), www.eeoc.gov/laws/guidance/section-12- the more persuasive view of the law. proposed rule’s disagreement that the religious-discrimination. The EEOC’s website states OFCCP also believes that a broader view for both these documents that, ‘‘[a]s a result of the exemption’s scope is limited to a Supreme Court’s decision in Our Lady of is more likely to encourage religious coreligionist preference, and the Guadalupe School v. Morrissey-Berru, we are organizations to enter the pool of proposed rule’s but-for causation currently working on updating this web page.’’ Id. competitors for government contracts, standard. 32 See EEOC, ‘‘PROPOSED Updated Compliance which benefits the government. For OFCCP has a decades-long Manual on Religious Discrimination’’ (Nov. 17, 2020), https://beta.regulations.gov/document/ partnership with the EEOC and works EEOC-2020-0007-0001 (last accessed November 18, 33 Id. at 21. closely with it to ensure equal 2020). 34 Id. at 20.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79366 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

these reasons, OFCCP believes that any is, entities that are organized for religious the regulation to impose the least issues arising from any differences with purposes and engage in activity consistent burden on society, consistent with the EEOC’s views as stated in with, and in furtherance of, such purposes— obtaining the regulatory objectives; and subregulatory guidance from 2008 are have an express statutory exemption from in choosing among alternative Title VII’s prohibition on religious outweighed by the benefits of adopting discrimination in employment. Under that regulatory approaches, select those a broader view of the exemption. exemption, religious organizations may approaches that maximize net benefits. Additionally, OFCCP believes any choose to employ only persons whose beliefs E.O. 13563 recognizes that some differences on this issue may be and conduct are consistent with the benefits are difficult to quantify and resolved in the near future. The EEOC’s organizations’ religious precepts. For provides that, where appropriate and proposed guidance is even more example, a Lutheran secondary school may permitted by law, agencies may consistent with OFCCP’s final rule. The choose to employ only practicing Lutherans, consider and discuss qualitatively proposed guidance states that ‘‘the only practicing Christians, or only those values that are difficult or impossible to willing to adhere to a code of conduct exemption allows religious consistent with the precepts of the Lutheran quantify, including equity, human organizations to prefer to employ community sponsoring the school. Indeed, dignity, fairness, and distributive individuals who share their religion, even in the absence of the Title VII impacts. defined not by the self-identified exemption, religious employers might be able This final rule is an E.O. 13771 religious affiliation of the employee, but to claim a similar right under RFRA or the deregulatory action because it is broadly by the employer’s religious Religion Clauses of the Constitution. expected to reduce compliance costs observances, practices, and beliefs.’’ 35 Id. at 6; see also id. at 12a–13a and potentially the cost of litigation for The guidance goes on to state that ‘‘[t]he regulated entities. IV. Regulatory Procedures prerogative of a religious organization to 1. The Need for the Regulation employ individuals ‘‘ ‘of a particular A. Executive Order 12866 (Regulatory religion’ . . . has been interpreted to Planning and Review), Executive Order As discussed in the preamble, OFCCP include the decision to terminate an 13563 (Improving Regulation and received numerous comments employee whose conduct or religious Regulatory Review), and Executive addressing the need for the regulation. Some commenters stated the proposal beliefs are inconsistent with those of its Order 13771 (Reducing Regulation and 36 was necessary to ensure religious employer.’’ Controlling Regulatory Costs) OFCCP also believes some entities could contract with the federal commenters mischaracterize any Under Executive Order 12866 (E.O. government without compromising their differences between the OFCCP and 12866), OMB’s Office of Information religious identities or missions. Some EEOC in this area as presenting and Regulatory Affairs (OIRA) commenters also agreed with OFCCP’s contractors with conflicting liability. determines whether a regulatory action observation that religious organizations OFCCP’s final rule is at least as, or is significant and, therefore, subject to have been reluctant to participate as more, protective of religious the requirements of E.O. 12866 and federal contractors because of the lack of organizations than the view stated in the OMB review. Section 3(f) of E.O. 12866 clarity or perceived narrowness of the EEOC’s guidance. A contractor can defines a ‘‘significant regulatory action’’ E.O. 11246 religious exemption. choose to adhere to the view articulated as an action that is likely to result in a OFCCP also received comments by the EEOC in 2008 and be in full rule that: (1) Has an annual effect on the objecting to the proposal because they compliance under the view of both economy of $100 million or more, or claimed it would permit taxpayer- or agencies. adversely affects in a material way a government-funded discrimination. Finally, OFCCP must balance its sector of the economy, productivity, Commenters argued that the coordination with the EEOC with its competition, jobs, the environment, Government should not allow federal need to follow directives from the public health or safety, or State, local or contractors to fire or refuse to hire President and the U.S. Department of tribal governments or communities (also qualified individuals because they do Justice. Section 4 of Executive Order referred to as economically significant); not regularly attend religious services or 13798 states that ‘‘[i]n order to guide all (2) creates serious inconsistency or adhere to the ‘‘right’’ religion. agencies in complying with relevant otherwise interferes with an action Additionally, commenters expressed Federal law, the Attorney General shall, taken or planned by another agency; (3) skepticism about religious as appropriate, issue guidance materially alters the budgetary impacts organizations’ reluctance to participate interpreting religious liberty protections of entitlement grants, user fees, or loan as federal contractors. Many of these in Federal law.’’ The Attorney General programs, or the rights and obligations commenters stated that OFCCP issued such guidance on October 6, of recipients thereof; or (4) raises novel provided no evidence to support its 2017, ‘‘to guide all administrative legal or policy issues arising out of legal claim or asserted that the proposed rule agencies and executive departments in mandates, the President’s priorities, or would increase rather than reduce the executive branch.’’ Office of the the principles set forth in E.O. 12866. confusion. In addition, several Att’y Gen., Memorandum for All This final rule has been designated a commenters cited a report from a Executive Departments and Agencies: ‘‘significant regulatory action’’ although progressive policy institute concluding Federal Law Protections for Religious not economically significant, under that faith-based organizations that had Liberty at 1 (Oct. 6, 2017), available at section 3(f) of E.O. 12866. The Office of objected to the lack of an expanded www.justice.gov/opa/press-release/file/ Management and Budget has reviewed religious exemption in E.O. 13672 1001891/download. This rule is fully this final rule. Pursuant to the continued to be awarded government compatible with that guidance: Congressional Review Act (5 U.S.C. 801 contracts. et seq.), OIRA designated this rule as not OFCCP disagrees with commenters’ Religious corporations, associations, a ‘‘major rule,’’ as defined by 5 U.S.C. characterization of the rule as educational institutions, and societies—that 804(2). discriminatory. OFCCP is committed to Executive Order 13563 (E.O. 13563) enforcing all of E.O. 11246’s protections, 35 EEOC, ‘‘PROPOSED Updated Compliance Manual on Religious Discrimination’’ at 24. directs agencies to adopt a regulation including those protecting employees 36 Id. (citing Hall, 215 F.3d at 625; Little, 929 F.3d only upon a reasoned determination from discrimination on the basis of at 951). that its benefits justify its costs; tailor religion. OFCCP emphasizes again that

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00044 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79367

this rule will have no effect on the within that definition and thus Entities registered in the SAM database overwhelming majority of federal evaluates the impacts using data for the consist of contractor firms and other contractors. Even for religious entire contractor universe despite the entities (such as state and local organizations that serve as government fact this number significantly overstates governments and other organizations) contractors, they too must comply with the number of religious contractors. that are interested in federal contracting all of E.O. 11246’s nondiscrimination Prior to publication of the NPRM, opportunities and other forms of federal requirements except in some narrow OFCCP surveyed the list of contractors financial assistance. The total number of respects under some narrow and in the General Service Administration’s entities in the SAM database fluctuates reasonable circumstances recognized System for Award Management (SAM) and is posted on a monthly basis. The under law. This rule provides clarity on to identify organizations whose North current database includes those circumstances, consistent with American Industry Classification approximately 435,000 entities. Thus, OFCCP’s obligations to also respect and System (NAICS) descriptions or names OFCCP determines that 435,000 entities accommodate the free exercise of included the word ‘‘religious,’’ is a reasonable representation of the religion. ‘‘church,’’ ‘‘mosque,’’ etc. This survey number of entities that may be affected OFCCP agrees with the comments was not a useful or appropriate proxy by the final rule.38 OFCCP recognizes stating that the religious exemption for the number of potentially affected that this SAM number likely results in contained in section 204(c) of E.O. entities for several reasons. First, not all an overestimation for two reasons: The 11246 is necessary to ensure religious organizations with ‘‘religious’’ NAICS system captures firms that do not meet organizations can contract with the codes or names would qualify for the the jurisdictional dollar thresholds for federal government without exemption, given that any formulation the three laws that OFCCP enforces, and compromising their religious identities of the religious-organization test is fact- it captures contractor firms for work or missions. The fact that some faith- intensive and requires much more than performed outside the United States by based organizations have been willing to that the organization simply have (what individuals hired outside the United enter into federal contracts does not is commonly understood to be) a States, over which OFCCP does not have mean that other faith-based religious term in its name. This holds authority. Further, because this rule organizations have not been reluctant to true under any formulation of the test, only applies to religious contractors, do so. Indeed, a few commenters offered whether that used in a case like LeBoon OFCCP is confident that this estimate evidence that religious organizations or the test set out in the NPRM and overstates the true universe of have been reluctant to contract with or refined in the final rule. Second, and contractors affected by the rule. receive grants from the federal similarly, many religious organizations OFCCP anticipates three main groups government because of the lack of that could qualify for the religious that potentially will be impacted: clarity regarding religious exemptions in employer exemption at issue here may Religious organizations that decide to federal law. In addition, although some not include one of those three specific become federal contractors because of commenters objected to the provision of descriptors in their NAICS description this final rule’s clarity on the scope and any religious exemption for federal much like many religious organizations application of the religious exemption, contractors, the religious exemption is do not include one of those three words religious organizations that are already part of E.O. 11246 that OFCCP is in their legal names. Third, the religious federal contractors, and all current obligated to administer and enforce and exemption is an optional federal contractors. OFCCP is unable to has been part of the Executive Order for accommodation. Organizations that reasonably quantify the costs, benefits, nearly two decades. qualify for it may choose to use it, or and transfers for these three groups of OFCCP is publishing this final rule to not, and OFCCP has no reliable way of organizations, but provides the clarify the scope and application of the following qualitative analysis. Though religious exemption. The intent is to determining which will do so. Fourth, OFCCP believes that, as a government religious organizations new to federal provide certainty and make clear that contracting will likely incur upfront the exemption includes not only agency, it would be a fraught matter for it to search for potentially religious costs and compliance costs associated churches but employers that are with becoming a federal contractor, it is organized for religious purpose, hold organizations based on its own view of what sorts of terms are religious, assess reasonable to assume they believe that themselves out to the public as carrying becoming a federal contractor will out a religious purpose, and engage in the results in the abstract, and attempt to attribute religious characteristics to further their goals, which will result in activity consistent with and in benefits to the organization (whether furtherance of that religious purpose. the organizations found. This rule elsewhere rejects that sort of approach. increased revenues, more financial OFCCP believes that the rule will stability, or better market access). In promote consistency in OFCCP’s For all these reasons, OFCCP has chosen to use broader estimates of the addition, if the new potential administration and that it will be clearer contractors are awarded government for contractors to follow. Further, contractor universe. Further, OFCCP anticipates that many contracts, the government and the OFCCP believes it will help achieve public will receive better quality or consistency with the administration contractors would affirmatively disclaim any religious basis and thus lower-cost services because most federal policy to enforce federal law’s robust contracts are rewarded through protections of religious freedom. OFCCP recognizes that the following analysis will be an overestimate, but competitive bidding which selects 2. Discussion of Impacts uses it out of an abundance of caution. (generally speaking) either the lowest In this section, OFCCP presents a OFCCP determined that there are 38 summary of the costs associated with approximately 435,000 entities While the final rule may result in more 37 religious corporations, associations, educational the new definitions in § 60–1.3 and the registered in the SAM database. institutions or societies entering into federal new rule of construction in § 60–1.5. contracting or subcontracting, there is no way to While this rule will only apply to 37 U.S. General Services Administration, System estimate the volume of increase. As noted above, for Award Management, data released in monthly OFCCP does not anticipate that the number of federal contractors that are religious, files, available at https://sam.gov. The SAM religious contractors will grow to be equal to non- OFCCP lacks data to determine the database is an estimate with the most recent religious contractors, but uses this estimate due to number of contractors that would fall download of data occurring November 2020. the lack of data.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00045 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79368 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

cost per unit or highest quality unit at 3. Public Comments to address the economic and non- a specific price. As the number of In this section, OFCCP addresses the economic costs to employees in the potential federal contractors rises, the public comments specifically received form of lost wages and benefits, out of competitive process should result in on the Regulatory Impact Analysis. pocket medical expenses, job searches, better quality and prices for goods and One commenter, a public policy and negative mental and physical health services which will enhance the societal research and advocacy organization, consequences of discrimination. Two benefits of federal contracting. If total asserted that OFCCP underestimated the commenters, a civil liberties costs from contracting with the new wage rate of the employees who would organization and a labor union, organization are lower than the status likely review the rule. The commenter mentioned that there are 25 states quo, the result will be a transfer to asserted that the employee would likely without explicit statutory protections taxpayers. be an attorney rather than a human barring employment discrimination Religious organizations which are resource manager. The commenter based on gender identity and sexual already federal contractors will see a suggested that most contractors would orientation and asserted that workers in minimal cost for rule familiarization consult in-house or outside counsel to these states are not otherwise covered and compliance and will continue to help with rule familiarization. The by statutory protections. The commenters who made these assertions efficiently provide services to the U.S. commenter also provided an alternate provided no additional information or government. The clear boundaries of the fully loaded hourly compensation rate data to support their assertions. religious exemption may permit these for Lawyers (SOC 23–1011). OFCCP Additionally, given Bostock’s holding contractors to more freely seek the acknowledges that some contractors that Title VII’s prohibition on sex religious exemption with assurance that may have in-house counsel review the discrimination includes discrimination they are complying with their legal final rule. However, some contractors do on the basis of sexual orientation and obligations under Executive Order not have in-house counsel, and their transgender status, these concerns seem 11246, and they may revisit their review will be conducted by human lessened. employment practices accordingly. resource managers. Taking into OFCCP cannot determine quantitatively OFCCP has reviewed these comments consideration this comment, OFCCP has and notes that any attempt to project the direction or magnitude of any adjusted its wage rate to reflect review changes in employment but believes the costs to employees would necessarily by either in-house counsel or human require OFCCP to speculate that certain overall effects will be quite small at resource managers. workers will face discrimination only these organizations, as most employees Several commenters addressed the once this rule is finalized. Further, the at them were likely attracted to them time needed for a contractor to become commenters ignore the possibility that because of a shared sense of religious familiar with the final rule. These contractors may choose to hire mission, and extremely small when commenters asserted that the estimate of individuals of greater religious diversity considering the entire contractor one half-hour was too low. One as a result of this rule because their universe or the economy as a whole. On commenter provided no additional incentive to only hire coreligionists will one hand, religious employers may feel information or alternative calculation. be diminished. Absent data regarding more free to hire those that are not The remaining two provided alternative the number of individuals who are not denominational coreligionists, given estimates ranging from 1.5 hours to 2.5 discriminated against in the status quo this final rule’s explanation, consistent hours to become familiar with the final but would be discriminated against with law, that an organization does not rule. OFCCP acknowledges that the when this rule is finalized, and non- forfeit the exemption when it hires precise amount of time each company coreligionist individuals who will be outside strict denominational will take to become familiar with hired by a contractor as a result of this boundaries, and that an organization understanding the new regulations is rule that OFCCP cannot assess the mere may require acceptance of or adherence difficult to estimate. However, the possibility that some workers could face to particular religious tenets as part of elements that OFCCP uses in its different costs. Likewise, OFCCP lacks the employment relationship regardless calculation take into account the length data for the number of new contractors of employees’ denominational and complexity of the final rule. The that may enter the market and the membership. On the other hand, given final rule adds definitions to the number of employees that work for such this clarity, religious employers may existing regulations implementing E.O. companies. As such, OFCCP does not also feel more confident in their ability 11246 and clarifies the exemption estimate the benefits to the employees of to hire and retain employees based on contained in section 204(c) of E.O. those new contractors. religious criteria. Additionally, OFCCP 11246. As such, the final rule clarifies Commenters also said that OFCCP believes these assurances for religious requirements and reduces burdens on failed to address the costs to taxpayers organizations will result in reduced contractors trying to understand their in the form of a restricted labor pool, legal costs for both the religious obligations and responsibilities of decreased productivity, employee contractors and OFCCP. complying with E.O. 11246. Thus, turnover, and increased health care All current federal contractors may OFCCP has decided to retain its initial costs related to employment face additional competition as new estimate of one half-hour for rule discrimination and increased social potential competitors enter the market. familiarization. This estimate accounts stigma. In addition, some commenters Since the total amount of available for the time needed to read the final rule mentioned that OFCCP did not account government contracts is not anticipated or participate in an OFCCP webinar for intangible costs related to reductions to change, the increased competition about the final rule. in equity, fairness, and personal may provide better prices for the Many commenters asserted that freedom that would result from allowing government, but may also result in a OFCCP did not address the potential businesses and organizations receiving reallocation of the contracts. Should this costs of the final rule on employees, taxpayer dollars to opt out of critical occur, it is possible that revenues will taxpayers, and minority groups, nondiscrimination provisions that be transferred between various including LGBT individuals, women, protect employees based on gender government contractors or from current and religious minorities. The identity and sexual orientation. The contractors to new entrants. commenters asserted that OFCCP failed commenters who made these assertions

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00046 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79369

provided no additional information or One individual commenter asserted that it does not anticipate any costs data to support their assertions. Further, that OFCCP did not properly determine beyond rule familiarization for the commenters provide no additional the rule’s economic significance. The contractors. support for their assertion that the rule commenter asserted that the Regulatory Taking the Regulatory Impact will increase costs to taxpayers and Impact Analysis in the NPRM did not Analysis comments into consideration, ignore the possibility that the rule will take into account ‘‘the actual monetary OFCCP has assessed the costs and expand the pool of federal contractors, impact of the regulation.’’ Using all benefits of the final rule as follows. thereby saving taxpayers money. available information and data, OFCCP OFCCP believes that either a Human Similarly, several commenters has addressed the quantifiable and addressed the potential impact of the Resource Manager (SOC 11–3121) or a qualitative costs and benefits of this Lawyer (SOC 23–1011) would review rule on state and local governments. final rule as required. It provides an Three commenters, a city attorney, a the final rule. OFCCP estimates that assessment of the costs associated with state’s attorney, and a civil liberties and 50% of the reviewers would be human rule familiarization and concludes that human rights legal advocacy resource managers and 50% would be the addition of definitions and organization, mentioned that state and in-house counsel. Thus, the mean local governments may lose important clarification of an exemption do not hourly wage rate reflects a 50/50 split tax revenue if people relocate or choose create additional burdens for the between human resource managers and to withdraw from the workforce because regulated community. As stated in the lawyers. The mean hourly wage of of the final rule. Another commenter preamble, the intent of the final rule is human resource managers is $62.29 and mentioned that state and local to clarify the scope of the religious the mean hourly wage of lawyers is governments that serve victims of exemption and promote consistency in $69.86.39 Therefore, the average hourly discrimination will need to contribute OFCCP’s administration of it. The wage rate is $66.08 (($62.29 + $69.86)/ to, provide, and administer more public commenter also asserted that OFCCP 2). OFCCP adjusted this wage rate to benefits programs for vulnerable did not account for the impact on larger reflect fringe benefits such as health populations. These comments are contractors. The Regulatory Flexibility insurance and retirement benefits, as assume that the rule will impose costs Act requires agencies to consider the well as overhead costs such as rent, on workers and that those costs will in impact of a regulation on a wide range utilities, and office equipment. OFCCP turn be imposed upon the communities of small entities, including small used a fringe benefits rate of 46% 40 and in which those workers live. None of businesses, nonprofit organizations, and an overhead rate of 17%,41 resulting in these commenters provided additional small governmental jurisdictions. It a fully loaded hourly compensation rate information or data to support their does not address larger corporations. of $107.71 ($66.08 + ($66.08 × 46%) + statements. However, OFCCP’s assessment reflects ($66.08 × 17%)).

TABLE 1—LABOR COST

Average Fringe benefit Overhead Fully loaded Major occupational groups hourly wage rate rate hourly rate (%) (%) compensation

Human Resources Managers and Lawyers ...... $66.08 46 17 $107.71

4. Cost of Regulatory Familiarization sessions to identify any specific materials provided by OFCCP, or challenges contractors believe they face, participate in an OFCCP webinar to OFCCP acknowledges that 5 CFR or may face, when complying with the learn the new requirements.42 1320.3(b)(1)(i) requires agencies to new regulations. OFCCP notes that such Consequently, the estimated burden for include in the burden analysis the informal compliance guidance is not rule familiarization would be 217,500 estimated time it will take for binding. hours (435,000 contractor firms × 1⁄2 contractors to review and understand OFCCP believes that human resource hour). OFCCP calculates the total the instructions for compliance. In order managers or lawyers at each contractor estimated cost of rule familiarization as to minimize the burden, OFCCP will firm would be the employees $23,426,925 (217,500 hours × $107.71/ publish compliance assistance responsible for understanding the new hour) in the first year, which amounts materials, such as fact sheets and regulations. OFCCP further estimates to a 10-year annualized cost of answers to frequently asked questions. that it will take a minimum of one half- $2,666,359 at a discount rate of 3% OFCCP may also host webinars for hour for a human resource professional (which is $6.13 per contractor firm) or interested persons that describe the new or lawyer at each contractor firm to read $3,117,259 at a discount rate of 7% regulations and conduct listening the rule, read the compliance assistance (which is $7.17 per contractor firm).

TABLE 2—REGULATORY FAMILIARIZATION COSTS

Total number of contractors ...... 435,000. Time to review rule ...... 30 minutes.

39 BLS, Occupational Employment Statistics, worked in 2017, while benefit costs averaged 42 OFCCP believes that contractor firms that may Occupational Employment and Wages, May 2019, $11.26, which is a benefits rate of 46%. be potentially affected by the rule may take more https://www.bls.gov/oes/current/oes_nat.htm. 41 Cody Rice, U.S. Environmental Protection time to review the final rule, while contractor firms 40 BLS, Employer Costs for Employee Agency, ‘‘Wage Rates for Economic Analyses of the that may not be affected may take less time, so the Toxics Release Inventory Program’’ (June 10, 2002), Compensation, https://www.bls.gov/ncs/data.htm. one half-hour reflects an estimated average for all https://www.regulations.gov/document?D=EPA-HQ- contractor firms. Wages and salaries averaged $24.26 per hour OPPT-2014-0650-0005.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00047 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79370 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

TABLE 2—REGULATORY FAMILIARIZATION COSTS—Continued Human resources manager and lawyer fully loaded hourly compensation ...... $107.71. Regulatory familiarization cost ...... $23,426,925. Annualized cost with 3% discounting ...... $2,666,359. Annualized cost per contractor with 3% discounting ...... $6.13. Annualized cost with 7% discounting ...... $3,117,259. Annualized cost per contractor with 7% discounting ...... $7.17.

5. Cost Savings to E.O. 11246. It also increases religious contract with the government after the OFCCP expects that contractors freedom for religious employers. religious exemption is clarified. impacted by the rule will experience The final rule increases clarity for A further benefit of this rule would be cost savings. Specifically, the clarity federal contractors. This impact most that some religious contractors will provided in the new definitions and the likely yields a benefit to taxpayers (if increase the diversity of their workforce. interpretation provided will reduce the contractor fees decrease because they do Under some prior interpretations, the risk of noncompliance to contractors not need to engage third-party religious exemption was only provided and the potential legal costs that representatives to interpret OFCCP’s to contractors who hired co-religionists findings of noncompliance with requirements). While some commenters (e.g., a Catholic company hiring only OFCCP’s requirements might impose. expressed concern that the rule was not Catholics; a Latter-day Saint contractor One mass mail campaign of commenters clear, OFCCP believes that the rule is hiring only Latter-day Saints; etc.) and asserted that allowing religious sufficiently consistent with Title VII thus religious contractors were organizations to continue to provide a case law and principles and that it will incentivized to limit their hiring to only variety of services, such as assisting promote consistency in administration. co-religionists. Once this rule is victims of sexual abuse, the hungry, and Furthermore, by increasing clarity for finalized, such religious contractors will the homeless, is effective because it both contractors and for OFCCP no longer be required to limit their saves taxpayer dollars through enforcement, the final rule may reduce hiring. The likely outcome of this contracting instead of expanding the number and costs of enforcement change is that the workforces of government bureaucracy. proceedings by making it clearer to both religious employers will become more Some commenters argued that the sides at the outset what is required diverse. rule will decrease clarity and will thus under the regulations. This would also B. Regulatory Flexibility Act and increase costs for contractors, especially most likely represent a benefit to Executive Order 13272 (Consideration if those contractors believe their taxpayers (since fewer resources would of Small Entities) obligations under the EEOC conflict be spent in OFCCP administrative The agency did not receive any public with their obligations under the final litigation). rule. First, OFCCP believes that the E.O. comments on the Regulatory Flexibility 11246 nondiscrimination obligations it OFCCP notes that some commenters Analysis. enforces remain in force and that the asserted that OFCCP did not provide The Regulatory Flexibility Act of 1980 rule is sufficiently consistent with Title evidence that faith-based organizations (RFA), 5 U.S.C. 601 et seq., establishes VII case law and principles and that it have been reluctant to contract with the ‘‘as a principle of regulatory issuance will promote consistency in federal government because of the lack that agencies shall endeavor, consistent administration. Second, even assuming of certainty about the religious with the objectives of the rule and for purposes of this analysis that exemption. The fact that some small applicable statutes, to fit regulatory and contractors’ obligations under EEOC and number of faith-based organizations informational requirements to the scale E.O. 11246 differ (e.g., that the have been willing to enter into federal of the businesses, organizations, and exemption in E.O. 11246 permits an contracts does not mean that other faith- governmental jurisdictions subject to action forbidden under the EEOC’s view based organizations have not been regulation.’’ Public Law 96–354, 2(b). of Title VII), a contractor remains reluctant to do so. OFCCP believes that The RFA requires agencies to consider obligated to abide by Title VII and any providing clarity to the religious the impact of a regulation on a wide exemption from E.O. 11246 simply exemption currently included under range of small entities, including small prevents additional liability before E.O. 11246 will promote clarity and businesses, nonprofit organizations, and OFCCP for the same action. certainty for all contractors. Moreover, a small governmental jurisdictions. Accordingly, only those contractors that few commenters confirmed OFCCP’s Agencies must review whether a final wish to rely on the E.O. 11246 observation that religious organizations rule would have a significant economic exemption need consider it, and we have been reluctant to participate as impact on a substantial number of small expect that the additional costs incurred federal contractors because of the lack of entities. See 5 U.S.C. 603. If the rule by such organizations to understand the clarity or perceived narrowness of the would, then the agency must prepare a exemption beyond their existing E.O. 11246 religious exemption. One regulatory flexibility analysis as compliance costs will be minimal. individual commenter described his described in the RFA. See id. However, experience with religious organizations’ if the agency determines that the rule 6. Benefits reluctance to contract or subcontract would not be expected to have a E.O. 13563 recognizes that some rules with the federal government, and two significant economic impact on a have benefits that are difficult to other commenters offered examples or substantial number of small entities, quantify or monetize but are important, evidence of religious organizations’ then the head of the agency may so and states that agencies may consider reluctance to participate in other certify and the RFA does not require a such benefits. This final rule improves contexts, such as federal grants. Thus, regulatory flexibility analysis. See 5 equity and fairness by giving contractors OFCCP expects that the number of new U.S.C. 605. The certification must clear guidance on the scope and contractors may increase because provide the factual basis for this application of the religious exemption religious entities may be more willing to determination.

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations 79371

OFCCP does not expect the final rule governments; however, the agency institution of learning, including to have a significant economic impact believes that these effects will be neither acceptance of or adherence to sincere on a substantial number of small entities direct nor substantial. Thus, OFCCP has religious tenets as understood by the and does not believe the final rule has determined that it does not have employer as a condition of employment, any recurring costs. The regulatory ‘‘federalism implications.’’ This rule whether or not the particular religion of familiarization cost discounted at a 7% will not ‘‘have substantial direct effects an individual employee or applicant is rate of $50.33 per contractor or $7.17 on the States, on the relationship the same as the particular religion of his annualized is a de minimis cost. between the national government and or her employer or prospective Therefore, the first year and annualized the States, or on the distribution of employer. burdens as a percentage of the smallest power and responsibilities among the * * * * * employer’s revenue would be far less various levels of government.’’ Religion includes all aspects of than 1%. Accordingly, OFCCP certifies F. Executive Order 13175 (Consultation religious observance and practice, as that the final rule would not have a well as belief. significant economic impact on a and Coordination With Indian Tribal * * * * * substantial number of small entities. Governments) Religious corporation, association, That is consistent with the Department’s This final rule does not have tribal educational institution, or society. (1) analysis in the NPRM. implications under Executive Order Religious corporation, association, 13175 that would require a tribal C. Paperwork Reduction Act educational institution, or society summary impact statement. The final means a corporation, association, The Paperwork Reduction Act of 1995 rule will not ‘‘have substantial direct educational institution, society, school, requires that OFCCP consider the effects on one or more Indian tribes, on college, university, or institution of impact of paperwork and other the relationship between the Federal learning that: information collection burdens imposed Government and Indian tribes, or on the (i) Is organized for a religious on the public. See 44 U.S.C. 3507(d). An distribution of power and agency may not collect or sponsor the purpose; responsibilities between the Federal (ii) Holds itself out to the public as collection of information or impose an Government and Indian tribes.’’ information collection requirement carrying out a religious purpose; unless the information collection List of Subjects in 41 CFR Part 60–1 (iii) Engages in activity consistent with, and in furtherance of, that instrument displays a currently valid Civil rights, Employment, Equal religious purpose; and OMB control number. See 5 CFR employment opportunity, Government (iv)(A) Operates on a not-for-profit 1320.5(b)(1). contracts, Government procurement, basis; or OFCCP has determined that there is Investigations, Labor, and Reporting and (B) Presents other strong evidence that no new requirement for information recordkeeping requirements. collection associated with this final its purpose is substantially religious. rule. The final rule provides definitions Craig E. Leen, (2) Whether an organization’s and a rule of construction to clarify the Director, OFCCP. engagement in activity is consistent with, and in furtherance of, its religious scope and application of current law. For the reasons set forth in the purpose is determined by reference to The information collections contained preamble, OFCCP revises 41 CFR part the organization’s own sincere in the existing E.O. 11246 regulations 60–1 as follows: are currently approved under OMB understanding of its religious tenets. Control Number 1250–0001 PART 60–1—OBLIGATIONS OF (3) To qualify as religious a (Construction Recordkeeping and CONTRACTORS AND corporation, association, educational Reporting Requirements) and OMB SUBCONTRACTORS institution, society, school, college, Control Number 1250–0003 university, or institution of learning (Recordkeeping and Reporting ■ 1. The authority citation for part 60– may, or may not: Have a mosque, Requirements—Supply and Service). 1 continues to read as follows: church, synagogue, temple, or other house of worship; or be supported by, Consequently, this final rule does not Authority: Sec. 201, E.O. 11246, 30 FR require review by the Office of 12319, 3 CFR, 1964–1965 Comp., p. 339, as be affiliated with, identify with, or be Management and Budget under the amended by E.O. 11375, 32 FR 14303, 3 CFR, composed of individuals sharing, any authority of the Paperwork Reduction 1966–1970 Comp., p. 684, E.O. 12086, 43 FR single religion, sect, denomination, or Act. 46501, 3 CFR, 1978 Comp., p. 230, E.O. other religious tradition. 13279, 67 FR 77141, 3 CFR, 2002 Comp., p. (4) The following examples apply this D. Unfunded Mandates Reform Act of 258 and E.O. 13672, 79 FR 42971. definition to various scenarios. It is 1995 ■ 2. Amend § 60–1.3 by assumed in each example that the For purposes of the Unfunded ■ a. Adding in alphabetical order the employer is a federal contractor subject Mandates Reform Act of 1995, 2 U.S.C. definitions of ‘‘Particular religion,’’ to Executive Order 11246. 1532, this final rule does not include ‘‘Religion,’’ ‘‘Religious corporation, (i)(A) Example. A closely held for- any federal mandate that may result in association, educational institution, or profit manufacturer makes and sells excess of $100 million in expenditures society,’’ and ‘‘Sincere,’’ and metal candlesticks and other decorative by state, local, and tribal governments in ■ b. Adding paragraph (a) and adding items. The manufacturer’s mission the aggregate or by the private sector. and reserving paragraph (b). statement asserts that it is committed to The revisions read as follows: providing high-quality candlesticks and E. Executive Order 13132 (Federalism) similar items to all of its customers, a OFCCP has reviewed this final rule in § 60–1.3 Definitions. majority of which are churches and accordance with Executive Order 13132 * * * * * synagogues. Some of the manufacturer’s regarding federalism. OFCCP recognizes Particular religion means the religion items are also purchased by federal that there may be some existing costs of a particular individual, corporation, agencies for use during diplomatic that may shift from the federal association, educational institution, events and presentations. The government to state or local society, school, college, university, or manufacturer regularly consults with

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4700 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 79372 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Rules and Regulations

ministers and rabbis regarding new its emails and other communications, the business’s customers are private designs to ensure that they conform to the contractor holds itself out as a individuals or museums interested in any religious specifications. The religious organization to its employees, the items as display pieces or for their manufacturer also advertises heavily in applicants, and clients. Finally, cultural value. The business’s marketing predominantly religious publications notwithstanding that the contractor materials include examples of religious and donates a portion of each sale to collects a placement fee similar to iconography and artifacts from a variety charities run by churches and nonreligious staffing companies, it is of world religions, as well as various synagogues. organized as a non-profit. cultural and artistic items. (B) Application. The manufacturer (iii)(A) Example. A small catering (B) Application. The business likely likely does not qualify as a religious company provides kosher meals does not qualify as a religious organization. Although the primarily to synagogues and for various organization. Its mission statement manufacturer provides goods events in the Jewish community, but references an arguably religious predominantly for religious other customers, including federal purpose, namely perpetuating the communities, the manufacturer’s agencies, sometimes hire the caterer to world’s religious legacy, but in context fundamental purpose is secular and provide meals for conferences and other that appears to have more to do with pecuniary, not religious, as evidenced events. The company’s two owners are religion’s historic value rather than by its mission statement. Because the Hasidic Jews and its six employees, manufacturer lacks a religious purpose, while not exclusively Jewish, receive evidencing a religious conviction of the it cannot carry out activity consistent instruction in kosher food preparation business or its owner. Similarly, it is at with that (nonexistent) religious to ensure such preparation comports best unclear whether the business is purpose. And while the manufacturer with Jewish laws and customs. This engaging in activities in furtherance of advertises heavily in religious additional work raises the company’s this purpose when most of its sales publications and consults with religious operating costs higher than were it to serve no religious purpose. Finally, functionaries on its designs, the provide non-kosher meals. The while the business displays some manufacturer does not identify itself, as company’s mission statement, which religious items, these appear to be a opposed to its customers, as religious. has remained substantially the same minor part of the business’s overall Finally, given that the manufacturer is since the company was organized, presentation and do not convey that the a for-profit entity, it would need to describes its purpose as fulfilling a business has a religious identity. The make a strong evidentiary showing that religious mandate to strengthen the factors to qualify as a religious it is a religious organization, which it Jewish community and ensure Jewish organization do not appear to be met, has not. persons can participate fully in public especially given that the business as a (ii)(A) Example. A nonprofit life by providing kosher meals. The for-profit entity would need to make a organization enters government company’s ‘‘about us’’ page on its strong evidentiary showing that it is a contracts to provide chaplaincy services website states that above all else, the religious organization. to military and federal law-enforcement company seeks to ‘‘honor G-d’’ and * * * * * organizations around the country. The maintain the strength of the Jewish Sincere means sincere under the law contractor is organized as a non-profit, religion through its kosher meal applied by the courts of the United but it charges the military and other services. The company also donates a States when ascertaining the sincerity of clients a fee, similar to fees charged by portion of its proceeds to charitable a party’s religious exercise or belief. other staffing organizations, and its projects sponsored by local Jewish manager and employees all collect a congregations. In its advertising and on * * * * * market-rate salary. The organization’s its website, the company prominently (a) Severability. Should a court of articles of incorporation state that its includes religious symbols and text. competent jurisdiction hold any purpose is to provide religious services (B) Application. The company likely provision(s) of this section to be invalid, to members of the same faith wherever qualifies as a religious organization. The such action will not affect any other they may be in the world, and to company’s mission statement and other provision of this section. educate other individuals about the materials show a religious purpose. Its (b) [Reserved] faith. Similar statements of purpose predominant business activity of appear on the organization’s website providing kosher meals directly furthers ■ 3. Amend § 60–1.5 by adding and in its bid responses to government and is wholly consistent with that self- paragraphs (e) and (f) to read as follows: requests for proposals. All employees identified religious purpose, as are its receive weekly emails, and occasionally hiring and training practices. Through § 60–1.5 Exemptions. videos, about ways to promote faith in its advertising and website, the * * * * * the workplace. The employee handbook company holds itself out as a religious (e) Broad interpretation. This subpart contains several requirements regarding organization. Finally, although the shall be construed in favor of a broad personal and workplace conduct to company operates on a for-profit basis, protection of religious exercise, to the ensure ‘‘a Christian atmosphere where the other facts here show strong maximum extent permitted by the U.S. the Spirit of the Lord can guide the evidence that the company operates as Constitution and law, including the organization’s work.’’ a religious organization. Religious Freedom Restoration Act of (B) Application. Under these facts, the (iv)(A) Example. A for-profit collector 1993, as amended, 42 U.S.C. 2000bb et contractor likely qualifies as a religious business sells a wide variety of artistic, seq. organization. The contractor’s cultural, religious, and archeological organizing documents expressly state items. The government purchases some (f) Severability. Should a court of that its mission is primarily religious in of these from time to time for research competent jurisdiction hold any nature. Moreover, the contractor or aesthetic purposes. The business’s provision(s) of this section to be invalid, exercises religion through its business mission statement provides that its such action will not affect any other activities, which is providing purpose is to curate the world’s provision of this section. chaplaincy services, and through its treasures to perpetuate its historic, [FR Doc. 2020–26418 Filed 12–8–20; 8:45 am] hiring and training practices. Through cultural, and religious legacy. Most of BILLING CODE 4510–45–P

VerDate Sep<11>2014 17:33 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00050 Fmt 4701 Sfmt 9990 E:\FR\FM\09DER2.SGM 09DER2 jbell on DSKJLSW7X2PROD with RULES2 Vol. 85 Wednesday, No. 237 December 9, 2020

Part IV

The President

Proclamation 10124—Human Rights Day, Bill of Rights Day, and Human Rights Week, 2020 Proclamation 10125—National Pearl Harbor Remembrance Day, 2020

VerDate Sep<11>2014 17:52 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\09DED0.SGM 09DED0 jbell on DSKJLSW7X2PROD with PRESDOC0 VerDate Sep<11>2014 17:52 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4717 Sfmt 4717 E:\FR\FM\09DED0.SGM 09DED0 jbell on DSKJLSW7X2PROD with PRESDOC0 79375

Federal Register Presidential Documents Vol. 85, No. 237

Wednesday, December 9, 2020

Title 3— Proclamation 10124 of December 4, 2020

The President Human Rights Day, Bill of Rights Day, and Human Rights Week, 2020

By the President of the United States of America

A Proclamation Nearly 250 years ago, heroes of our Revolution signed the Declaration of Independence, offering a bold enumeration of inalienable rights endowed to us by our Creator. In time, with independence secured from a tyrannical monarchy, our Nation etched these principles of liberty and equality into the law of our fledgling Nation when we ratified our Constitution. The revolutionary idea they embodied—that certain individual rights are beyond the reach of government—has resonated around the world. Today, and this week, we celebrate our sacred rights and the example they have set for the rest of history. James Madison, who drafted the Bill of Rights text, was initially skeptical of the need to secure specific rights explicitly in the Constitution, believing the checks and balances inherent in our system of government would operate to achieve that objective. But he came to recognize the value that the Bill of Rights could provide and worked to ensure that the individual rights and freedoms of Americans were precisely enumerated in the highest law of the land. Madison was acutely aware that, while a government formed to serve its people is just and legitimate, ‘‘power, lodged as it must in human hands, will ever be liable to abuse.’’ Accordingly, he worked to imprint essential human rights, including the rights to peaceful assembly, freedom of speech, and free exercise of religion in our foundational legal text, empowering generations of Americans by protecting them from govern- ment abuses. The revolutionary understanding of human rights reflected in the Declaration of Independence and encoded in our Constitution has provided a blueprint for the world in advancing individual human rights. In 1948, looking to our Bill of Rights as a model, the United Nations General Assembly estab- lished the Universal Declaration of Human Rights, which recognizes the ‘‘inherent dignity’’ and ‘‘equal and inalienable rights’’ of mankind. Earlier this year, we also celebrated the 45th anniversary of the signing of the Helsinki Accords, in which the Western World acknowledged similar funda- mental human freedoms in defiance of the Soviet Union. Despite these milestones, the world is still plagued by tragic human rights abuses, including the oppression of women, forced labor, racism, and ethnic and religious persecution. My Administration continues to fight these injus- tices on all fronts while calling on other sovereign nations to respect the unalienable rights of their people. Earlier this year, I signed an Executive Order on Preventing Online Censorship, which protects and fosters freedom of expression for Americans on social media and other platforms and also seeks to combat human rights abuses abroad like the mass imprisonment of religious minorities in China, which are often obscured by a cloud of false information online. Additionally, I recently signed an Executive Order on Advancing International Religious Freedom, which prioritizes this funda- mental freedom in American diplomacy and recognizes that advancing reli- gious freedom abroad is vital to combating rising levels of violence and crimes against humanity around the globe. There is no greater defender

VerDate Sep<11>2014 17:52 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4705 Sfmt 4790 E:\FR\FM\09DED0.SGM 09DED0 jbell on DSKJLSW7X2PROD with PRESDOC0 79376 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Presidential Documents

of liberty than the United States, and we will remain steadfast in our efforts. During Human Rights Day, Bill of Rights Day, and Human Rights Week, we cherish the unique story of our Nation and celebrate the patriots who helped our country secure our fundamental rights, freedoms, and values for ourselves and our posterity. We also take pride in the role that this heritage has played in advancing and protecting human rights around the world. America’s commitment to individual liberty and human dignity is at our very core. We acknowledge that the principles set forth in the Bill of Rights are foundational, and we recommit to ensuring their legacy in our country as we continue to lead the way toward stronger human rights protections around the world. NOW, THEREFORE, I, DONALD J. TRUMP, President of the United States of America, by virtue of the authority vested in me by the Constitution and the laws of the United States, do hereby proclaim December 10, 2020, as Human Rights Day; December 15, 2020, as Bill of Rights Day, and the week beginning on December 6, 2020, as Human Rights Week. I call upon the people of the United States to mark these observances with appropriate ceremonies and activities. IN WITNESS WHEREOF, I have hereunto set my hand this fourth day of December, in the year of our Lord two thousand twenty, and of the Independence of the United States of America the two hundred and forty- fifth.

[FR Doc. 2020–27242 Filed 12–8–20; 11:15 am] Billing code 3295–F1–P

VerDate Sep<11>2014 17:52 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00004 Fmt 4705 Sfmt 4790 E:\FR\FM\09DED0.SGM 09DED0 jbell on DSKJLSW7X2PROD with PRESDOC0 Trump.EPS Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Presidential Documents 79377 Presidential Documents

Proclamation 10125 of December 4, 2020

National Pearl Harbor Remembrance Day, 2020

By the President of the United States of America

A Proclamation On the morning of December 7, 1941, Imperial Japanese forces ambushed the Naval Station Pearl Harbor on the Hawaiian island of Oahu. Tragically, 2,403 Americans perished during the attack, including 68 civilians. On this National Pearl Harbor Remembrance Day, we solemnly honor and uphold the memory of the patriots who lost their lives that day—‘‘a date which will live in infamy’’—and we reflect on the courage of all those who served our Nation with honor in the Second World War. Seventy nine years ago, Imperial Japan launched an unprovoked and dev- astating attack on our Nation. As torpedo bombers unleashed their deadly cargo on our ships and attack aircraft rained bombs from above, brave members of the United States Navy, Marines, Army, and Army Air Forces mounted a heroic defense, manning their battle stations and returning fire through the smoke and chaos. The profound bravery in the American resist- ance surprised Japanese aircrews and inspired selfless sacrifice among our service members. In one instance, Machinist’s Mate First Class Robert R. Scott, among 15 Sailors awarded the Medal of Honor for acts of valor on that day, refused to leave his flooding battle station within the depths of the USS CALIFORNIA, declaring to the world: ‘‘This is my station and I will stay and give them air as long as the guns are going.’’ Forever enshrined in our history, the attack on Pearl Harbor shocked all Americans and galvanized our Nation to fight and defeat the Axis powers of Japan, Germany, and Italy. As Americans, we promise never to forget our fallen compatriots who fought so valiantly during World War II. As a testament to their memory, more than a million people visit the site of the USS ARIZONA Memorial each year to pay their respects to the Sailors entombed within its wreckage and to all who perished that day. Despite facing tremendous adversity, the Pacific Fleet, whose homeport re- mains at Pearl Harbor to this day, is stronger than ever before, upholding the legacy of all those who gave their lives nearly 80 years ago. On this National Pearl Harbor Remembrance Day, we recall the phrase ‘‘Remember Pearl Harbor,’’ which stirred the fighting spirit within the hearts of the more than 16 million Americans who courageously served in World War II. Over 400,000 gave their lives in the global conflict that began, for our Nation, on that fateful Sunday morning. Today, we memorialize all those lost on December 7, 1941, declare once again that our Nation will never forget these valiant heroes, and resolve as firmly as ever that their memory and spirit will survive for as long as our Nation endures. The Congress, by Public Law 103–308, as amended, has designated December 7 of each year as ‘‘National Pearl Harbor Remembrance Day.’’ NOW, THEREFORE, I, DONALD J. TRUMP, President of the United States of America, do hereby proclaim December 7, 2020, as National Pearl Harbor Remembrance Day. I encourage all Americans to observe this solemn day of remembrance and to honor our military, past and present, with appropriate ceremonies and activities. I urge all Federal agencies and interested organiza- tions, groups, and individuals to fly the flag of the United States at half-

VerDate Sep<11>2014 17:53 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4790 Sfmt 4790 E:\FR\FM\09DED1.SGM 09DED1 jbell on DSKJLSW7X2PROD with PRESDOC1 79378 Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Presidential Documents

staff in honor of those American patriots who died as a result of their service at Pearl Harbor. IN WITNESS WHEREOF, I have hereunto set my hand this fourth day of December, in the year of our Lord two thousand twenty, and of the Independence of the United States of America the two hundred and forty- fifth.

[FR Doc. 2020–27243 Filed 12–8–20; 11:15 am] Billing code 3295–F1–P

VerDate Sep<11>2014 17:53 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4790 Sfmt 4790 E:\FR\FM\09DED1.SGM 09DED1 jbell on DSKJLSW7X2PROD with PRESDOC1 Trump.EPS i

Reader Aids Federal Register Vol. 85, No. 237 Wednesday, December 9, 2020

CUSTOMER SERVICE AND INFORMATION CFR PARTS AFFECTED DURING DECEMBER

Federal Register/Code of Federal Regulations At the end of each month the Office of the Federal Register General Information, indexes and other finding 202–741–6000 publishes separately a List of CFR Sections Affected (LSA), which aids lists parts and sections affected by documents published since Laws 741–6000 the revision date of each title. 3 CFR Proposed Rules: Presidential Documents 24...... 78258 Executive orders and proclamations 741–6000 Proclamations: 25...... 78258 The United States Government Manual 741–6000 10121...... 77343 35...... 78258 10122...... 78193 Other Services 192...... 78258 10123...... 78195 327...... 78794 Electronic and on-line services (voice) 741–6020 10124...... 79375 741...... 78269 Privacy Act Compilation 741–6050 10125...... 79377 Executive Orders: 13 CFR ELECTRONIC RESEARCH 13960...... 78939 120...... 78205 Administrative Orders: World Wide Web Memorandums: 14 CFR Memorandum of 39 ...... 76949, 76951, 76953, Full text of the daily Federal Register, CFR and other publications December 3, 2020 ...... 78945 76955, 77991, 78215, 78699, is located at: www.govinfo.gov. Memorandum of 78702, 78954 Federal Register information and research tools, including Public December 3, 2020 ...... 78947 71 ...... 76958, 78705, 79117 Inspection List and electronic text are located at: 97...... 78219, 78221 5 CFR www.federalregister.gov. 187...... 78223 Proposed Rules: 399...... 78707 E-mail 2641...... 77014 Proposed Rules: FEDREGTOC (Daily Federal Register Table of Contents Electronic 7 CFR 39 ...... 78277, 78279, 78805, Mailing List) is an open e-mail service that provides subscribers 78808, 78971, 78974, 78977 with a digital form of the Federal Register Table of Contents. The 3565...... 77985 71...... 78811 digital form of the Federal Register Table of Contents includes 8 CFR HTML and PDF links to the full text of each document. 15 CFR Proposed Rules: 774...... 78684 To join or leave, go to https://public.govdelivery.com/accounts/ 103...... 77016 USGPOOFR/subscriber/new, enter your email address, then 235...... 77016 16 CFR follow the instructions to join, leave, or manage your 1001...... 78240 Proposed Rules: subscription. 1003...... 78240 801...... 77042, 77053 1208...... 78240 PENS (Public Law Electronic Notification Service) is an e-mail 802...... 77042, 77053 1214...... 78240 service that notifies subscribers of recently enacted laws. 803...... 77042, 77053 1240...... 78240 To subscribe, go to http://listserv.gsa.gov/archives/publaws-l.html 1245...... 78240 and select Join or leave the list (or change settings); then follow 17 CFR 1246...... 78240 the instructions. 1292...... 78240 3...... 78718 FEDREGTOC and PENS are mailing lists only. We cannot 230...... 78224 respond to specific inquiries. 10 CFR 232...... 78224 1021...... 78197 240...... 78224 Reference questions. Send questions and comments about the 249...... 78224 Proposed Rules: Federal Register system to: [email protected] 270...... 78224 Ch. I ...... 78046 The Federal Register staff cannot interpret specific documents or 430...... 77017, 78964 regulations. 20 CFR 431...... 78967 404...... 78164 FEDERAL REGISTER PAGES AND DATE, DECEMBER 12 CFR 416...... 78164 3...... 77345 21 CFR 76949–77342...... 1 4...... 77345 77343–77984...... 2 52...... 77345 Proposed Rules: 77985–78196...... 3 208...... 77345 1306...... 78282 78197–78698...... 4 211...... 77345 1308...... 78047 78699–78938...... 7 212...... 77345 22 CFR 78939–79116...... 8 217...... 77345 79117–79378...... 9 225...... 77345 Proposed Rules: 235...... 77345 181...... 78813 238...... 77345 246...... 78949 24 CFR 304...... 77345 100...... 78957 324...... 77345 214...... 78230 337...... 77345 Proposed Rules: 347...... 77345 5...... 78295 348...... 77345 92...... 78295 614...... 77364 93...... 78295 Ch. X...... 77987 574...... 78295

VerDate Sep 11 2014 18:37 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00001 Fmt 4712 Sfmt 4712 E:\FR\FM\09DECU.LOC 09DECU jbell on DSKJLSW7X2PROD with FR_CU ii Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Reader Aids

960...... 78295 1225...... 77095 412...... 78748 48 CFR 966...... 78295 1236...... 77095 413...... 78748 Proposed Rules: 982...... 78295 414...... 78770 37 CFR 2...... 78815 417...... 78748 25 CFR 3...... 78815 42...... 79120 476...... 78748 7...... 78815 Proposed Rules: 38 CFR 480...... 78748 13...... 78815 90...... 78296 484...... 78748 15...... 78815 Proposed Rules: 26 CFR 486...... 77898 17...... 78815 36...... 79142 495...... 78748 52...... 78792 1 ...... 76960, 76976, 77365, 512...... 77404 227...... 78300 77952 39 CFR 1001...... 77684 252...... 78300 602...... 77952 501...... 78234 1003...... 77684 28 CFR 40 CFR 49 CFR 26...... 76979 9...... 78743 45 CFR 171...... 78029 172...... 78029 79...... 79118 52...... 77996, 79129 1...... 78770 60...... 78412 173...... 78029 153...... 76979 29 CFR 63...... 77384, 78412 174...... 78029 170...... 78236 4044...... 78742 79...... 78412 175...... 78029 1304...... 78787 80...... 78412 176...... 78029 30 CFR 180...... 77999, 78002 Proposed Rules: 178...... 78029 Proposed Rules: 320...... 77384 147...... 78572 180...... 78029 250...... 79266 721...... 78743 150...... 78572 225...... 79130 550...... 79266 1042...... 78412 153...... 78572 Proposed Rules: 1043...... 78412 155...... 78572 571...... 78058 31 CFR 1065...... 78412 156...... 78572 1039...... 78075 Proposed Rules: 1090...... 78412 158...... 78572 1108...... 78075 33...... 78572 Proposed Rules: 184...... 78572 50 CFR 52...... 78050 33 CFR 158...... 78300 47 CFR 17...... 78029 117...... 77994 257...... 78980 622...... 78792, 79135 165...... 77994, 78232 1...... 78005 635...... 77007, 79136 Proposed Rules: 41 CFR 9...... 78018 648...... 79139 165...... 77093 60–1...... 79324 73...... 78022, 78028 665...... 77406 76...... 78237 679 ...... 77406, 78038, 79139 36 CFR 42 CFR Proposed Rules: Proposed Rules: Proposed Rules: 405...... 78748 54...... 78814 17...... 77108, 77408 1224...... 77095 411...... 77491 97...... 78815 679...... 78076, 78096

VerDate Sep 11 2014 18:37 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00002 Fmt 4712 Sfmt 4712 E:\FR\FM\09DECU.LOC 09DECU jbell on DSKJLSW7X2PROD with FR_CU Federal Register / Vol. 85, No. 237 / Wednesday, December 9, 2020 / Reader Aids iii

www.govinfo.gov. Some laws H.R. 8276/P.L. 116–210 may not yet be available. LIST OF PUBLIC LAWS To authorize the President to posthumously award the Public Laws Electronic H.R. 835/P.L. 116–206 This is a continuing list of Medal of Honor to Alwyn C. Notification Service public bills from the current Rodchenkov Anti-Doping Act Cashe for acts of valor during (PENS) session of Congress which of 2019 (Dec. 4, 2020; 134 Operation Iraqi Freedom. have become Federal laws. Stat. 998) (Dec. 4, 2020; 134 Stat. 1016) This list is also available H.R. 1668/P.L. 116–207 H.R. 8472/P.L. 116–211 PENS is a free email online at https:// Internet of Things Impact Aid Coronavirus Relief notification service of newly www.archives.gov/federal- Cybersecurity Improvement Act (Dec. 4, 2020; 134 Stat. enacted public laws. To register/laws. Act of 2020 (Dec. 4, 2020; 1017) subscribe, go to https:// The text of laws is not 134 Stat. 1001) S. 3147/P.L. 116–212 listserv.gsa.gov/cgi-bin/ published in the Federal H.R. 3589/P.L. 116–208 Improving Safety and Security wa.exe?SUBED1=PUBLAWS- Register but may be ordered Greg LeMond Congressional for Veterans Act of 2019 L&A=1 in ‘‘slip law’’ (individual Gold Medal Act (Dec. 4, 2020; (Dec. 4, 2020; 134 Stat. 1019) pamphlet) form from the 134 Stat. 1008) Note: This service is strictly Superintendent of Documents, S. 3587/P.L. 116–213 for email notification of new U.S. Government Publishing H.R. 4104/P.L. 116–209 Department of Veterans Affairs laws. The text of laws is not Office, Washington, DC 20402 Negro Leagues Baseball Website Accessibility Act of available through this service. (phone, 202–512–1808). The Centennial Commemorative 2019 (Dec. 4, 2020; 134 Stat. PENS cannot respond to text will also be made Coin Act (Dec. 4, 2020; 134 1024) specific inquiries sent to this available at https:// Stat. 1011) Last List December 8, 2020 address.

VerDate Sep 11 2014 18:37 Dec 08, 2020 Jkt 253001 PO 00000 Frm 00003 Fmt 4712 Sfmt 4711 E:\FR\FM\09DECU.LOC 09DECU jbell on DSKJLSW7X2PROD with FR_CU