Title IV of the Agricultural Risk Protection Act of 2000 (Pub. L. 106-224), known as the Plant Protection Act, incorporates nine preexisting pest quarantine and exclusion statutes into a comprehensive law aimed at, among other things, augmenting the Secretary's authority to detect, control, and eradicate plant pests and noxious weeds. Section 434 of the Plant Protection Act authorizes the Secretary to issue such regulations and orders as he considers necessary to carry out this title. This rule delegates that authority from the Secretary of Agriculture to the Assistant Secretary for Marketing and Regulatory Programs (as noted previously, now entitled the Under Secretary for Marketing and Regulatory Programs); from that official to the Administrator of the Animal and Plant Health Inspection Service; and from the Administrator of the Animal and Plant Health Inspection Service to the Deputy Administrator for Plant Protection and Quarantine. We will further amend title 7 and amend title 9 of the Code of Federal Regulations in a future rulemaking action to add the Plant Protection Act to our lists of legal authorities and to make any other changes deemed necessary as a result of the enactment of this law.

This rule relates to internal agency management. Therefore, this rule is exempt from the provisions of Executive Order 12866 and 12988. Moreover, pursuant to 5 U.S.C. 553, notice of proposed rulemaking and opportunity for comment are not required for this rule, and it may be made effective less than 30 days after publication in the Federal Register . In addition, under 5 U.S.C. 804, this rule is not subject to congressional review under the Small Business Regulatory Enforcement Fairness Act of 1996, Pub. L. 104-121. Finally, this action is not a rule as defined by 5 U.S.C. 601 et seq. , the Regulatory Flexibility Act, and thus is exempt from the provisions of that Act.

This rule is issued under Marketing Order No. 920, as amended (7 CFR part 920), regulating the handling of kiwifruit grown in California, hereinafter referred to as the “order.” The marketing order is effective under the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the “Act.”

The Department of Agriculture (Department) is issuing this rule in conformance with Executive Order 12866.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the marketing order now in effect, California kiwifruit handlers are subject to assessments. Funds to administer the order are derived from such assessments. It is intended that the assessment rate as issued herein will be applicable to all assessable kiwifruit beginning August 1, 2000, and continue until amended, suspended, or terminated. This rule will not preempt any State or local laws, regulations, or policies, unless they present an irreconcilable conflict with this rule.

The Act provides that administrative proceedings must be exhausted before parties may file suit in court. Under section 608c(15)(A) of the Act, any handler subject to an order may file with the Secretary a petition stating that the order, any provision of the order, or any obligation imposed in connection with the order is not in accordance with law and request a modification of the order or to be exempted therefrom. Such handler is afforded the opportunity for a hearing on the petition.

After the hearing the Secretary would rule on the petition. The Act provides that the district court of the United States in any district in which the handler is an inhabitant, or has his or her principal place of business, has jurisdiction to review the Secretary's ruling on the petition, provided an action is filed not later than 20 days after the date of the entry of the ruling.

This rule decreases the assessment rate established for the Committee for the 2000-2001 and subsequent fiscal periods from $0.05 to $0.03 per 22-pound volume fill container or equivalent of kiwifruit.

The California kiwifruit marketing order provides authority for the Committee, with the approval of the Department, to formulate an annual budget of expenses and collect assessments from handlers to administer the program. The members of the Committee are producers of California kiwifruit. They are familiar with the Committee's needs and the costs for goods and services in their local area and are thus in a position to formulate an appropriate budget and assessment rate.

The assessment is normally formulated and discussed in a public meeting. A public meeting was held on July 11, 2000. Because a Committee quorum (eight Committee representatives) was not present at the meeting, the Committee voted on the budget and assessment rate by telephone on July 13, 2000. Thus, all directly affected persons were provided an opportunity to participate and provide input.

For the 1998-1999 and subsequent fiscal periods, the Committee recommended, and the Department approved, an assessment rate that would continue in effect from fiscal period to fiscal period unless modified, suspended, or terminated by the Secretary upon recommendation and information submitted by the Committee or other information available to the Secretary.

In the telephone conference call on July 13, 2000, the Committee unanimously recommended 2000-2001 expenditures of $81,575 and an assessment rate of $0.03 per 22-pound volume fill container or equivalent of kiwifruit. In comparison, last year's budgeted expenditures were $83,800. The assessment rate of $0.03 is $0.02 lower than the rate currently in effect.

The Committee voted to reduce 2000-2001 budgeted expenditures and the assessment rate to lessen the financial burden on California kiwifruit handlers. The following table compares major budget expenditures recommended by the Committee for the 2000-2001 and 1999-2000 fiscal periods:

The assessment rate recommended by the Committee was derived by considering the amount of funds in the Committee's operating reserve, anticipated expenses, and expected shipments of California kiwifruit. Kiwifruit shipments for the year are estimated at 2,704,545 22-pound volume fill containers or equivalents of kiwifruit, which should provide $81,136 in assessment income at an assessment rate of $.03 per container, $439 less than the estimated expenses. Income derived from handler assessments, along with $24,000 from the Committee's operating reserve, will be adequate to meet budgeted expenses and to establish an adequate reserve (estimated to be $23,561 at the end of the 2000-2001 fiscal period). Reserve funds will be kept within 1 fiscal period's expenses, the maximum permitted under § 920.42 of the order.

The assessment rate established in this rule will continue in effect indefinitely unless modified, suspended, or terminated by the Secretary upon recommendation and information submitted by the Committee or other available information.

Although this assessment rate is effective for an indefinite period, the Committee will continue to meet prior to or during each fiscal period to recommend a budget of expenses and consider recommendations for modification of the assessment rate. The dates and times of Committee meetings are available from the Committee or the Department. Committee meetings are open to the public and interested persons may express their views at these meetings.

The Department will evaluate Committee recommendations and other available information to determine whether modification of the assessment rate is needed. Further rulemaking will be undertaken as necessary. The Committee's 2000-2001 budget and those for subsequent fiscal periods will be reviewed and, as appropriate, approved by the Department.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA), the Agricultural Marketing Service (AMS) has considered the economic impact of this rule on small entities. Accordingly, AMS has prepared this initial regulatory flexibility analysis.

The purpose of the RFA is to fit regulatory actions to the scale of business subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Marketing orders issued pursuant to the Act, and the rules issued thereunder, are unique in that they are brought about through group action of essentially small entities acting on their own behalf. Thus, both statutes have small entity orientation and compatibility.

There are approximately 400 producers of kiwifruit in the production area and approximately 56 handlers subject to regulation under the marketing order. Small agricultural producers are defined by the Small Business Administration (13 CFR 121.201) as those having annual receipts less than $500,000, and small agricultural service firms are defined as those whose annual receipts are less than $5,000,000.

None of the 56 handlers subject to regulation have annual kiwifruit sales of at least $5,000,000, excluding receipts from any other sources. Ten of the 400 producers subject to regulation have annual sales of at least $500,000; and the remaining 390 producers have sales less than $500,000, excluding receipts from any other sources. The majority of California kiwifruit producers and handlers may be classified as small entities.

This rule decreases the assessment rate established for the Committee and collected from handlers for the 2000-2001 and subsequent fiscal periods from $0.05 to $0.03 per 22-pound volume fill container or equivalent. The Committee unanimously recommended 2000-2001 expenditures of $81,575 and an assessment rate of $0.03 per 22-pound volume fill container or equivalent. The assessment rate of $0.03 is $0.02 lower than the current rate. The quantity of assessable kiwifruit for the 2000-2001 fiscal period is estimated at 2,704,545 22-pound volume fill containers or equivalents. Thus, the $0.03 rate should provide $81,136 in assessment income, $439 less than the estimated expenses.

The estimated assessments of $81,136, combined with the $24,000 from the Committee's operating reserve will allow the Committee to meet its expenses and to establish an adequate reserve (estimated to be $23,561 at the end of the 2000-2001 fiscal period). Reserve funds will be kept within 1 fiscal period's expenses, the maximum permitted under § 920.42 of the order.

The following table compares major budget expenditures recommended by the Committee for the 2000-2001 and 1999-2000 fiscal years:

The Committee reviewed and unanimously recommended 2000-2001 expenditures of $81,575 which includes decreases in Administrative Staff and Field Salaries, and office costs. The Committee also unanimously recommended lowering the assessment rate from $0.05 to $0.03 to lessen the financial burden on handlers.

Prior to arriving at this budget, the Committee considered information from various sources, such as the Committee's Finance and Assessment Subcommittee. These groups discussed alternate expenditure levels. The subcommittee looked at maintaining the assessment rate at its current level, but determined that handler financial burden should be lessened. The assessment rate of $0.03 per 22-pound volume fill container or equivalent of assessable kiwifruit was recommended by the Committee and was derived by considering the funds in the Committee's operating reserve, anticipated expenses, and expected shipments of California kiwifruit.

Kiwifruit shipments for the year are estimated at 2,704,545 22-pound volume fill containers or equivalents of kiwifruit, which should provide $81,136 in assessment income, $439 less than the estimated expenses. Income derived from handler assessments, along with the $24,000 from the Committee's operating reserve, will be adequate to meet budgeted expenses and to establish an adequate reserve (estimated to be $23,561 at the end of the 2000-2001 fiscal period). Reserve funds will be kept within 1 fiscal period's expenses, the maximum permitted under § 920.42 of the order.

A review of historical information and preliminary information pertaining to the upcoming fiscal period indicates that the grower price for the 2000-2001 season will be approximately $12.32 per 22-pound volume fill container or equivalent of kiwifruit. Therefore, the estimated assessment revenue for the 2000-2001 fiscal period as a percentage of total grower revenue is estimated at 0.2 percent.

This action decreases the assessment obligation imposed on handlers. Assessments are applied uniformly on all handlers, and some of the costs may be passed on to producers. However, decreasing the assessment rate reduces the burden on handlers, and may reduce the burden on producers.

In addition, the Committee's July 11, 2000, meeting was widely publicized throughout the California kiwifruit industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the July 11, 2000, meeting was a public meeting and all entities, both large and small, were able to express views on this issue.

Additionally, all attendees were advised of the telephone conference call to be conducted on July 13, 2000. Finally, interested persons are invited to submit information on the regulatory and informational impacts of this action on small businesses.

This action imposes no additional reporting or recordkeeping requirements on either small or large California kiwifruit handlers. As with all Federal marketing order programs, reports and forms are periodically reviewed to reduce information requirements and duplication by industry and public sector agencies.

The Department has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule.

A small business guide on complying with fruit, vegetable, and specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/fv/moab.html. Any questions about the compliance guide should be sent to Jay Guerber at the previously mentioned address in the FOR FURTHER INFORMATION CONTACT section.

After consideration of all relevant material presented, including the information and recommendation submitted by the Committee and other available information, it is hereby found that this rule, as hereinafter set forth, will tend to effectuate the declared policy of the Act.

Pursuant to 5 U.S.C. 553, it is also found and determined upon good cause that it is impracticable, unnecessary, and contrary to the public interest to give preliminary notice prior to putting this rule into effect, and that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register because: (1) The 2000-2001 fiscal period begins on August 1, 2000, and the marketing order requires that the rate of assessment for each fiscal period apply to all assessable kiwifruit handled during such fiscal period; (2) this action decreases the assessment rate for assessable kiwifruit beginning with the 2000-2001 fiscal period; (3) handlers are aware of this action which was unanimously recommended by the Committee during a telephone conference meeting and is similar to other assessment rate actions issued in past years; and (4) this interim final rule provides a 60-day comment period, and all comments timely received will be considered prior to finalization of this rule.

The administrative requirements for awards and subawards under all USDA entitlement programs are currently in 7 CFR part 3015, “Uniform Federal Assistance Regulations.” The corresponding requirements for awards and subawards to State and local governmental organizations under USDA nonentitlement programs are in subparts A through D of 7 CFR part 3016, “Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments.” The administrative requirements for awards and subawards to nongovernmental, non-profit organizations are in 7 CFR part 3019, “Uniform Administrative Requirements for Grants and Agreements With Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations.” This final rule expands the scope of parts 3016 and 3019 to include entitlement programs, and deletes administrative requirements for awards and subawards under such programs from the scope of part 3015. It also establishes, in subpart E to part 3016, certain exceptions to the general administrative requirements that will apply only to the entitlement programs. The following text outlines the evolution of these changes.

On March 11, 1988, USDA joined other Federal agencies in publishing a final grants management common rule applicable to assistance relationships established by grants and cooperative agreements, and by subawards thereunder, to State and local governments (53 FR 8044). Prior to that date, administrative requirements for awards and subawards under all USDA programs were codified at 7 CFR part 3015. The USDA implemented the common rule at 7 CFR part 3016 . At that time, the common rule did not apply to entitlement programs such as the Food Stamp and Child Nutrition Programs administered by the Food and Nutrition Service, USDA, and the entitlement grant programs administered by the Department of Health and Human Services (DHHS). However, subpart E of part 3016 was reserved with the express intention of including provisions specifically tailored to the entitlement programs. Pending the publication of subpart E to part 3016, the USDA entitlement programs have remained under part 3015. These programs included:

(1) Entitlement grants under the following programs authorized by the Richard B. Russell National School Lunch Act (42 U.S.C. 1751 et seq ): (a) National School Lunch Program, General and Special Meal Assistance (sections 4 and 11 of the Act, respectively), (b) Commodity Assistance (section 6 of the Act), (c) Summer Food Service Program for Children (section 13 of the Act), and (d) Child and Adult Care Food Program (section 17 of the Act);

(2) Entitlement grants under the following programs authorized by the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq ), (a) Special Milk Program for Children (section 3 of the Act), (b) School Breakfast Program (section 4 of the Act), and (c) State Administrative Expense Funds (section 7 of the Act); and

(3) Entitlement grants for State Administrative Expenses under the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq ) (sections 4(b) and 16 of the Act).

The exclusion of these programs from the scope of part 3016 caused that regulation to apply only to USDA's nonentitlement programs. The principal nonentitlement programs administered by the Food and Nutrition Service include the Special Supplemental Nutrition Program for Women, Infants and Children (WIC), the Commodity Supplemental Food Program (CSFP), the WIC Farmers' Market Nutrition Program (FMNP), the Nutrition Education and Training Program (NET), and the Emergency Food Assistance Program (TEFAP).

On August 24, 1995, USDA published an interim final rule at 7 CFR part 3019 in order to implement the revised Office of Management and Budget (OMB) Circular A-110, “Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations” (60 FR 44122). As with part 3016, USDA did not include entitlement programs in the scope of part 3019. In excluding entitlements from the scope of part 3019 at the time of its initial publication, USDA anticipated issuing a document that would provide a single set of grant and subgrant administrative rules for all types of organizations operating USDA entitlement programs.

On February 17, 1998, USDA published a Notice of Proposed Rulemaking (Proposed Rule) (63 FR 7734) as the first step in developing such a document. USDA received six requests for additional time for comment. Accordingly, on May 22, 1998, USDA published a 30 day extension to the initial 90 day comment period (63 FR 28294). Excluding the time extension requests, USDA received comments within the time period from 45 interested parties.

In publishing the proposed rule, USDA specifically solicited comments on: (1) Applying the provisions of part 3016 to USDA entitlement program awards and subawards to State and local governmental organizations; (2) applying the provisions of part 3019 to USDA entitlement program awards and subawards to nongovernmental Non-Profit Organizations; and (3) adopting proposed exceptions to be included in subpart E of part 3016. The exceptions proposed for subpart E included: (1) Requiring States and other governmental program operators to conduct procurements under USDA entitlement programs in accordance with § 3016.36(b) through (i); (2) requiring governmental grantees and subgrantees to adopt the requirement in § 3019.43 which prohibits the award of a contract under a Federal program to a firm that had performed certain services to orchestrate that procurement; and (3) establishing program regulations as the authoritative source for financial reporting requirements under the Food Stamp and Child Nutrition Programs.

Eight of the commenters were in favor of the proposal to provide a single set of regulations governing the administration of grants and subgrants. Conversely, six commenters stated that no change to the current regulation should be made. However, further review of the underlying basis for opposing change disclosed that the comments were more specifically related to contracting provisions proposed for subpart E to part 3016, as opposed to the overall concept of applying parts 3016 and 3019 to USDA's entitlement program awards and subawards.

Therefore, in the absence of any specific objections to the proposal, USDA is amending parts 3016 and 3019 to apply those provisions to entitlement awards and subawards.

By far, the largest number of the comments received were related to this issue. The USDA had proposed to depart from the Federalism principle set out in § 3016.36(a) with respect to State grantee and governmental subgrantee procurements under entitlement programs by requiring States to follow the rules set out in § 3016.36(b) through (i). The USDA made this proposal primarily to strengthen competition in grantee and subgrantee procurements under entitlement programs. While State rules generally contain detailed competition requirements, USDA had sought to ensure a minimum, uniform level of competition in procurements under its entitlement programs. In doing so, USDA recognized that the rules stated at § 3016.36(b) through (i) did not comprise a complete procurement system but rather formed an outline in which each State's own procurement regulations must provide the details. Under the proposed rule, therefore, Federal rules would have taken precedence over State rules only where the latter failed to provide for such minimum requirements.

One commenter agreed with the proposal on the basis that it would simplify administrative oversight and reduce uncertainty in grants management. However, thirteen of the commenters strongly opposed the departure from Federalism. These commenters pointed out that the approach could result in disparate treatment of procurements under entitlement programs versus those under other programs. Several commenters also argued that USDA had not provided sufficient justification for such a broad approach. Upon further review, USDA agrees that its concerns for competition in procurements under its entitlement programs can be resolved without mandating specific Federal requirements on such a global scale. Therefore, USDA has revised the final rule to remove the requirement in the proposed § 3016.60(a) which would have required States to follow the procurement rules set out in § 3016.36(b) through (i). As an alternative, the final rule authorizes States to use either State rules, in accordance with § 3016.36(a), or to adopt the requirements in § 3016.36(b) through (i). It should be noted that USDA does not intend that these revisions change the longstanding relationships between States and subrecipients. Some of the interpretive language in the Proposed Rule preamble may have resulted in a misunderstanding of current practice with regard to State oversight of subrecipient procurements. The USDA's position continues to be that as part of their oversight responsibilities, States are to require that local governments follow the requirements in § 3016.36(b) through (i) and that non-profit organizations follow the requirements in part 3019. Section 3016.37 still governs relationships other than procurements.

The Federal government's interest in ensuring maximum competition dictates that certain practices cannot be allowed. Increasing and ensuring competition provides the greatest opportunity to procure the highest quality goods and services at the lowest possible cost. Lower costs, in turn, help extend the purchasing power of grants under the nutrition-assistance programs vital to the health of vulnerable populations such as children and the needy. Therefore, regardless of whether States choose to follow State rules or the requirements in § 3016.36(b) through (i), States must ensure that the requirements set out in subpart E of this final rule are followed.

The USDA has addressed below the special provisions in subpart E of part 3016 that will apply to entitlement programs and the related comments.

As explained in the preamble to the proposed rule, the USDA is concerned about the effects of geographical preference in procurements under the entitlement programs it administers. Geographical preference in procurement entails the use of procedures that give bidders and offerors a competitive advantage based solely on their location within the territory of the procuring entity. For example, a State's procurement rules may require that an out-of-state bidder's bid be surcharged a prescribed percentage, or that a bid submitted by a firm located within the state be discounted a prescribed percentage, for price comparison purposes. Such practices are inherently anti-competitive. Indeed, the preamble to the March 11, 1988, grants management common rule expressed governmentwide policy on this matter by identifying “* * * the application of unreasonably restrictive qualifications and any percentage factors that give bidding advantages to in-State or local firms* * *” as “* * * barriers to open and free competition which are not in the public interest.” (53 FR 8039).

Only open and free competition can ensure that program operators obtain the best products and services at the lowest possible prices, thereby maximizing the impact of scarce Federal resources. For example, the mission of USDA's Child Nutrition Programs is to improve children's health and well-being by providing them with nutritious, low-cost or free meals. These programs depend heavily on program operators' procurements. As noted above, increased competition enhances the program operators' ability to buy quality products at low prices, and thus enables them to offer better, lower cost meals to children. In these programs especially, maximum open and free competition is directly linked to the operators' ability to achieve program goals. It is therefore vital to the success of the programs.

The USDA received very few comments on this subject. Those comments were divided with two in favor, two opposed and one questioning the absence of specific data. The primary argument in opposition was that prohibiting geographic preference would have a negative effect on partnerships between schools and the food industry. The USDA does not agree that the effect on such partnerships is of such a magnitude that the anti-competitive practice should be allowed. The USDA has considered the benefits of partnering between procuring entities and members of the food industry located within the territory of the procuring entity. We have weighed this benefit against the detriment to competition caused by providing such preferences. We find the benefit of partnering based on geographic location does not outweigh the damage such practices cause to competition. In making this finding, USDA has taken into account the ever increasing ability of procuring entities and offerors to consult and gather information and expertise across long distances via telephone, electronic mail, facsimile, video, telephone conferencing and the Internet. In light of this trend towards the increasing availability of information and ease of communications, we disagree that the use of geographic preferences is needed as a way to foster partnering relationships.

This final rule prohibits geographic preference in procurements under USDA entitlement programs. In the proposed rule, this requirement was one of the items covered in § 3016.36(b) through (i) (see § 3016.36(c)(2)). Because, as discussed above, this final rule allows States to elect to use their own rules rather than § 3016.36(b) through (i), the prohibition on geographic preferences is included in § 3016.60(c) of subpart E as a mandatory procurement requirement.

Under § 3019.43, non-profit organizations are currently precluded from awarding contracts under USDA nonentitlement programs to firms “that develop or draft specifications, requirements, statements of work, invitations for bids and/or requests for proposals” for such procurements. The purpose of this regulation is to “ensure objective contractor performance and eliminate unfair competitive advantage.” Extending the applicability of part 3019 to USDA entitlement programs operated by non-profit organizations will result in equal application of this requirement to both entitlement and nonentitlement programs.

USDA also proposed applying this requirement to State and local governmental program operators through a provision in part 3016, subpart E. USDA's intent in proposing this exception to the general rule was the same as that underlying the existing requirement for non-profit organizations: to minimize the anti-competitive effect of less-than-arm's length transactions under USDA entitlement programs.

Three State agencies and one commenter representing a State agency agreed, explicitly stating that contractors involved in drafting specifications, requirements, statements of work, invitations for bids, or requests for proposals should be excluded from bidding. However, twenty-nine commenters disagreed with or had concerns regarding this proposed exception.

The commenters' principal concerns were that: (1) food service personnel might lack the necessary knowledge to write bid specifications that would be correct, complete, precise, and understandable; (2) the only way to learn about products or services is to discuss specifications with potential bidders; (3) the prohibition would have a negative impact on the food manufacturers' willingness to develop products to meet school food service needs; (4) schools would either have to spend more money to get an acceptable product or schools would get inferior products and defeat the purpose of the program; and (5) this prohibition, when considered in conjunction with the proposal to have States follow the procurement requirements in § 3016.36(b) through (i), would unduly emphasize lowest cost to the detriment of other needs and benefits.

Following lengthy study of the comments on this issue, especially those opposing the prohibition in new § 3016.60(b), USDA concludes that there has been a misunderstanding of both the intent and the anticipated effect of this revision.

The commenters' concerns listed above focus on a program operator's ability to obtain the information necessary to formulate specifications that will elicit responsive bids or offers of the desired product or service. Specifications comprise a statement of a program operator's need for a product or service. The USDA agrees that a program operator is in the best position to know its own needs. Under both the old rules and this final rule, that operator may consult with as many expert sources as necessary to obtain the information needed for an effective procurement. In proposing the prohibition against using contractors who previously drafted the bid specifications, USDA had no intention of prohibiting consultations between program operators and industry.

Permissible practices include accessing publicly available information and contacting manufacturers and distributors directly. Examples of publicly available information include, but are not limited to: Product brochures; product specification handouts; information available on the Internet and in trade journals; recommendations from other program operators; and information obtained by visiting other program operations and attending industry and professional trade fairs. The types of information that a program operator can obtain through direct industry contacts include, but are not limited to: recommendations of one product over another; features that enable one to differentiate between available products; prices for specific products or product features; model numbers and other data that enable one to identify products that may meet one's needs; specification sheets; and, informational hand-outs. A program operator can do all these things in the course of conducting a proper procurement.

Legislation enacted subsequent to the publication of the proposed rule further affirmed program operators' authority to obtain information needed for their procurements under USDA entitlement programs. Section 104(e) of the William F. Goodling Child Nutrition Reauthorization Act of 1998 (Goodling Act) (Pub. L. 105-336, 112 Stat. 3143) amended the National School Lunch Act to provide that “[i]n acquiring a good or service for programs under [such] Act or the Child Nutrition Act of 1966 (other than section 17 of that Act (42 U.S.C. 1771 et seq. )) a State, State agency, school, or school food authority may enter into a contract with a person who has provided specification information to the State, State agency, school, or school food authority for use in developing contract specifications for acquiring such good or service.”(Emphasis added.) (Pub. L. 105-336, § 104(e), 112 Stat. 3143). The emphasized language makes clear Congress' intent to permit all States, State agencies, schools, or school food authorities operating programs under either the National School Lunch Act or the Child Nutrition Act of 1966 (except for the WIC program) to collect information from prospective contractors, yet still enter into contracts with such contractors.

A program operator may not engage a contractor to actually write the bid or proposal terms, product specifications, procurement procedures, contract terms, etc., and then consider this same contractor for the resulting contract award. Congress made it clear, by prefacing the phrase “in developing contract specifications” with the words “for use” that it must be the State, State agency, school, or school food authority that does the actual development, drafting or any other form of bid specification preparation. The Conference Report accompanying the Goodling Act makes clear that this provision “* * * is not intended to allow a potential contractor or other interested party to participate in the procurement process through drafting the procurement specifications, procedures or documents” (H.R. Conf. Rep. No. 786,105th Cong., 2d Sess.38 (1998).) Prospective contractors who develop, draft or in any other way prepare bid specifications, may not enter into a contract based on those specifications.

One commenter articulated the key distinction: A vendor that furnished information to a program operator for the program operator's use in formulating specifications for a procurement action may still be considered for the procurement award. But, a vendor engaged in actually drafting the specifications or other procurement documents may not be considered for the award. Both Federal law and regulations thus hold program operators responsible for their own specifications and procurement documents. Program operators must conduct their procurements under the USDA entitlement programs in a manner that avoids any appearances of, or actual, conflicts of interest.

With regard to the related concern that lowest cost was being over emphasized to the detriment of quality, USDA is aware that industry specification advice is not the only information program operators use in formulating specifications. For example, the USDA supports those schools and institutions operating the Child Nutrition Programs in their efforts to identify children's preferences for different types of food products through student surveys, tastes tests, etc. Such quality factors will continue to be allowed as part of the specifications under these revised rules. We would note that this kind of information cannot be obtained through consultations with industry, yet obtaining it is an essential prerequisite both to discussing a school district's needs for products and services with industry representatives and to soliciting bids or offers from industry.

With regard to balancing cost and quality, the method a program operator chooses for a procurement (small purchase, formal advertising with sealed bids, formal advertising for negotiable proposals, etc.) must be appropriate for the desired product or service. For example, for subgrantees subject to § 3016.36(b) through (i), the formal advertising, sealed bid method described at § 3016.36(d)(2) is appropriate when a program operator's public solicitation describes the desired product or service with sufficient precision that responsive bids will differ only in price. If this is not possible, a program operator should consider using the competitive negotiation method described at § 3016.36(d)(3).

Once a method is chosen for a particular procurement, however, the program operator must consistently observe the principles of that method. Negotiating under a sealed bid procurement, for example, is inappropriate; the lowest responsive bid must be accepted and unresponsive bids, regardless of price, must be rejected.

In this regard, a program operator seeking to work with a contractor in developing a custom-made product that will meet program needs must exercise caution to avoid inappropriately blending the sealed bid and competitive proposal procedures. The program operator may engage the contractor to develop the product and supply the finished product to the program, thus providing all qualified vendors the opportunity to compete for an award to both develop and supply the product. It would not be acceptable, however, for the same program operator to negotiate with the same contractor to develop the product and then, in a separate procurement action, publicly solicit bids to supply the product; the product would only be available from the firm that developed it.

We cannot overemphasize, however, that neither the sealed bid method nor the competitive proposal method requires a program operator to award a contract to a vendor that lacks the capability to successfully perform under the terms and conditions of the proposed procurement. Nor is a program operator required to award a contract to a bidder whose bid does not meet bid specifications simply because that bidder submitted the lowest price; any unresponsive bid must be rejected.

Other than the geographic preference and conflict of interest prohibitions in § 3016.60, the procurement regulations applicable to USDA entitlement program grantees and subgrantees remain essentially unchanged from prior practice. Grantees and subgrantees are encouraged to incorporate quality and taste related factors into the specifications and evaluation requirements as appropriate under each procurement mechanism and in accordance with applicable State and local procurement regulations.

The regulations continue to allow program operators to use small purchase, sealed bid, and competitive proposals procurement methods. All three methods allow program operators to incorporate quality as a procurement consideration. Under the sealed bid method, which requires that awards be made on the basis of lowest price, quality considerations, when sufficiently definite, can be built into the specifications, or a two-step bidding process may be used. Quality considerations under the sealed bid method are not an award factor, but a responsiveness issue assessing compliance with the specifications, which is why the specifications must be sufficiently definite. Awards cannot be made to a bidder offering a nonconforming product.

Under the competitive proposals method, quality considerations not only can be built into the product specifications for responsiveness, but also can be used as evaluation factors in making the award determination. The competitive proposals method allows for the use of less definite factors. The following hypothetical case illustrates this point.

A school district solicits sealed bids for fresh or frozen pizza products, inviting bids from all potential suppliers. Among other specifications, the solicitation requires that the pizza products be tasty. To assess conformance with the taste specification, the school district requires that bidders provide pizza product samples with their bids. The school district will assess taste acceptability through blind taste tests by students, rating samples as either acceptable or unacceptable. Bids providing unacceptable samples will be considered nonresponsive for failure to conform with the specification requirements. The solicitation instructs that award will be made to the lowest price supplier whose pizza product conforms to all specification requirements, including taste acceptability.

Five suppliers of fresh and frozen pizza submit prices and bid samples. The bids are as follows:

The school district correctly awards the contract to Supplier C. Of the four suppliers whose products ranked acceptable for taste (those of Suppliers B, C, D, and E), Supplier C submitted the lowest bid. The school district correctly rejects the Supplier A's bid even at the lowest price because the product did not conform to the specification requiring an acceptable taste.

USDA has revised the proposed regulatory language in new section 3016.60(b) to make express the authority of, and limitations on, program operators to acquire information from prospective contractors as spelled out in the Goodling Act; and to otherwise clarify the aspects of this provision that have been misunderstood. New paragraph 3016.60(b) makes clear that a grantee or subgrantee may not contract with a party who has developed, drafted, or in any other way prepared specifications, procedures, or documents for such contract; and that, conversely, a prospective contractor may provide information to a grantee or subgrantee, which the grantee or subgrantee may then use to develop its own documents and specifications, and still enter into a contract with the grantee and subgrantee.

Purchases using informal, small purchase methods can generally be made in less time and at less expense because such methods are simpler than formal procurement methods. State and local governments' ability to use the small purchase method for these programs is generally expressed as a dollar level known as the small purchase threshold. The Federal small purchase threshold under both § 3016.36 and § 3019.44 is tied to the level set at 41 U.S.C. 401(11) (currently $100,000). Two commenters expressed concern that many program operators may not realize the benefits of this feature of this rule because State and local government procurement rules often set small purchase thresholds lower than the Federal $100,000 level. The commenters' assessment of the effect of the lower State and local thresholds is correct when applied to this final rule. When a lower State or local small purchase threshold exists, only procurements below that level can be conducted using the simplified procedures. A formal method (sealed bid or competitive proposal) must be used for those procurements above the State or local level.

The USDA proposed a third specific exception to be included in subpart E of 7 CFR 3016: the exclusion of the USDA entitlement programs listed at § 3016.4(b), except the Food Distribution Program on Indian Reservations, from the financial reporting provisions in § 3016.41. No comments were received on this proposal. The exception language proposed for subpart E, § 3016.61 has been incorporated into the final rule.

The USDA made an editorial change in part 3015 to correct the name of the USDA office responsible for Federal assistance policy. Finally, USDA made a technical change in § 3016.4 to recognize the recent reclassification of the Food Distribution Program on Indian Reservations from nonentitlement to entitlement. No comments were received on these two changes. Therefore, the changes have been incorporated into the final rule.

The Office of Management and Budget reviewed the Proposed Rule and determined the rule to be significant under Executive Order 12866. In accordance with the provisions of Executive Order 12866, USDA prepared a cost benefit assessment which analyzed the economic impact of this rule on States, other grantees, and subgrantees operating USDA entitlement programs. The economic impact analysis had two discrete dimensions: bringing these programs under the umbrella of parts 3016 and 3019, and establishing the deviations and exceptions stated in subpart E to part 3016.

As stated in the Proposed Rule, USDA believes that both dimensions would have a negligible economic impact.

However, USDA does not have the database needed to quantify the foregoing generalizations about the costs and savings associated with this rule. Accordingly, USDA requested commenters to provide feedback on the economic impact of this rule. One of the commenters referred to the issue of economic impact of the overall rule in relation to USDA's proposal to set aside the Federalism principle to require the State to use § 3016.36(b) through (i) in conducting procurements under USDA entitlement programs. However, no commenter provided any substantive information on this subject or referred USDA to sources where it could be found. Since USDA has revised the final rule to avoid setting aside the Federalism principle, the one comment received in this regard is now moot. Several comments contained references to the potential cost of implementing certain specific provisions within the rule. These comments are discussed in the appropriate sections above.

As noted above, under this rule, financial reporting requirements, with the exception of the Food Distribution Program on Indian Reservations, will continue to be contained in the program-specific regulations rather than in part 3016. Because the reporting requirements themselves remain unchanged, this provision of the rule will have no economic impact on grantees and subgrantees.

The Office of Management and Budget has reviewed this final rule and determined the rule to be not significant.

Executive Order 13132 (E.O. 13132) on “Federalism” (64 FR 43255, August 10, 1999) requires Federal agencies to have an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” The final rules for 7 CFR parts 3015 and 3019 have no federalism implications. 7 CFR part 3016 is already applicable to State and local governments operating nonentitlement programs. A proposed revision to 7 CFR part 3016 was published as a Proposed Rule on February 17, 1998, to make the rule applicable to State and local governments operating entitlement programs. It should be noted that this Proposed Rule was published prior to the November 2, 1999, implementation of E.O. 13132. However, in the spirit of E.O 13132, USDA had already included substantial intergovernmental consultation in the development of the Proposed Rule. Subsequently it was determined that the Proposed Rule included a potential Federalism implication related to § 3016.36 which deals with procurement. The USDA met with State and local officials on multiple occasions to discuss proposed policy changes for entitlement programs and, in particular, to discuss the subject matter of the Proposed Rule. In addition, during the comment period USDA received comments on the Proposed Rule from eight State agencies in seven States and twenty local governments in eleven States. In light of comments received, the proposed provision for States to follow Federal rules in procurement was changed in this final rule to give States the option of following State or Federal procurement rules. We believe this change is in accordance with Federalism principles.

The USDA does not believe that this rule will have a significant civil rights impact and invited comments on this position. No comments were received.

The information collection requirements of this rule were previously approved for USDA under #0505-0008 for entitlement and nonentitlement programs. However, that number has been retired because the reporting and recordkeeping requirements of this rule are the same as those required by OMB Circulars A-102 and A-110 and have already been cleared by OMB. The USDA believes this rule will not impose additional information collection requirements on grantees and subgrantees.

In accordance with the requirements of the Regulatory Flexibility Act (5 U.S.C. 605(b)), the USDA Chief Financial Officer has reviewed this rule and certifies that it does not have a significant economic impact on a substantial number of small entities. The potential economic impact is discussed above in connection with Executive Order 12866.

SBA published a final rule in the Federal Register on February 10, 1999, (64 FR 6503), governing 7(a) loan securitizations. This correction adds a sentence to § 120.425(a), on capital requirements, that was inadvertently omitted. Section 120.425(a) provides that all “securitizers must be considered to be ‘well capitalized’ by their regulator.” It further states that “SBA, as the regulator, will consider a nondepository institution to be ‘well capitalized’ if it maintains a minimum unencumbered paid in capital and paid in surplus equal to at least 10 percent of its assets, excluding the guaranteed portion of 7(a) loans.” This correction adds that “[t]he capital charge applies to the remaining balance outstanding on the unguaranteed portion of the securitizer's 7(a) loans in its portfolio and in any securitization pools.”

This correction is consistent with notice provided in the preamble to the final rule published on February 10, 1999 (64 FR 6503). That preamble stated that commenters requested SBA to clarify that “the capital charge applies not only to the unguaranteed portion of the securitizer's 7(a) loans in the portfolio but also to the remaining balance outstanding in the securitization pools” and that SBA “incorporated” this clarification “into the final rule.”

By making this correction, SBA is incorporating the clarification, as intended, into the final rule.

On June 1, 2000, the Federal Aviation Administration (FAA) issued AD 2000-11-21, amendment 39-11769, which applies to certain Airbus Model A319, A320, and A321 series airplanes. That AD requires a one-time general visual inspection to determine the part number and serial number of the spoiler servocontrol, and corrective action, if necessary. That AD was prompted by issuance of mandatory continuing airworthiness information by a foreign civil airworthiness authority. The actions required by that AD are intended to prevent failure of the spoiler servocontrol piston rod, which could result in reduced controllability of the airplane.

Paragraph (a) of AD 2000-11-21 specifies a “general visual inspection.” However, the FAA points out that since the inspection is to determine the part number and serial number of certain components, it is unnecessary to require a general visual inspection. Likewise, it is unnecessary to include the definition of that inspection in Note 2 following paragraph (a) of that AD. Instead, the FAA considers that an “inspection” rather than a “general visual inspection” adequately describes the action required by this AD to determine the part number and serial number for the spoiler servocontrols. Paragraph (a) of this AD reflects these changes.

In addition, the FAA recently obtained information that paragraphs (a) and (b) of AD 2000-11-21 contain incorrect paragraph references to the applicable service bulletins. The information specifies that paragraph (a) should reference paragraph 3.B.(1)(b) instead of paragraph 2.B.(1)(b) of the applicable service bulletins, and that paragraph (b) should reference paragraph 3.B.(1)(b)1 instead of paragraph 2.B.(1)(b)1. However, the FAA points out that paragraphs 2.B.(1)(b) and 2.B.(1)(b)1 are the correct paragraph references specified by Airbus Service Bulletin A320-17-1126 and A320-27-1127, both dated April 26, 1999. In addition, paragraphs 3.B.(1)(b) and 3.B.(1)(b)1 are the correct paragraph references specified by Revision 01 of those service bulletins, both dated October 6, 1999. Therefore, in paragraph (a) of this AD, the FAA has added a reference to paragraph 3.B(1)(b) of Revision 01 of the service bulletins, and in paragraph (b) of this AD, the FAA has added a reference to paragraph 3.B(1)(b)1 of Revision 01 of the service bulletins.

The FAA has determined that such corrections to paragraphs (a) and (b) of AD 2000-11-21 are necessary. These corrections will ensure that operators are notified of the correct type of inspection required by this AD, and the correct paragraph references of the applicable service bulletins.

This document corrects the type of inspection required by this AD, corrects certain paragraph references to the applicable service bulletins, and adds the AD as an amendment to section 39.13 of the Federal Aviation Regulations (14 CFR 39.13).

The AD is reprinted in its entirety for the convenience of affected operators. The effective date of the AD remains July 18, 2000.

Since this action only corrects the type of inspection required (and removes Note 2 defining the previously specified inspection), and corrects certain paragraph references to the applicable service bulletins, it has no adverse economic impact and imposes no additional burden on any person. Therefore, the FAA has determined that notice and public procedures are unnecessary.

The USA's position on special use airspace (SUA) is that they will keep and efficiently utilize only that airspace necessary to accomplish the mission of the USA. In keeping with that policy, the USA has closed the Savanna Army Depot. As a result, all military related operations have ceased at the depot, therefore, R-3302 is no longer required.

This amendment to 14 CFR part 73 removes R-3302 Savanna, IL. The FAA is taking this action in response to a DOD, USA determination that this restricted airspace is no longer required to support the USA mission. Because this action only involves removal of restricted airspace, I find that notice and public comment under 5 U.S.C. 553(b) are unnecessary.

Section 73.33 of 14 CFR part 73 was republished in FAA Order 7400.8G, dated September 1, 1999.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore—(1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

This action reduces restricted airspace. The rule contains no changes to air traffic control procedures or routes. Therefore, the FAA has determined that this action is not subject to environmental assessments and procedures in accordance with FAA Order 1050.1D, “Policies and Procedures for Considering Environmental Impacts,” and the National Environmental Policy Act.

The final regulation that is the subject of this correction established regulations governing freight forwarding facilities for DEA distributing registrants. The final regulation amended 21 CFR Parts 1300, 1301, 1304 and 1307. As published, the final regulation contained an error that could cause confusion in the regulated industry. Accordingly, the publication July 19, 2000 of the final regulation to establish freight forwarding facilities for DEA distributing registrants which was the subject of Federal Register Document 00-18147 is corrected as follows:

On April 17, 2000 (65 FR 2086), HUD published a proposed rule that would revise HUD's regulations in 24 CFR part 903 that implement the Public Housing Agency Plan to fully reflect the importance of deconcentration by income and affirmatively furthering fair housing in a PHA's admission policy, consistent with the Administration's directive to achieve “One America.” The April 17, 2000 rule also proposed to provide further direction to PHAs on the implementation of deconcentration and affirmatively further fair housing. In addition to these amendments, HUD proposed a change to § 903.11(c) that would permit the Secretary of HUD to further simplify the PHA Plan submission for PHAs permitted to submit a streamlined plan.

While HUD received many comments on the proposed amendments concerning deconcentration of poverty, no public comments were received on the proposed amendment to § 903.11(c). HUD is still considering public comments on the proposed amendments concerning deconcentration of poverty and a final rule addressing these amendments will be issued separately. This rule proceeds to codify the amendment to § 903.11(c).

The Secretary, in accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)), has reviewed and approved this final rule, and in so doing certifies that this rule does not have a significant economic impact on a substantial number of small entities. This rule is limited to making a technical, simplification change to HUD's regulations in 24 CFR 903.11, as described in this preamble.

This final rule does not have federalism implications and does not impose substantial direct compliance costs on State and local governments or preempt State law within the meaning of Executive Order 13132 (entitled “Federalism”).

The Finding of No Significant Impact with respect to the environment was prepared during the interim rulemaking stage of the PHA Plan rule (Docket No. FR-4420), in accordance with HUD regulations in 24 CFR part 50 that implement section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4223). That Finding remains applicable to this rule, and is available for public inspection between 7:30 a.m. and 5:30 p.m. weekdays in the Office of the Rules Docket Clerk, Office of General Counsel, Room 10276, Department of Housing and Urban Development, 451 7th Street, SW, Washington, DC 20410.

Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4; approved March 22, 1995) (UMRA) establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments, and on the private sector. This rule does not impose any Federal mandates on any State, local, or tribal governments, or on the private sector, within the meaning of the UMRA.

The Catalog of Federal Domestic Assistance numbers applicable to the programs affected by this rule are 14.850 and 14.855.

On April 20, 1999, we published the proposed rule in the Federal Register (64 FR 19318). During the 90-day comment period, which ended on July 19, 1999, MMS held a workshop.

On February 5, 1997, we published a final rule in the Federal Register (62 FR 5320) concerning the training of lessee and contractor employees engaged in drilling, well completion, well workover, well servicing, or production safety system operations in the OCS. The final rule streamlined the previous regulations by 80 percent, provided the flexibility to use alternative training methods, and simplified the training options at 30 CFR 250, Subpart O—Training.

The February 5, 1997, final rule did not sufficiently address developing a performance-based training system, so we planned to publish a proposed rule to better address this issue. Before considering any further revisions to the rule, we decided to hold a workshop in Houston, Texas. The purpose of the workshop was to discuss the development of a performance-based training system for OCS oil and gas activities.

On April 4, 1997, we published a Federal Register notice (62 FR 18070) announcing the workshop. We stated that the goal of the meeting was to develop a procedure that ensures that lessee and contractor employees are trained in well control or production safety system operations by creating a less prescriptive training program, focusing on results and not on processes.

To improve the regulations at 30 CFR 250, Subpart O—Training, the workshop notice asked attendees to be prepared to present and discuss comments on the following four performance measures and indicators that could be used as part of a performance-based program:

• MMS Written Test;

• MMS Hands-On and Simulator Testing;

• Audits, Interviews, or Cooperative Reviews; and

• Incident of Noncompliance (INC), Civil Penalty, and Event Data.

On June 10, 1997, we conducted a public workshop in Houston, Texas, which received excellent participation from industry and training schools. Approximately 190 people attended the workshop, representing a diverse cross section of the oil and gas industry.

The next step in the development of a performance-based training system was accomplished by publishing a proposed rule on April 20, 1999. The rule focused on the development of a performance-based training program. The proposed rule required lessee and contract employees to develop their own training programs tied to the job duties of their personnel. This final rule will primarily focus on training results rather than on the process by which employees are trained. By developing appropriate performance measures, MMS can evaluate the effectiveness of a lessee's training programs by:

• written testing;

• hands-on testing;

• training system audits; or

• employee interviews.

This approach requires lessees to be responsible for the quality and the level of training their employees receive.

In addition to the changes we made to the final rule in response to comments, we also reworded certain complex sections for further clarity. In many instances, the changes improve MMS's internal work processes to better serve its external customers. Following are the major changes by section.

• We replaced the tables in proposed § 250.1504. In the proposed rule, the tables listed the minimum “knowledge and job skill elements” employees must have to competently perform their assigned well control and production safety duties. The elements were far too prescriptive for a performance-based rule. The new 30 CFR 250.1503(a) is more performance-based, stating that: “You” must establish and implement a training program so that all of your employees are trained to competently perform their assigned well control and production safety duties. The knowledge and job skill elements that an employee must possess in order to perform assigned well control or production safety duties are the responsibility of the lessee.

• We added § 250.1502, establishing a 2-year transition period to ensure a smooth transition from the existing rule to the new requirement.

• We deleted proposed § 250.1502(c) that stated that both lessees and contractors are required to develop training plans. We now specify that only lessees are required to develop a training plan.

• We modified proposed § 250.1503(b)(1) through (7) to add clarity and specificity so that lessees understand they are responsible for ensuring that all personnel working on their leases are trained and can competently perform their assigned well control or production safety duties. We also wanted contractors to understand that the lessees will review their training program for contract personnel.

• We replaced proposed § 250.1510 with § 250.1503(c). In proposed § 250.1510, we explained why it may be necessary for lessees to provide a training plan to the MMS. In § 250.1503(c), we describe what documentation the lessee must provide to MMS upon request of the Regional or District Supervisor.

• We deleted proposed § 250.1512 and moved the requirements to § 250.1509 in the final rule. Under the current system, MMS-approved training schools conduct hands-on, simulator, or other types of testing that must be passed by the employees before they can work on the OCS. Under the final rule, § 250.1509 outlines the requirements involved if MMS conducts, or requires the lessees to conduct, these tests. We are changing the requirement in the proposed rule that the lessees pay all costs associated with testing. This final rule specifies that the lessees are responsible for paying the testing costs, excluding salary and travel costs for MMS personnel.

MMS received 25 comments on the proposed rule. The comments were received from six production operators, six drilling contractors, two trade organizations, one standard setting organization, nine training schools, and one congressional office. We reviewed all the comments and, in some instances, we revised the final language based on these comments. MMS grouped the major comments and organized them by the proposed regulation section number or subject, as highlighted in the comment table.

The TRICARE Retiree Dental Program (TRDP), a voluntary dental insurance plan completely funded by enrollees' premiums, was implemented in 1998 to provide benefits for basic dental care and treatment based on the authority of 10 U.S.C. 1076c. Under the enabling legislation, the benefits that can be provided are limited to “basic dental care and treatment, involving diagnostic services, preventative services, basic restorative services (including endodontics), surgical services, and emergency services.” Accordingly, the implementing regulation, 32 CFR 199.22, limited coverage to the most common dental procedures necessary for maintenance of good dental health and did not include coverage of major restorative services, prosthodontics, orthodontics or other procedures considered to be outside of the “basic dental care and treatment” range.

Although the program was viewed as a major advance in offering dental coverage to retired members of the Uniformed Services and their family members at a very reasonable cost, there were still concerns that the enabling legislation was too restrictive in scope and that there should be expansion of services to better meet the needs of retirees.

Congress responded to these concerns by amending 10 U.S.C. 1076c with section 704 of the National Defense Authorization Act for Fiscal Year 2000, Pub. L. 106-065, to allow the Secretary of Defense to offer additional coverage. Under provisions of the amendment, the TRDP benefits may be “comparable to the benefits authorized under section 1076a” of title 10, the Dependents Dental Plan, commonly known as the TRICARE Family Member Dental Plan. Thus, in addition to the original basic services described above, which continue to be mandated, coverage of “orthodontic services, crowns, gold fillings, bridges, complete or partial dentures, and such other services as the Secretary of Defense considers to be appropriate” [10 U.S.C. 1076a(d)(3)] may be covered by the TRDP.

The language of section 704 of the National Defense Authorization Act for Fiscal Year 2000 is permissive and does not mandate such coverage. However, because of the many requests for additional TRDP coverage regardless of the inevitable increase in premiums, the DoD is proposing to expand the current coverage through a contractual arrangement. The premium cost of the enhanced coverage will remain the responsibility of the enrollees.

This interim final rule allows expansion of the TRDP benefits to be comparable to the coverage under Active Duty Dental Plan at 32 CFR 199.13, commonly known as the TRICARE Family Member Dental Plan. It maintains the original basic TRDP coverage, with the original initial and renewal enrollment periods, until contractual arrangements are in place for the additional benefits. Enrollment in the original basic plan will be superseded by enrollment in the enhanced plan. Effective with the implementation of an enhanced plan, new enrollments for basic coverage will cease. Enrollees in the basic plan at that time may continue their enrollment for basic coverage, subject to the applicable premium and eligibility provisions, as long as the contract administering that coverage is in effect. Enrollees in the basic plan will be allowed an enrollment option at the time the enhanced plan is implemented.

One of the aims of the interim final rule is to allow flexibility in the design of an enhanced benefit structure that will help keep the increase in premiums within a reasonable range with the addition of the major dental coverage. This takes into account the increase in premiums not only for the increased benefits but the potential increase due to the risk of adverse selection. Adverse selection is the tendency for people who have a greater-than-average likelihood of needing treatment to seek coverage more than those who have a lesser likelihood of needing treatment. Accordingly, the interim final rule provides for renewal enrollment periods of up to 12 months per period for the enhanced benefits, thereby allowing the risk to be spread over a greater period of time than the month-to-month continuing enrollment for the basic coverage. Renewal for the basic program continues to be on a monthly basis. To offset the longer renewal periods, the rule allows a flexibility in the initial enrollment period for the enhanced benefits by permitting it to be in the range of from 12 to 24 months, the exact length to be determined through contractual arrangement. The initial enrollment period for the basic program will continue to be 24 months.

In addition, the interim final rule allows the establishment of an alternative course of treatment policy as in the TFMDP, adds a provision for orthodontic lifetime maximum should an orthodontic benefit be offered, and removes the specific dollar limit on the non-orthodontic annual benefit maximum while retaining the requirement for an annual maximum benefit amount. These changes are being made to permit more flexibility in the design and implementation of an enhanced TRDP benefit structure and allow ways to mitigate the increased risk for adverse selection and unacceptably high premiums that are likely to occur with the addition of major coverage.

Recognizing that occasionally some enrollees experience “buyer's remorse” shortly after enrolling in the program, this rule adds a 30-day grace period that allows new enrollees to terminate a TRDP enrollment immediately after enrollment provided no benefits have been used. This is consistent with the legislative mandate that the retiree dental plan be voluntary and provides enrollees an opportunity to further consider their dental needs before they are obligated for the initial enrollment period.

Executive Order 12866 requires certain regulatory assessments for any “significant regulatory action,” defined as one that would result in an annual effect on the economy of $100 million or more, or have other substantial impacts.

The Regulatory Flexibility Act (RFA) requires that each federal agency prepare, and make available for public comment, a regulatory flexibility analysis when the agency issues a regulation which would have a significant impact on a substantial number of small entities.

This rule is not a significant regulatory action under the provisions of Executive Order 12866, and it would not have a significant impact on a substantial number of small entities.

This rule will not impose additional information collection requirements on the public under the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35). The TRICARE Retiree Dental Program Enrollment Form currently in use received approval from the Office of Management and Budget (OMB) in January 1998 under OMB Number 0720-0015. That approval expires January 31, 2001.

To implement enhanced benefits in the retiree dental program in a timely manner, this rule is being issued as an interim final rule, with comment period. This is an exception to our standard practice of soliciting public comments prior to issuance. The Assistant Secretary of Defense (Health Affairs) has determined for good cause that following the standard practice in this case would be impracticable, unnecessary, and contrary to the public interest. This determination is based on several factors. First, the government has no financial interest at stake that could be impacted by rulemaking. The TRDP is distinctly different and administratively separate from other TRICARE programs. It is open to all Uniformed Services retirees regardless of age and is completely funded by enrollees' premiums. Secondly, although no appropriated funds are involved in this program, the Department maintains a fiduciary duty to act in the best interest of the intended beneficiaries (retirees). Retirees will be financially disadvantaged by delay in adding coverage of the major dental procedures to the TRDP. The more quickly this rule is put into effect, the more quickly retirees can receive the additional coverage at a reasonable premium rate. Lastly, this change directly implements a statutory amendment enacted by Congress expressly for this purpose. Interested persons are invited to comment on this rule during the 60-day public comment period. All written comments timely received will be carefully considered prior to finalization of this rule. A discussion of the major issues received by public comments will be included with the issuance of the final rule, anticipated approximately 90 days after the end of the comment period.

Although this rule is being published as a temporary final rule without prior notice, an opportunity for public comment is nevertheless desirable to ensure the rule is both reasonable and workable. Accordingly, we encourage you to submit comments and related material. If you do so, please include your name and address, identify the docket number (CGD05-00-032), indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related materials in an unbound format, no larger than 8.5 by 11 inches, suitable for copying. If you would like to know they reached us, please enclose a stamped, self-addressed postcard or envelope.

A notice of proposed rulemaking (NPRM) was not published for this regulation. In keeping with 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a NPRM. The Coast Guard was notified of the need for special local regulations with insufficient time to publish a NPRM, allow for comments, and publish a final rule prior to the event.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . We had insufficient time to prepare and publish this rule in the Federal Register 30 days in advance of the events. To delay the effective date of the rule would be contrary to the public interest since a timely rule is necessary to protect mariners from the hazards associated with high speed powerboat races.

On August 26 and August 27, 2000, the Chesapeake Bay Power Boat Association will sponsor the “Chesapeake Challenge” powerboat race, on the waters of the Patapsco River, Baltimore, Maryland. The event will consist of 65 to 80 offshore powerboats racing in heats around an oval race course. A large fleet of spectator vessels is anticipated. Due to the need for vessel control during the races, vessel traffic will be temporarily restricted to provide for the safety of spectators, participants and transiting vessels.

The Coast Guard is establishing temporary special local regulations on specified waters of the Patapsco River. The temporary special local regulations will be in effect from 1 p.m. on August 26, 2000 to 4 p.m. on August 27, 2000. The effect will be to restrict general navigation in the regulated areas during the event. Except for participants in the “Chesapeake Challenge” powerboat race and vessels authorized by the Coast Guard Patrol Commander, no person or vessel may enter or remain in the regulated area. This rule also establishes three spectator viewing areas for the exclusive use of spectator vessels. These regulations are needed to control vessel traffic during the event to enhance the safety of participants, spectators and transiting vessels.

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not significant under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040; February 26, 1979).

We expect the economic impact of this temporary final rule to be so minimal that a full Regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary.

Although this regulation prevents traffic from transiting a portion of the Patapsco River during the event, the effect of this regulation will not be significant due to the limited duration of the regulation and the extensive advance notifications that will be made to the maritime community via the Local Notice to Mariners, marine information broadcasts, and area newspapers, so mariners can adjust their plans accordingly.

Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), we considered whether this rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

This rule will affect the following entities, some of which may be small entities: The owners or operators of vessels intending to transit or anchor in the effected portions of the Patapsco River during the event.

Although this regulation prevents traffic from transiting or anchoring in a portion of the Patapsco River during the event, the effect of this regulation will not be significant because of its limited duration and the extensive advance notifications that will be made to the maritime community via the Local Notice to Mariners, marine information broadcasts, and area newspapers, so mariners can adjust their plans accordingly.

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

We have analyzed this rule under Executive Order 13132 and have determined that this rule does not have implications for federalism under that Order.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) governs the issuance of Federal regulations that require unfunded mandates. An unfunded mandate is a regulation that requires a State, local, or tribal government or the private sector to incur direct costs without the Federal Government's having first provided the funds to pay those costs. This rule will not impose an unfunded mandate.

This rule will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not concern an environmental risk to health or risk to safety that may disproportionately affect children.

We prepared an “Environmental Assessment” in accordance with Commandant Instruction M16475.1C, and determined that this rule will not significantly affect the quality of the human environment. The “Environmental Assessment” and “Finding of No Significant Impact” is available in the docket where indicated under ADDRESSES.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a NPRM. The Coast Guard also finds good cause to make this rule effective less than 30 days after publication in the Federal Register . The sponsor of the event did not provide the Coast Guard with the final details for the event in sufficient time to publish a NPRM or a final rule 30 days in advance. The delay encountered if normal rulemaking procedures were followed would effectively cancel the event. Cancellation of this event is contrary to the public interest since the fireworks display is for the benefit of the public.

Mr. Felix Grucci of Brookhaven, NY is sponsoring a fireworks display on Great South Bay, Davis Park, Sayville, NY. The fireworks display will occur on August 12, 2000 with a rain date of August 13, 2000. The safety zone covers all waters of the Great South Bay within a 600 foot radius of the fireworks launching area which will be located in approximate position: 40°-41′17″N, 073°-00′20″W, (NAD 1983). This zone is required to protect the maritime community from the safety dangers associated with this fireworks display. Entry into or movement within this zone will be prohibited unless authorized by the Captain of the Port or his on-scene representative.

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040, February 26, 1979). The Coast Guard expects the economic impact of this proposal to be so minimal that a full Regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary. This safety zone involves only a portion of the Great South Bay and entry into this zone will be restricted for only 90 minutes on August 12, 2000. Although this regulation prevents traffic from transiting this section of the Great South Bay, the effect of this regulation will not be significant for several reasons: the duration of the event is limited; the event is at a late hour; all vessel traffic may safely pass around this safety zone; and extensive, advance maritime advisories will be made.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we considered whether this rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses not-for-profit organizations that are independently owned and operated are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

The Coast Guard certifies under 5 U.S.C. 605 (b) that this rule will not have a significant impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: The owners or operators of vessels intending to transit or anchor in a portion of the Great South Bay from 9:30 p.m. until 11 p.m. on August 12, 2000. This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons: The duration of the event is limited; the event is at a late hour; all vessel traffic may safely pass around this safety zone; and extensive, advance maritime advisories will be made.

Under subsection 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 [Pub. L. 104-121], the Coast Guard wants to assist small entities in understanding the rule so that they could better evaluate its effects on them and participate in the rulemaking process. If your small business or organization would be affected by this rule and you have any questions concerning its provisions or options for compliance, please call Chief Chris Stubblefield at (203) 468-4428. Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

This rule calls for no collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

We have analyzed this rule under Executive Order 13132 and have determined that this rule does not have implications for federalism under that Order.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) governs the issuance of Federal regulations that require unfunded mandates. An unfunded mandate is a regulation that requires a State, local, or tribal government or the private sector to incur direct costs without the Federal Government having first provided the funds to pay those unfunded mandate costs. This rule will not impose an unfunded mandate.

This rule will not effect a taking of private property or otherwise have taking implications under E.O. 12630, Government Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of E.O. 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this proposed rule under E.O. 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not concern an environmental risk to health or risk to safety that may disproportionately affect children.

The Coast Guard has considered the environmental impact of this rule and concluded that under figure 2-1, paragraph 34(g), of Commandant Instruction, M 16475.C, this rule is categorically excluded from further environmental documentation. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under Addresses .

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(8), the Coast Guard finds that good cause exists for not publishing an NPRM. Good cause exists for not publishing an NPRM due to the date the Application for Approval of Marine Event was received, there was insufficient time to draft and publish an NPRM. Further, it is a local event with minimal impact on the waterway, vessels may still transit through western Long Island Sound during the event, the zone is only in effect for 1 1/2 hours and vessels can be given permission to transit the zone except for about 20 minutes during this time. Any delay encountered in this regulation's effective date would be unnecessary and contrary to public interest since immediate action is needed to close the waterway and protect the maritime public from the hazards associated with this fireworks display.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . This is due to the following reasons: It is a local event with minimal impact on the waterway, vessels may still transit through western Long Island Sound during the event, the zone is only in affect for 1 1/2 hours and vessels can be given permission to transit the zone except for about 20 minutes during this time. Vessels will not be precluded from mooring at or getting underway from recreational piers in the vicinity of the zone. There are no commercial facilities in the vicinity of the zone. Additionally, this location will be a permanent fireworks safety zone regulated by 33 CFR 165.168. The final rule for this regulation was published in the Federal Register on July 13, 2000. No comments were received during this rulemaking.

The Coast Guard has received an application to hold a fireworks program on the waters of western Long Island Sound off Larchmont, NY. This regulation establishes a safety zone in all waters of western Long Island Sound within a 240-yard radius of the fireworks barge in approximate position 40°54′45″N 73°44′55″W (NAD 1983), about 450 yards southwest of the entrance to Horseshoe Harbor. The safety zone is in effect from 9:20 p.m. (e.s.t.) until 10:50 p.m. (e.s.t.) on Friday, August 11, 2000. If the event is cancelled due to inclement weather, then this section is effective from 9:20 p.m. (e.s.t.) until 10:50 p.m. (e.s.t.) on Sunday, August 13, 2000. The safety zone prevents vessels from transiting a portion of western Long Island Sound and is needed to protect boaters from the hazards associated with fireworks launched from a barge in the area. Marine traffic will still be able to transit through western Long Island Sound during this event. Additionally, vessels will not be precluded from mooring at or getting underway from recreational piers in the vicinity of the zone. There are no commercial facilities in the vicinity of the zone. This safety zone precludes the waterway users from entering only the safety zone itself. Public notifications will be made prior to the event via the Local Notice to Mariners.

This final rule is not a significant regulatory action under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. It has not been reviewed by the Office of Management and Budget under that Order. It is not significant under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040; February 26, 1979). The Coast Guard expects the economic impact of this final rule to be so minimal that a full Regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary. This finding is based on the minimal time that vessels will be restricted from the zone, that vessels may still transit through western Long Island Sound, that vessels will not be precluded from mooring at or getting underway from recreational piers in the vicinity of the zone, there are no commercial facilities in the vicinity of the zone, and advance notifications which will be made.

The size of this safety zone was determined using National Fire Protection Association and New York City Fire Department standards for 8″ mortars fired from a barge combined with the Coast Guard's knowledge of tide and current conditions in the area.

Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), the Coast Guard considered whether this final rule will have a significant economic impact on a substantial number of small entities. “Small entities” include small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

For reasons discussed in the Regulatory Evaluation above, the Coast Guard certifies under section 605(b) of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) that this final rule will not have a significant economic impact on a substantial number of small entities.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offered to assist small entities in understanding the rule so that they could better evaluate its effects on them and participate in the rulemaking process. Small entities were notified of this marine event by its publication in the First Coast Guard District Local Notice to Mariners #30 dated July 25, 2000.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

This final rule does not provide for a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ).

The Coast Guard has analyzed this final rule under the principles and criteria contained in Executive Order 13132 and has determined that this final rule does not have implications for federalism under that Order.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) governs the issuance of Federal regulations that require unfunded mandates. An unfunded mandate is a regulation that requires a State, local, or tribal government or the private sector to incur direct costs without the Federal Government's having first provided the funds to pay those unfunded mandate costs. This rule will not impose an unfunded mandate.

This rule will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not concern an environmental risk to health or risk to safety that may disproportionately affect children.

The Coast Guard considered the environmental impact of this final rule and concluded that under figure 2-1, paragraph 34(g), of Commandant Instruction M16475.1C, this final rule is categorically excluded from further environmental documentation. This rule fits paragraph 34(g) as it establishes a safety zone. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under ADDRESSES .

We are finalizing approval of Santa Barbara's 1998 Clean Air Plan (CAP). The Santa Barbara County Air Pollution Control District (SBCAPCD) adopted the plan to meet the Clean Air Act (CAA) requirements for ozone areas classified as serious. The California Air Resources Board (CARB) submitted the plan to us on March 19, 1999. EPA determined the submittal to be complete on April 28, 1999, pursuant to 40 CFR part 51, appendix V.

On March 30, 2000, we proposed approval of the ozone plan with respect to its emissions inventories, control measures, 1999 rate-of-progress (ROP) plan, attainment demonstration, and transportation budgets. Please see that document (65 FR 16864-16869) for further details on our proposed action, applicable CAA requirements, and additional information on the affected area.

We received no public comments.

In this document, we are finalizing the following actions on the 1998 CAP. For each action, we indicate the page on which the element is discussed in our proposal.

(1) Approval of the revised baseline and projected emissions inventories under CAA sections 172(c)(3) and 182(a)(1)—16865;

(2) Approval of the SBCAPCD's measures 333, 352, 353, T13, T18, T21, and T22, including the District's commitment to adopt and implement the measures by specified dates (if applicable, in the case of the contingency measures) to achieve the identified emission reduction, under CAA section 110(k)(3)—16866 (Table 1);

(3) Approval of the rate-of-progress (ROP) plan for the milestone year 1999, under CAA sections 182(c)(2)—16866 (Table 2);

(4) Approval of the attainment demonstration under CAA sections 182(c)(2)—16867;

(5) Approval of the revised motor vehicle emissions budgets for purposes of transportation conformity under CAA section 176(c)(2)(A)—16867.

In addition, EPA finds that the SBCAPCD has established and implemented a Photochemical Assessment Monitoring Station (PAMS) network meeting the requirements of CAA section 182(c)(1)—16868.

Upon the effective date of our approval of the 1998 CAP, this plan replaces and supersedes the 1994 ozone SIP with the exception of the approved State control measures, the local control measures that are not amended by the 1998 CAP, and the local transportation control measures (TCMs) for which the 1998 CAP augments the TCMs and projects included in the 1994 SIP.  1 Our final approval also makes enforceable the SBCAPCD commitments to adopt and implement the control measures and contingency measures (if applicable) listed in Table 1 (16866), to achieve the specified emissions reductions.

The Office of Management and Budget (OMB) has exempted this regulatory action from Executive Order 12866, entitled “Regulatory Planning and Review.”

Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997), applies to any rule that: (1) Is determined to be “economically significant” as defined under Executive Order 12866, and (2) concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the Agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the Agency.

This rule is not subject to Executive Order 13045 because it does not involve decisions intended to mitigate environmental health or safety risks.

Under Executive Order 13084, Consultation and Coordination with Indian Tribal Governments, EPA may not issue a regulation that is not required by statute, that significantly affects or uniquely affects the communities of Indian tribal governments, and that imposes substantial direct compliance costs on those communities, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by the tribal governments. If the mandate is unfunded, EPA must provide to the Office of Management and Budget, in a separately identified section of the preamble to the rule, a description of the extent of EPA's prior consultation with representatives of affected tribal governments, a summary of the nature of their concerns, and a statement supporting the need to issue the regulation.

In addition, Executive Order 13084 requires EPA to develop an effective process permitting elected and other representatives of Indian tribal governments “to provide meaningful and timely input in the development of regulatory policies on matters that significantly or uniquely affect their communities.” Today's rule does not significantly or uniquely affect the communities of Indian tribal governments. Accordingly, the requirements of section 3(b) of Executive Order 13084 do not apply to this rule.

Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999) revokes and replaces Executive Orders 12612, Federalism and 12875, Enhancing the Intergovernmental Partnership. Executive Order 13132 requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” Under Executive Order 13132, EPA may not issue a regulation that has federalism implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, or EPA consults with State and local officials early in the process of developing the proposed regulation. EPA also may not issue a regulation that has federalism implications and that preempts State law unless the Agency consults with State and local officials early in the process of developing the proposed regulation.

This rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 F.R. 43255, August 10, 1999), because it merely approves a state rule implementing a federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. Thus, the requirements of section 6 of the Executive Order do not apply to this rule.

The Regulatory Flexibility Act (RFA) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small not-for-profit enterprises, and small governmental jurisdictions.

This final rule will not have a significant impact on a substantial number of small entities because SIP approvals under section 110 and subchapter I, part D of the Clean Air Act do not create any new requirements but simply approve requirements that the State is already imposing. Therefore, because the Federal SIP approval does not create any new requirements, I certify that this action will not have a significant economic impact on a substantial number of small entities.

Moreover, due to the nature of the Federal-State relationship under the Clean Air Act, preparation of flexibility analysis would constitute Federal inquiry into the economic reasonableness of state action. The Clean Air Act forbids EPA to base its actions concerning SIPs on such grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 255-66 (1976); 42 U.S.C. 7410(a)(2).

Under Section 202 of the Unfunded Mandates Reform Act of 1995 (“Unfunded Mandates Act”), signed into law on March 22, 1995, EPA must prepare a budgetary impact statement to accompany any proposed or final rule that includes a Federal mandate that may result in estimated annual costs to State, local, or tribal governments in the aggregate; or to private sector, of $100 million or more. Under Section 205, EPA must select the most cost-effective and least burdensome alternative that achieves the objectives of the rule and is consistent with statutory requirements. Section 203 requires EPA to establish a plan for informing and advising any small governments that may be significantly or uniquely impacted by the rule.

EPA has determined that the approval action promulgated does not include a Federal mandate that may result in estimated annual costs of $100 million or more to either State, local, or tribal governments in the aggregate, or to the private sector. This Federal action approves pre-existing requirements under State or local law, and imposes no new requirements. Accordingly, no additional costs to State, local, or tribal governments, or to the private sector, result from this action.

The Congressional Review Act, 5 U.S.C. 801 et seq. , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . A major rule cannot take effect until 60 days after it is published in the Federal Register . This rule is not a “major” rule as defined by 5 U.S.C. 804(2).

Section 12 of the National Technology Transfer and Advancement Act (NTTAA) of 1995 requires Federal agencies to evaluate existing technical standards when developing a new regulation. To comply with NTTAA, EPA must consider and use “voluntary consensus standards” (VCS) if available and applicable when developing programs and policies unless doing so would be inconsistent with applicable law or otherwise impractical.

The EPA believes that VCS are inapplicable to this action. Today's action does not require the public to perform activities conducive to the use of VCS.

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 13, 2000. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

On March 6, 2000 the Commonwealth of Pennsylvania submitted a formal revision to its State Implementation Plan (SIP). The revisions amend Chapter 121 section 121.1 Definitions, and add Chapter 129 section 129.75 Mobile Equipment Repair and Refinishing, pertaining to volatile organic compound (VOC) control requirements for motor vehicle repair and refinishing facilities.

The March 6, 2000 submittal amends Chapter 121, section 121.1 to add definitions of terms used in the substantive provisions in Chapter 129. The definitions include: automotive pretreatment, automotive primer-sealer, automotive primer-surfacer, automotive specialty coating, automotive topcoat, antique motor vehicle, classic motor vehicle, mobile equipment, and automotive touch up repair. Airless spray was added for clarification, and automotive elastomeric coating, automotive impact-resistant coating, automotive jambing clearcoat, automotive lacquer, automotive low-gloss coating, and automotive multicolored topcoat were added to make the final rule consistent with Federal regulations.

Section 129.75 establishes allowable VOC content requirements for coatings used in mobile equipment repair and refinishing. Section 129.75(a) applies to a person who applies mobile equipment repair and refining or color matched coatings to mobile equipment or mobile equipment components. Section 129.75(b) establishes exceptions to the general applicability of the rules where the coating is done in an automobile assembly plant or by an individual who does not receive compensation for application of the coatings. Section 129.75(c) establishes the VOC content of automobile refinished coatings: the allowable VOC content (as applied), and the weight of VOC per volume of coating (minus water and non-VOC solvents). Section 129.75(d) provides the methodology for calculating the VOC emissions, which includes documentation concerning the VOC content of the coatings calculated. Section 129.75(e) establishes application techniques and time frames for existing and new facilities. Sections 129.75(f), (g) and (h) establish the requirements for cleaning spray guns associated with this source category and housekeeping, pollution prevention, and training requirements for individuals applying mobile equipment repair and refinishing coatings.

EPA is publishing this rule without prior proposal because the Agency views this as a noncontroversial amendment and anticipates no adverse comment since the revisions are administrative changes to the state regulations. However, in the “Proposed Rules” section of today's Federal Register , EPA is publishing a separate document that will serve as the proposal to approve the SIP revision if adverse comments are filed. This rule will be effective on October 13, 2000 without further notice unless EPA receives adverse comment by September 13, 2000. If EPA receives adverse comment, EPA will publish a timely withdrawal in the Federal Register informing the public that the rule will not take effect. EPA will address all public comments in a subsequent final rule based on the proposed rule. EPA will not institute a second comment period on this action. Any parties interested in commenting must do so at this time.

EPA is approving, as revisions to the Pennsylvania SIP, the amendments to Chapter 121 General Provisions, section 121.1. Definitions, and the addition of Chapter 129 Standards For Sources, section 129.75 Mobile Equipment Repair and Refinishing, pertaining to volatile organic compound (VOC) control requirements for motor vehicle repair and refinishing facilities. These revisions were submitted by the Commonwealth of Pennsylvania on March 6, 2000.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. This action merely approves state law as meeting federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). Because this rule approves pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). For the same reason, this rule also does not significantly or uniquely affect the communities of tribal governments, as specified by Executive Order 13084 (63 FR 27655, May 10, 1998). This rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely approves a state rule implementing a federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This rule also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant.

In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the Clean Air Act. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings' issued under the executive order. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ).

The Congressional Review Act, 5 U.S.C. 801 et seq. , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . This rule is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action, approving revisions to Pennsylvania volatile organic compounds regulations pertaining to VOC control requirements for motor vehicle repair and refinishing facilities, must be filed in the United States Court of Appeals for the appropriate circuit by October 13, 2000. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This rule may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

The EPA Region IV announces its deletion of the Palmetto Recycling Site, Columbia, Richland County, South Carolina, from the NPL, Appendix B of the NCP, 40 CFR part 300. EPA identifies sites that appear to present a significant risk to public health, welfare, or the environment and maintains the NPL as the list of these sites. EPA and SCDHEC have determined that the remedial action for the Site has been successfully executed. EPA will accept comments on this notice thirty days after publication of this notice in the Federal Register .

Section II of this document explains the criteria for deleting sites from the NPL. Section III discusses the procedures that EPA is using for this action. Section IV discusses the history of the Palmetto Recycling Site and explains how the Site meets the deletion criteria. Section V states EPA's action to delete the Site from the NPL unless dissenting comments are received during the comment period.

Section 300.425(e) of the NCP provides that sites may be deleted from, or recategorized on the NPL where no further response is appropriate. In making a determination to delete a site from the NPL, EPA shall consider, in consultation with the state, whether any of the following criteria have been met:

(i) Responsible parties or other parties have implemented all appropriate response actions required; or

(ii) All appropriate response under CERCLA has been implemented, and no further action by responsible parties is appropriate; or

(iii) The remedial investigation has shown that the release poses no significant threat to public health or the environment and, therefore, taking of remedial measures is not appropriate.

Even if a site is deleted from the NPL, where hazardous substance, pollutants, or contaminants remain at the site above levels that allow for unlimited use and unrestricted exposure, EPA's policy is that a subsequent review of the site will be conducted at least every five years after the initiation of the remedial action at the site to ensure that the site remains protective of public health and the environment. In the case of this Site, no hazardous substances remain on-site above health-based levels that prevent unlimited use and unrestricted exposure. Therefore, a five-year review is not required. However, although contaminants are not impacting the groundwater at the Site, groundwater monitoring is required by the Record of Decision to confirm that the remedy remains effective at protecting human health and the environment. Therefore, EPA will conduct a five-year review for the Site to summarize the data obtained from groundwater monitoring. If new information becomes available that indicates a need for further action, EPA will initiate remedial actions. Whenever there is a significant release from a site deleted from the NPL, the site shall be restored to the NPL without the application of the Hazardous Ranking System.

The following procedures were used for the intended deletion of this Site: (1) All appropriate response under CERCLA has been implemented and no further action by EPA is appropriate; (2) SCDHEC concurred with the proposed deletion decision; (3) A notice has been published in the local newspaper and has been distributed to appropriate federal, state, and local officials and other interested parties announcing the commencement of a 30-day dissenting public comment period on EPA's Direct Final Action to Delete; and, (4) All relevant documents have been made available for public review at the local Site information repositories. EPA is requesting only dissenting comments on the Direct Final Action to Delete.

For deletion of the Site, EPA's Regional Office will accept and evaluate public comments on EPA's Final Notice before making a final decision to delete. If necessary, the Agency will prepare a Responsiveness Summary, responding to each significant comment submitted during the public comment period. Deletion of the Site from the NPL does not itself create, alter, or revoke any individual's rights or obligations and does not preclude eligibility for future response actions. The NPL is designed primarily for informational purposes and to assist Agency management. As mentioned in section II of this document, § 300.425(e)(3) of the NCP states that the deletion of a site from the NPL does not preclude eligibility for future response actions.

The following summary provides the Agency's rationale for the proposal to delete this Site from the NPL.

The Palmetto Recycling Site is located off Koon Store Road about 8 miles north of Columbia, Richland County, South Carolina. The Site occupies approximately one and one half acres and is bounded on the north by an unnamed tributary of Dry Fork Creek and on the east by Babe Reeves Road. To the west and south of the site are residential areas interspersed with light commercial operations.

Palmetto Recycling, Inc. purchased the property in 1979 to operate a battery recycling company. It is unknown what activities occurred at the Site prior to 1979. From 1979 to 1983, the facility was involved in the reclamation of lead from batteries. Specific neutralization process details are unknown, but at some point, Palmetto Recycling started discharging wastewater to the local sewer system. After discharging wastewater for an unknown period of time, Palmetto Recycling attempted to obtain a discharge permit. In 1981, SCDHEC denied applications by Palmetto Recycling, Inc. to operate a hazardous waste facility and to transport hazardous wastes. After permit applications were denied, some waste liquids were sent off-site to an acid recycler and some were disposed of on-site.

In the early 1980's, a study conducted by SCDHEC identified elevated concentrations of lead and iron in the groundwater samples collected next to the sump. High levels of lead, barium, and chromium were found in the sediment from the unnamed stream that runs north of the Site. The investigation also revealed the presence of elevated concentrations of lead in on-site soils. SCDHEC noted the presence of a five-foot deep, unlined acid pit containing 1,800 gallons of acid waste at the Site, as well as 100 drums of caustic waste and an unstabilized pile of battery casings.

On February 11, 1983, Palmetto Recycling filed for bankruptcy and a trustee was appointed to provide oversight of cleanup activities. In 1984, Palmetto Recycling employees removing equipment from the Site destroyed a section of the roof covering the on-site collection sump that collected wastewater containing lead oxide and sulfuric acid from the wash process. As a result of this incident, sump water percolated through soils adjacent to the pit area. Three removal actions were taken at the Site to address immediate health and environmental risks. On April 25, 1984, 10,800 gallons of contaminated water were collected and taken to a qualifying facility. In April 1984, SCDHEC informed the bankruptcy trustee that additional measures would be necessary to bring the Site under control. Later in 1984, contractors removed and disposed off-site approximately 100 drums containing liquid caustic waste. On October 2, 1985, SCDHEC authorized another contractor to remove site soils contaminated with lead and chromium. A total of 365 tons of soils were removed from various areas on-site and from locations outside the fenced area and placed in off-site landfills during 1985 and 1986. On October 4, 1989, the Site was placed on the National Priorities List (NPL).

In 1992, EPA negotiated with parties it had identified as Potentially Responsible Parties (PRPs) for the Site to conduct the Remedial Investigation/Feasibility Study (RI/FS). An agreement was not reached between EPA and the parties. Therefore, EPA conducted RI Field activities at the Site from April 1993 through July 1994. The FS was completed in November 1994.

Based on the results of the RI/FS reports and the risk assessment, surface soil was the only medium of concern and lead was the only contaminant of concern. Lead levels in soil ranged from 6.3 parts per million (ppm) to 6,400 ppm. The cleanup level for lead contaminated soils of 400 ppm was established to minimize site risks and ensure future protection of groundwater. In March 1995, EPA issued a Record of Decision (ROD) for the Site which selected excavation and off-site disposal of all soil contaminated with lead above the concentration level of 400 ppm. In addition, the ROD required the collection of additional confirmation samples from adjacent residential yards and from Babe Reaves Road to confirm the absence or presence of soil contamination through off-site migration. Groundwater was no longer impacted. However, groundwater monitoring will continue on an annual basis to confirm that the remedy continues to be effective at protecting human health and the environment. The selected remedy eliminated the principal threat posed by conditions at the Site by reducing the potential for human exposure to high concentrations of lead (i.e., greater than the clean-up level of 400 ppm).

In May 1997, a Consent Decree was signed between the United States and one PRP. A Remedial Design for the specific remedial actions was approved by EPA and the South Carolina Department of Health and Environmental Control in April 1998. From November 1998 through January 1999, several components of the Remedial Action were implemented that included verification sampling and analysis, monitoring well abandonment, a structural inspection, an asbestos survey analysis, approval of backfill material and permitting activities. The verification sample test results, together with previous RI and Remedial Design (on-site and residential) test results, were used to further refine excavation boundaries and confirm that residential properties were not contaminated. Sample results showed that lead levels in the adjacent residential yard were below 400 ppm. Revised (reduced) excavation boundaries based on this data were approved by EPA and SCDHEC on December 24, 1998. Between January 11, 1999 and February 3, 1999, a total of 363 drums of Investigation Derived Waste (IDW) type waste were appropriately segregated, characterized and removed off-site to a RCRA qualifying facility. In addition, approximately 6,500 gallons of liquid IDW were removed off-site to a qualifying publicly owned treatment works.

Soil excavation activities began on January 12, 1999. Approximately 947 cubic yards of soil were excavated down to one-foot and removed from the Site. After excavation was completed in each area, a post-excavation survey was performed to verify removal of the top one-foot of soil. Excavated soil and sediment were transported to and treated/disposed at a qualifying Resource Conservation and Recovery Act (RCRA) facility. Backfilling the Site with clean backfilled material provided further assurance that the Site no longer poses any threats to human health or the environment. Construction activities were concluded on February 3, 1999.

Although contaminants are not impacting the groundwater at the Site, groundwater monitoring is required by the Record of Decision to confirm that the remedy remains effective at protecting human health and the environment.

The cleanup levels established in the Record of Decision for soil have been met. In addition, current groundwater monitoring indicates that the groundwater concentrations for lead are below the health-based level of 15 parts per billion (ppb). The concentration levels detected during groundwater monitoring range from non-detect to 3.2 ppb. Thus, no hazardous substances remain on-site above health-based levels that prevent unlimited use and unrestricted exposure. Therefore, a five-year review is not required. However, as required by the ROD and at the request of SCDHEC, EPA will conduct a five-year review to assess the continued effectiveness of the remedial action and to summarize the data obtained from groundwater monitoring.

The remedy selected for this Site has been implemented in accordance with the Record of Decision. Therefore, no further response action is necessary. The remedy has resulted in the significant reduction of the long-term potential for release of contaminants, therefore, human health and potential environmental impacts have been minimized. EPA and SCDHEC find that the remedy implemented continues to provide adequate protection of human health and the environment.

SCDHEC concurs with EPA that criteria for deletion of the Site have been met. Therefore, EPA is deleting the Site from the NPL.

This action will be effective October 13, 2000. However, if EPA receives dissenting comments by September 13, 2000, EPA will publish a document that withdraws this action.

Pursuant to 49 U.S.C. 33112, Insurer reports and information, NHTSA requires certain passenger motor vehicle insurers to file an annual report with the agency. Each insurer's report includes information about thefts and recoveries of motor vehicles, the rating rules used by the insurer to establish premiums for comprehensive coverage, the actions taken by the insurer to reduce such premiums, and the actions taken by the insurer to reduce or deter theft. Under the agency's implementing regulation, 49 CFR part 544, the following insurers are subject to the reporting requirements: (1) Those issuers of motor vehicle insurance policies whose total premiums account for 1 percent or more of the total premiums of motor vehicle insurance issued within the United States; (2) those issuers of motor vehicle insurance policies whose premiums account for 10 percent or more of total premiums written within any one State; and (3) rental and leasing companies with a fleet of 20 or more vehicles not covered by theft insurance policies issued by insurers of motor vehicles, other than any governmental entity. Pursuant to its statutory exemption authority, the agency has exempted smaller passenger motor vehicle insurers from the reporting requirements.

Section 33112(f)(2) provides that the agency shall exempt small insurers of passenger motor vehicles if NHTSA finds that such exemptions will not significantly affect the validity or usefulness of the information in the reports, either nationally or on a state-by-state basis. The agency may not, however, exempt an insurer under this section if it is considered an insurer only because of section 33112(b)(1); that is, if it is a self-insurer. The term “small insurer” is defined, in section 33112(f)(1)(A) and (B), as an insurer whose premiums for motor vehicle insurance issued directly or through an affiliate, including pooling arrangements established under State law or regulation for the issuance of motor vehicle insurance, account for less than 1 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the United States. However, that section also stipulates that if an insurance company satisfies this definition of a “small insurer,” but accounts for 10 percent or more of the total premiums for all motor vehicle insurance issued in a particular State, the insurer must report about its operations in that State.

As provided in 49 CFR part 544, NHTSA exercises its exemption authority by listing in Appendix A each insurer which must report because it had at least 1 percent of the motor vehicle insurance premiums nationally. Listing the insurers subject to reporting instead of each insurer exempted from reporting because it had less than 1 percent of the premiums nationally is administratively simpler since the former group is much smaller than the latter. In Appendix B, NHTSA lists those insurers that are required to report for particular States because each insurer had a 10 percent or a greater market share of motor vehicle premiums in those States. In establishing part 544 (52 FR 59, January 2, 1987), the agency stated that Appendices A and B will be updated annually. It has been NHTSA's practice to update the appendices based on data voluntarily provided by insurance companies to A.M. Best, and made available for the agency each spring. The agency uses the data to determine the insurers' market shares nationally and in each state.

In addition, upon making certain determinations, NHTSA is authorized to grant exemptions to self-insurers, defined in 49 U.S.C. 33112(b)(1) as any person who has a fleet of 20 or more motor vehicles (other than any governmental entity) which are used primarily for rental or lease and which are not covered by theft insurance policies issued by insurers of passenger motor vehicles. Under 49 U.S.C. 33112(e)(1) and (2), NHTSA may exempt a self-insurer from reporting, if the agency determines:

(1) The cost of preparing and furnishing such reports is excessive in relation to the size of the business of the insurer; and

(2) The insurer's report will not significantly contribute to carrying out the purposes of chapter 331.

In a final rule published June 22, 1990 (55 FR 25606), the agency granted a class exemption to all companies that rent or lease fewer than 50,000 vehicles because it believed that reports from only the largest companies would sufficiently represent the theft experience of rental and leasing companies. NHTSA concluded those reports by the many smaller rental and leasing companies do not significantly contribute to carrying out NHTSA's statutory obligations and that exempting such companies will relieve an unnecessary burden on most companies that potentially must report. As a result of the June 1990 final rule, the agency added a new Appendix C that consists of an annually updated list of the self-insurers that are subject to part 544.

Following the same approach, as in the case of Appendix A, NHTSA has included, in Appendix C, each of the relatively few self-insurers subjected to reporting instead of relatively numerous self-insurers exempted. NHTSA updated Appendix C based primarily on information from the publications, Automotive Fleet Magazine and Business Travel News.

On April 7, 2000, NHTSA published a notice of proposed rulemaking (NPRM) to update the list of insurers in Appendices A, B, and C required to file reports (65 FR 18267). Appendix A of the NPRM listed those insurers which must report because each had at least 1 percent of the motor vehicle insurance premiums on a national basis. The list was last amended in a notice published on October 25, 1999 (See 64 FR 57393). Based on the 1997 calendar year data from A.M. Best, NHTSA proposed to reissue Appendix A without change.

Under part 544, each of the 18 insurers listed in Appendix A of the NPRM would have been required to file a report not later than October 25, 2000, setting forth the information required by part 544 for each State in which it did business in the 1997 calendar year. As long as those 18 insurers remain listed, they would be required to submit reports by each subsequent October 25 for the calendar year ending slightly less than 3 years before.

Appendix B of the NPRM listed those insurers that would be required to report for particular States for calendar year 1997, because each insurer had a 10 percent or a greater market share of motor vehicle premiums in those States. Based on the 1997 calendar year A.M. Best's data for market shares, NHTSA proposed to reissue Appendix B without change.

Under part 544, each of the 11 insurers listed in Appendix B of the NPRM would have been required to report no later than October 25, 2000 on their calendar year 1997 activities in every state in which they had a 10 percent or greater market share, and set forth the information required by Part 544. As long as those 11 insurers remain listed, they would be required to submit reports on or before each subsequent October 25 for the calendar year ending slightly less than 3 years before.

Based on information in Automotive Fleet Magazine and Business Travel News for 1997, the most recent year for which data are available, NHTSA proposed one change in Appendix C. As indicated above, that appendix lists rental and leasing companies required to file reports. Based on the data reported in the above mentioned publications, NHTSA proposed to remove the Penske Truck Leasing Company from Appendix C and add Ford Rent-A-Car System to Appendix C.

Under part 544, each of the 19 companies (including franchisees and licensees) listed in Appendix C would have been required to file reports for calendar year 1997 no later than October 25, 2000, and set forth the information required by part 544. As long as those 19 companies remain listed, they would be required to submit reports on or before each subsequent October 25 for the calendar year ending slightly less than 3 years before.

In response to the NPRM, the agency received no comments. Accordingly, this final rule adopts the proposed changes to Appendices A, B, and C.

This notice has not been reviewed under Executive Order 12866. NHTSA has considered the impact of this final rule and has determined the action not to be “significant” within the meaning of the Department of Transportation's regulatory policies and procedures. This rule implements the agency's policy of ensuring that all insurance companies that are statutorily eligible for exemption from the insurer reporting requirements are in fact exempted from those requirements. Only those companies that are not statutorily eligible for an exemption are required to file reports.

NHTSA does not believe that this rule, reflecting more current data, affects the impacts described in the final regulatory evaluation prepared for the final rule establishing part 544 (52 FR 59, January 2, 1987). Accordingly, a separate regulatory evaluation has not been prepared for this rulemaking action. Using the Bureau of Labor Statistics Consumer Price Index for 1999, the cost estimates in the 1987 final regulatory evaluation were adjusted for inflation. The agency estimates that the cost of compliance is $83,300 for any insurer added to Appendix A, $33,320 for any insurer added to Appendix B, and $9,613 for any insurer added to Appendix C. In this final rule, for Appendix A, the agency made no changes; for Appendix B, the agency made no changes; and for Appendix C, the agency would add one company and remove one company. The agency therefore estimates that the net effect of this final rule will be no cost to insurers, as a group.

The information collection requirements in this final rule have been submitted to and approved by the Office of Management and Budget (OMB) pursuant to the requirements of the Paperwork Reduction Act (44 U.S.C. 3501 et seq. ). This collection of information was assigned OMB Control Number 2127-0547 (“Insurer Reporting Requirements”) and was approved for use through August 31, 2003.

The agency has also considered the effects of this rulemaking under the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ). I certify that this final rule would not have a significant economic impact on a substantial number of small entities. The rationale for the certification is that none of the companies included in Appendices A, B, or C would be construed to be a small entity within the definition of the RFA. “Small insurer” is defined, in part under 49 U.S.C. 33112, as any insurer whose premiums for all forms of motor vehicle insurance account for less than 1 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the United States, or any insurer whose premiums within any State, account for less than 10 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the State. This notice would exempt all insurers meeting those criteria. Any insurer too large to meet those criteria is not a small entity. In addition, in this rulemaking, the agency proposes to exempt all “self insured rental and leasing companies” that have fleets of fewer than 50,000 vehicles. Any self insured rental and leasing company too large to meet that criterion is not a small entity.

This action has been analyzed according to the principles and criteria contained in Executive Order 12612, and it has been determined that the final rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment.

In accordance with the National Environmental Policy Act, NHTSA has considered the environmental impacts of this final rule and determined that it would not have a significant impact on the quality of the human environment.

This final rule does not have any retroactive effect, and it does not preempt any State law, 49 U.S.C. 33117 provides that judicial review of this rule may be obtained pursuant to 49 U.S.C. 32909, section 32909 does not require submission of a petition for reconsideration or other administrative proceedings before parties may file suit in court.

On April 14, 2000, we published a proposed rule in the Federal Register (65 FR 20125) proposing to add the State of Delaware to the list of States whose falconry laws meet or exceed Federal falconry standards. We also proposed to amend the list of States that participate in the cooperative Federal/State permit system by adding Delaware and Vermont.

Regulations in 50 CFR part 21 provide for review and approval of State falconry laws by the Fish and Wildlife Service. A list of States that allow the practice of falconry and whose falconry laws are approved by the Service is found in 50 CFR 21.29(k). As provided in 50 CFR 21.29 (a) and (c), the Director has reviewed certified copies of the falconry regulations adopted by the State of Delaware and has determined that they meet or exceed Federal falconry standards. Federal falconry standards contained in 50 CFR 21.29 (d) through (i) include permit requirements, classes of permits, examination procedures, facilities and equipment standards, raptor marking, and raptor taking restrictions. Delaware regulations also meet or exceed all restrictions or conditions found in 50 CFR 21.29(j), which includes requirements on the number, species, acquisition, and marking of raptors. Therefore, this rule adds the State of Delaware under § 21.29(k) as a State that meets Federal falconry standards. Inclusion of Delaware in this list eliminates the previous restriction that prohibited falconry within that State. The practice of falconry is now authorized in those States.

We are publishing the entire list of States that have met the Federal falconry standards, including the State of Delaware. We believe that publishing this list in its entirety will eliminate any confusion concerning which States have approval for falconry and further indicate which States participate in a cooperative Federal/State permit system program. We are adding asterisks to both Delaware and Vermont to identify them as participants in the cooperative permit program as explained below.

We are making this rule effective immediately. The Administrative Procedure Act (5 U.S.C. 553(d)(1)) allows us to do so because this final rule relieves a restriction that prohibited the State of Delaware from allowing the practice of falconry.

The need for these changes to 50 CFR 21.29(k) arose from the expressed desire of the State of Delaware to institute a falconry program for the benefit of citizens interested in the sport of falconry and to participate in a cooperative Federal/State permit system. Accordingly, the State has promulgated regulations that meet or exceed Federal requirements protecting migratory birds. These changes to 50 CFR 21.29(k) were necessary to allow, by inclusion of Delaware within the listing of authorized falconry States, persons in the State of Delaware to practice falconry. This rule also identifies the State of Vermont as a participant in a cooperative Federal/State permit system following that State's addition to the list of approved falconry States on September 7, 1999 (64 FR 48565).

We received two comments on the proposed rule. One comment was from a private individual and the other was from the Director, Division of Fish and Wildlife, Department of Natural Resources and Environmental Control, State of Delaware. Both supported the proposed action.

In compliance with the requirements of section 102(2)(C) of the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4332(2)(C)), and the Council on Environmental Quality's regulations for implementing NEPA (40 CFR parts 1500-1508), the Service prepared an Environmental Assessment (EA) in July 1988 to support establishment of simpler, less restrictive regulations governing the use of most raptors. This EA is available to the public at the location indicated under the ADDRESSES caption. Based on review and evaluation of the proposed rule to amend 50 CFR 21.29(k) by adding Delaware to the list of States whose falconry laws meet or exceed Federal falconry standards, and Delaware and Vermont as participants in the cooperative application program, we have determined that the issuance of this final rule is categorically excluded from NEPA documentation under the Department of the Interior's NEPA procedures in 516 DM 2, Appendix 1.10.

Section 7 of the Endangered Species Act (ESA) of 1972, as amended (16 U.S.C. 1531, et seq. ), provides that, “The Secretary [of the Interior] shall review other programs administered by him and utilize such programs in furtherance of the purposes of this Act” [and] shall “insure that any action authorized, funded, or carried out * * * is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of [critical] habitat * * *” Our review pursuant to section 7 concluded that this action is not likely to adversely affect listed species. A copy of this determination is available by contacting us at the address indicated under the ADDRESSES caption.

This rule was not subject to the Office of Management and Budget (OMB) review under Executive Order 12866. The Department of the Interior has determined that this rule would not have a significant effect on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). This is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act; it will not have an annual effect on the economy of $100 million or more, will not cause a major increase in costs or prices, and will not adversely affect competition, employment, investment, productivity, or innovation.

We estimate that 20 individuals would obtain falconry permits as a result of this rule, and many of the expenditures of those permittees would accrue to small businesses. The maximum number of birds allowed by a falconer is 3, so the maximum number of birds likely to be possessed is 60. Some birds would be taken from the wild, but captive-bred raptors could be purchased. Using one of the more expensive birds, the northern goshawk, as an estimate, the cost to procure a single bird is less than $5,000, which, with an upper limit of 60 birds, translates into $300,000. Expenditures for building facilities would be less than $32,000 for 60 birds, and for care and feeding less than $60,000. These expenditures, totaling less than $400,000, represent an upper limit of potential economic impact from the addition of Delaware to the list of approved States.

This rule has no potential takings implications for private property as defined in Executive Order 12630. The only effect of this rule on the constituent community is to allow falconers in the State of Delaware to apply for falconry permits. We estimate that no more than 20 people would apply for falconry permits in Delaware. This rule contains information collection requirements that are approved by OMB under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The information collection is covered by an existing OMB approval for licenses/permit applications, number 1018-0022. For further details concerning the information collection approval, see 50 CFR 21.4.

We have determined, and certify pursuant to the Unfunded Mandates Reform Act, 2 U.S.C. 1502 et seq. , that this rulemaking will not impose a cost of $100 million or more in any given year on local or State governments or private entities. The rule does not have significant Federalism effects pursuant to Executive Order 13132. We also have determined that these regulations meet the applicable standards provided in sections 3(a) and 3(b)(2) of Executive Order 12988 for civil justice reform, and that the rule does not unduly burden the judicial system.

Regarding Government-to-Government relationships with Tribes, this rulemaking will have no effect on federally recognized Tribes. There are no federally recognized Tribes in the State of Delaware. Furthermore, the revisions to the regulations are of a purely administrative nature affecting no Tribal trust resources.

Aboriginal subsistence whaling in the United States is governed by the Whaling Convention Act (16 U.S.C. 916 et seq .), which requires the Secretary of Commerce (Secretary) to publish, at least annually, aboriginal subsistence whaling quotas and any other limitations on aboriginal subsistence whaling deriving from regulations of the IWC.

At the 1997 Annual Meeting of the IWC, the Commission set quotas for aboriginal subsistence use of bowhead whales from the Bering-Chukchi-Beaufort Seas stock. The bowhead quota was based on a joint request by the United States and the Russian Federation, accompanied by documentation concerning the needs of 2 Native groups, Alaska Eskimos and Chukotka Natives in the Russian Far East.

This action by the IWC thus authorized aboriginal subsistence whaling by the AEWC for bowhead whales. This aboriginal subsistence harvest is conducted in accordance with a cooperative agreement between NOAA and the AEWC.

The IWC set a 5-year block quota of 280 bowhead whales landed. For each of the years 1998 through 2002, the number of bowhead whales struck may not exceed 67, except that any unused portion of a strike quota from any year, including 15 unused strikes from the 1995-1997 quota, may be carried forward. No more than 15 strikes may be added to the strike quota for any 1 year. The 1999 strike quota was 82. At the end of the 1999 harvest, there were 15 unused strikes available for carry-forward, so the combined strike quota for 2000 is also 82 (67 + 15).

The United States and the Russian Federation have concluded an arrangement to ensure that the total quota of bowhead whales landed and struck in 2000 will not exceed the quotas set by the IWC. Under that arrangement, the Russian natives may use no more than 7 strikes, and the Alaska Eskimos may use no more than 75 strikes.

NOAA is assigning 75 strikes to the Alaska Eskimos. The AEWC will allocate these strikes among the 10 villages whose cultural and subsistence needs have been documented in past requests for bowhead quotas from the IWC, and will ensure that its hunters use no more than 75 strikes.

The IWC regulations, as well as the NOAA rule at 50 CFR 230.4(c), forbid the taking of calves or any whale accompanied by a calf.

NOAA rules (at 50 CFR 230.4) contain a number of other prohibitions relating to aboriginal subsistence whaling, some of which are summarized here. Only licensed whaling captains or crew under the control of those captains may engage in whaling. They must follow the provisions of the relevant cooperative agreement between NOAA and a Native American whaling organization. The aboriginal hunters must have adequate crew, supplies, and equipment. They may not receive money for participating in the hunt. No person may sell or offer for sale whale products from whales taken in the hunt, except for authentic articles of Native handicrafts. Captains may not continue to whale after the relevant quota is taken, after the season has been closed, or if their licenses have been suspended. They may not engage in whaling in a wasteful manner.