This action is directed to the public in general, and to current and former Federal employees and applicants for Federal employment in particular, who may want to contact OSC by mail, including to: (a) Allege a prohibited personnel practice or other violation of civil service law, rule, or regulation by a Federal agency; (b) submit a whistleblower disclosure; or (c) request an advisory opinion on political activity under the Hatch Act.

OSC recently moved the agency mailroom to Suite 201 at its headquarters office. OSC also recently revised its regulations at 5 CFR part 1800 for other purposes. See 65 FR 64881 (Oct. 31, 2000). As part of that regulatory revision, OSC updated the official mailing address shown in certain sections of part 1800 (dealing with the filing of complaints and whistleblower disclosures) to change the suite number shown, from Suite 300 to Suite 201. OSC is now publishing technical amendments to other sections of agency regulations at 5 CFR Chapter VIII, updating the official mailing address shown in those sections. (Suite 300, formerly used in the mailing address, will continue to appear in OSC's official agency address, and to serve as the reception point for agency visitors.)

This action is taken under the Special Counsel's authority, at 5 U.S.C. 1212(e), to publish regulations in the Federal Register . Under the Administrative Procedure Act, at 5 U.S.C. 553(b)(3)(B), statutory procedures for agency rulemaking do not apply “when the agency for good cause finds (and incorporates the finding and a brief statement of reasons therefor in the rules issued) that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.” OSC finds that such notice and public procedure are impracticable, unnecessary, or contrary to the public interest, on the grounds that: (1) These amendments are technical and non-substantive; and (2) the public benefits from early correction of an incorrect address, and further delay is unnecessary and contrary to the public interest.

OSC will submit this final rule to Congress and the General Accounting Office pursuant to the Congressional Review Act. The rule is effective upon publication, as permitted by 5 U.S.C. 808. Pursuant to 5 U.S.C. 808(2), OSC finds that good cause exists for this effective date, based on the reasons cited in the preceding paragraph for the § 553(b)(3)(B) determination.

The Farm Service Agency published a document amending part 1951 in the Federal Register on August 18, 2000, (65 FR 50401). This document corrects the Federal Register as it appeared. In rule FR Doc. 00-20679, the Agency is correcting § 1951.914(c)(1)(A) to clarify that the increase in square footage that is being considered is “living area” square footage.

On July 27, 2000, the Office of Federal Housing Enterprise Oversight (OFHEO) published a notice of its intention to undertake a regulatory project to ensure the adoption and implementation of various written policies and procedures for the supervision of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation. See 65 FR 46119 (July 27, 2000). This final regulation makes technical and organizational changes to the numbering of existing regulations so they will fit logically within a new framework of the regulatory project that will incorporate additional rulemaking. Section 553(b)(3)(A) of Title 5, United States Code, provides that when regulations involve matters of agency organization, procedure or practice, the agency may publish regulations in final form and that a delayed effective date is unnecessary. 5 U.S.C. 553(d).

The final regulation adds three new subchapter headings, amends one subchapter heading, redesignates existing parts and conforms internal cross-references therein. The following derivation table shows the origin of the material that is contained in each of the newly designated subchapters and parts.

With the renumbering of OFHEO's regulations, the section reference and internal cross-references to old part and section numbers must also be changed. As such, each new part addresses amendatory cross-references in a table reflecting the new sections, the cross-sections to be deleted, and the new cross-sections to be added.

This is a technical rule that reorganizes OFHEO's regulations without substantive change to the rule and will not impose any substantive regulatory requirements. It is not a significant regulatory action under Executive Order 12866, 58 FR 51735 (Oct. 4, 1993), or a “rule” under the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. , or the Small Business Regulatory Enforcement Act, 5 U.S.C. 804(3)(C). Consequently, no regulatory impact assessment is required, no regulatory flexibility analysis is required, and no report to Congress or GAO is required.

OFHEO has determined that there is good cause for issuing this rule without notice and public comment. Section 553(b)(3) of Title 5, United States Code, provides that when regulations involve matters of agency organization, procedure or practice, the agency may publish regulations in final form. Additionally, OFHEO finds that there is good cause for having this rule take effective immediately pursuant to 5 U.S.C. 553(d).

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Boeing Model 747-400 series airplanes was published in the Federal Register on June 28, 2000 (65 FR 39828). That action proposed to require repetitive inspections to detect fatigue cracking of the longeron splice fittings at stringer 11 on the left and right sides at body station 2598, and various follow-on actions.

Interested persons have been afforded an opportunity to participate in the making of this amendment. Due consideration has been given to the comments received.

One commenter supports the proposed rule.

One commenter requests that the FAA revise the proposed rule to reference a new service bulletin, Boeing Alert Service Bulletin 747-53A2419, Revision 1, dated September 21, 2000. (The proposed rule referenced Boeing Alert Service Bulletin 747-53A2419, dated December 17, 1998, as the appropriate source of service information for certain proposed actions.) The commenter provides no justification for its request.

The FAA concurs with the commenter's request. Since the issuance of the proposed rule, the FAA has reviewed and approved Revision 1 of the service bulletin, including Appendix A. Revision 1 clarifies certain instructions and revises the effectivity listing to show changes in airplane operators. (No additional airplanes are added to the effectivity listing of Revision 1.) Therefore, the FAA has revised the applicability statement and paragraphs (a), (b)(1), (b)(2), and (c) of this final rule to reference Revision 1 of the service bulletin as the appropriate source of service information for the actions required by those paragraphs. The FAA also has added a new Note 2 to this AD (and reordered subsequent notes accordingly) to state that accomplishment of the actions required by this AD in accordance with the original issue of the service bulletin is acceptable for compliance with this AD.

One commenter requests that the FAA revise the proposed AD to reflect the service bulletin instructions for removal and replacement of the longeron splice fittings. The commenter notes that the service bulletin allows for removal and replacement of only those splice fittings that are cracked, provided that repetitive inspections of the remaining, uncracked, fittings continue. The proposed AD would require removal and replacement of all four fittings on the affected side if a single fitting is found to be cracked.

The FAA does not concur with the commenter's request. As explained in the “Differences Between Proposed Rule and Alert Service Bulletin” section of the proposal, the FAA finds it appropriate to mandate replacement of all longeron splice fittings on the affected side of the airplane if one fitting is found to be cracked. As pointed out in that same section of the proposal, the service bulletin recommends replacement of all four fittings on one side of the airplane at the same time (see Flag Note 1 of Figure 1 of the service bulletin). No change to the final rule is necessary in this regard.

After careful review of the available data, including the comments noted above, the FAA has determined that air safety and the public interest require the adoption of the rule with the changes previously described. The FAA has determined that these changes will neither increase the economic burden on any operator nor increase the scope of the AD.

There are approximately 490 Model 747-400 series airplanes of the affected design in the worldwide fleet. The FAA estimates that 59 airplanes of U.S. registry will be affected by this AD.

It will take approximately 2 work hours (1 hour per each side) per airplane to accomplish the required inspection, at an average labor rate of $60 per work hour. Based on these figures, the cost impact of this inspection on U.S. operators is estimated to be $7,080, or $120 per airplane, per inspection cycle.

It will take approximately 12 work hours (6 hours per each side) per airplane to accomplish the required rework or replacement, at an average labor rate of $60 per work hour. Required parts will cost between $731 and $7,906 per airplane. Based on these figures, the cost impact of this rework or replacement on U.S. operators is estimated to be between $1,451 and $8,626 per airplane.

The cost impact figures discussed above are based on assumptions that no operator has yet accomplished any of the requirements of this AD action, and that no operator would accomplish those actions in the future if this AD were not adopted. The cost impact figures discussed in AD rulemaking actions represent only the time necessary to perform the specific actions actually required by the AD. These figures typically do not include incidental costs, such as the time required to gain access and close up, planning time, or time necessitated by other administrative actions.

The regulations adopted herein will not have a substantial direct effect 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. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

For the reasons discussed above, I certify that this action (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) will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A final evaluation has been prepared for this action and it is contained in the Rules Docket. A copy of it may be obtained from the Rules Docket at the location provided under the caption ADDRESSES.

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Boeing Model 747 series airplanes was published in the Federal Register on July 31, 2000 (65 FR 46672). That action proposed to require inspections to detect cracking of the front spar web of the wing, and corrective action, if necessary.

Interested persons have been afforded an opportunity to participate in the making of this amendment. Due consideration has been given to the comments received.

One commenter states that the airplane manufacturer informed it that inspections by Boeing Alert Service Bulletin 747-57A2311, dated January 27, 2000, are not necessary at this time for airplanes modified by Boeing Service Bulletin 747-57A2303. (In a separate comment, addressed below, the airplane manufacturer notes that the original issue of Boeing Alert Service Bulletin 747-57A2311 will be revised to, among other things, extend the compliance threshold for inspection of certain airplanes modified by Boeing Service Bulletin 747-57A2303.)

The commenter makes no specific request for a change to the proposed rule. The FAA infers that the commenter is requesting that the FAA revise the proposed rule to extend the compliance time for the inspections required by paragraph (a) of this AD for airplanes that have been modified by Boeing Service Bulletin 747-57A2303, Revision 1, dated September 25, 1997. The FAA concurs with this request. The modification to which the commenter refers involves replacement of the front spar web of the wing with a new shot-peened front spar web, and it is provided as an optional terminating action in paragraph (c) of AD 99-10-09, amendment 39-11162 (64 FR 25194, May 11, 1999). The FAA finds that, if this optional terminating action has been done, operators are not required to inspect the new section of the front spar web that overlaps with the inspection area specified in this AD (the area between FSSI 668 and FSSI 684) until 13,000 flight cycles or 30,000 flight hours after the accomplishment of the replacement. A new paragraph (b) has been added to this AD to specify this, and subsequent paragraphs have been reordered accordingly.

One commenter requests that the FAA revise the proposed rule to provide special inspection instructions for airplanes modified in accordance with Boeing Service Bulletin 747-57A2303. The commenter points out that if the modification in that service bulletin is installed, it is not possible to accomplish the “Part 2 optional web inspection” given as one option for compliance with paragraph (a) of the proposed AD, due to the proximity of a new web splice on the aft face of the front spar web. Thus, airplanes modified per Boeing Service Bulletin 747-57A2303 can only be inspected using the “Part 1 external web inspection” in paragraph (a) of this AD.

The FAA partially concurs with the commenter's request. The FAA does not find it necessary to revise this AD to include special instructions for airplanes modified with another AD. Operators should note that most AD actions address modifications affecting the subject area of the AD using the note that appears as Note 1 of this AD, which states, “For airplanes that have been modified, altered, or repaired so that the performance of the requirements of this AD is affected, the owner/operator must request approval for an alternative method of compliance in accordance with paragraph (d) of this AD.” However, to be clear, the FAA finds that it is appropriate in this case to clarify that operators of airplanes modified by Boeing Service Bulletin 747-57A2303, Revision 1, must apply for an alternative method of compliance, in accordance with paragraph (d) of this AD, if they choose to comply with this AD using the Part 2 optional web inspection. Note 3 has been added to this AD accordingly.

One commenter, the airplane manufacturer, requests that the FAA delay issuance of the proposed AD until a new revision of Boeing Alert Service Bulletin 747-57A2311 is issued. The commenter describes several changes that will be made to this service bulletin, which is referenced as the appropriate source of service information in the proposed rule. These changes include:

• For certain airplanes modified by Boeing Service Bulletin 747-57A2303, the compliance threshold for inspecting certain areas will be extended. (See “Request to Provide for Airplanes With Replaced Front Spar Web,” above.)

• The type of inspection will be revised for certain airplanes on which web splice plates have been installed by Boeing Service Bulletin 747-57A2303. (See “Request to Specify Method of Compliance for Modified Airplanes,” above.)

• The inspection area will be expanded.

• Instructions for terminating action and post-modification inspections will be included.

The FAA does not concur with the commenter's request to delay the issuance of this final rule. The FAA finds that, in view of the criticality of the unsafe condition addressed in this AD, it would be inappropriate to delay issuance of this AD pending receipt of a new service bulletin. Once the new service bulletin has been approved, the FAA may consider further rulemaking to mandate the actions in that bulletin. However, note that, based on the requests of another commenter, changes have been made to this AD related to the first two items listed by the commenter. See “Request to Provide for Airplanes With Replaced Front Spar Web” and “Request to Specify Method of Compliance for Modified Airplanes,” above, for more information on these changes.

After careful review of the available data, including the comments noted above, the FAA has determined that air safety and the public interest require the adoption of the rule with the changes previously described. The FAA has determined that these changes will neither increase the economic burden on any operator nor increase the scope of the AD.

There are approximately 478 Model 747 series airplanes of the affected design in the worldwide fleet. The FAA estimates that 97 airplanes of U.S. registry will be affected by this AD.

The external inspections that are one option for compliance with this AD will take approximately 48 work hours per airplane (not including access and close-up), at an average labor rate of $60 per work hour. Based on these figures, the cost impact of the external inspections on U.S. operators is estimated to be $2,880 per airplane, per inspection cycle.

In lieu of accomplishment of the external inspections, this AD provides an optional web inspection that takes approximately 50 work hours per airplane, at an average labor rate of $60 per work hour. Based on these figures, the cost impact of the optional web inspection on U.S. operators is estimated to be $3,000 per airplane, per inspection cycle.

The cost impact figures discussed above are based on assumptions that no operator has yet accomplished any of the requirements of this AD action, and that no operator would accomplish those actions in the future if this AD were not adopted. The cost impact figures discussed in AD rulemaking actions represent only the time necessary to perform the specific actions actually required by the AD. These figures typically do not include incidental costs, such as the time required to gain access and close up, planning time, or time necessitated by other administrative actions.

The regulations adopted herein will not have a substantial direct effect 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. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

For the reasons discussed above, I certify that this action (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) will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A final evaluation has been prepared for this action and it is contained in the Rules Docket. A copy of it may be obtained from the Rules Docket at the location provided under the caption ADDRESSES.

On November 7, 2000, the Commission proposed to amend its Rule 4.22 to permit CPOs to file a claim for an extension of time to file a pool's annual report where the pool is invested in other collective investment vehicles, and the CPO cannot obtain the information its accountant requires about the collective investment vehicles in time for the pool's Annual Report to be prepared, audited, and distributed by the due date. 1

The 30-day comment period expired on December 7, 2000. The Commission received four comment letters, which generally supported the proposed rulemaking.

Two commenters expressed the concern that a CPO that has filed a notice claiming an extension of time to file should not be unnecessarily burdened by having to make the same claim in future years. One of these commenters suggested that, in the alternative, the Commission use language contained in prior staff no-action letters, which indicated that the Commission staff should be notified if there is a change in circumstances relating to the relief criteria. The Commission considered this approach in the proposed rule, recognizing the need to balance the burden of notification with the need to ensure that the entity still qualified for the relief. The rule does not require that the same claim be made in future years. Rather, the rule requires that the CPO simply confirm that the circumstances necessitating the relief continue to apply by restating the representations required by Rule 4.22(f)(2)(iv). Permitting the CPO to file the statement at the same time as the annual report minimizes the burden.

Two of the commenters requested that the Commission provide clarification of the procedure by which a CPO needing more than 150 days to complete an annual report could request an extension of time. A third commenter requested that the Commission consider increasing the permitted extension to 120 days, or 210 days following the fiscal year end.

Commission staff have reviewed past extension requests and found that a substantial majority of the requesters have indicated that they can complete their Annual Reports within 150 days of the end of the commodity pool's fiscal year. The new extension provisions in Rule 4.22(f)(2) are intended to provide a standardized and simplified extension procedure for this group of CPOs. Only a small number of past requests have exceeded the 150-day period. Therefore, in the unusual event that a CPO is not able to meet the requirements for this streamlined procedure, the CPO may request an extension of time pursuant to Rule 4.22(f)(1). In contrast to the procedures of Rule 4.22(f)(2), under which relief may be obtained automatically upon the filing of the required notice and representations, a request under Rule 4.22(f)(1) is not granted automatically, and must include detailed supporting documentation to justify the need for the extension. Additionally, Section 140.99 of the Commission's regulations provides a mechanism for obtaining relief in those cases that do not fall within the bounds set by Rule 4.22(f)(1) or (f)(2).

Finally, one commenter suggested that the Commission clarify that a CPO's claim for an extension of time is effective upon receipt of the claim by the CFTC. The word “claim” in the rule indicates that, if all the relevant criteria apply, the CPO needs only to file the specified notice to obtain the relief. Thus, a claim made pursuant to Rule 4.22(f)(2) is effective upon receipt.

The rule will be effective upon publication in the Federal Register . 2 It is the Commission's intention that CPOs may follow this revised rule in filing Annual Reports due to be filed in calendar year 2001 for fiscal years ending in 2000.

The Regulatory Flexibility Act (“RFA”), 5 U.S.C. 601-611 (1994), requires that agencies, in proposing rules, consider the impact of those rules on small businesses. The Commission has previously established certain definitions of “small entities” to be used by the Commission in evaluating the impact of its rules on such entities in accordance with the RFA. 3 The Commission previously has determined that registered CPOs are not small entities for the purpose of the RFA. 4 In this regard, the Commission notes that it did not receive any comments regarding the RFA implications of the amendment to Rule 4.22(f).

This rule (Section 4.22(f)) contains information collection requirements. As required by the Paperwork Reduction Act of 1995, 5 the Commission has submitted a copy of this rule to the Office of Management and Budget (OMB) for its review. 6 In response to the Commission's invitation in the proposed rulemaking to comment on any potential paperwork burden associated with this regulation, no comments were received.

The Federal Energy Regulatory Commission (Commission or FERC) is revising Parts 352, 357, and 385 of its regulations to revise its FERC Form No. 6: Annual Report of Oil Pipeline Companies (Form 6) schedules and instructions to better meet current and future regulatory requirements and industry needs; update Uniform Systems of Accounts (USofA) requirements to be more consistent with current Generally Accepted Accounting Principles (GAAP); and amend its regulations to provide for the electronic filing of Form 6 commencing with reporting year 2000, due on or before March 31, 2001. The Commission has tested the software and related elements of the electronic filing mechanism. This rule is part of the Commission's ongoing program to update and eliminate burdensome and unnecessary accounting and reporting requirements. These changes will reduce, by about 25 percent, the burden on regulated companies for maintaining and reporting information under the Commission's regulations.

In 1977, the responsibility to regulate oil pipeline companies was transferred to the Commission from the Interstate Commerce Commission (ICC). 1 In accordance with the transfer of authority, the Commission was delegated the responsibility under section 1 of the Interstate Commerce Act (49 U.S.C. 1) to regulate the rates and charges for transportation of oil by pipeline and establish valuation of those pipelines, and under section 20 of that Act to require pipelines to file annual reports of information necessary for the Commission to exercise its statutory responsibilities. 2

The ICC developed the Form P to collect information on an annual basis to enable it to carry out its regulation of oil pipeline companies under the Interstate Commerce Act. A comprehensive review of the reporting requirements for oil pipeline companies was performed on September 21, 1982, when the Commission issued Order No. 260  3 revising the former ICC Form P, “Annual Report of Carriers by Pipeline” and redesignating it as FERC Form No. 6, “Annual Report of Oil Pipeline Companies.” In 1994, the Commission addressed additional revisions to the Form 6 in Order Nos. 571 and 571-A, 4 including adding a new page 700. The information included in the Form 6 was determined at that time to be the minimum necessary for Shippers to assess filed rate changes under Order No. 561. 5

In Order No. 561, the Commission adopted an indexing methodology to regulate oil pipeline rate changes as well as certain alternative rate-changing methodologies where a Pipeline or a Shipper could justify a departure from the indexing methodology. The Commission found that this indexing methodology would simplify and thereby expedite the process of changing rates. Under the Commission's indexing methodology, oil pipeline Shippers play a more active role in monitoring the application of the Commission's rate indexing methodology. Unlike Shippers in the natural gas and electric industries regulated by the Commission, oil pipeline Shippers bear a greater burden in proving that proposed indexed rate changes are unjust and unreasonable. Moreover, when a Shipper attempts to justify a complaint against an existing or grandfathered rate, it must satisfy a substantial evidentiary burden before a hearing and formal discovery rights are granted. This burden requires an in-depth analysis of oil pipelines' cost and revenue data.

As a result of the shift in responsibilities and the specific information requirements outlined in Commission Rule 206  6 for a protest or complaint, the Commission makes the following changes to Form 6 information collection in this final rule.

On July 27, 2000, the Commission issued a notice of proposed rulemaking (NOPR) in Docket No. RM99-10-000. 7 The Commission received six comments on the NOPR representing oil pipeline companies and oil pipeline shippers. 8

The Commission is revising Part 357—Annual Special or Periodic Reports: Carriers Subject to Part I of the Interstate Commerce Act for pipeline carriers subject to the provisions of section 20 of the Interstate Commerce Act. For the most part, these revisions amend the annual filing requirements and raise the minimal filing threshold for the Form 6. The Commission is also revising the Form 6 instructions and schedules to clarify definitions and general instructions, eliminate duplicate reporting requirements, remove and consolidate schedules, update current schedules, and revise current schedules. Therefore, the final rule lowers the reporting burden on relatively small companies and clarifies the Form 6 reporting requirements which promotes consistent reporting practices among pipeline carriers. Since the Form 6 is intended to be both a financial and ratemaking document, 9 the final rule ensures that the Commission has the financial, operational, and ratemaking information needed to carry out its regulatory responsibilities to monitor the oil pipeline industry in a dynamically changing environment. Respondents to the NOPR commended the Commission's efforts in generally reducing the burden to the pipeline industry while providing a balanced approach to the need for information by oil pipeline shippers and providing for electronic submissions of the Form 6. However, several respondents had differing opinions on the necessity for additional information requirements on several of the Form 6 pages and several definitions and thresholds. Topics addressed in the NOPR that were agreed to or accepted by industry are not commented upon in this final rule. Specific topics requiring a Commission response to industry's comments are addressed below.

Sinclair Oil Corporation (Sinclair) argued that raising the reporting threshold for submission of a complete Form 6 from $350,000 to $1,000,000 would be excessive and contribute to distortions in the data. Sinclair believes that a reporting threshold of $1,000,000 is too high and eliminates too many companies. Sinclair recommends raising the reporting threshold to $500,000 in order to reduce the reporting burden for smaller companies and prevent inconsistencies in data reported.

Upon further review, the Commission believes that Sinclair's statement has merit and grants its request to raise the reporting threshold to $500,000 rather than the proposed $1,000,000. In this final rule, the Commission is requiring jurisdictional oil pipeline companies with annual jurisdictional operating revenues greater than $350,000 but less than $500,000 for each of the three previous calendar years to prepare and file pages 1—“Identification and Attestation,” 301—“Operating Revenue Accounts (Account 600),” and 700—“Annual Cost of Service Based Analysis Schedule” of the Form 6 on or before March 31 of each year. Also, the Commission requires those jurisdictional oil pipeline companies with annual jurisdictional operating revenues of $350,000 or less for each of the three previous calendar years are required to prepare and file with the Commission pages 1—“Identification and Attestation” and 700—“Annual Cost of Service Based Analysis Schedule” of FERC Form No. 6 on or before March 31 of each year for the previous calendar year.

Williams Pipeline Company (Williams) questioned the requirement to report in whole dollar amounts rather than rounding to the nearest thousand. Williams claims that “reporting dollars below the thousand dollar threshold provides no incremental benefit,” and that companies small enough to fall below the $500 threshold would also be below the Form 6 reporting threshold.

The Commission believes that rounding dollars to the nearest thousand may inaccurately reflect the operations of smaller companies. If oil pipeline companies are permitted to round to the nearest thousand the Commission will not know whether a number is not reported because the value is zero or the value is rounded down to zero. In addition, rounding to whole dollar amounts ensures consistency with other Commission filings, including FERC Forms 1 and 2. Therefore, Williams suggested revision to the whole dollar reporting requirement is denied.

The Association of Oil Pipe Lines (AOPL), Equilon Pipeline Company, LLC (Equilon), Marathon Ashland Pipe Line Company, LLC (Marathon), and Williams stated that the definition of an “undivided joint interest pipeline” as “a common carrier by pipeline controlled by more than one common carrier” was inconsistent with the meaning of the term in the industry and would apply to all joint interest pipelines, not just those that are “undivided” joint interest. AOPL stated that an undivided joint interest pipeline was not a legal entity. Rather it was a “legal fiction” created to cover situations where several common carrier pipelines had “a separate and distinct property interest, as opposed to shareholder interest, in a single physical pipeline.” Marathon proposed defining an “undivided joint interest pipeline” as “physical pipeline property owned in undivided joint interest by more than one person/entity.” The Commission agrees with Marathon and adopts the recommended definition. 11

Marathon does not support excluding undivided joint interest pipelines from schedules 212 and 213. Marathon argues that the schedules should reflect carriers' total company activity within the property accounts. The Commission believes that total company data can be obtained by adding the data on pages 212-213 to the data on pages 214-215. Shippers that want to contest a rate need the undivided joint interest pipeline information separated from the total carrier property information. The Commission maintains its position to require separate reporting of undivided joint interest pipeline information.

AOPL, Williams, and Equilon believe that accounting for carrier property by gathering, trunk and general facilities is “an undue burden and unwarranted.” AOPL disagrees with the Commission's stated purpose for requiring such a breakout. 12 AOPL states that few depreciation studies are requested and that the “benefit to be gained by breaking these costs out by gathering, trunk and general facilities * * * is small and * * * not enough to offset the burden.” AOPL argues that the requested breakout for depreciation purposes can be readily obtained after a depreciation study is requested. Additionally, AOPL states that shippers participating in the rulemaking stated that they did not need such information.

Marathon, on the other hand, had no objection to breaking out carrier property by gathering, trunk and general facilities, and Sinclair endorsed maintaining the distinctions between gathering, trunk and delivery lines. Sinclair stated that the information is invaluable to shippers in understanding and analyzing the financial data reported by pipeline companies.

The Commission believes that the carrier property information broken out by gathering, trunk and general facilities is vital in order to determine whether a full depreciation study should be requested, and to assist the shipper in meeting its burden to show that a rate should be set for full hearing and investigation. Therefore, the Commission maintains the requirement to provide carrier property information by gathering, trunk, and general facilities.

Undivided Joint Interest Property) (Pages 214-215).

Accrued Depreciation-Carrier Property (Page 216).

Accrued Depreciation—Undivided Joint Interest Property) (Page 217). AOPL, Williams, Equilon, Marathon believe that undivided joint interest property should only be reported separately if the depreciation rates differ from that of the carrier's other assets. AOPL states that if the undivided joint interest property is depreciated at the same rate as the carrier's other assets the carrier should only be required to make a statement to that effect. AOPL contends that the Commission's assertion that depreciation rates vary among the classes of property  13 is rarely true. In addition, Marathon believes that there should be a carrier property threshold of $10 million for any undivided joint interest property that must be reported separately.

The Commission believes that even if the depreciation rate is the same for both carrier property and undivided joint interest property, the breakout of undivided joint interest pipeline base information is needed in its own right. Carrier property and accrued depreciation data is used not only for depreciation studies, but is needed to calculate a rate base to determine items such as rate of return and income taxes in a cost of service analysis. The Commission believes that even if depreciation rates rarely vary among the different classes of property, that is hardly a reason not to require the numbers to be shown separately. As to Marathon's suggested threshold of $10 million in undivided joint interest property before reporting that information separately, the Commission believes that a $10 million threshold would render the data on undivided joint interest pipelines useless. The Commission, therefore, maintains the requirement to identify undivided joint interest property separately, and denies the request to require such identification only when the depreciation rate is different than the carrier property or more than $10 million.

Williams requests that the Commission abandon the requirement to report detailed cost information of noncarrier property and income from noncarrier property. Williams states that the Commission is concerned with activities related to the transportation of oil in interstate commerce and that nonjurisdictional activities of a pipeline are of no concern to the Commission or shippers. Williams also states that it is inappropriate to require companies to divulge nonjurisdictional information to competitors.

The Commission needs information related to noncarrier property for ratemaking proceedings, settlements, and discovery. Additionally, the Commission uses the information to ascertain whether joint costs have been allocated properly between carrier and noncarrier property. In order to reduce the burden to jurisdictional companies, the Commission has raised the reporting threshold from $250,000 to $1,000,000. Therefore, the Commission denies Williams' request to abandon the reporting requirement for noncarrier property.

AOPL, Williams, and Equilon disagree with the Commission's requirement to distinguish between crude oil and product movements, stating that this distinction is without relevance. AOPL argues that companies that operate both crude and product lines do not break their costs down between the two commodities. AOPL believes that the Commission's assertion that companies must maintain such an accounting distinction under Statements of Financial Accounting Standards (SFAS) No. 131—Disclosures about Segments of an Enterprise and Related Information is misguided. AOPL states that many of the carriers reporting to FERC are not publicly held and do not report to the Securities and Exchange Commission so they are not covered under SFAS 131. AOPL recommends that if the Commission continues to require cost allocation between crude and product systems, the burden should only be imposed on pipelines that carry more than 10 percent of the other commodity.

In addition, AOPL believes that pipelines should not be required to allocate revenues among gathering, trunk and delivery systems. AOPL states that when the Commission examines function for purposes of cross-subsidization it obtains the information it needs directly from the carrier, making mandatory Form 6 reporting an unwarranted burden.

Marathon, however, does not oppose the reporting of revenue data by crude oil and product movements or by gathering, trunk and delivery systems. Sinclair approves of reporting the distinctions between crude oil and product lines by gathering, trunk and delivery lines. Sinclair states that the separate reports are invaluable for analyzing financial data and vital to the analysis of the performance of the ceiling price index.

AOPL recommends the Commission reconsider its NOPR decision not to revise page 301 to include prior year information. 14 AOPL states that adding prior year information would bring page 301 into alignment with other Form 6 schedules and would facilitate review of revenue data.

The Commission finds that there are significant differences between crude and product lines in the way they operate, the markets they serve, and the costs they incur, necessitates the reporting of such revenues separately. Pipelines, also, recognize these differences in their oil pipeline tariffs which clearly distinguish between services and rates for crude or product transportation. The Commission believes that it is essential for a shipper who is trying to allocate costs and revenues to specific facilities, and match those facilities with a pipeline's different services (gathering, trunk or delivery, crude or product), to know what functions the facilities serve. The Commission believes that a proper allocation is important to the shipper regardless of the percentage of crude or product transported. Therefore, the Commission denies the request to eliminate the distinctions between crude oil or product lines and gathering, trunk or delivery lines. Additionally, the Commission denies the request to require only those companies that carry more than 10 percent of either crude oil or product to allocate their costs between the different product lines. However, the Commission agrees with AOPL that requiring carriers to report prior year revenues will facilitate review of revenue data while not adding an additional burden to the industry and has revised page 301 to include this requirement.

AOPL, Williams, and Equilon argue that separate crude and product service accounting should not be required of companies that carry less than 10 percent of either commodity. AOPL also objects to the requirement to allocate costs by gathering, trunk or delivery, stating that this information is not needed to functionalize costs or analyze rates.

As stated in our response to Operating Revenue Accounts above, the Commission believes that it is essential for a shipper who is trying to allocate costs and revenues to specific facilities, and match those facilities with a pipeline's different services (gathering, trunk or delivery, crude or product), to know what functions the facilities serve. The Commission believes that a proper allocation is important to the shipper regardless of the percentage of crude or product transported. Therefore, the Commission maintains the requirement to distinguish between crude oil or product lines and gathering, trunk or delivery lines, and denies the request to allow companies that carry less than 10 percent of either crude oil or product to be relieved of the separate reporting requirement.

Sinclair states that two new subcategories consisting of “direct” and “indirect” expenses be created within the operations and maintenance accounts. Sinclair argues that it needs this more precise information to determine if there is a need for a further evaluation of proposed tariff changes. The Commission sees no benefit and Sinclair has provided no compelling arguments for further burdening pipelines with the additional requirement of subdividing the operations and maintenance accounts into “direct” and “indirect” expenses. Pipelines are already required to aggregate significant indirect costs such as employee benefits and taxes in separate accounts in the general expense group of accounts. This information should be sufficient to determine if there is a need for a further evaluation of proposed tariff changes. Therefore, the Commission denies Sinclair's request.

AOPL, Williams, and Equilon state that the Commission should not change the reporting of volumes moved on undivided joint interest pipelines as the operator of an undivided joint interest pipeline is not privy to company tariffs and volumes shipped under those tariffs. AOPL states that if the Commission wants to be able to track the volumes shipped on an undivided joint interest pipeline, that information must be provided by each of the individual owners.

The Commission believes that the changes to the instructions for reporting volumes moved are appropriate but agrees with AOPL that they have not clearly indicated the Commission's intentions. Therefore, the instructions are revised to ensure that volumes moved on undivided joint interest pipelines operated by others are reported. The last sentence in Instruction No. 2 is revised to read “Any barrels received into a pipeline owned by the respondent, but operated by others, should be reported separately on additional pages (For example 600a-601a, 600b-601b, etc.),” and Instruction No. 3 has been reorganized and the final sentence revised to read “Any barrels delivered out of a pipeline owned by the respondent, but operated by others, should be reported separately on additional pages (For example 600a- 601a, 600b-601b, etc.).”

In order to be consistent in the reporting of mileage and volumes reported for undivided joint interest property operated by others, pages 602 and 603 have been revised to include a reporting category for undivided joint interest property owned by respondents, but operated by others.

AOPL, Williams, Equilon, and Marathon opposed requiring pipelines to file additional cost of service information as proposed in the NOPR, specifically lines 1 through 8 on Form 6, page 700. AOPL suggests shippers have several sources of information, such as a pipeline's tariff and the existing Form 6, that provides sufficient information. On the other hand, Sinclair and the Society for the Preservation of Oil Pipeline Shippers (SPOPS) supports the NOPR proposal to require a breakdown of the total cost of service, but urges the Commission to require additional cost of service reporting not only by the company as a whole, but also for each system. SPOPS also urges the Commission to require pipelines to report “Return on Equity,” which the Commission's NOPR does not propose to collect.

Sinclair urges the Commission to augment the current reporting requirements of page 700 by requiring pipelines to report total cost of service, operating revenues, throughput in barrels, and throughput in barrel miles on a system-by-system basis. In addition to requesting cost of service reporting by system, Sinclair asks the Commission to require those companies with multiple forms of rate regulation to report separate cost of service, revenue, expense and throughput data on the portion of operations still subject to the indexing methodology.

The Commission believes that the proposed page 700 breakdown is a reasonable compromise in this instance. Therefore, the Commission adopts revised page 700 data requirements identified on Line Nos. 1 through 8 in order to balance the competing needs of pipelines and shippers in the regulation of oil pipelines.

The stated purpose of page 700 is to provide a means whereby a shipper can determine whether a pipeline's cost of service or per-barrel/mile costs is so substantially divergent from the revenues produced by its cost of service rates to warrant a challenge that requires the pipeline to justify its rates. 15 In Order No. 571, the Commission rejected requests that the data reported on page 700 include separate cost of service information for each individual system, 16 and stated that page 700 was not intended to require a pipeline to demonstrate with precision its cost of service attributable to each individual system it operates. 17 Consistent with our decision in Order No. 571, the Commission denies suggestions by shippers that pipelines be required to file separate cost of service information for each individual system and additional information specifying debt and equity components.

Form 6, page 700, Instruction 2 requires that values for the components of the existing data requirements (Total Cost of Service on Line No. 9) be computed on a total company basis consistent with Commission Opinion No. 154-B et al. methodology. Instruction 3 requires the reporting of total company revenue (Total Interstate Operating Revenue) on Line No. 10.

AOPL states that current total cost of service under Opinion No 154-B does not equate to total company costs, asserting that cost of service consists of those costs related to the pipeline's jurisdictional services. AOPL argues that respondents' values on page 700 should only reflect jurisdictional cost of service and revenues. AOPL does not object to providing total revenue information, but states total revenue information is not identical to Opinion No. 154-B cost of service.

SPOPS asserts that the Commission can only address jurisdictional rates in its determinations and, therefore, it should be matching total company costs with total company revenues. SPOPS argues that the numbers on page 700 are understated since the current page 700 compares total cost of service and only pipeline revenues. SPOPS also argues that pipelines could manipulate the jurisdictional cost of service to fit revenues by including nonjurisdictional revenues. SPOPS recommends the Commission, as proposed in the NOPR, require pipelines to report total company revenues along with total company cost of service.

The Commission agrees that revenues reported on Line No. 10 of page 700 should reflect only jurisdictional revenues, not nonjurisdictional revenues. Therefore, Line 10 of page 700 is revised to require pipelines to report “Total Interstate Operating Revenues,” as reported on page 301, bringing it in sync with the reporting requirements specified in Instruction 2.

SPOPS states that the Commission cannot call upon shippers to prove a particular rate is not just and reasonable without the information necessary to ascertain the cost of service allocated to that rate. Form 6, page 700, Instruction 7 requires a pipeline to make its cost of service workpapers available for inspection when requested by the Commission or its staff. Commission Order No. 571 stated that the use of page 700 should be limited and should not be misleading. 18 The information on page 700 was intended to be a preliminary screening tool for pipeline rate filings. As such, page 700 provides a means whereby a shipper can determine whether a pipeline's cost of service is so substantially divergent from the revenues produced by its rates to warrant a challenge that requires the pipeline to justify its rates. The Commission clarifies the circumstances under which a pipeline is required to provide supporting workpapers for data reported on page 700. The workpapers must fully support all amounts reported on page 700 including but not limited to the total company Opinion 154-B calculations and all of its associated components, total company revenues, including allocations of costs and revenues between jurisdictional and nonjurisdictional facilities/services, and between interstate and intrastate services, and all assumptions made for the Opinion 154-B calculations and cross-references to underlying source documents. Additionally, the Commission revises Instruction 7 to state that “A respondent may be requested by the Commission or its staff to provide its workpapers which support the data reported on page 700.”

SPOPS urges the Commission to require the filing of total company cost of service as proposed in the NOPR, and to reconsider its stated position to play a less active role in monitoring and overseeing pipeline rates and practices. 19 The NOPR raised the Commission's recently adopted complaint procedures as well as recent interpretations of the “changed circumstances” requirements of the EPAct as reasons to expand page 700 reporting.

AOPL disagrees with shippers' need for adequate information in complaint proceedings and notes that since the new, more stringent complaint procedures became effective, eight complaints have been set for hearing. 20 Further, AOPL argues that nothing has changed since Order Nos. 561 and 571 were issued. Specifically, AOPL asserts the number of recent complaints suggests that shippers don't need better information; and that total volume, cost and revenue information currently available to shippers is sufficient to meet the Commission's “changed circumstances” tests.

As stated previously, page 700 was designed as a preliminary screening tool for pipeline rate filings. It provides a means for a shipper to determine whether a pipeline's cost of service or per-barrel/mile cost is so substantially divergent from the revenues produced by its rates to warrant a challenge that requires the pipeline to justify its rates. The Commission believes that the additional information provided on the new page 700 provides the information necessary to monitor the reasonableness of a pipeline's filed rates and will further enable a shipper to challenge a pipeline's rates.

a. Electronic Filing of Form 6 . In the NOPR, the Commission proposed requiring electronic filing of the Form 6 with conforming paper copies commencing with the report for calendar year 2000, due on or before March 31, 2001. No industry comments were received in opposition to this proposal. Therefore, the Commission implements the Form 6 electronic filing requirement with issuance of this final rule. Additionally, respondents should identify an electronic filing technical contact and inform the Secretary of the contact's name, telephone number and e-mail address by the effective date of this final rule. Any changes to this information should be submitted to the Secretary.

b. Form 6 Reporting Alternatives . Williams expressed its disappointment that the Commission ignored industry's initiative to shift to GAAP financial statements, and encouraged the Commission to continue exploring a shift to a reporting format that is consistent with other financial reviews. AOPL and Marathon support the Commission's efforts to align the Uniform System of Accounts (USofA) with GAAP requirements, but feel that uniformity of accounting systems among oil pipeline companies is more important to the industry than the filing format for the information.

As stated in the NOPR, this final rule updates the USofA regulations to reflect Statements of Financial Accounting Standards. 21 The Commission believes these changes simplify the Form 6, reduce the overall reporting burden on pipeline companies, and result in more consistent industry reporting while providing the Commission the information it needs to regulate the oil industry. The Commission will consider future changes to the Form 6 based on changes to the Statements of Financial Accounting Standards.

After issuance of the NOPR, it was noted that a change was proposed to the regulatory text under the Instructions for Carrier Property Accounts for Instruction 3-3. This was done inadvertently. No changes to this instruction are planned at this time.

Commission regulations require that an environmental assessment or an environmental impact statement be prepared for any Commission action that may have a significant adverse effect on the human environment. 22 No environmental consideration is necessary for the promulgation of a rule that is clarifying, corrective, or procedural or that does not substantially change the effect of legislation or regulations being amended, 23 and also for information gathering, analysis, and dissemination. 24 The final rule does not substantially change the effect of the underlying legislation. However, the final rule makes changes to Form 6, and also impacts information gathering. Accordingly, no environmental considerations are necessary.

The Commission received no comments on its certification, in the NOPR, that the proposed rule would not have a significant economic impact on a substantial number of small entities and that an initial Regulatory Flexibility Act (RFA)  25 analysis is not required.

In Mid-Tex Elect. Coop. v. FERC, 773 F. 2d 327 (D. C. Cir. 1985), the court found that Congress, in passing the RFA, intended agencies to limit their consideration “to small entities that would be directly regulated” by proposed rules. Id. at 342. The court further concluded that “the relevant ‘economic impact’ was the impact of compliance with the proposed rule on regulated small entities.” Id. at 342.

This final rule will not have an adverse impact on small entities, nor will it impose upon them any significant costs of compliance. Rather, this rule will significantly reduce the reporting burden on relatively small companies by raising the reporting threshold, and promote consistent reporting practices among pipeline carriers. Most filing entities regulated by the Commission do not fall within the RFA's definition of a small entity. 26 Therefore, the Commission certifies that this rule will not have a significant economic impact on a substantial number of small entities.

The following collection of information contained in this final rule was submitted to the Office of Management and Budget (OMB) for review under Section 3507(d) of the Paperwork Reduction Act of 1995. 27 FERC identifies the information provided under Part 352 and § 357.2 as FERC Form No. 6.

Public Reporting Burden: Estimated Annual Burden.

The final rule establishes new reporting requirements, modifies existing reporting requirements and eliminates those requirements that are no longer applicable. The burden for complying with this proposed rule are as follows:

On May 18, 2000, President Clinton signed into law the Trade and Development Act of 2000 (“the Act”), Public Law 106-200, 114 Stat. 251. Title V of the Act concerns imports of certain wool articles and sets forth provisions intended to provide tariff relief to U.S. manufacturers of specific wool products. Within Title V, section 505 permits eligible U.S. manufacturers to claim a limited refund of duties paid on imports of select wool articles.

On October 26, 2000, Customs published a document in the Federal Register (65 FR 64178) that proposed to amend the Customs Regulations to provide for the refund of duties paid on imports of certain wool products, as authorized by section 505 of Title V of the Act. In that document, Customs explained the eligibility, documentation and procedural requirements necessary to file and substantiate a wool duty refund claim. On November 6, 2000, a document was published in the Federal Register (65 FR 66589) that corrected several typographical errors in the proposed rulemaking.

The proposed rulemaking was intended to implement the terms of section 505 in new § 10.184 of the Customs Regulations. The proposed rules set forth the eligibility, documentation and procedural requirements necessary for a claimant to establish the amount of duties paid on eligible wool products in calendar year 1999, and to substantiate a claim for a duty refund in the years 2000, 2001 and 2002, pursuant to the terms of the statute.

Section 505 authorizes duty refunds on certain worsted wool fabrics, wool yarn and wool fiber and wool top. The wool duty refunds authorized by section 505 were set forth in § 10.184(c) of the proposed regulations.

As section 505 limits the amount of duties that may be refunded to a claimant in each of calendar years 2000, 2001, and 2002 to an amount not to exceed one-third of the amount of duties paid on eligible wool products in calendar year 1999, Customs proposed that an eligible manufacturer that anticipates seeking a section 505 duty refund in calendar years 2000, 2001, and 2002, must file with Customs a letter of intent to that effect, along with documentation that substantiates, to Customs satisfaction, the amount of duties paid on eligible wool products imported in calendar year 1999. The procedural and documentation requirements for filing a letter of intent were set forth in § 10.184(d) of the proposed regulations.

Section 10.184(e) of the proposed rulemaking provided that Customs would issue a wool duty refund verification letter to each prospective claimant that timely and completely substantiates, to Customs satisfaction, the amount of duties paid on eligible wool products imported in calendar year 1999.

The proposed rulemaking, at § 10.184(g), identified two classes of claimants that may file a wool duty refund claim: manufacturers who are the importers of eligible wool merchandise and manufacturers who are not the importers of worsted wool fabric. For both types of manufacturers, it was proposed that an eligible claimant be permitted to submit to Customs a request for a refund of duties paid on imports of eligible wool products in each of calendar years 2000, 2001 and 2002. The proposed rulemaking stated that all duty refund claims must be substantiated by relevant entry summary information and, in the case of non-importing manufacturers, the entry summary information may be submitted to Customs by the manufacturer or the importer.

Sixteen comments from the public were received in response to the publication of the notice of proposed rulemaking. A description of the comments, together with Customs analysis thereof, is set forth below.

Comment: Filing a Letter of Intent or Claim Where the Manufacturer is Both an Importer of Worsted Wool Fabric and a Purchaser of Such Fabric in a Single Claim Year . The proposed regulations identify three types of claimants who can file a letter of intent for purposes of claiming a wool duty refund: eligible manufacturers who import eligible wool merchandise; eligible manufacturers who do not import worsted wool fabric, but who possess the relevant entry summary numbers for the imported fabric; and eligible manufacturers who do not import worsted wool fabric, and who do not possess the relevant entry summary information. The documentation these manufacturers must submit to substantiate their letters of intent was described in proposed § 10.184(d)(1), (d)(2) and (d)(3). Several commenters state that the proposed regulations suggest that a claimant can only be described by one of the three types of claimant categories, and accordingly is limited to filing one letter of intent under either proposed paragraph (d)(1), (d)(2) or (d)(3). One of these commenters suggests that as an eligible manufacturer may have been both an importer and a purchaser of eligible wool fabric in calendar year 1999, the final regulations should permit such a manufacturer to be able to file a letter of intent, with appropriate substantiating information, under any combination of proposed § 10.184(d)(1), (d)(2) and (d)(3). To this end, this commenter suggests that the final regulations should either require more than one letter of intent for such a manufacturer or, preferably, that a single letter of intent may be filed that identifies the specific classes under which an eligible manufacturer is filing, together with the attachments/affidavits required for each class of manufacturer.

Several commenters raise the same issue regarding the procedures for filing a wool duty refund claim, as set forth in proposed § 10.184(g)(3)(i) through (g)(3)(vi). They note that as a manufacturer may be both an importer of eligible wool fabric and a purchaser of such imported fabric, the final regulations should permit a manufacturer to be able to file a single claim pursuant to the documentation requirements for both categorizations.

On a related note, several commenters state that there may be instances where a non-importing manufacturer purchases worsted wool fabric from more than one importer/supplier, and some importers are willing to provide the manufacturer with the relevant entry summary information and some are only willing to provide such information directly to Customs. In these instances, these commenters suggest that the final regulations should permit a manufacturer, both for purposes of filing a letter of intent and for filing a duty refund claim, to be able to submit relevant entry summary information directly to Customs and to have such information submitted to Customs by the importer/supplier.

Customs Response: Customs agrees that the proposed regulations did not expressly state that a manufacturer may file a letter of intent under any combination of § 10.184(d)(1), (d)(2) and (d)(3). As it was Customs intent to permit this, the final regulations provide the documentation requirements for filing a letter of intent where the manufacturer is described by two or more of paragraphs (d)(1), (d)(2) or (d)(3) of this section. This is set forth in § 10.184(d)(4). Additionally, § 10.184(g)(3)(vii) is added to the final regulations to reflect the fact that, for purposes of filing a claim, a manufacturer may be both an importer of worsted wool fabric and a purchaser of such fabric in the same claim year. The final regulations also permit, at § 10.184(d)(2)(i)(D), (d)(2)(ii), (g)(3)(iii) and (g)(3)(iv), a non-importing manufacturer to be able to submit relevant entry summary numbers directly to Customs, and to have such entry information submitted directly to Customs by the importer(s), all in conjunction with a single claim.

Comment: Changes to proposed § 10.184(d)(2)(i)(D) and § 10.184(d)(2)(ii) and (d)(3)(ii). One commenter suggests two clarifying changes to § 10.184(d). First, it is suggested that proposed § 10.184(d)(2)(i)(D)( 5 ) and (D)( 6 ) be redesignated in the final regulations as (d)(2)(i)(D)( 5a ) and (d)(2)(i)(D)( 5b ), respectively, so as to correlate to the itemization in the related affidavit set forth at proposed § 10.184(d)(2)(ii). Second, the commenter suggests that the heading text of the affidavits set forth at proposed § 10.184(d)(2)(ii) and (d)(3)(ii) be amended to include the following description in the parenthetical reference: “* * * for the fabric identified in the invoices submitted with this affidavit)”.

Customs Response: The final regulations reflect, at § 10.184(d)(2)(ii) and (d)(3)(ii), the amended affidavit heading text suggested by the commenter. Customs will not redesignate § 10.184(d)(2)(i)(D)( 5 ) and (d)(2)(i)(D)( 6 ), in that the drafting rules prescribed by the Federal Register do not permit the change as suggested.

Comment: Place to File a Letter of Intent. One commenter notes that the proposed regulations did not specify where a letter of intent and related documentation should be filed.

Customs Response: Customs recognizes the omission. The final regulations create a new § 10.184(d)(7) that sets forth the place where a letter of intent must be filed.

Comment: Issuance of Verification Letters. Several commenters request clarification of the time within which Customs will send written verification letters to prospective claimants. Proposed § 10.184(e) provided that Customs will issue a prospective claimant a written verification letter within 30 calendar days from the date Customs receives a completed letter of intent. The commenters note that Customs may not have the information it needs within 30 days of receiving a prospective claimant's letter of intent that relies on invoices to substantiate the amount of duties paid in calendar year 1999, and therefore will either have to file an amended verification letter at a later date or wait until 30 calendar days from the close of the filing date for letters of intent.

Customs Response: Customs agrees that the date by which Customs will issue a verification letter requires clarification. The proposed rule stated that, in all cases, Customs will issue a verification letter within 30 calendar days of receiving a prospective claimant's letter of intent. The verification letter sets forth the amount of wool duty refund the prospective claimant is eligible to receive and, where invoices were used to substantiate the amount claimed in the letter of intent, the percentage deducted from the invoice amounts with an accompanying explanation.

Where invoices are used to substantiate a letter of intent, Customs must wait until it has received all such letters of intent because the agency will need to compare the aggregate amount of duties being claimed for each importer, as evidenced by invoices, with the amount actually paid by each importer, as evidenced by the Automated Commercial System (ACS). In other words, in situations where invoices are used to substantiate a letter of intent, Customs will not be able to ascertain the percentage to be deducted from each invoice amount, and consequently determine the maximum refund amount that a prospective claimant is eligible to claim, until it has received all letters of intent that rely on invoices. Customs will have to receive all letters of intent that rely on invoices in order to calculate the aggregate amount of duties attributable to each importer and compare this amount with the amount paid by each importer as indicated by ACS. As a result, it will not be possible for Customs to issue a verification letter within 30 calendar days after receiving a prospective claimant's letter of intent that relies on invoices, in that Customs will not have the necessary information to determine the amount to deduct from each invoice amount. Accordingly, this final rule reflects that Customs will issue a verification letter in response to a letter of intent that uses invoices, in whole or in part, to substantiate the amount of duties paid in calendar year 1999 within 30 days from the closing date for filing letters of intent. It is further noted, that this document extends the date, as proposed, by which Customs must receive all letters of intent. See discussion below. The time frame within which Customs will issue a verification letter in response to a letter of intent that is substantiated solely by entry summary information remains unchanged from the terms set forth in the proposed rulemaking (i.e., 30 calendar days from the date Customs receives the letter of intent).

Comment: Extension of Time to File a Letter of Intent. Two commenters suggest that Customs extend the time period to submit a letter of intent so as to allow prospective claimants adequate time to collect the requisite information.

Customs Response: Customs agrees. The final regulations provide in § 10.184(d)(4) that a manufacturer's letter of intent must be received by Customs no later than March 31, 2001, unless this date is extended upon due notice in the Federal Register .

Comment: A Claimant May File Only One Wool Duty Refund Claim, and Amended Claims Where Applicable, for Each Claim Year. Proposed § 10.184(g)(1) stated that a claimant may submit to Customs, once per calendar year, a request for a refund of duties paid on imports of eligible wool products in each of calendar years 2000, 2001, and 2002. Several commenters note that this time limitation seemingly precludes a claimant from filing two separate wool duty refund claims for two different claim years in the same calendar year. The commenters suggest that the regulations should provide that a claimant may file only one wool duty refund claim for each claim year; however, refund claims for two different claim years may be filed within the same calendar year.

Customs Response: It was Customs intent to permit a claimant to file more than one refund claim in a given calendar year, so long as the refund claims were for different claim years. Customs agrees with the commenters that the proposed language seemingly precluded this. Therefore, this final rule provides at § 10.184(g)(1) that a claimant may file one claim for a wool duty refund for each of claim years 2000, 2001, and 2002, including, where applicable, any related amended claims for such claim year. There is no prohibition against a claimant filing two separate claims in a single calendar year, so long as the claims are for two different claim years.

Comment: Time to File a Wool Duty Refund Claim and Amended Claims. Several commenters request that Customs extend the deadlines for filing wool duty refund claims and amended claims, and clarify the meaning of the term “defective claim”. Proposed § 10.184(g)(1) provided that all claims for a wool duty refund, whether original or amended, must be received by Customs within 90 calendar days from the last day of the calendar year for which a wool duty refund is being sought. The proposed rule provided that a claim may be amended within 30 calendar days from the date of the original submission or, if Customs has notified the claimant in writing that the claim is insufficient to support a duty refund claim or is otherwise defective, within 30 calendar days from the date of the Customs notification. The commenters suggest extending these deadlines so that a claim may be filed by December 31 of the year following the claim year for which a wool duty refund is being sought, and that a claim may be amended within 90 calendar days from the date of the original submission or December 31, whichever date is sooner. The commenters suggest that the time period to file an amended claim in response to a Customs notice of insufficient or defective claim be extended to 90 calendar days from the date of such notice, without the imposition of the December 31 deadline, described above, that is applicable to all other claims and amended claims. Lastly, the commenters suggest that the term “defective claim” include a claim that identifies one or more entry summaries that are not available for a refund.

Customs Response: Customs agrees with the comments. Accordingly, in this final regulation Customs is extending the deadlines set forth in proposed § 10.184(g)(1) for filing a wool duty refund claim and related amendments. The final regulations state, at § 10.184(g)(1), that should Customs notify a claimant in writing that the claim is insufficient to support a duty refund claim or is otherwise defective, Customs must receive the claimant's subsequent amended claim or claims within 90 calendar days from the date of such notification. Regarding the term “defective claim,” Customs is providing in a parenthetical reference provided at § 10.184(g)(1) that an example of a defective claim is a claim that relies on any entry summary that is ineligible for a wool duty refund, as provided for in § 10.184(j). In order to facilitate the administrative processing of wool duty refund claims, the final regulations provide at § 10.184(h) that no duty refund will be issued to a claimant until the applicable amendment period has expired or unless the claimant has provided Customs with a signed waiver of amendment.

Comment: No Interest Payable in Wool Duty Refunds. Several commenters note that the proposed regulation does not describe the circumstances when interest may be payable on wool duty refunds.

Customs Response: Customs will not pay interest on wool duty refund claims. The United States Supreme Court, in Library of Congress v. Shaw , 478 U.S. 310, 106 S. Ct. 2957 (1986), held that interest cannot be recovered in a suit against the Federal Government in the absence of an express waiver of sovereign immunity, by specific contractual or statutory provision or by express consent by Congress. Section 505 does not expressly waive the government's sovereign immunity from an award of interest. Moreover, there can be no such waiver “by implication or by use of ambiguous language,” as held by the Supreme Court in United States v. N.Y. Rayon Importing Co., 329 U.S., at 659. The statute that authorizes Customs to pay interest on certain duties and fees is codified at 19 U.S.C. 1505. It specifically refers to payments of interest on “excess moneys deposited” which shall accrue through the “date of liquidation or reliquidation of the applicable entry or reconciliation.” 19 U.S.C. 1505(c). Customs payment of claims for refunds under these regulations is not a payment of excess moneys deposited, nor is it triggered by the liquidation of an entry or reconciliation. Rather, these claims are analogous to claims for drawback. Just as no interest is paid on drawback claims, so no interest will be paid on these claims. After Customs has verified that the entry summaries associated with the claim have finally liquidated and the period for amending the claim has expired or the claimant has expressly waived the right to amend the claim, Customs will issue a courtesy notice informing the claimant that the payment will be forthcoming. No notice of liquidation or reliquidation will be posted regarding the claim.

Comment: Definition of the term “Supplier”. Several commenters suggest that Customs define the term “supplier” to mean the entity who is not the importer that sold the fabric directly to the manufacturer.

Customs Response: Customs agrees with the commenters' view that the term “supplier,” in the context of these regulations, means an entity who is not the importer that sells fabric directly to the manufacturer. We do not think it is necessary to formally define this term in the final regulation. Customs believes that the meaning of the term “supplier,” as intended by Customs and suggested by the commenters, is clear from the context in which it appears in the regulations ( i.e., the claimant purchased imported worsted wool fabric “from an identified importer or from an identified supplier”).

Comment: Definition of the term “Manufacturer”. Several commenters state that the term “manufacturer” should be clarified so as to describe who is eligible to claim a wool duty refund under the terms of these regulations. To that end, the commenters note that some manufacturers are producers of eligible products ( i.e., custom tailors), some are subsidiaries of larger companies or purchasers of eligible wool products from related companies, and some manufacturers acquire other manufacturers or undergo reorganizations that result in an assignation of legal interests.

Customs Response: Customs is of the view that it is not feasible to attempt to identify in the final regulations each business relationship or transaction that may affect the eligibility of a manufacturer to claim a refund, have another party file a letter of intent or refund claim on the manufacturer's behalf, or assign a successor-in-interest to an existing wool duty refund claim, etc. Customs will decide whether such situations affect the right to file a wool duty refund claim on a case by case basis. Any questions in this regard should be submitted to Customs as an attachment to a letter of intent or wool duty refund claim. Regarding the more specific questions of whether a custom tailor is an eligible claimant for purposes of the wool duty refund program and whether the legal assignee of an eligible manufacturer may exercise the assignor's claim rights, Customs notes the following. Customs is of the view that so long as a custom tailor manufactures men's or boys' suits, suit-type jackets or trousers, of imported worsted wool, the tailor is described by the terms set forth in § 10.184(c)(1) and there is no need to include any clarification in regard to this class of manufacturer. The final regulations reflect, however, in § 10.184(f)(7), that an eligible claimant may be the legal assignee, as established to Customs satisfaction, of the existing wool duty refund claim rights of an eligible manufacturer described in paragraphs (f)(1), (f)(2), (f)(3), (f)(4), (f)(5) or (f)(6) of § 10.184. The final regulations also set forth, at new paragraphs (d)(5) and (g)(viii), the documentation that a legal assignee of a manufacturer's wool duty refund claim rights must provide to Customs for purposes of filing a letter of intent and a refund claim.

Comment: Confidentiality. One commenter expresses concern with respect to confidential treatment of certain commercial information. Specifically, the commenter notes that as proposed § 10.184(e) provided that a verification letter issued to a prospective claimant will contain the ACS-generated amount of duties paid by a specific importer in calendar year 1999, the prospective claimant will be advised of the amount of duty paid by each of their importers or suppliers. The commenter is of the view that a prospective claimant will be able to calculate from this information the prices paid for imported fabric and the mark-up cost. The commenter, citing section 645 of the Trade Secrets Act (18 U.S.C. 1905) posits that release of this information may violate the prohibition against release of confidential information by government officials.

Customs Response: In response to the concern expressed by the commenter, Customs is deleting reference in the verification letter to the ACS-generated amount of duties paid by a specific importer in calendar year 1999. Section 10.184(e) of the final regulations reflects this approach.

Comment: Use of Invoices to Substantiate Wool Duty Refund Claims. One commenter questions why the proposed regulations permit a manufacturer to substantiate a letter of intent by providing Customs with invoices for worsted wool fabric imported in calendar year 1999, but requires entry summary information to substantiate a wool duty refund claim.

Customs Response: Section 505(d) requires that “any person applying for a rebate under this section shall properly identify and make appropriate claim to the United States Customs Service for each entry involved.” For this reason, the final regulations implementing the statute require a claimant to identify to Customs the entry summaries that provide the basis for a wool duty refund claim. Invoices do not provide the requisite information to substantiate a wool duty refund as mandated by section 505.

Comment: Retroactive Substitution of Entry Summary Numbers for Purposes of Drawback Claims. One commenter notes that where an importer provides entry summary numbers to its customers or directly to Customs for purposes of substantiating a wool duty refund claim, and the importer later learns that a drawback claim is available on one or more of those entry summaries, the drawback claim is invalid. The commenter suggests that in this situation the importer be allowed to replace the entry summaries identified to Customs to substantiate a wool duty refund claim with other comparable entry summaries, so long as the amount of duty paid in connection with the replacement entries is not less than the duty paid on the original entry.

Customs Response: First, it is important to recognize that in the situation posited by the commenter, the importer's drawback claim may not necessarily be forfeited. As set forth in § 10.184(j)(3) of the proposed regulations, if an entry has been used to provide the basis for a duty refund claim pursuant to section 505, and the entire amount of duties paid on that entry was refunded to the claimant, a claim for drawback that is based on that entry will be denied by Customs. If an entry has been used to substantiate a claim for a section 505 duty refund, and an amount in duties paid on that entry has not been refunded, the remaining amount may be eligible for drawback. An entry that has already had 99% of the duties paid on that entry refunded by way of a drawback claim may not be used to provide the basis for a wool duty refund claim. Based on the foregoing, the crucial determination as to whether an importer can replace an entry summary that has already been identified to Customs for purposes of substantiating a claim with another entry summary that has had a comparable amount of duties paid in connection with that entry is whether the wool duty refund claim has been processed yet. If so, and the entire amount of duties paid on that entry was refunded to the claimant, no substitution of entry summaries will be permitted, and a claim for drawback that is based on that entry will be denied by Customs. If, however, the section 505 claim has not yet been processed, § 10.184(j)(3) of the final regulations will permit an importer to replace or substitute an entry summary pursuant to the terms discussed above.

Comment: Importer's Affidavit in Support of a Non-Importing Manufacturer's Letter of Intent. One commenter inquires whether an importer's affidavit in support of a non-importing manufacturer's letter of intent, set forth in proposed § 10.184(d)(2)(iv), covers a single manufacturer.

Customs Response: Each importer's affidavit in support of a non-importing manufacturer's letter of intent applies only to the specific manufacturer or supplier(s) identified in the affidavit.

Comment: Request that Importers be Permitted to File on Behalf of Manufacturers. One commenter requests that importers be permitted to file wool duty refund claims on behalf of smaller manufacturers.

Customs Response: For administrative and legal purposes, Customs considers it important that a manufacturer file a claim on its own behalf, in that the manufacturer, or a knowledgeable authorized officer or employee of the manufacturer, is required to provide a statement to Customs attesting to the truth and accuracy of the submitted information.

Comment: Allocation of Fabric Prices by an Importer. One commenter notes that as some manufacturers purchase fabric at different prices from different sources at different times of the year, it may not be possible for an importer to determine which fabric entry, or portion of an entry, was sold to a particular manufacturer. The commenter questions how an importer will be able to determine a method of allocating the higher price fabrics to its customers.

Customs Response: Customs does not require that an importer allocate to a manufacturer the specific entry for the fabric that was sold to that manufacturer. Rather, the importer need only allocate those entries on which an amount was paid in duties that substantiates the amount of duty refund being claimed by the manufacturer.

Comment: Distinction between HTSUS provisions that may be used to substantiate wool duty refund claims for claim year 2000, and for claim years 2001 and 2002. One commenter notes that the language in proposed § 10.184(c)(2) that read, “[A] manufacturer of worsted wool fabric, who imports wool yarn of the kind described in HTSUS subheadings 5107.10.00 and 9902.51.13 * * * ,” should be changed to read, in pertinent part, “* * * 5107.10.00 or 9902.51.13 * * *.” The commenter points out that the amended language should reflect the construction used in paragraphs (c)(1) and (c)(3).

Customs Response: This comment precipitated Customs review of the entire structure of § 10.184(c) and (f). It is Customs view that a distinction must be made in the final regulations as to which tariff provisions may be used to substantiate a wool duty refund in each of claim years 2000, 2001, and 2002. In this regard, the final regulations state that the chapter 51, HTSUS, provisions identified in paragraphs (c) and (f) provide the basis for a wool duty refund for claim year 2000, and the HTSUS 9902 subheadings identified in these paragraphs provide the basis for a refund for claims years 2001 and 2002. This distinction is necessitated by the terms of section 505, which only authorizes the refund of duties paid in each of claim years 2000, 2001, and 2002, on imports of certain wool products described in HTSUS subheadings 9902.51.11, 9902.51.12, 9902.51.13 and 9902.5114. As these 9902, HTSUS, provisions will only go into effect on January 1, 2001, it is impossible for a claimant to use these provisions to substantiate a year 2000 claim. For this reason, Customs is permitting claimants to substantiate year 2000 claims with the chapter 51, HTSUS, tariff provisions identified in the regulations. Customs will not permit the chapter 51 tariff provisions to be used to substantiate wool duty refund claims for claim years 2001 and 2002, inasmuch as these tariff provisions are broader in scope (they contain no limiting micron criteria in their legal heading text) than the designated 9902, HTSUS, provisions. To do so would result in the Treasury Department refunding more monies than it is statutorily authorized to do.

Comment: Micron Limitation. One commenter notes that the proposed regulations allowed no refund of duties paid on imports of wool yarn of 18.5 micron or finer.

Customs Response: As Congress did not expressly provide for the refund of duties paid on imports of wool yarn of 18.5 micron or finer in section 505, Customs, as an administrative agency, may not exceed what is statutorily authorized.

Comment: Manufacturers of Wool Fabric and Wool Yarn. One commenter raises the issue that the proposed regulations did not provide for duty refunds where the manufacturer of wool fabric purchases imported wool yarn or where the manufacturer of wool yarn purchases imported wool fiber or wool top.

Customs Response: Sections 505(b) and 505(c) require that manufacturers of wool fabric and wool yarn also be importers of eligible wool products in order to be eligible to receive a wool duty refund under the terms of the statute. It is noted that section 505(a) does not require a manufacturer of men's or boys' suits, suit-type jackets, or trousers of worsted wool fabric to also be an importer of worsted wool fabric to be eligible for the refund. Customs has interpreted this difference in statutory construction to mean that Congress did not intend to provide wool duty refunds under sections 505(b) and 505(c) to manufacturers who are not importers.

After analysis of the comments and further review of the matter, Customs has determined to adopt as a final rule the amendments proposed in the Notice of Proposed Rulemaking published in the Federal Register (65 FR 641780) on October 26, 2000, as corrected by the document published in the Federal Register (65 FR 66589) on November 6, 2000, with the changes mentioned in the comment discussion and with the following additional change that removes unnecessary language.

Customs has removed the regulatory text language in proposed § 10.184(j)(1) regarding the order of precedence for purposes of refunding duties paid on eligible wool imports. As each manufacturer that timely and completely files a claim pursuant to the terms set forth in this section, regardless of the date and time of filing, is eligible to receive its verified claim, there is no need to establish an order of precedence.

Because these amendments conform the Customs Regulations to reflect the terms of section 505, within Title V, of the Trade and Development Act of 2000, which authorizes a refund of duties paid on imports of certain wool articles, pursuant to the provisions of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. , it is certified that these amendments will not have a significant impact on a substantial number of small entities. Further, these amendments do not meet the criteria for a “significant regulatory action” as specified in Executive Order 12866.

The collection of information contained in this final rule has been reviewed and approved by the Office of Management and Budget (OMB) in accordance with the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3507) under control number 1515-0227. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number assigned by OMB.

The collection of information in this final rule is in § 10.184 of the Customs Regulations. The information requested is necessary to implement the terms of section 505 of the Trade and Development Act of 2000, whereby Customs is authorized to substantiate and process claims for refunds of duties paid in each of calendar years 2000, 2001, and 2002, on imports of certain wool products. The collection of information is required in order for a claimant to obtain the duty refund. The likely respondents are business organizations who seek a refund of duties paid on imports of eligible wool products in each of calendar years 2000, 2001, and 2002.

The estimated average annual burden associated with the collection of information in this final rule is 290 hours per respondent or recordkeeper. Comments concerning the accuracy of this burden estimate and suggestions for reducing this burden should be sent to the U.S. Customs Service, Information Services Group, Office of Finance, 1300 Pennsylvania Avenue, N.W. Washington, D.C. 20229, and to OMB, Attention: Desk Officer for the Department of the Treasury, Office of Information and Regulatory Affairs, Washington, D.C. 20503. A copy should also be sent to the Regulations Branch at the address set forth above.

The principal author of this document was Suzanne Kingsbury, Office of Regulations and Rulings, U.S. Customs Service. However, personnel from other offices participated in its development.

This document contains amendments to the Procedure and Administration Regulations (26 CFR part 301) relating to Federal tax deposits under section 6302(c) of the Internal Revenue Code (Code). Section 6302(c) provides that the Secretary may authorize Federal Reserve banks, and incorporated banks, trust companies, domestic building and loan associations, or credit unions that are depositaries or financial agents of the United States, to receive any tax imposed under the internal revenue laws, in such manner, at such times, and under such conditions as the Secretary may prescribe. Pursuant to this authority, various regulations provide that Federal Reserve banks, as well as other authorized financial institutions, may receive certain Federal tax deposits.

In cooperation with the Treasury Department's Financial Management Service (FMS), the Federal Reserve System has been streamlining its Treasury Tax and Loan (TT&L) Operation to respond to the fact that the overwhelming majority of Federal Tax Deposits (FTDs) are now received electronically. The widespread adoption of electronic deposits by taxpayers is an important aspect of improving the efficiency, reliability, and cost-effectiveness of the Treasury Department's financial management. In general, compared to the universe of all tax deposits, the percentage of FTDs made with paper coupons has significantly declined. FTDs made with paper coupons at Federal Reserve banks now constitute only a tiny percentage of all tax deposits. For example, in Fiscal Year 1999, of the approximately 100 million Federal tax deposits, made by paper coupon and electronically, only about 270,000, or less than one half of one percent, were paper coupons presented at Federal Reserve banks. Additionally, the number of paper coupons presented at Federal Reserve banks has declined over twenty-five percent since 1997.

The Treasury Department has developed an array of other deposit options that are more convenient for taxpayers to use, and more economical to process, than deposits with Federal Reserve banks. For example, taxpayers may use their touch tone telephone or personal computer to make deposits 24 hours a day through the Electronic Federal Tax Payment System (EFTPS). For those taxpayers who still prefer paper coupons over electronic deposits, there are now more than 10,000 financial institutions nationwide that are designated as TT&L depositaries where taxpayers may make FTD deposits using paper coupons.

In response to the declining number of deposits being made with paper coupons at Federal Reserve banks, the Federal Reserve Bank of St. Louis was selected, effective May 1, 2000, to serve as the only Federal Reserve bank accepting FTDs. Even after this consolidation, however, it is no longer cost-effective for the Federal Reserve bank in St. Louis to process the small number of paper coupons it receives annually. Accordingly, these temporary regulations remove all Federal Reserve banks as depositaries for Federal taxes. To mitigate any difficulties for those taxpayers who still do not wish to use the deposit alternatives discussed above, the Treasury Department has authorized a financial agent to receive and process FTD payments through the mail, thereby maintaining a mail-in alternative for taxpayers who do not have an account with an authorized financial institution and who do not wish to use EFTPS. The address for this mail-in alternative is Financial Agent, Federal Tax Deposit Processing, P.O. Box 970030, St. Louis, Missouri, 63197. The IRS is also issuing proposed regulations that remove Federal Reserve banks as depositaries of Federal taxes. See the notice of proposed rulemaking on this subject in the Proposed Rules section of this issue of the Federal Register .

It has been determined that this Treasury decision is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It also has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations, and because the regulations do not impose a collection of information on small entities, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not apply. Pursuant to section 7805(f) of the Internal Revenue Code, these regulations will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small business.

The principal author of these regulations is Brinton T. Warren of the Office of Associate Chief Counsel, Procedure and Administration (Administrative Provisions and Judicial Practice Division). However, other personnel from the IRS and Treasury Department participated in their development.

(1) The Department of the Army previously announced an interim rule to establish basic contractor-reporting requirements to identify the number and value of direct, and associated indirect, labor work year equivalents for contracted services in support of the Army. The interim rule, effective on the date of publication, was published in the Federal Register (65 FR 13906) dated Wednesday, March 15, 2000. Comments and responses pertaining to the new reporting requirements are provided in b. below.

(2) Major changes to the Interim Rule are outlined herein and further explained in “b.” below. In response to numerous administrative questions and requests for clarification from both public and private sector sources, Part 668 has been completely reorganized and rewritten for better readability, clarity and completeness; and to allow easier implementation by the Army contracting community and Army contractors. To further assist with this objective, the Final Rule will be cited and further implemented as appropriate in the Army Federal Acquisition Regulation Supplement.

(3) The substantive changes resulting from the Public Comment process are as follows:

(a) Section 668.1(b)(1)(i) excepting FAR Part 12 contract actions from inclusion of the reporting requirement, and mandatory reporting, is deleted in its entirety. With the effective date of this Final Rule, the reporting requirement will be included in all contracts specified in the amended § 668.1(c)(3) (including those entered into using Part 12 procedures, unless otherwise exempt). All affected contractors shall be requested to provide reportable data from October 1, 1999 (or later start of contract date), in order to insure complete, accurate and useful information to Congress and Army planners.

(b) Section 668(b)(1)(iii) is deleted, and will be moved to § 668.2(e).

(c) Section 668.2 is renamed “Contract Reporting Requirements.” Section 668.2(a) is changed (in § 668.2(d)) by amending “relevant composite indirect labor rate” to read “relevant annualized average or composite indirect labor rates” in order to clarify that rates reported (for hours and dollar value) do not have to be adjusted for every reporting period; and will further clarify that actual estimated hours and dollars may always be reported (in lieu of rates) for indirect labor related to the direct labor reported. To this end, the ASA (M&RA) secure website ( https://contractormanpower.us.army.mil ) will be amended to add appropriate fields and clarifications.

(d) A new § 668.2(g) is added to clarify that prime contractors may use their discretion to determine whether sub-contractors will report their information directly to the data collection web site, or to the prime contractors for validation and submission to the collection web site.

(e) The current paragraph (c), titled “Reporting format” is redesignated as paragraph (i) and corresponding changes are made to the list of required data elements;

(f) The secure Army website and its URL address is now highlighted in Section 668.2(a) and (i). The website is the principal source of detailed information on the reporting process, Help Desk functions, and other information and assistance.

Comments and responses are provided as follows:

Comment: Contractor recommended that the rule clarify that it is permissible for a contractor to use an algorithm of the overall relation of total indirect labor hours to the total direct and indirect hours on an annualized basis for the purposes of reporting the composite indirect rate.

Response: The rule will be clarified to reflect the permissibility for contractors to report using an annualized average composite indirect rate for estimating indirect man-hours rather than a rate developed for the specific reporting period.

Comment: Public sector union requested clarification on the meaning of the “composite indirect rate” for estimating value.

Response: The composite indirect rate for estimating value (as opposed to hours) is intended to capture the labor-related charges included in the indirect pools. This rate, when multiplied against the value of direct labor hours is intended to provide an estimate of all of the compensation related charges associated with the reportable services under the contract action during the reporting period ( i.e. , both direct and indirect labor charges). These compensation charges include: salaries and wages; directors' fees; bonuses (including stock); incentive awards; employee stock options; stock appreciation rights; employee insurance; fringe benefits ( e.g., vacation, sick leave, holidays, military leave, supplemental unemployment benefit plans); contributions to pension plans (defined benefit, defined contribution); other post-retirement benefits, annuity, and employee incentive compensation and deferred compensation plans; early retirement plans; off-site pay; incentive pay; hardship pay; severance pay; and COLA differential. Contractors may also report estimated total hours and dollars for (related) indirect labor (as opposed to providing average composite rates). Either method chosen should be consistently reported. The Final Rule, at Section 668.2(d)(2), contains these clarifications; and the secure Army website will be amended to reflect the new data fields.

Comment: Contractor questioned application of reporting requirement to Time and Materials (T&M) and Firm Fixed Price (FFP) contracts since the contractor invoices the Government based on its fully burdened labor rates, as proposed under T&M, and agreed upon prices or rates under FFP, and does not otherwise usually disclose actual labor costs (under T&M) or actual labor hours or costs under FFP. Conversely, public sector unions requested that the Rule be clarified to apply the reporting requirement to firm fixed price type contracts, on the basis that, assuming the numbers (hours and value) are known and collected by the contractors for their own business purposes, the numbers should be reported to the secure Army website since they are not to be used for billing nor for audit, or any other purposes beyond those stated in the Rule (reporting and manpower planning).

Response: The Army is not requesting this contractor manpower information as a basis for future negotiation, payment or post-audit under the contract(s) reported; and is treating all provided information, especially any estimated indirect labor hour or rate/value information, as proprietary when specifically associated with a contractor by name and contract number. The Rule will clarify that reporting the requested information is not required when a contractor would be forced to create a new, internal cost accounting, allocation or payroll system in order to reasonably identify the requested data. However, it is unlikely that a contractor would be able to operate in accordance with generally accepted accounting principles, and in compliance with taxation and benefits laws and regulations, without having the requested information readily available either at the time of a request for progress payment, submission of invoices or vouchers, or quarterly. Lastly, the data as reported by contractors will not be furnished through or to Army contracting offices, but directly to the office responsible for manpower reporting to Congress and providing gross data to Army planners. Accordingly, firm fixed price contracts and time and materials contracts shall fall within the scope of the reporting requirement and the Final Rule is clarified to reflect that change.

Comment: Public sector union questioned the exclusion of Federal Acquisition Regulation (FAR) Part 12 service contracts from the scope of the reporting requirement.

Response: Initially, FAR Part 12 contracts were exempted on the basis that the reporting requirement could detract from the commercial practices tenet, and based on the sparse use of those procedures for service contracts in general. However, on review of the comments, and reflection on the remaining exceptions for reporting, it was determined that, if contractors possessed the needed data as a matter of common business practice, and if the reporting requirement was minimally burdensome and intrusive, then it should be reported, notwithstanding the use of Part 12. In addition, Army contracting personnel notified us that the number and size/scope of Part 12 Service contracts was quite large and increasing, contrary to our initial expectations. Given the intended scope of both section 2461(g) of title 10 and section 343 of the Fiscal Year 2000 National Defense Authorization Act, excluding the significant and growing numbers of service contracts awarded under Part 12 will detract from the reliability of information collected and undercut the purposes of data collection. Accordingly, the Final Rule eliminates the exception for contracts entered into under the authority and procedures of FAR Part 12.

Comment: Public sector unions questioned the exclusion of contracts below $100,000 in value from the scope of the rule.

Response: The $100,000 exclusion is intended to minimize the workload burden in compiling the report, and covers a relatively small number of contractor support man-hours provided under a large number of contract actions. The Rule will, however, be clarified to explain that the $100,000 refers to the total estimated value of the contract in the case of Task Order or Delivery Order contracts. Individual orders under such contracts that are reported using a DD Form 350, Individual Contracting Action Report (i.e., greater than $25,000) shall be reported). The Army may periodically consider eliminating this exclusion in the event the exclusion is misused or results in a substantial number of service contracts and manpower information being excluded from the requirement in a way that would impair the reliability of the overall data.

Comment: Public sector unions questioned the scope of the proprietary nature of the data and requested that the Army address how it intends on making the data available to the public. Army Major Command Chiefs of Staff and their contracting offices queried how they would be informed about contractor compliance with the reporting requirement.

Response: For the purposes of this data collection effort, information reported on direct or indirect labor hours and rates, and the value of those hours, when associated with a contract number and contractor identity, is treated as proprietary. It was and is considered essential to the data collection effort to ensure this level of information security to reporting contractors. Data subject to potential release to Army sources or the public, or under the Freedom of Information Act, would include information such as the identity of contractors reporting; the number of contract actions reported on; and the overall number of labor hours and value of various categories of support services reported, and other aggregations, but in no event will there be public release of specific reported data when linked to contractor name and or contract number. The Final Rule is clarified to provide that proprietary information may be provided to internal Army sources for purposes of evaluating and enforcing compliance with the reporting requirement, provided the information is appropriately marked and treated as proprietary. For purposes of assuring compliance with the reporting requirement, the Army may eventually decide to make a summarization of non-proprietary, releasable data available through a web site; however this will not be possible in the near future due to the late implementation by many contracting activities and the need for a validation process and cycle using the Federal Procurement Data System database.

Comment: A member of the public suggested that the rule clarify how sub-contractors would report this information. In addition, a contractor suggested that sub-contracting its payroll system excluded it from the scope of the reporting requirement.

Response: Clarifying language is included in the Final Rule making clear that prime contractors may either require their sub-contractors to directly report the information required by this rule to the data collection web site; or the prime contractor may report subcontractor-provided information to the data collection web site (identifying the source of the numbers to the extent practicable). In addition, clarifying language is included in the Final Rule that sub-contracting the payroll system of a contractor is not a basis for exclusion of the contractor from the reporting requirement.

Comment: An Army contracting office queried whether the reporting requirement applied to Army contracts awarded by them using General Services Administration (GSA) contract vehicles.

Response: Clarifying language is included in the Final Rule that the reporting requirement applies to Army contract actions, valued at greater than $100,000, awarded by Army contracting offices using GSA contract vehicles.

Comment: Contractor suggested that the submission of an invoice with an additional attachment be allowed in lieu of the web-based data collection, at the option of the contractor.

Response: Using multiple data collection formats and methods is impracticable for the Government and would adversely affect the reliability and cost of the data collection. In addition, the inclusion of attachments on an invoice would, for all practical purposes, eliminate the access protections afforded by using a secure web site not associated with contracting channels, for all data collection.

Comment: Public sector union suggested that the reporting requirement be extended to cover manufacturing work analogous to the work performed at Army arsenals and some Army depots (primarily remanufacturing).

Response: The final rule applies only to services covered by federal supply class or service codes covered by the “Research and Development,” and the “Other Services and Construction” codes. The final rule does not include a reporting requirement for the acquisition of supplies and equipment by purchase, lease or barter. However, when non-incidental services are discretely included in such contract actions, and these services may be characterized under the Other Services and Construction codes or Research and Development codes, they shall be subject to the reporting requirement. Just as, in manufacturing work performed at Army arsenals, support services that the Arsenals contract for must be reported.

Comment: Public sector comments from overseas commands recommended that foreign vendors/contractors providing services to the Army overseas (such as in Contingency support in theaters of operation) be excepted from the reporting requirement. The concern is certain foreign contractors may not be able to connect to the Internet; may not be conversant with our language, our accounting rules and assumptions, and may be distrustful of providing potentially business- (or tax) sensitive information to a foreign government ( i.e., the United States), notwithstanding the stated purpose and pledge to protect such data as proprietary.

Response: One of the purposes of this minimal burden data collection effort is for Army Leadership to gain visibility over the total resources (manpower and associated costs) necessary to accomplish mission requirements, as reliance on contractor support has increased. A recent (October 19, 2000) Memorandum to all Army Commanders and Heads of Staff Agencies, signed by the Vice Chief of Staff, GEN John M. Keane, states: “Defined in both functional and appropriation terms by theater, this [CME] information will address a material weakness capturing the “contractor shadow workforce” support to our forces. This information is very important to Army planning and programming, the Quadrennial Defense Review, and for assuring full visibility of all costs in activity based costing initiatives.” If foreign contractors are unable to comply with the entirety of the reporting requirement, without creating a whole new allocation system or system of records, they can exempt themselves from that part of the reporting which they can certify as infeasible. This must be supported with a written certification outlining the portion of the reporting which is impracticable and the reasons therefore. In certain extreme cases ( e.g., when the contractor has no capability to use the Internet), the Army contracting office shall be required to report the relevant data and estimates to the best of their ability.

The Interim Rule included an exception to the requirement for reporting when a contractor did not have an internal system for aggregating billable hours in the direct and indirect pools, or an internal payroll accounting system, and did not otherwise have to provide this information to the Government. Since these circumstances and facts are not known in advance by contracting officers, this “exemption” (as somewhat restated) has been moved from § 668.1 (which instructs contracting officers), to § 668.2, “Contract Reporting Requirements” (which will instruct offerors and contractors in solicitations and contracts). A corresponding requirement has been added for a written certification of these facts to be submitted by the offeror/contractor.

There were a number of suggestions from both public and private sector sources (some mentioned above) for total exemption from reporting for various circumstances, mostly irrelevant to the purpose of the data collection or its availability. The Rule has been amended to clarify that even partial reporting of the data elements required is significantly more useful to the Army than no report at all.

The rule does not require the preparation of a regulatory flexibility analysis since it is not expected to have a significant economic impact on a substantial number of small entities ( i.e. small and small disadvantaged businesses).

The rule does not impose an enforceable duty among small governments ( i.e. States and local governments).

Pursuant to the Paperwork Reduction Act of 1995, the reporting provisions of this rule have been approved by the Office of Management and Budget (OMB) and assigned OMB control number 0702-0112, with an expiration date of August 31, 2003.

This is not a significant regulatory action in that it is not likely to result in a rule that will have an annual effect on the economy of $100 million or more or adversely affect productivity, the environment, public health or safety.

It has been determined that this rule does not have sufficient Federalism implications to warrant the preparation of a Federalism Assessment. The provisions contained in this rule will have little or no direct effect on States or local governments.

Pursuant to 5 U.S.C., Chapter 8, the rule will be forwarded to both Houses of Congress and the GAO in the final rule announcement together with the GAO prescribed special reporting form for this purpose.

In this document, the Army Department adopts the interim rule published March 15, 2000 as final with the above described changes as set forth below. (Because of the number of changes and the significant reorganization of the Rule, the amended part 668 is provided in full.)

In final rule 59 FR 31933, the latitude/longitude position and safety fallout radius around the barge conducting fireworks display are no longer correct because the marine event sponsor has increased the fireworks display shell size (12 inches) and amount of fireworks display (600 lbs Division 1.3G UN 0335), causing an increase in the required safety fallout radius of 300 yards around the barge conducting fireworks display activities and changing the latitude/longitude position.

In final rule 59 FR 31934, the safety fallout radius around the barge conducting fireworks display is no longer correct because the marine event sponsor has increased the fireworks display shell size (12 inches) and amount of fireworks display (600 lbs Division 1.3G UN 0335), causing an increase in the required safety fallout radius of 300 yards around the barge conducting fireworks display activities.

A Notice of Proposed Rule Making (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 an NPRM. In keeping with the requirements of 5 U.S.C. 533(d)(3), the Coast Guard also finds good cause exists for making this regulation effective less than 30 days after publication in the Federal Register . The Coast Guard received confirmation of this request from Great Lakes Dredge and Dock Company on 2 October, 2000. There was not sufficient time to publish a proposed rule in advance of the event. Publishing an NPRM and delaying the effective date of the regulation would be contrary to the public interest because immediate action is necessary to protect vessels, property, and the public, from hazards associated with the detonation of explosives.

The Captain of the Port Wilmington, North Carolina, received notification from Great Lakes Dredge and Dock Company on 2 October 2000, that the company intended to detonate explosives along the bottom of the Cape Fear River in order to break up rock to be dredged. In order to ensure the safety of life and property the Coast Guard is establishing a safety zone that encompasses the section of the Cape Fear River where the blasting is to occur. The safety zone is the width of the Cape Fear River, between Latitudes 34°06′00″ N and 34°09′00″ N. Vessels and persons entering the safety zone must check one of the following sources of information concerning the location and time of blasts occurring that day, and maintain a 500 yard distance from the blast sites. The blast sites within the safety zone will be identified daily and made available to the public through a Broadcast Notice to Mariners, direct contact with the control vessel on channel 16 VHF-FM, direct contact with the contractor, Great Lakes Dredge and Dock Company at (910) 350-3507, or through the Coast Guard Marine Safety Office at (910) 772-2200. In addition, Great Lakes Dredging will have control vessels present at the site of blast to warn any vessels in the area.

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). This rule only affects waters between Latitudes 34°06′00″ N and 34°09′00″ N on the Cape Fear River, Wilmington, North Carolina. Vessels will be allowed to pass through the Safety Zone if they inform themselves of the time and location of the blasts. The actual blast sites will be identified daily and made available to the public through a Broadcast Notice to Mariners, direct contact with the control vessel on channel 16 VHF-FM, direct contact with the contractor, Great Lakes Dredge and Dock Company at (910) 350-3507, or through the Coast Guard Marine Safety Office at (910) 772-2200. Therefore, 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.

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 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 that portion of the Cape Fear River affected by this safety zone from 9:00 a.m. 6 November 2000, through 5:00 p.m. on 31 January 2001.

This safety zone will not have a significant economic impact on substantial number of small entities for the following reasons. This rule only affects a limited area of water for the limited period of time. Vessels will be allowed to transit the safety zone provided that they comply with Captain of the Port requirements for doing so. It is unlikely that there will be more than two blasts a day, one in the morning and one in the evening. The waterway will be restricted one hour before the blasts and will be reopened after the blast.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we are willing to assist small entities in understanding the rule so that they can better evaluate its effects on them and participate in the rulemaking process.

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 Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small businesses. 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 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 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 rule and concluded that under figure 2-1, paragraph (32)(g) of Commandant Instruction M16475.lC, this rule is categorically excluded from further environmental documentation.

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 fact that the safety zone is required due to an unforeseen potential explosive atmosphere and required vessel safety inspections and needed repairs. 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 inspection personnel, the vessel HIGHLAND FAITH and vessels in the vicinity of the HIGHLAND FAITH, and the marine environment.

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 an unforeseen explosive atmosphere, and is needed to protect the inspection personnel, the vessel HIGHLAND FAITH and vessels in the vicinity of the HIGHLAND FAITH, and the marine environment.

There is an ongoing potential explosive atmosphere in the Port of New York/New Jersey on the vessel HIGHLAND FAITH that began on December 5, 2000. The Coast Guard is establishing a temporary moving safety zone to provide safety to personnel engaged in the vessel safety inspection and vessel repairs, and to vessels in the area. The safety zone is in effect from 10:30 a.m. (e.s.t.) on December 12, 2000, until 7 a.m. (e.s.t.) on January 1, 2001. The effective times of this safety zone may be extended or shortened depending on the time required to conduct the safety inspections and vessel repairs. The safety zone prevents vessels from transiting within a 2000-foot radius of the vessel HIGHLAND FAITH in the Port of New York/New Jersey. The size and duration of this zone may be expanded or contracted as required for oil spill recovery activities, safety inspections, and vessel repairs. Public notifications will be made by facsimile, broadcast notice to mariners, and to VTS users as required.

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 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, and the unforeseen nature of the potential explosive atmosphere.

The size of this safety zone was determined using the predicted explosive radius of the vessel.

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 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 a portion of the Port of New York/New Jersey during the times this zone is activated.

This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons: it is due to an unforeseen incident creating a potential explosive atmosphere, and the safety zone only closes the Port of New York/New Jersey within a 2000-foot radius of the vessel HIGHLAND FAITH while it is in the Port of New York/New Jersey. The size and duration of the zone may be expanded or contracted due to the results of the vessel safety inspection.

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.

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 as the zone will only be in effect for the time required to complete the vessel safety inspections and repairs on the vessel HIGHLAND FAITH while it is in the Port of New York/New Jersey.

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 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 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 rule and concluded that under figure 2-1, paragraph 34(g), of Commandant Instruction M16475.1C, this 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.

You can find a copy of today's action at http://www.epa.gov/ttn/rto.

The contents of this preamble are listed in the following outline:

For almost 30 years, Congress has focused major efforts on curbing ground-level (tropospheric) ozone. In 1990, Congress amended the CAA to better address, among other things, continued nonattainment of the 1-hour ozone National Ambient Air Quality Standards (NAAQS) and transport of air pollutants across State boundaries.

The 1990 Amendments reflect general awareness by Congress that ozone is a regional, as well as local problem. Ozone and NO X , one of its precursors, may be transported long distances across State lines to combine with ozone and precursors downwind, thereby worsening the ozone problems downwind. This transport phenomenon is a major reason for the persistence of the ozone problem, notwithstanding the imposition of numerous emission controls, both Federal and State, across the country.

Section 110(a)(2)(D) of the CAA is one of the most important tools for addressing the problem of transport. This section states that States must adopt SIPs that contain provisions prohibiting sources within the State from contributing significantly to nonattainment problems in, or interfering with maintenance by, downwind States. Section 110(k)(5) of the CAA authorizes EPA to find that a SIP is substantially inadequate to meet any CAA requirement. It further authorizes EPA to require a State with an inadequate SIP to submit, within a specified period, a SIP revision to correct the inadequacy.

By notice dated October 27, 1998, EPA issued its final rule under sections 110(a)(2)(D) and 110(k)(5) NO X SIP call rules finding that emissions of NO X from 22 States and the District of Columbia significantly contribute to downwind areas' nonattainment of the 1-hour ozone NAAQS (63 FR 57356). In the NO X SIP call rule, as modified by the March 2, 2000 technical amendment (65 FR 11222), EPA also established emissions budgets for NO X that each of the identified States must meet through enforceable SIP measures. The SIP call rule addressed both the 1-hour ozone NAAQS in existence since 1979 and a revised 8-hour NAAQS EPA promulgated in 1997. Various industries and States challenged the final NO X SIP call rule by filing petitions for review in the U.S. Court of Appeals for the District of Columbia (D.C. Circuit).  1

The September 24, 1998 NO X SIP called required States to submit SIP revisions by September 30, 1999. State Petitioners challenging the NO X SIP call filed a motion requesting the Court to stay the submission schedule until April 27, 2000. In response, in May 1999, the DC Circuit issued a stay of the SIP submission deadline pending further order of the Court. Michigan versus EPA, No. 98-1497 (D.C. Cir., May 25, 1999) (order granting stay in part).

In a separate legal challenge to EPA's revised NAAQS for ozone, the D.C. Circuit remanded the 8-hour ozone NAAQS. American Trucking Associations, Inc. v. EPA, 175 F.3d 1027 upon rehearing 195 F.3d 4 (D.C. Cir. 1999). The Supreme Court is considering this case. Prior to presenting argument in the SIP call case, EPA informed the court that it would stay the 8-hour basis of the SIP call and requested that the court stay its consideration of the 8-hour basis of the SIP call due to the uncertainties created by the litigation. The EPA indefinitely stayed the NO X SIP call as it applies for the purposes of the 8-hour NAAQS (65 FR 56245, September 18, 2000).

On March 3, 2000, the court of appeals issued an opinion, largely upholding the 1-hour basis for the NO X SIP call. However, the court vacated and remanded the rule as it applied to three States—Wisconsin, Georgia and Missouri—on the basis that the record for the 1-hour standard did not support EPA's determinations with respect to these three States. The court also remanded, but did not vacate, two other minor issues—the definition of an electric generating unit, as applied to cogeneration units, and the control level assumed for internal combustion engines.

On April 11, 2000, in light of the court's favorable decision, EPA filed a motion with the court to lift the stay of the SIP submission date. The EPA requested that the court lift the stay as of April 27, 2000. The EPA recognized, however, that at the time the stay was issued, States had approximately 4 months (128 days) remaining to submit SIPs. Therefore, EPA's motion to lift the stay indicated that EPA would allow States until September 1, 2000 to submit SIPs addressing the SIP call. 2 On June 22, 2000, the Court granted EPA's request in part. The Court ordered that EPA allow the States 128 days from the June 22, 2000 date of the order to submit their SIPs. 3 Therefore, SIPs were due October 30, 2000. 4 Because the court vacated the rule as to Wisconsin, Georgia, and Missouri, these States were not required to submit SIPs by that date.

Today, EPA is making findings of failure to officially submit complete submissions to their SIPs, including adopted rules, in response to the SIP call. The States that are receiving these findings are Virginia, West Virginia, Alabama, Kentucky, North Carolina, South Carolina, Tennessee, Illinois, Indiana, Michigan, Ohio, and the District of Columbia. The EPA intends to continue working with these States so that they can submit approvable adopted rules as soon as possible. EPA is issuing findings today to help ensure continued progress in reducing NO X emissions in the eastern portion of the country.

These findings start an 18-month sanctions clock; if the State fails to make the required submittal which EPA determines is complete within that period, the emissions offset sanction will apply in accordance with 40 CFR 51.121(n) and 52.31. The offset sanction requires new or modified sources subject to a CAA section 173 new source review program for ozone to obtain reductions in existing emissions in a 2:1 ratio to offset their new emissions. 5 If 6 months after the sanction is imposed, the State still has not made a complete submittal that EPA has determined is complete, limitations on the approval of Federal highway funds will apply in accordance with 51.212(a) and 52.31. Conversely, the 18-month clock, or additional 6-month clock, stops and the sanctions will not take effect (or will be lifted) when EPA finds that the State has made a complete SIP submittal under the SIP call.

In addition, CAA section 110(c) provides that EPA can promulgate a FIP immediately after making the findings, as late as 2 years after making the findings, or any time in between. Public health in downwind States depends on reductions being made upwind, and it is important that sources in States that have met their obligations under the NO X SIP call are not at a competitive disadvantage to sources in other States subject to the NO X SIP call. The EPA will take these needs into consideration as it reviews taking any action regarding FIPs.

Our goal is to have approvable SIPs that meet the requirements of the NO X SIP call. We remain ready to work with the States to develop fully approvable SIPs, which would eliminate the need for EPA to promulgate a FIP or replace any FIP that EPA adopts. The process of developing the SIP call rulemaking offered opportunities for collaboration, and such opportunities remain as the States continue to develop their SIPs.

Recently, EPA sent letters to the Governors of the affected States describing the status of the States' effort and these findings in more detail. These letters are included in the docket to this rulemaking.

This notice is final agency action but is not subject to notice-and-comment requirements of the Administrative Procedures Act (APA), 5 U.S.C. 553(b). The EPA invokes, consistent with past practice (for example, 61 FR 36294), the good cause exception pursuant to the APA, 5 U.S.C. 553(b)(3)(B). The EPA believes that because of the limited time provided to make findings of failure to submit and findings of incompleteness regarding SIP submissions or elements of SIP submission requirements, Congress did not intend such findings to be subject to notice-and-comment rulemaking. Notice and comment are unnecessary because no significant EPA judgment is involved in making a nonsubstantive finding of failure to submit SIPs or elements of SIP submissions required by the CAA. Furthermore, providing notice and comment would be impracticable because of the limited time provided under the statute for making such determinations. Finally, notice and comment would be contrary to the public interest because it would divert agency resources from the critical substantive review of complete SIPs. See 58 FR 51270, 51272, n.17 (October 1, 1993); 59 FR 39832, 39853 (August 4, 1994).

This action is exempt from OBM review under Executive Order 12866.

Under the Regulatory Flexibility Act (RFA), 5 U.S.C. et seq. , EPA must prepare a regulatory flexibility analysis assessing the impact on small entities of any rule subject to the notice-and-comment rulemaking requirements. Because this action is exempt from such requirements, as described under (A) above, it is not subject to the RFA.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, and tribal governments, in the aggregate, or to the private sector, of $100 million or more in any 1 year. Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost-effective or least burdensome alternative that achieves the objectives of the rule.

Before EPA establishes any regulatory requirements that may significantly or uniquely affect small governments, including tribal governments, it must have developed under section 203 of the UMRA a small government agency plan. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates, and informing, educating, and advising small governments on compliance with the regulatory requirements.

Today's rule contains no Federal mandates (under the regulatory provisions of title II of the UMRA) for State, local, or tribal governments or the private sector. The various CAA provisions discussed in this notice require the States to submit SIPs. This notice merely provides a finding that the States have not met those requirements. This notice does not, by itself, require any particular action by any State, local, or tribal government, or by the private sector.

For the same reasons, EPA has determined that this rule contains no regulatory requirements that might significantly or uniquely affect small governments.

Under section 801(a)(1)(A) of the APA, as amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), EPA submitted, by the effective date of this rule, 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 General Accounting Office. This rule is not a “major rule” as defined by APA 804(2), as amended.

The EPA is issuing this action as a rulemaking. There is a question as to whether this action is a rule of “particular applicability” under § 804(3)(A) of the APA as amended by SBREFA, and thus exempt from the congressional submission requirements, because this rule applies only to named States. In this case, EPA has decided to err on the side of submitting this rule to Congress, but will continue to consider this issue of the scope of the exemption for rules of “particular applicability.”

This rule does not contain any information collection requirements which require OMB approval under the Paperwork Reduction Act (44 U.S.C. 3501 et seq. ).

Under CAA section 307(b)(1), a petition to review today's action may be filed in the Court of Appeals for the District of Columbia within 60 days of December 26, 2000.

Pursuant to section 182 of the Clean Air Act (CAA), ozone nonattainment areas classified as serious or above are required to implement RACT for all major sources of NO X by no later than May 31, 1995. The major source size is determined by the classification of the nonattainment area and whether it is located in the Ozone Transport Region which was established by the CAA. Because the District of Columbia is classified as a serious ozone nonattainment area, major stationary sources are defined as those that emit or have the potential NO X to emit 50 tons or more of NO X per year.

On January 13, 1994, the District of Columbia Department of Consumer and Regulatory Affairs (DCRA), now known as the District of Columbia Department of Public Health (DCPH), submitted revisions to its State Implementation Plan (SIP) that included a new regulation, Section 805, entitled “Reasonably Available Control Technology for Major Stationary Sources of Oxides of Nitrogen,” to Subtitle I (Air Quality) of Title 20 of the District of Columbia Municipal Regulations (DCMR). Section 805 requires sources which emit or have the potential to emit 50 tons or more of NO X per year to comply with RACT requirements by May 31, 1995.

On February 25, 1999 (64 FR 9272), EPA published a direct final rulemaking (DFR) conditionally approving the District of Columbia's NO X RACT regulation found in section 805 of Title 20 of the DCMR. A companion notice of proposed rulemaking (NPR) proposing conditional approval the District of Columbia's NO X RACT regulation was published in the Proposed Rules section of the same February 25, 1999 Federal Register (64 FR 9289). In the February 25, 1999 DFR, EPA stated that if adverse comments were received within 30 days of its publication, EPA would publish a document announcing the withdrawal of that DFR before its effective date. Because EPA did receive adverse comments on the February 25, 1999 DFR within the prescribed time frame, we withdrew it. Under these circumstances the companion NPR remained in effect and interested parties submitted comments pursuant to that NPR. The withdrawal of the DFR document appeared in the Federal Register on April 13, 1999 (70 FR 17982).

On August 28, 2000, the District of Columbia submitted proposed revisions to EPA, for parallel processing, to Section 805 of Title 20 of the DCMR as a supplement to its January 13, 1994 SIP submittal. These revisions correct the deficiencies identified in the February 25, 1999 notice. On September 28, 2000 (65 FR 58249), EPA published a new NPR which withdrew its February 25, 1999 proposed conditional approval and instead proposed full approval of the District's NO X RACT regulation as amended by its August 28, 2000 submittal. The specific requirements of the District of Columbia's NO X RACT regulation and the rationale for EPA's approval are explained in the September 28, 2000 NPR and will not be restated here. No public comments were received on the September 28, 2000 NPR.

These proposed revisions were approved by the District of Columbia City Council on October 17, 2000, adopted on October 26, 2000 and became permanent and effective on December 8, 2000. EPA is fully approving the District of Columbia's NO X RACT regulation found in section 805 of Title 20 of the DCMR submitted on January 13, 1994 and supplemented on August 28, 2000, October 26, 2000 and December 8, 2000.

EPA is fully approving the District of Columbia's NO X RACT regulation found in section 805 of Title 20 of the DCMR. This SIP revision was submitted by the District of Columbia on January 13, 1994 and supplemented with a revised version of section 805 of Title 20 of the DCMR submitted for parallel processing on August 28, 2000. The revised regulations were adopted by the District of Columbia on October 26, 2000 and became permanent and effective in the District on December 8, 2000. The District submitted the fully adopted and effective revised version of section 805 of Title 20 of the DCMR to EPA on December 8, 2000. The regulations formally adopted were exactly the same as the proposed version upon which EPA proposed approval. Approval of this SIP revision is necessary for full approval of the attainment demonstration SIP for the Metropolitan Washington, DC ozone nonattainment area.

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 (Pub. L. 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 must be filed in the United States Court of Appeals for the appropriate circuit by February 26, 2001. 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 approving the District of Columbia's NO X RACT regulation may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

Throughout this document, “we,” “us” and “our” refer to EPA.

On July 24, 2000 (65 FR 45566), EPA proposed a limited approval of the following rules that were submitted for incorporation into the Arizona SIP.

We proposed a limited approval because we determined that these rules improve the SIP and are largely consistent with the relevant CAA requirements. However, we cannot grant a full approval because the rules contain deficiencies which conflict with section 110 of the Act. Our proposed action contains more information on the basis for this rulemaking, but the major deficiency that we identified is that the rules do not adequately specify test methods, recordkeeping, monitoring, and other requirements needed to make the rules enforceable.

EPA's proposed action provided a 30-day public comment period. During this period, we received a letter dated August 22, 2000 from Donald Gabrielson of PCAQCD. This letter clarified that EPA's proposed action “will not trigger a requirement for additional revisions of these rules.” EPA concurs with this statement. The letter also requested that EPA explicitly delete old PCAQCD rules R7-3-3.1, 3-2 and 3-3 when approving new PCAQCD rules 5-18-740, 19-800 and 24-1055. As stated below, EPA's final action to approve the new rules will supercede the old rules.

No comments were submitted that change our assessment of the rules as described in our proposed action. Therefore, as authorized in sections 110(k)(3) and 301(a) of the Act, EPA is finalizing a limited approval of the submitted rules. This action incorporates the submitted rules into the Arizona SIP, including those provisions identified as deficient and will supercede Rules 7-3-3.1, 7-3-3.2, and 7-3-3.3 from the SIP. Note that the submitted rules have been adopted by the PCAQCD, and EPA's final limited approval does not prevent PCAQCD from enforcing them. Because this is an attainment area, EPA is not simultaneously finalizing a limited disapproval of the rules. As a result, no sanctions clocks under section 179 or FIP clocks under section 110(c) are associated with this action.

The Office of Management and Budget (OMB) has exempted this regulatory action from Executive Order (E.O.) 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 E.O. 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 E.O. 13045 because it does not involve decisions intended to mitigate health or safety risks.

Under E.O. 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 OMB, 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, E.O. 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 E.O. 13084 do not apply.

E.O. 13132, entitled Federalism (64 FR 43255, August 10, 1999) revokes and replaces E.O. 12612, Federalism and 12875, Enhancing the Intergovernmental Partnership. E.O. 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 E.O. 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 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 E.O. 13132, because it merely acts on 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 act on 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 CAA, 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 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 costs of $100 million or more to either State, local, or tribal governments in the aggregate, or to the private sector. This Federal action acts on 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.

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.

EPA believes that VCS are inapplicable to today's action because it does not require the public to perform activities conducive to the use of VCS.

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).

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 February 26, 2001. 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).

You can find the index and the following supporting materials on the Internet at: http://www.epa.gov/epaoswer/hazwaste/ldr/index.htm

These regulations are promulgated under the authority of sections 1006(b), 2002, and 3004 of RCRA, as amended, 42 U.S.C. 6905, 6012(a), 6921, and 6924.

The LDR program generally requires that generators of hazardous wastes pretreat the wastes before they can be disposed of on land. The treatment must substantially reduce the toxicity or mobility of the hazardous waste to minimize short- and long-term threats to human health and the environment posed by the waste's disposal. See RCRA section 3004 (m)(1). EPA typically accomplishes this objective by requiring that hazardous constituents in the wastes be treated to, or be present at levels no greater than levels, set out in 40 CFR Part 268, reflecting performance of the Best Demonstrated Available Technology for the waste. In addition to BDAT treatment levels, EPA uses treatability variances (both risk-based and technology based), and determination equivalency (see 40 CFR 268.42) for situations where the treatment standard is specified as a method of treatment and other technologies perform comparably to the specified method.

Contaminated soils excavated during a remedial action, whether it is conducted under RCRA, Superfund, or state authority, are subject to the Land Disposal Restriction (LDR) requirements when the soil contains listed hazardous waste or exhibits a hazardous characteristic, and when it is excavated outside of a corrective action management unit (CAMU) or an area of contamination (AOC). EPA's rules require that soils contamination with hazardous waste(s) meet LDR requirements when a generator excavates such soils and places them in a land disposal unit (See RCRA sections 3004(d)(3) and (e)(3) (requiring LDR requirements to apply to such contaminated soils); 63 FR at 28602 (May 26, 1998)). 1 The LDR requirements specify constituent concentrations which must be met in the treated soils, or in some cases particular technologies which must be employed, prior to placement of the soils. Application of these requirements to remedial actions has sometimes reduced the flexibility needed to make site-specific remedial decisions, and thus sometimes presented a barrier to cost-effective management of contaminated media. (As explained in the following section, however, the special standards for contaminated soils which EPA adopted in the Phase 4 rule should alleviate some of these difficulties, since those standards can be achieved without resort to combustion treatment technology.) While there are alternatives to managing contaminated soils which mitigate the burden of meeting these requirements (such as obtaining a treatability variance once the LDRs are triggered), it has been EPA's experience that the LDRs often have driven remedial decisions away from excavating the soils in the first place. Under such circumstances, facilities, may simply have deferred cleanup to a later date. In cases where cleanup was still pursued, it was often the case that either containment remedies have been employed ( e.g. , cap and cover in-place, thereby avoiding the LDRs) or the soils have been treated in-situ (which allows treatment without triggering LDRs). While containment and in-situ treatment of soils offer management options which have generally been less expensive than complying with the LDR requirements for the media, they may not always result in the most environmentally protective cleanup.

EPA has long recognized the incentives and objectives for the hazardous waste prevention and cleanup programs differ fundamentally. EPA has developed extensive policies and regulations to preserve RCRA's goal of protectiveness, while providing oversight agencies the tools necessary to make effective site-specific remedial decisions. One such regulation is the Phase IV LDR Rule (63 FR 28603-04). Promulgated in May 26, 1998, the Phase IV LDR Rule established alternative soil treatment standards, in part, to remedy the disincentives to excavation/ex-situ treatment of soils which were created by application of the LDRs in a remedial setting. In recognition of the physical and chemical differences which often exist between as-generated waste and contaminated soils, these standards require that contaminated soils which will be land disposed be treated to reduce concentrations of hazardous constituents by 90 percent or meet hazardous constituent concentrations that are ten times the universal treatment standard (UTS), whichever is greater. (See Louisiana Environmental Action Network v. EPA , 172 F. 3d 65, 67, 70 (D.C. Cir. 1999) which upheld EPA's authority to develop more lenient treatment standards for contaminated soils and other remediation wastes in order to encourage remediation involving exhumation and treatment of these wastes, since “the agency's authority to compel high-quality disposition of such wastes is not as great as it is for as yet undisposed waste.”) The soil treatment standards apply to all underlying hazardous constituents reasonably expected to be present in any given volume of contaminated soil when such constituents are found at initial concentrations greater than ten times the UTS (See 63 FR at 28608-28609; 40 CFR 268.49(d)).

Importantly for the present rule, the existing standards further require that generators treat all constituents subject to treatment (CST)  2 in contaminated soils. See 63 FR at 28608-09; 40 CFR 268.49(d). A constituent subject to treatment is any hazardous constituent listed at 40 CFR 264.48 that might be present in the soil at levels exceeding 10 times the UTS for that constituent. See 40 CFR 268.49(b). In the Phase IV rule, EPA imposed this requirement for the first time on soils exhibiting the Toxicity Characteristic (TC) for metals, and on soils containing listed hazardous wastes. 3

PCBs can be an example of a CST in contaminated soils, including metal-containing soils. Where this occurs, the Phase IV rule establishes a treatment standard of 100 ppm total PCBs in soil (10 times the UTS) or 90 percent reduction of total PCB concentrations in the soil, whichever is less stringent. See 40 CFR 268.49(c). EPA found that generators can achieve these standards without applying combustion technology, (see 63 FR at 28616 Table 4), although treatment often requires that heat be applied to the waste, as occurs with thermal desorption technology. The rules also provide another treatment option: to treat soils to the standards applicable to process wastes, although in that instance as well, soils that exhibit a hazardous characteristic must achieve treatment standards for CSTs before they are land disposed. 40 CFR 268.40(e). EPA found that generators can achieve these standards without applying combustion technology, (see 63 FR at 28616 Table 4), although treatment often requires that heat be applied to the waste, as occurs with thermal desorption technology.

RCRA also addresses PCBs in soils under Section 3004(d)(2)(E), the so-called California list provision. This provision prohibits land disposal of hazardous wastes that contain halogenated organic compounds at concentrations equal to or exceeding 1000 ppm. Congress specified this level (and the other California list levels) as a starting point in the land disposal prohibition process, prohibiting land disposal of wastes that pose the most obvious hazards. See 51 FR at 44718 (Dec. 11, 1986). PCBs are a type of halogenated organic compound. Consequently, in the absence of the Phase IV PCB standards, the 1000 ppm statutory level would be the upper bound of PCBs that could be in contaminated soil without triggering LDR treatment requirements ( i.e. , contaminated soils could not be land disposed equal to or greater than 1000 ppm total HOCs all of which, in theory, could be PCBs).

Unfortunately, initial indications are that the requirement that PCBs be treated as a CST in soils exhibiting the TC for metals is having an effect opposite to what EPA intended. As EPA noted at proposal, cleanups of sites with metal characteristic soils where PCBs are now a CST and where the remedy was to involve soil exhumation, treatment and redisposal have stopped, or been seriously delayed. See Letter from Phillip Comella Esq. to Steven Silverman, EPA Office of General Counsel, April 21, 1999 detailing experiences of private entities, including waste generators, treaters and disposers; Memorandum to Administrative Record, November 2, 1999 (detailing experiences of EPA site managers). As set out in more detail in these communications, the reason is that as a practical matter a choice is now being presented between combustion and leaving soils in place. Some of the reasons attributed for this are:

Commenters acknowledge that at least some of these situations could be eligible for a treatment variance under 40 CFR 268.44. Such variances can be requested when a standard is demonstrably not achievable using non-combustion technology, or when treatment to LDR levels would discourage aggressive remediation. See LEAN v. EPA , 172 F. 3d at 70 (upholding EPA authority to issue treatment variances for remediation wastes where existing treatment standard discourages aggressive remediation). But there are undesirable delays attendant in the variance process, and EPA in any case believes that if a problem with a rule is widespread, it is appropriate to amend the rule rather than issuing variances piecemeal.

Commenters to the proposed rule reiterated that cleanups of TC metal soils containing PCBs is being impeded, but provided no additional empirical information in support.

EPA does not necessarily agree with all of these comments, but does believe that remediations involving TC soils contaminated with both PCBs and metals are being delayed or stopped. This situation has taken place after promulgation of the new Phase IV requirements respecting these soils, and, as indicated at proposal, it appears that at least some of the reasons for these delays are legitimately attributable to the new requirements in the Phase IV rule. Commenters all supported this overall conclusion (albeit anecdotally rather than empirically). Thus, this aspect of the Phase IV rule appears at least potentially to be having an environmentally counterproductive effect of delaying cleanups and discouraging aggressive remediation.

EPA believes it is appropriate to temporarily defer the requirement that PCBs be treated as an CST in TC soils under RCRA 1006(b) in order to investigate how best to integrate the RCRA LDR requirements for PCBs with the cleanup programs under Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and RCRA (both the specific “corrective action” requirements of RCRA 3004(u) and (v) and 3008(h), and the cleanup requirements applying to RCRA regulated units, e.g. , during closure).

Another reason is to provide EPA an opportunity to investigate further the relationship between the RCRA rules and those under the authority of the Toxic Substances Control Act (TSCA) for PCB remediation wastes. See 63 FR 35384 (June 29, 1998). TSCA allows “bulk PCB remediation wastes” including soils containing 50 ppm PCBs or greater to be disposed without treatment in a TSCA disposal facility or an RCRA subtitle C landfill. See 40 CFR 761.61(b)(2)(i). These TSCA standards, which allow disposal without treatment of soils containing any concentrations of PCBs greater or equal to 50 ppm, were not established to represent levels at which threats posed by land disposal of PCB-containing soils are minimized. Furthermore, those rules require persons disposing of PCBs to comply with all other applicable Federal, State, and local laws and regulations, and should not be read as overriding applicable RCRA requirements. Nonetheless, the TSCA rules serves a similar purpose as the RCRA Phase IV rule—an attempt to encourage aggressive remediation of contaminated soil (see 63 FR at 35409) and reflects the Agency's judgment that land disposal of these soils is reasonably protective.

Under RCRA the standard set forth by Congress for the LDR program was to “* * * promulgate regulations specifying those levels or methods of treatment, if any, which substantially diminish the toxicity of the waste or substantially reduce the likelihood of migration of hazardous constituents from the waste so that short-term and long-term threats to human health and the environment are minimized.” See 42 U.S.C. 6924(m). Under TSCA Congress authorized EPA to prescribe methods for the disposal of PCBs so long as they do not “present an unreasonable risk to health or the environment.” See 15 U.S.C. 2605(e). TSCA also explicitly requires EPA to consider economic impact when promulgating rules under its authority. See 15 U.S.C. 2601(b) and (c). By comparison, Congress did not identify economic considerations under RCRA in setting treatment standards. “* * * Waste that is nevertheless generated should be treated, stored or disposed of so as to minimize the present and future threat to human health and the environment.” See 42 U.S.C. 6902(b). Thus, the RCRA LDR program differs from regulations promulgated under TSCA in two respects. First, the RCRA LDR program has an explicit requirement to treat waste prior to disposal. TSCA contains no such requirement. Second, TSCA has an explicit requirement to consider economic impacts when the Agency promulgates regulations under its authority that is not present in RCRA. Although both types of regulations are intended to address health and environmental risks from PCBs, these key differences between RCRA and TSCA can lead to different approaches to environmental regulation. Certainly as an interim measure EPA believes it appropriate to seek to coordinate better the two sets of rules, and thus to defer the Phase IV rule while we further evaluate the workings and actual effect of the two sets of rules. EPA believes it is appropriate to temporarily defer the requirement that PCBs be treated as a CST in TC soils under RCRA 1006(b) in order to investigate how best to integrate the RCRA LDR requirements for PCBs with the cleanup programs under Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and RCRA (both the specific “corrective action” requirements of RCRA 3004(u) and (v) and 3008(h), and the cleanup requirements applying to RCRA regulated units, e.g. , during closure).

The statutory California list provision mentioned above (RCRA section 3004(d)(2)(E)) will create an upper bound on the concentration of PCBs in soil that could be disposed without treatment. As explained earlier, that upper bound will be 1,000 ppm, the statutory limit for halogenated organic compounds. This means that the temporary deferral will only affect a relatively narrow class of wastes: soils exhibiting the TC for metals and containing PCBs in concentration between 100 ppm and a maximum of 1000 ppm (this maximum applying only if no other HOCs are present in the contaminated soil).

RCRA allows temporary deferral of the Phase IV requirement. As in the temporary deferral of RCRA requirements to accommodate a potentially overlapping regulatory regime for underground storage tanks at issue in Edison Electric Inst. v. EPA , 2 F. 3d 438 (D.C. Cir. 1993), EPA here needs to investigate further the relationship of different sets of rules addressing PCB-contaminated soil disposal. These soils will be managed protectively during the deferral period, either in RCRA subtitle C or TSCA-approved landfills, and there is a reasonable upper bound on the concentration of PCBs that could be disposed of without treatment. See 2 F.3d at 452-53 citing these factors as a reasonable justification for a comparable temporary deferral. Moreover, EPA may permissibly alter land disposal restriction treatment standards for remediation wastes in order to encourage aggressive remediations. See LEAN, 172 F. 3d at 69-70.

The scope of this deferral is exclusive to soils exhibiting the TC for metals which contain PCBs as an underlying hazardous constituent. The requirement to treat PCBs as a CST also can apply to soils containing a listed hazardous waste, where the generator elects to comply with the alternative soil standard of 10 times Universal Treatment Standard or 90 percent reduction of initial concentrations. See 40 CFR 268. 49(d). It should be noted, however, that a generator would have the option of treating such soil to the standards for process wastes, see 40 CFR 268.49(b), in which case there is no requirement to treat CSTs. Thus, generators do not face the same quandary as they do with soils exhibiting the TC for metals which contain PCBs as a .

In general, all comments supported the deferral of PCBs as a constituent subject to treatment in soils. Commenters felt that the inconsistency between RCRA and TSCA regulations concerning the treatment/disposal of material containing PCBs should be resolved.

As noted at proposal, EPA believes it is appropriate to seek a better coordination between the two sets of rules, and thus to defer PCBs as an CST in soils, while the Agency further evaluates the workings and actual effect of the two sets of rules. Several commenters suggested that EPA simply defer to the TSCA rule without an independent determination that the TSCA standards are sufficient to minimize threats posed by land disposal. EPA does not believe that this suggestion can be supported. RCRA requires that treatment standards for hazardous waste must minimize the threats posed by land disposal. RCRA section 3004(m). The TSCA rule was not developed to satisfy that standard. See, e.g., Chemical Waste Management v. EPA , 976 F. 2d 2, 25 (D.C. Cir. 1992) (EPA may not defer LDR treatment requirements to less stringent disposal requirements of another environmental statute); see also Hazardous Waste Treatment Council v. EPA , 886 F. 2d 355, 362-63 (D.C. Cir. 1989) noting stringency of the minimize threat standard in RCRA section 3004 (m), and further explaining why that requirement justifies LDR standards more stringent than those developed pursuant to less stringent statutory standards).

Another general recommendation is that EPA should extend the deferral to all soils, debris and PCB bulk product waste that contain listed hazardous waste, as well as for soils that are hazardous waste due to the exhibition of a TC for a metal. EPA has not received any hard information, or any convincing reasons, why the Phase IV requirements should be impeding treatment of soils contaminated with listed hazardous wastes. As already explained, the rules allow generators the option of treating the soil to the standards for process wastes, see 40 CFR 268.49(b), in which case there is no requirement to treat CSTs. Moreover, this alternative (to treat soil to meet the standards for listed hazardous waste) represents the status quo before the Phase IV rule (i.e. it merely restates already-existing regulatory requirements), so that one cannot properly attribute to the Phase IV rule any impediment to remediating these contaminated soils. Generators thus can continue to operate as they did before promulgation of the Phase IV rule.

Under section 3006 of RCRA, EPA may authorize qualified States to administer and enforce the RCRA hazardous waste program within the State. Following authorization, we maintain independent enforcement authority under sections 3007, 3008, 3013, and 7003 of RCRA, although authorized States have enforcement responsibility. A State would become authorized for today's proposed PCB treatment standard for contaminated soil by following the approval process described under 40 CFR 271.21. See 40 CFR 271 for the overall standards and requirements for authorization.

Like all land disposal restriction treatment standards, today's changes are proposed under the authority of 3004(g) and (m) of RCRA. These statutory provisions were enacted as part of the Hazardous and Solid Waste Amendments (HSWA) of 1984. Under section 3006(g) of RCRA, new requirements promulgated under the authority of statutory provisions added by HSWA go into effect in authorized States at the same time as they do in unauthorized States—as long as the new requirements are more stringent than the requirements a State is currently authorized to implement.

Authorized States are not required to modify their programs when we promulgate changes to Federal requirements that are less stringent than existing Federal requirements. This is because RCRA section 3009 allows the States to impose (or retain) standards that are more stringent than those in the Federal program. (See also 40 CFR 271.1(i)). Therefore, States that are authorized for the LDR program are not required to adopt today's changes, and these changes do not go into effect until the State revises its LDR program accordingly. However, we encourage States to allow compliance with the new PCB treatment standard for contaminated soil if they have the ability under State law to waive existing land disposal restriction treatment standards, or if they have adopted them but are not yet authorized. Again, if a State is not currently authorized for the LDR program, we will implement the new treatment standard in that State.

Under Executive Order 12866, (58 FR 51735 (October 4, 1993)) the Agency must determine whether a regulatory action is “significant” and therefore subject to OMB review and the requirements of the Executive Order. The Order defines “significant regulatory action” as one that is likely to result in a rule that may:

OMB has determined that this rule is not a “significant regulatory action” under the terms of Executive Order 12866 and is therefore not subject to OMB review.”

We estimated the costs of today's final rule to determine if it is a significant regulation as defined by the Executive Order. The analysis considered compliance cost savings from the deferral and resulted in cost savings. A detailed discussion of the methodology used for estimating the costs, economic impacts and the benefits attributable to today's final rule, followed by a presentation of the cost, economic impact and benefit results were prepared and documented in the following report: “Economic Assessment of the Deferral of Phase IV Land Disposal Restriction Treatment Standards for Polychlorinated Biphenyls (PCBs) as an Underlying Hazardous Constituent in Contaminated Soils.” This report can be found in its entirety in the docket for today's final rule. A summary of the report is provided below.

To estimate the cost savings associated with today's final rule deferring of CST requirements for PCB-containing hazardous soils, the Agency estimated the difference between the costs that would have been incurred in the absence of the deferral and the costs estimated under the post-regulatory environment with the deferral. The cost savings are reported based upon a shift of more expensive baseline treatment technologies (incineration, thermal desorption or nonthermal treatment for PCB-containing hazardous waste soils that exhibit a TC for metal) followed by immobilization of the residue to less expensive post-regulatory treatment including immobilization of soils exhibiting a TC for metal soils. Although generally placing soils that are metal contaminated are prohibited from being combusted, all of the contaminated soils affected by this rulemaking have incineration as an option. Only soils with an insignificant organic content are prohibited from combustion as a treatment technology. Soils with PCBs at levels greater than 10 ppm are considered to have sufficient organic content. See May 23, 1994 memo from Elliott Laws to Waste Management Directors I—X for further details.

The procedure for estimating the volumes of PCB-containing hazardous wastes affected by today's final rule is detailed in the background document “Economic Assessment of the Deferral of Phase IV Land Disposal Restriction Treatment Standards for Polychlorinated Biphenyls (PCBs) as an Underlying Hazardous Constituent in Contaminated Soils,” which was placed in the docket for today's final rule. To estimate volumes of TC hazardous PCB contaminated soils affected by this rulemaking, the Agency looked at data received from a waste treatment firm and extrapolated it national estimates of soils remediated using Biennial Reporting Systems data. The Agency estimates annual affected soil volumes to be 86,500 tons.

The Phase IV LDR final rule  4 applied a requirement to treat all TC metal waste (i.e., wastes that are hazardous because they exhibit the toxicity characteristic for selected metals and carry the corresponding EPA hazardous waste number D004 through D011) for CSTs reasonably expected to be present. 5 In practical terms, this means that if a hazardous waste that is only hazardous for metal constituents also contains organic constituents above the UTS levels, those underlying organic constituents must also be treated to the UTS level if the waste is to be land disposed. 6 For PCBs, the UTS level is 10 ppm. 7,   8

The Phase IV LDR final rule also established an alternative set of treatment standards for hazardous soils. These alternative standards were designed to encourage cost-effective cleanup of hazardous contaminated soils that are subject to LDRs. Prior to the Phase IV LDRs, hazardous soils were required to comply with the traditional technology-based treatment standards developed for processed industrial hazardous waste. These treatment standards often proved to be inappropriate ( e.g. , not cost effective) and unachievable ( e.g. , did not account for heterogeneous soil matrices) when applied to hazardous constituents present in soils. For example, in the case of TC metal soils containing PCBs, treating both metals and PCBs would entail a combination of treatment technologies. These technologies most likely would consist of incineration (or other thermal treatment) to destroy the PCBs, followed by immobilization of the ash to prevent the metallic constituents from leaching. This treatment approach is problematic because (1) it is expensive, (2) it destroys the soil, which is a valuable natural resource, and (3) incineration of metal bearing waste and/or soils is generally considered to be impermissible dilution (because it may allow metals to volatilize and enter the atmosphere) unless it has sufficient organic content to justify treatment. The alternative soil treatment standards provide more flexible, less stringent treatment requirements that, for many contaminants, are achievable using a variety of non-thermal treatment alternatives. For instance, a site may now choose to (1) reduce hazardous constituents by at least 90 percent of their initial concentration, or (2) meet ten times the applicable universal treatment standard. 9 Thus, for TC metal soils that contain PCBs, the PCBs currently must be treated to either 90 percent reduction or to 100 ppm (which is 10 times the UTS level), whichever is greater, prior to land disposal. EPA intended that these alternative treatment standards would allow soils to be treated using non-combustion treatment technologies.

To estimate costs saving resulting from this rule, EPA examined a number of thermal and non-thermal treatment technologies for PCBs and TC metals along with their estimated costs and commercial availability. The Agency then took the estimated soil volumes and assigned treatment trains to percentages of the affected volume ( e.g. 10 percent of affected soils are estimated to be treated through in-situ technologies) in both the baseline ( i.e. pre-regulation) and post-rule. EPA's estimate of cost savings is the difference between the more expensive baseline treatment remedies ( e.g. incineration) and the less expensive post-rule treatment remedies ( e.g. stabilization). The baseline treatment remedies are more expensive because they require treatment of both PCBs and metal whereas the post-rule treatment remedies only require treatment of metals for the affected soils. The extent of the cost savings from the deferral of LDR treatment standards for TC metal PCB-containing hazardous waste soils depends on the decision whether to remediate the site, the decision to switch to in-situ clean-up remedies (avoiding LDR treatment standards) and the decision to pursue other administrative remedies such as treatability variances. As the result, EPA has estimated the incremental treatment cost savings attributable to the deferral of the Phase IV LDR treatment standards for PCBs as a CST in hazardous soils to be $47.6 million annually. EPA notes that these cost savings are not new savings under the Land Disposal Restriction program. Rather, these cost savings are saving previously provided from the PCB disposal rule (63 FR 34384, June 29, 1998). The PCB disposal rule allowed greater flexibility in the types of land disposal units that PCB-contaminated remediation waste could be placed in including RCRA Subtitle C hazardous waste landfills for soils with PCB concentrations greater than 50 ppm and Part 258 RCRA nonhazardous landfills for soils with PCB concentrations less than 50 ppm. See 40 CFR 761.61(a)(5)(ii)&(iii).

EPA has not completed an economic impact analysis with today's final rule due to uncertainty regarding the identity of owner/operators of affected sites. Because this final rule results in cost savings mentioned above, any economic impacts would be favorable to affected entities. Because affected entities would be subject to less stringent treatment requirements for PCBs in TC contaminated soils, they would only have to treat the metals in the soil which would mean lower treatment costs and therefore less expensive site cleanups.

The primary benefit of this final rule is to encourage remediation of soils contaminated with both TC metals and PCB soils. The Economic Analysis completed for this rule documents a list of public commenters who have stipulated that they are not conducting cleanups under current regulations. These additional clean ups will reduce the potential for environmental releases of hazardous constituents, given the increased treatment of TC metals and placement of these soils into secure land disposal units.

The RFA generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute 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 organizations, and small governmental jurisdictions.

For purposes of assessing the impacts of today's rule on small entities, small entity is defined as: (1) A small business; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of today's final rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. In determining whether a rule has a significant economic impact on a substantial number of small entities, the impact of concern is any significant adverse economic impact on small entities, since the primary purpose of the regulatory flexibility analyses is to identify and address regulatory alternatives “which minimize any significant economic impact of the proposed rule on small entities.” 5 U.S.C. Sections 603 and 604. Thus, an agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, or otherwise has a positive economic effect on all of the small entities subject to the rule. The overall economic impact of today's final rule to defer LDR treatment standards for TC metal PCB-containing hazardous waste soils results in cost savings of $47.6 million (for additional detail see cost savings discussion above). We have therefore concluded that today's final rule will relieve regulatory burden for all small entities.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, and tribal governments, in the aggregate, or to the private sector, of $100 million or more in any one year. Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost-effective or least burdensome alternative that achieves the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent with applicable law. Moreover, section 205 allows EPA to adopt an alternative other than the least costly, most cost-effective or least burdensome alternative if the Administrator publishes with the final rule an explanation why that alternative was not adopted. Before EPA establishes any regulatory requirements that may significantly or uniquely affect small governments, including tribal governments, it must have developed under section 203 of the UMRA a small government agency plan. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates, and informing, educating, and advising small governments on compliance with the regulatory requirements.

EPA has determined that this rule does not include a federal mandate that may result in estimated costs of $100 million or more to either state, local, or tribal governments in the aggregate. The rule would not impose any federal intergovernmental mandate because it imposes no enforceable duty upon state, tribal or local governments. States, tribes and local governments would have no compliance costs under this rule. It is expected that states will adopt this rule, and submit it for inclusion in their authorized RCRA programs, but they have no legally enforceable duty to do so. For the same reasons, EPA also has determined that this rule contains no regulatory requirements that might significantly or uniquely affect local governments. Thus, today's rule is not subject to the requirements of Sections 202 and 205 of UMRA.

The information collection requirements in this final rule have been submitted for approval to the Office of Management and Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. EPA has prepared and Information Collection Request (ICR) document: OSWER ICR No. 1442.15 (LDR Phase IV), and a copy may be obtained from Sandy Farmer, Collections Strategies Division; U.S. Environmental Protection Agency (2822); 1200 Pennsylvania Ave. N.W., Washington, D.C. 20460-0002, by e-mail at farmer.sandy@epamail.epa.gov, or by calling (202) 260-2740. A copy may also be downloaded off the internet at http://www.epa.gov/icr.

EPA believes the changes in this final rule to the information collection do not constitute a substantive or material modification. This rule would not change any of the information collection requirements that are currently applicable RCRA Land Disposal Restrictions Phase IV except to possibly reduce those requirements by requiring fewer references to PCBs. There is no net increase in recordkeeping and reporting requirements (if anything, there may be a slight decrease, as just noted). As a result, the reporting, notification, or recordkeeping (information) provisions of this rule will not need to be submitted for approval to the Office of Management and Budget (OMB) under section 3504(b) of the Paperwork Reduction Act, 44 U.S.C. 3501 et. seq.

Executive Order 13045: “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 final rule is not subject to the Executive Order because it is not economically significant as defined in Executive Order 12866, and because the Agency does not have reason to believe the environmental health or safety risks addressed by this action present a disproportionate risk to children.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law 104-113, section 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g. , materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

This final rulemaking does not involve technical standards. Therefore, EPA is not considering the use of any voluntary consensus standards.

Under Executive Order 12898, “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations,” as well as through EPA's April 1995, “Environmental Justice Strategy, OSWER Environmental Justice Task Force Action Agenda Report,” and National Environmental Justice Advisory Council, EPA has undertaken to incorporate environmental justice into its policies and programs. EPA is committed to addressing environmental justice concerns, and is assuming a leadership role in environmental justice initiatives to enhance environmental quality for all residents of the United States. The Agency's goals are to ensure that no segment of the population, regardless of race, color, national origin, or income, bears disproportionately high and adverse human health and environmental effects as a result of EPA's policies, programs, and activities, and all people live in clean and sustainable communities. To address this goal, EPA considered the impacts of this final rule on low-income populations and minority populations and concluded.

Today's final rule is intended to encourage aggressive remediation of contaminated soils, and thus, and to benefit all populations. As such, this rule is not expected to cause any disproportionately high and adverse impacts to minority or low-income communities versus non-minority or affluent communities.

Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), 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” are 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.”

This final rule does not have federalism implications. It 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. EPA has determined that this rule, would not have “federalism implications” within the meaning of Executive Order 13132. This is because the rule would not impose any direct effects on States, would not preempt State law, and would not constrain State administrative discretion. In fact, States need not even adopt this final rule as part of their authorized programs. Thus, the Executive Order does not apply to this rule.

Under Executive Order 13084, EPA may not issue a regulation that is not required by statute, that significantly 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, or EPA consults with those governments. If EPA complies by consulting, Executive Order 13084 requires EPA to 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 officials 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. Today's rule does not create a mandate on State, local or tribal governments. The rule does not impose any enforceable duties on these entities. Accordingly, the requirements of section 3(b) of Executive Order 13084 do not apply to this rule.

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 action is [OR is not] a “major rule” as defined by 5 U.S.C. 804(2). This rule will be effective.

The reader should also refer to the Proposed Rule at 65 FR 26802 and the Immediate Final Rule at 65 FR 26750, both published on May 9, 2000.

We received written comments from four parties during the comment period, two of which opposed the authorization. One comment expressed concern that Montana has more programs than the State can afford and it appeared that EPA wants to put more people out of business. Two comments expressed concern that this authorization would make Montana's rules more stringent than the Federal rules. One of these commenters later withdrew this comment but noted that StATS (EPA's database containing the status of Federal rule adoptions for each State) showed that Montana had not yet adopted EPA's less stringent Land Disposal Restrictions (LDR) rules and that it was odd and confusing that EPA plans to authorize Montana for some rules that are no longer effective. Another comment expressed concern that Montana has not been able to retain sufficient trained staff to adequately implement the Corrective Action program; one comment asked EPA to clarify that Montana cannot enforce HSWA rules until Montana adopts them; and one comment asked EPA to clarify that EPA cannot enforce non-HSWA requirements until Montana adopts them. Finally, three comments addressed EPA's statement in the Immediate Final Rule that EPA “retains the authority to take enforcement actions regardless of whether the State has taken its own actions”. Specifically, these three comments stated that in light of the Eighth Circuit decision in Harmon Industries, Inc. v. Browner, 1919 F. 3d 894 (8th Circuit 1999), EPA has no authority under RCRA to bring an enforcement action against a company that has already settled with an authorized State agency for the same violations.

Congress enacted RCRA in 1976 to provide nationwide protection against environmental and health dangers arising from the generation, management, and disposal of waste. Congress' overriding concern was “the effect on the population and the environment of the disposal of discarded hazardous wastes—those which by virtue of their composition or longevity are harmful, toxic, or lethal” and “present a clear danger to the health and safety of the population and to the quality of the environment.”  1 Both the statutory text and legislative history make clear that Congress considered the problems associated with hazardous waste management to be national in scope. See, e.g., RCRA 1003(b), 42 U.S.C. 6902(b), establishing a “national policy” that hazardous waste should be treated, stored or disposed to minimize its threat; RCRA 1003(a)(4) and (5), 42 U.S.C. 6902(a)(4) and (5). Subtitle C of RCRA, sections 3001-3023, establishes a “cradle-to-grave” regulatory structure overseeing the safe treatment, storage, and disposal of hazardous waste. 2 42 U.S.C. 6921-6939e. EPA believes it is clear that the protective management of hazardous waste is the central policy objective underlying RCRA Subtitle C.

To achieve its goal of nationwide protection, Congress established a system that relies on both the Federal and State governments. Congress established some statutory requirements governing hazardous waste management and directed EPA to establish additional standards governing the identification of hazardous waste, RCRA 3001, and the management of such hazardous waste by generators, RCRA 3002; transporters, RCRA 3003; and treatment, storage and disposal facilities, RCRA 3004. 42 U.S.C. 6921-6924. Congress also established a permit requirement for hazardous waste treatment, storage, and disposal facilities in RCRA 3005 and directed EPA to establish regulations governing permitting. These statutory and regulatory requirements make up the Federal hazardous waste management program. See 40 CFR parts 124, 260-270, and 273.

Congress also established a process in RCRA 3006 of Subtitle C allowing States to request EPA to authorize a qualified State program. 42 U.S.C. 6926. The State hazardous waste “program” consists of statutes and regulations issued by the State prior to authorization that EPA determines are equivalent to the Federally-issued hazardous waste program and meet other statutory authorization requirements. Once authorized, a State may carry out its authorized program “in lieu of the Federal program under * * * subtitle [C] in such State and * * * issue and enforce permits for the storage, treatment, or disposal of hazardous waste.” RCRA 3006(b).

When EPA authorizes a provision of a State-issued statute or regulation, that requirement replaces the equivalent, Federally-issued requirement, and becomes the Federal requirement governing regulated parties in the State. Authorization federalizes the State-issued requirement so that it becomes a requirement of RCRA Subtitle C. A regulated party complying with authorized State-issued requirements is also complying with Federal requirements. 3

The authorized State-issued laws also retain their status as independent State requirements. RCRA 3009 allows States to retain the authority to regulate hazardous waste within the national framework established in RCRA Subtitle C and regulations promulgated by EPA. 42 U.S.C. 6929. State requirements, however, may be no less stringent than those authorized under RCRA Subtitle C.

RCRA 3006(b) also gives EPA the power to authorize a qualified State “to issue and enforce permits” for treatment, storage, and disposal (TSD) facilities. Congress used RCRA 3006(d) to clarify the effect of authorization on the permits so that any permit issued by a State with an authorized program “shall have the same force and effect as action taken by the Administrator under this subtitle.” After EPA authorizes State permitting, the State rather than EPA issues any new permits and TSD facilities in such a State generally do not need to get a second permit from EPA, as they did prior to authorization. 4

(1) Comment: “Montana does not need to expand any more programs, we have more now than the people in this State can afford. Sounds [to] me like you want to put some more people out of business or drive them out of this State!”

EPA's response: Our authorization of Montana's application would not add new programs in Montana. Instead, it would merely authorize regulations that Montana adopted in 1995 to update a program that it has operated since 1984. RCRA requires that States continue to adopt new Federal rules for hazardous waste in order for States to continue to regulate hazardous waste under the Federal program. Before we authorize Montana's newly adopted hazardous waste rules, handlers of hazardous waste in Montana are actually subject to regulation by both Montana and EPA. After we authorize Montana's rules, as we are doing today, the primary responsibility for implementing those rules rests with Montana, and EPA's primary role becomes one of oversight.

(2) Comment: The commenters noted that the rules that EPA proposes to approve are more stringent than current Federal rules in some cases. The commenters noted that Montana cannot adopt rules that are more stringent than Federal rule and objected to EPA's approval until EPA provides assurance that the program elements that EPA is approving are not those in the application package, but are in fact Montana's December 1999 updated rules.

EPA's response: States must formally adopt rules before they can apply to EPA for approval. As a result, our review and authorization of State rules lags behind the State's own rulemaking process. RCRA allows States one year to adopt new Federal rules where no State statutory change is necessary and two years where a State statutory change is necessary. The process of application, review, and authorization of those newly adopted rules may take an additional year or more, particularly if a State's rules must subsequently be changed to establish equivalence to their Federal counterparts.

In 1993 and 1996, EPA revised some of the Federal Land Disposal Restriction rules (LDRs) to be less stringent than the original LDR rules. This occurred after Montana had already adopted the original LDR rules. Montana adopted the less stringent LDR rules in December 1999, but has not yet applied to EPA for authorization. When Montana applies for authorization of the less stringent LDR rules and if we find that Montana's LDR rules are equivalent to EPA's, we will authorize those rules in a later Federal Register action. Because Montana's current application contains other rules which were not made less stringent by EPA, we believe it is more expedient to authorize Montana's application now rather than wait until Montana submits an application containing the less stringent rules.

(3) Comment: The comment noted that StATS (EPA's data base containing the status of Federal rule adoptions for each State) shows that Montana has not yet adopted EPA's less stringent LDR rules. The comment also noted that Montana has in reality already adopted the less stringent LDR rules and found it rather odd and confusing that EPA plans to authorize Montana for some rules that are no longer effective.

EPA's response: At the time this comment was prepared, it may have been true that StATS incorrectly displayed the status of Montana's rule adoptions. However, as of June 30, 2000, StATS correctly displayed the adoption status of the rules in question.

For the second half of this comment, we refer the reader to comment number 2 above and add the following information: Whenever EPA modifies a rule, regardless of whether the change is to a less or a more stringent version, the lag between State adoption and EPA authorization may cause EPA to find itself authorizing a State for a rule which has already been changed. The apparent confusion will be cleared up when Montana submits an authorization update application which includes the less stringent LDR rules.

(4) Comment: Montana is unable to retain sufficient, multi-discipline trained, permanent staff to administer the Corrective Action program.

EPA's Response: As part of our review of Montana's hazardous waste program, we conducted Capability Assessments in 1994 and 2000 which examined precisely this question. These Capability Assessments are available through a Freedom of Information Act request or they may be viewed at the EPA Montana Office in Helena, Montana or at the EPA Region 8 office in Denver, Colorado.

EPA's 1994 Capability Assessment revealed that Montana had experienced some of the difficulties described in the comment. However, EPA's 2000 Capability Assessment revealed that Montana's Department of Environmental Quality (DEQ) and the Montana Legislature implemented several important changes since the time period described in the comment. These changes resulted in significant improvements in retention of qualified staff. The current staff and management within the DEQ hazardous waste program collectively have many years of experience in a variety of relevant technical and environmental program areas. We believe that the current mix of skills, experience, and retention in DEQ's hazardous waste program is sufficient to implement the Corrective Action program.

(5) Comment: EPA should clarify that Montana has no authority to enforce HSWA rules until the State adopts them. (The comment referred to EPA's statement in the Immediate Final Rule that EPA and Montana have agreed to joint permitting and enforcement for those HSWA requirements for which Montana is not yet authorized.)

EPA's response: Under a previous long-standing agreement, EPA and Montana have agreed that, when necessary, the agencies will issue a single, jointly-prepared permit document containing the signatures and authorities of both agencies. This agreement addresses the potential situation in which Montana would not yet be sufficiently authorized to issue the entire permit by itself. Under this arrangement, Montana issues the permit requirements for which it is authorized and EPA issues those permit requirements for which Montana is not authorized. The single joint permit would have in it all of the relevant Federal and State requirements and would substantially reduce the possibility of conflicting and duplicative requirements that might exist if EPA and Montana issued their permits separately. Montana and EPA would each oversee the permittee's implementation of their respective permit requirements.

Under this agreement, each agency retains its own independent enforcement authority. EPA may enforce requirements of Federal law, including requirements of the authorized program and any HSWA requirements for which Montana has not yet been authorized. Montana may enforce any requirement of State law.

Although the preamble in the Immediate Final Rule could have been more clear, EPA did not contemplate that Montana could enforce HSWA rules before it had adopted them as State rules.

(6) Comment: EPA should clarify that it cannot enforce non-HSWA requirements until Montana is authorized to administer them. (The comment referred to EPA's statement in the Immediate Final Rule that it retains authority to enforce RCRA requirements and suspend or revoke permits after authorization occurs.)

EPA's response: EPA may enforce Federally-issued HSWA rules in any State as soon as they are effective. EPA may enforce non-HSWA requirements in a base-authorized State like Montana after it is authorized for State-issued requirements equivalent to the Federal non-HSWA requirements. EPA's preamble statement discussed the enforcement authority which EPA retains after the State is authorized. Although it could have been more clear, EPA's statement did not refer to the enforcement of unauthorized non-HSWA rules.

(7) Comment: The commenters objected to EPA's assertion that EPA retains authority to take enforcement actions regardless of whether the State has taken its own actions. They state that under the decision in “Harmon” EPA has no authority under RCRA to bring an enforcement action against a company that has settled with a State agency for the same violations.

EPA's Response:

Authorization does not affect the authority of the Federal or State governments to take enforcement actions in the State. RCRA authorizes the Federal government to enforce the Subtitle C hazardous waste program independent of State enforcement and States continue to have the authority to enforce pursuant to State law.

EPA's longstanding interpretation of RCRA, 5 , that EPA may take an enforcement action regardless of whether a State with an authorized program has taken action, is based on the language of RCRA and Congress' intent at the time of enactment and subsequent amendment.

RCRA 3008(a) grants EPA the power to enforce RCRA Subtitle C requirements in all States, regardless of authorization. 42 U.S.C. 6928(a). The only restriction placed on EPA's ability to bring an enforcement action in a State with an authorized program is that EPA give notification to a State prior to issuing an order or commencing a civil action. Similarly in RCRA 3008(a)(3) and (c), Congress recognized that authorization does not supplant Federal enforcement when it gave EPA the power to revoke a permit whether “issued by the Administrator or the State” after giving notification to the State. Congress dispensed with even the notification requirement in the enforcement provisions creating criminal RCRA violations, leaving Federal power to enforce those laws despite authorization. See, U.S. v. MacDonald & Watson Waste Oil Co., 933 F.2d 35 (1st Cir. 1991). Similarly, Congress granted EPA broad enforcement powers to issue orders or initiate civil actions to require Corrective Action at interim status facilities in RCRA 3008(h), without imposing any limitations connected to authorization. 6

Nothing in RCRA 3006 modifies Federal enforcement authority. The section does not address Federal authority and, as discussed above, the “in lieu of” provision in RCRA 3006(b) operates only to substitute authorized State-issued hazardous waste requirements for Federally-issued equivalents as requirements of Subtitle C. RCRA 3006(d) also does not address Federal enforcement. Although States must have adequate enforcement authority to become authorized, RCRA 3006(b), the State enforcement provisions themselves are not part of the State hazardous waste program that becomes authorized to operate in lieu of the Federal program. This is clear from the language and structure of the statute, because the enforcement section of RCRA, as explained above, explicitly contemplates Federal enforcement in States with authorized programs. Thus, Congress clearly did not intend that State enforcement would operate in lieu of Federal enforcement in such States. Rather, Congress expressly established the standards governing Federal enforcement in States with authorized programs in the enforcement section of RCRA. In short, RCRA 3006(b) addresses what gets enforced, not who may take enforcement actions.

The provision which is titled “Effect of State permit ” provides that any action taken by a State under an authorized program has the “same force and effect” as an action of EPA's Administrator. This provision ensures that State-issued permits have the same force and effect as permits issued by EPA. Absent this provision there could have been some doubt as to whether a facility operating under a permit from a State with an authorized program had complied with the requirement in RCRA 3005(a) that each TSD facility have a RCRA permit.

In Harmon, the Eighth Circuit held that RCRA precluded EPA from pursing a civil action for violation of RCRA against a company when Missouri, a State with an authorized program, had signed an agreement with the same company that resolved claims based on violations of Missouri regulations, and a State court had embodied the settlement in a consent decree. In dicta, the court stated that EPA's enforcement rights are “triggered only after State authorization is rescinded or the State fails to initiate an enforcement action.” Harmon, 191 F.3d at 899.

It is the Federal government's position that the court did not correctly interpret the law in Harmon. 7 The decision conflicts with the better interpretation of RCRA, discussed previously, which authorizes EPA to maintain an enforcement action despite action by a State with an authorized hazardous waste program. The court disregarded the plain meaning of RCRA 3008(a) which conditions EPA's authority to take enforcement actions only upon notification to States with an authorized program, with no other limitations. 8 The Eighth Circuit also misinterprets RCRA 3006 based upon its unsupported conclusion that the “administration and enforcement of the hazardous waste program are inexorably intertwined.” See, U.S. v. Power Engineering Co., No. 97-B-1654, slip op at 15-17 (concluding that RCRA does not intertwine administration and enforcement). RCRA 3006(b) simply provides that once authorization takes place, selected State-issued requirements replace selected Federally-issued requirements as the controlling body of Federal hazardous waste requirements in that State. It does not affect Federal enforcement authority.

Similarly, Harmon fails to recognize, as discussed previously, that RCRA 3006(d) addresses State permits, clarifying that any permit issued by a State with an authorized program must be given the “same force and effect” of a permit issued by EPA. As the Colorado district court noted in Power Engineering, slip op. at 19, EPA's interpretation “is the most reasonable because it both gives effect to every word of the statute, and does not necessitate ‘harmonizing’ Section 6928 by adding restrictions on the EPA's enforcement power not found in the plain language of that section.”

EPA also believes the Harmon court's conclusion that, under the principles of res judicata, EPA is bound by a State court suit is contrary to the Supreme Court's decision in Montana v. U.S., 440 U.S. 147 (1979). EPA authorization of a State hazardous waste program is not sufficient to bring EPA into privity with the State or otherwise establish an agency relationship. Power Engineering, slip op at 29 (Harmon rests on “unsupported expansion of the doctrine of res judicata and provides no basis for precluding Federal enforcement based on “attenuated connection” of authorization).

Finally, the Harmon decision is fundamentally flawed because it fails to recognize the Federal/State relationship that Congress established in RCRA. It has long been a Federal goal and EPA policy to encourage and support State administration of the RCRA hazardous waste management program. At the same time, RCRA directs EPA to ensure that hazardous wastes are managed nationally in a responsible manner. Recognizing both the States' interest in program administration and the national interest in consistent and effective implementation of the RCRA program, RCRA provides for independent State and Federal authority in States with authorized programs. EPA must maintain the ability to enforce RCRA in a manner that ensures equal levels of protection from hazardous waste contamination for the entire nation. Although EPA rarely takes an enforcement action when a State has taken an action with respect to the same violator, 9 there are numerous circumstances where national interests must be protected. For example, EPA must be able to act where a particular violator operates facilities in several States, all with varying degrees of noncompliance. To rely on State-by-State actions to address such patterns of illegal activity would likely not result in a comprehensive remedy addressing corporate-wide mismanagement and penalties commensurate with the scope of illegal behavior. In addition, EPA may know of a pattern of non-compliance by different companies nationwide that threatens to erode part of the RCRA program and may therefore place a high priority on an enforcement action against a type of violation that is lower on the State's list of priorities. EPA's authority also may be required to address situations where a facility's illegal behavior in one State results in environmental contamination in a neighboring State. Similarly EPA must protect national interests in maintaining a level playing field to ensure that law abiding facilities are not at a competitive disadvantage to facilities that choose to violate the law. EPA enforcement helps ensure that disparate enforcement priorities between States do not disadvantage those companies that operate in States with rigorous environmental enforcement. See Power Engineering, slip op at 27-28.

Rather than foster cooperative efforts between EPA and the States, Harmon offers an unreasonable statutory interpretation which creates an incentive for competition between Federal and State governments. Some courts would erroneously use the Harmon rationale, to suggest that either sovereign is prohibited from bringing an action as a result of the action of the other sovereign. See e.g., Treacy v. Smithfield Foods Inc., Chancery No. 97-80, Final Order (Cir. Ct. Isle of Wight Co., Jan 5, 2000).

The suggestion in Harmon that, where the State has acted, EPA must withdraw authorization to take a civil enforcement action is a drastic, impractical, and lengthy remedy. At least one court already has agreed that program withdrawal is an inappropriate remedy, stating that “wholesale withdrawal of State enforcement authority is a drastic measure warranted only by drastic circumstances” such as where there is “clear evidence that the entire State program has fallen into disrepair,” CLEAN v. Premium Standard Farms, Inc., slip op. at 52, 2000 U.S. Dist. LEXIS 1990 (W.D. Mo. Feb 23, 2000) (citing Clean Water Act legislative history from 1972). Use of such a measure, when faced with a case-specific need for action, is unworkable within the State-Federal partnership scheme.

Because the Harmon court does not have the authority to impose its interpretation outside the Eighth Circuit and because it is proper for EPA to continue to exercise its enforcement authority consistent with its interpretation of RCRA, EPA is not adopting the court's interpretation of RCRA in the State of Montana. 10 EPA therefore stands by its statement that after authorization of Montana's hazardous waste program EPA may continue to “take enforcement actions regardless of whether the State has taken its own actions.”

The Office of Management and Budget (OMB) has exempted this action from the requirements of Executive Order 12866 (58 FR 51735, October 4, 1993) and, therefore, this action is not subject to review by OMB. This action authorizes State requirements for the purpose of RCRA 3006 and imposes no additional requirements beyond those imposed by State law. Accordingly, I certify that this action 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 action authorizes 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 (Pub. L. 104-4). For the same reason, this action 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 action 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 authorizes State requirements as part of the State RCRA hazardous waste program without altering the relationship or the distribution of power and responsibilities established by RCRA. This action also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant and it does not make decisions based on environmental health or safety risks.

Under RCRA 3006(b), EPA grants a State's application for authorization as long as the State meets the criteria required by RCRA. It would thus be inconsistent with applicable law for EPA, when it reviews a State authorization application, to require the use of any particular voluntary consensus standard in place of another standard that otherwise satisfies the requirements of RCRA. 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 Taking” 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. ).

You may be potentially affected by this action if you manufacture, import, process, or use the chemical substances contained in this rule. Potentially affected categories and entities may include, but are not limited to:

This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in the table in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether or not this action applies to certain entities. To determine whether you or your business is affected by this action, you should carefully examine the applicability provisions in title 40 of the Code of Federal Regulations (CFR) at 40 CFR 721.5. If you have any questions regarding the applicability of this action to a particular entity, consult the technical person listed under FOR FURTHER INFORMATION CONTACT .

1. Electronically . You may obtain copies of this document, and certain other related documents that might be available electronically, from the EPA Internet Home Page at http://www.epa.gov/. You may also obtain copies of the notice of availability documents for the 850 (62 FR 16486, April 15, l996) (FRL-5363-1) and 870 (63 FR 41845, August 5, l998) (FRL-5740-1) series OPPTS harmonized test guidelines at this same site. To access these documents, on the Home Page, select “Laws and Regulations,” “Regulations and Proposed Rules,” and then look up the entry for this document under the “ Federal Register —Environmental Documents.” You can also go directly to the Federal Register listings at http://www.epa.gov/fedrgstr/. The OPPTS harmonized test guidelines referenced in this document are available on EPA's Internet Home Page at http://www.epa.gov/opptsfrs/home/guidelin.htm.

2. In person . The Agency has established an official record for this action under docket control number OPPTS-50638. The official record consists of the documents specifically referenced in this action, any public comments received during an applicable comment period, and other information related to this action, including any information claimed as Confidential Business Information (CBI). This official record includes the documents that are physically located in the docket, as well as the documents that are referenced in those documents. The public version of the official record does not include any information claimed as CBI. The public version of the official record, which includes printed, paper versions of any electronic comments submitted during an applicable comment period, is available for inspection in the TSCA Nonconfidential Information Center, North East Mall Rm. B-607, Waterside Mall, 401 M St., SW., Washington, DC. The Center is open from noon to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Center is (202) 260-7099.

You may submit comments through the mail, in person, or electronically. To ensure proper receipt by EPA, it is imperative that you identify docket control number OPPTS-50638 in the subject line on the first page of your response.

1. By mail . Submit your comments to: Document Control Office (7407), Office of Pollution Prevention and Toxics (OPPT), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

2. In person or by courier . Deliver your comments to: OPPT Document Control Office (DCO) in East Tower Rm. G-099, Waterside Mall, 401 M St., SW., Washington, DC. The DCO is open from 8 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the DCO is (202) 260-7093.

3. Electronically . You may submit your comments electronically by e-mail to: oppt.ncic@epa.gov, or mail your computer disk to the address identified above. Do not submit any information electronically that you consider to be CBI. Electronic comments must be submitted as an ASCII file avoiding the use of special characters and any form of encryption. Comments will also be accepted on standard disks in WordPerfect 6.1/8.0 or ASCII file format. All comments in electronic form must be identified by docket control number OPPTS-50638. Electronic comments may also be filed online at many Federal Depository Libraries.

Do not submit any information electronically that you consider to be CBI. You may claim information that you submit to EPA in response to this document as CBI by marking any part or all of that information as CBI. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2. In addition to one complete version of the comment that includes any information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public version of the official record. Information not marked confidential will be included in the public version of the official record without prior notice. If you have any questions about CBI or the procedures for claiming CBI, please consult the technical person listed under FOR FURTHER INFORMATION CONTACT .

We invite you to provide your views on the various options we propose, new approaches we haven't considered, the potential impacts of the various options (including possible unintended consequences), and any data or information that you would like the Agency to consider during the development of the final action. You may find the following suggestions helpful for preparing your comments:

1. Explain your views as clearly as possible.

2. Describe any assumptions that you used.

3. Provide copies of any technical information and/or data you used that support your views.

4. If you estimate potential burden or costs, explain how you arrived at the estimate that you provide.

5. Provide specific examples to illustrate your concerns.

6. Offer alternative ways to improve the rule.

7. Make sure to submit your comments by the deadline in this document.

8. To ensure proper receipt by EPA, be sure to identify the docket control number assigned to this action in the subject line on the first page of your response. You may also provide the name, date, and Federal Register citation.

This SNUR will require persons to notify EPA at least 90 days before commencing manufacturing, importing, or processing a substance for any activity designated by this SNUR as a significant new use. The supporting rationale and background to this rule are more fully set out in the preamble to EPA's first direct final SNUR published in the Federal Register of April 24, 1990 (55 FR 17376). Consult that preamble for further information on the objectives, rationale, and procedures for the rules and on the basis for significant new use designations including provisions for developing test data.

Section 5(a)(2) of TSCA (15 U.S.C. 2604(a)(2)) authorizes EPA to determine that a use of a chemical substance is a “significant new use.” EPA must make this determination by rule after considering all relevant factors, including those listed in section 5(a)(2) of TSCA. Once EPA determines that a use of a chemical substance is a significant new use, section 5(a)(1)(B) of TSCA requires persons to submit a notice to EPA at least 90 days before they manufacture, import, or process the substance for that use. The mechanism for reporting under this requirement is established under 40 CFR 721.5.

General provisions for SNURs appear under subpart A of 40 CFR part 721. These provisions describe persons subject to the rule, recordkeeping requirements, exemptions to reporting requirements, and applicability of the rule to uses occurring before the effective date of the final rule. Provisions relating to user fees appear at 40 CFR part 700. Persons subject to this SNUR must comply with the same notice requirements and EPA regulatory procedures as submitters of PMNs under section 5(a)(1)(A) of TSCA. In particular, these requirements include the information submission requirements of TSCA section 5(b) and 5(d)(1), the exemptions authorized by TSCA section 5 (h)(1), (h)(2), (h)(3), and (h)(5), and the regulations at 40 CFR part 720. Once EPA receives a SNUR notice, EPA may take regulatory action under TSCA section 5(e), 5(f), 6, or 7 to control the activities on which it has received the SNUR notice. If EPA does not take action, EPA is required under TSCA section 5(g) to explain in the Federal Register its reasons for not taking action.

Persons who intend to export a substance identified in a proposed or final SNUR are subject to the export notification provisions of TSCA section 12(b). The regulations that interpret TSCA section 12(b) appear at 40 CFR part 707. Persons who intend to import a chemical substance identified in a final SNUR are subject to the TSCA section 13 import certification requirements, which are codified at 19 CFR 12.118 through 12.127 and 127.28. Such persons must certify that they are in compliance with SNUR requirements. The EPA policy in support of the import certification appears at 40 CFR part 707.

EPA is establishing significant new use and recordkeeping requirements for the following chemical substances under 40 CFR part 721, subpart E. In this unit, EPA provides a brief description for each substance, including its PMN number, chemical name (generic name if the specific name is claimed as CBI), CAS number (if assigned for non-confidential chemical identities), basis for the action taken by EPA in the TSCA section 5(e) consent order or as a non-section 5(e) SNUR for the substance (including the statutory citation and specific finding), toxicity concern, and the CFR citation assigned in the regulatory text section of this rule. The specific uses which are designated as significant new uses are cited in the regulatory text section of this document by reference to 40 CFR part 721, subpart E where the significant new uses are described in detail. Certain new uses, including production limits and other uses designated in the rule are claimed as CBI. The procedure for obtaining confidential information is set out in Unit VII.

Where the underlying TSCA section 5(e) consent order prohibits the PMN submitter from exceeding a specified production limit without performing specific tests to determine the health or environmental effects of a substance, the tests are described in this unit. As explained further in Unit VI., the SNUR for such substances contains the same production limit, and exceeding the production limit is defined as a significant new use. Persons who intend to exceed the production limit must notify the Agency by submitting a significant new use notice (SNUN) at least 90 days in advance. In addition, this unit describes tests that are recommended by EPA to provide sufficient information to evaluate the substance, but for which no production limit has been established in the TSCA section 5(e) consent order. Descriptions of recommended tests are provided for informational purposes.

Data on potential exposures or releases of the substances, testing other than that specified in the TSCA section 5(e) consent order for the substances, or studies on analogous substances, which may demonstrate that the significant new uses being reported do not present an unreasonable risk, may be included with significant new use notification. Persons submitting a SNUN must comply with the same notice requirements and EPA regulatory procedures as submitters of PMNs, as stated in 40 CFR 721.1(c), including submission of test data on health and environmental effects as described in 40 CFR 720.50.

EPA is not publishing SNURs for PMNs P-98-487, P-98-496, P-98-1033/1034/1035, P-99-31/32/33/34, P-99-531, P-99-519/522/593/594, P-99-544/545/546/547/548/583/584/585/ 586/587/588, P-99-703, and P-99-1131/1132/1133/1134/1135/1138, which are subject to a final TSCA section 5(e) consent order. The TSCA section 5(e) consent orders for these substances are derived from an exposure finding based solely on substantial production volume and significant or substantial human exposure and/or release to the environment of substantial quantities. For these cases there were limited or no toxicity data available for the PMN substances. In such cases, EPA regulates the new chemical substances under TSCA section 5(e) by requiring certain toxicity tests. For instance, chemical substances with potentially substantial releases to surface waters would be subject to toxicity testing of aquatic organisms and chemicals with potentially substantial human exposures would be subject to health effects testing for mutagenicity, acute effects, and subchronic effects. However, for these substances, the short-term toxicity testing required by the TSCA section 5(e) consent order is usually completed within 1 to 2 years of notice of commencement (NOC). EPA's experience with exposure-based SNURs requiring short-term testing is that the SNUR is often revoked within 1 to 2 years when the test results are received. Rather than issue and revoke SNURs in such a short span of time, EPA will defer publication of exposure-based SNURs until either a NOC or data demonstrating risk are received unless the toxicity testing required is long-term. EPA is issuing this explanation and notification as required in 40 CFR 721.160(a)(2) as it has determined that SNURs are not needed at this time for these substances which are subject to a final section 5(e) consent order under TSCA.

During review of the PMNs submitted for the chemical substances that are subject to this SNUR, EPA concluded that for 5 of the 40 substances, regulation was warranted under section 5(e) of TSCA, pending the development of information sufficient to make reasoned evaluations of the health or environmental effects of the substances. The basis for such findings is outlined in Unit III. Based on these findings, TSCA section 5(e) consent orders requiring the use of appropriate exposure controls were negotiated with the PMN submitters; the SNUR provisions for these substances designated herein are consistent with the provisions of the TSCA section 5(e) consent orders.

In the other 35 cases for which the proposed uses are not regulated under a TSCA section 5(e) consent order, EPA determined that one or more of the criteria of concern established at 40 CFR 721.170 were met.

EPA is issuing this SNUR for specific chemical substances which have undergone premanufacture review to ensure that:

1. EPA will receive notice of any company's intent to manufacture, import, or process a listed chemical substance for a significant new use before that activity begins.

2. EPA will have an opportunity to review and evaluate data submitted in a SNUR notice before the notice submitter begins manufacturing, importing, or processing a listed chemical substance for a significant new use.

3. When necessary, to prevent unreasonable risks, EPA will be able to regulate prospective manufacturers, importers, or processors of a listed chemical substance before a significant new use of that substance occurs.

4. All manufacturers, importers, and processors of the same chemical substance which is subject to a TSCA section 5(e) consent order are subject to similar requirements.

Issuance of a SNUR for a chemical substance does not signify that the substance is listed on the TSCA Inventory. Manufacturers, importers, and processors are responsible for ensuring that a new chemical substance subject to a final SNUR is listed on the TSCA Inventory.

EPA is issuing these SNURs as a direct final rule, as described in 40 CFR 721.160(c)(3) and 721.170(d)(4). In accordance with 40 CFR 721.160(c)(3)(ii), this rule will be effective February 26, 2001, unless EPA receives a written notice by January 25, 2001 that someone wishes to make adverse or critical comments on EPA's action. If EPA receives such a notice, EPA will publish a document to withdraw the direct final SNUR for the specific substance to which the adverse or critical comments apply. EPA will then propose a SNUR for the specific substance providing a 30-day comment period.

This action establishes SNURs for a number of chemical substances. Any person who submits a notice of intent to submit adverse or critical comments must identify the substance and the new use to which it applies. EPA will not withdraw a SNUR for a substance not identified in a notice.

EPA recognizes that section 5 of TSCA does not require developing any particular test data before submission of a SNUN. Persons are required only to submit test data in their possession or control and to describe any other data known to or reasonably ascertainable by them. In cases where a TSCA section 5(e) consent order requires or recommends certain testing, Unit III. lists those recommended tests.

However, EPA has established production limits in the TSCA section 5(e) consent orders for several of the substances regulated under this rule, in view of the lack of data on the potential health and environmental risks that may be posed by the significant new uses or increased exposure to the substances. These production limits cannot be exceeded unless the PMN submitter first submits the results of toxicity tests that would permit a reasoned evaluation of the potential risks posed by these substances. Under recent consent orders, each PMN submitter is required to submit each study at least 14 weeks (earlier consent orders required submissions at least 12 weeks) before reaching the specified production limit. Listings of the tests specified in the TSCA section 5(e) consent orders are included in Unit III. The SNURs contain the same production volume limits as the consent orders. Exceeding these production limits is defined as a significant new use.

The recommended studies may not be the only means of addressing the potential risks of the substance. However, SNUNs submitted for significant new uses without any test data may increase the likelihood that EPA will take action under TSCA section 5(e), particularly if satisfactory test results have not been obtained from a prior submitter. EPA recommends that potential SNUN submitters contact EPA early enough so that they will be able to conduct the appropriate tests.

SNUN submitters should be aware that EPA will be better able to evaluate SNUNs which provide detailed information on:

1. Human exposure and environmental release that may result from the significant new use of the chemical substances.

2. Potential benefits of the substances.

3. Information on risks posed by the substances compared to risks posed by potential substitutes.

EPA is establishing through this rule some significant new uses which have been claimed as CBI subject to Agency confidentiality regulations at 40 CFR part 2. EPA is required to keep this information confidential to protect the CBI of the original PMN submitter. EPA promulgated a procedure to deal with the situation where a specific significant new use is CBI. This procedure appears in 40 CFR 721.1725(b)(1) and is similar to that in § 721.11 for situations where the chemical identity of the substance subject to a SNUR is CBI. This procedure is cross-referenced in each of these SNURs.

A manufacturer or importer may request EPA to determine whether a proposed use would be a significant new use under this rule. Under the procedure incorporated from § 721.1725(b)(1), a manufacturer or importer must show that it has a bona fide intent to manufacture or import the substance and must identify the specific use for which it intends to manufacture or import the substance. If EPA concludes that the person has shown a bona fide intent to manufacture or import the substance, EPA will tell the person whether the use identified in the bona fide submission would be a significant new use under the rule. Since most of the chemical identities of the substances subject to these SNURs are also CBI, manufacturers and processors can combine the bona fide submission under the procedure in § 721.1725(b)(1) with that under § 721.11 into a single step.

If a manufacturer or importer is told that the production volume identified in the bona fide submission would not be a significant new use, i.e. it is below the level that would be a significant new use, that person can manufacture or import the substance as long as the aggregate amount does not exceed that identified in the bona fide submission to EPA. If the person later intends to exceed that volume, a new bona fide submission would be necessary to determine whether that higher volume would be a significant new use. EPA is considering whether to adopt a special procedure for use when CBI production volume is designated as a significant new use. Under such a procedure, a person showing a bona fide intent to manufacture or import the substance, under the procedure described in § 721.11, would automatically be informed of the production volume that would be a significant new use. Thus, the person would not have to make multiple bona fide submissions to EPA for the same substance to remain in compliance with the SNUR, as could be the case under the procedures in § 721.1725(b)(1).

To establish a significant “new” use, EPA must determine that the use is not ongoing. The chemical substances subject to this rule have recently undergone premanufacture review. TSCA section 5(e) consent orders have been issued for 5 substances and notice submitters are prohibited by the TSCA section 5(e) consent orders from undertaking activities which EPA is designating as significant new uses. In cases where EPA has not received an NOC and the substance has not been added to the Inventory, no other person may commence such activities without first submitting a PMN. For substances for which an NOC has not been submitted at this time, EPA has concluded that the uses are not ongoing. However, EPA recognizes in cases when chemical substances identified in this SNUR are added to the Inventory prior to the effective date of the rule, the substances may be manufactured, imported, or processed by other persons for a significant new use as defined in this rule before the effective date of the rule. However, 31 of the 40 substances contained in this rule have CBI chemical identities, and since EPA has received a limited number of post-PMN bona fide submissions, the Agency believes that it is highly unlikely that any of the significant new uses described in the following regulatory text are ongoing.

As discussed in the Federal Register of April 24, 1990, EPA has decided that the intent of section 5(a)(1)(B) of TSCA is best served by designating a use as a significant new use as of the date of publication rather than as of the effective date of the rule. Thus, persons who begin commercial manufacture, import, or processing of the substances regulated through this SNUR will have to cease any such activity before the effective date of this rule. To resume their activities, these persons would have to comply with all applicable SNUR notice requirements and wait until the notice review period, including all extensions, expires.

EPA has promulgated provisions to allow persons to comply with this SNUR before the effective date. If a person were to meet the conditions of advance compliance under § 721.45(h), the person would be considered to have met the requirements of the final SNUR for those activities. If persons who begin commercial manufacture, import, or processing of the substance between publication and the effective date of the SNUR do not meet the conditions of advance compliance, they must cease that activity before the effective date of the rule. To resume their activities, these persons would have to comply with all applicable SNUR notice requirements and wait until the notice review period, including all extensions, expires.

EPA has evaluated the potential costs of establishing significant new use notice requirements for potential manufacturers, importers, and processors of the chemical substance subject to this rule. EPA's complete economic analysis is available in the official record for this rule (OPPTS-50638).

Under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993), the Office of Management and Budget (OMB) has determined that proposed or final SNURs are not a “significant regulatory action” subject to review by OMB, because they do not meet the criteria in section 3(f) of the Executive Order.

Based on EPA's experience with proposing and finalizing SNURs, State, local, and tribal governments have not been impacted by these rulemakings, and EPA does not have any reasons to believe that any State, local, or tribal government will be impacted by this rulemaking. As such, EPA has determined that this regulatory action does not impose any enforceable duty, contain any unfunded mandate, or otherwise have any effect on small governments subject to the requirements of sections 202, 203, 204, or 205 of the Unfunded Mandates Reform Act of 1995 (UMRA) (Public Law 104-4).

Similarly, this action is not subject to the requirement for prior consultation with Indian tribal governments as specified in Executive Order 13084, entitled Consultation and Coordination with Indian Tribal Governments (63 FR 27655, May 19, 1998). Nor will this action have a substantial direct effect on 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, entitled Federalism (64 FR 43255, August 10, 1999).

In issuing this final 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, as required by section 3 of Executive Order 12988, entitled Civil Justice Reform (61 FR 4729, February 7, 1996).

EPA has complied with Executive Order 12630, entitled Governmental Actions and Interference with Constitutionally Protected Property Rights (53 FR 8859, March 15, 1988), by examining the takings implications of this final 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 action does not entail special considerations of environmental justice related issues as delineated by Executive Order 12898, entitled Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994).

This action is not subject to Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997), because this is not an economically significant regulatory action as defined by Executive Order 12866, and this action does not address environmental health or safety risks disproportionately affecting children.

In addition, since this action does not involve any technical standards, section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note), does not apply to this action.

Pursuant to section 605(b) of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq .), the Agency hereby certifies that promulgation of this SNUR will not have a significant adverse economic impact on a substantial number of small entities. The rationale supporting this conclusion is as follows. A SNUR applies to any person (including small or large entities) who intends to engage in any activity described in the rule as a “significant new use.” By definition of the word “new,” and based on all information currently available to EPA, it appears that no small or large entities presently engage in such activity. Since a SNUR only requires that any person who intends to engage in such activity in the future must first notify EPA by submitting a SNUN, no economic impact will even occur until someone decides to engage in those activities. Although some small entities may decide to conduct such activities in the future, EPA cannot presently determine how many, if any, there may be. However, EPA's experience to date is that, in response to the promulgation of over 530 SNURs, the Agency has received fewer than 15 SNUNs. Of those SNUNs submitted, none appear to be from small entities in response to any SNUR. In addition, the estimated reporting cost for submission of a SNUN (see Unit IX.), are minimal regardless of the size of the firm. Therefore, EPA believes that the potential economic impact of complying with this SNUR are not expected to be significant or adversely impact a substantial number of small entities. In a SNUR that published on June 2, 1997 (62 FR 29684) (FRL-5597-1), the Agency presented its general determination that proposed and final SNURs are not expected to have a significant economic impact on a substantial number of small entities, which was provided to the Chief Counsel for Advocacy of the Small Business Administration.

According to the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq ., an Agency may not conduct or sponsor, and a person is not required to respond to a collection of information that requires OMB approval under the PRA, unless it has been approved by OMB and displays a currently valid OMB control number. The OMB control numbers for EPA's regulations, after initial display in the preamble of the final rule and in addition to its display on any related collection instrument, are listed in 40 CFR part 9.

The information collection requirements related to this action have already been approved by OMB pursuant to the PRA under OMB control number 2070-0012 (EPA ICR No. 574). This action does not impose any burden requiring additional OMB approval. If an entity were to submit a significant new use notice to the Agency, the annual burden is estimated to average between 30 and 170 hours per response. This burden estimate includes the time needed to review instructions, search existing data sources, gather and maintain the data needed, and complete, review, and submit the required significant new use notice.

Send any comments about the accuracy of the burden estimate, and any suggested methods for minimizing respondent burden, including through the use of automated collection techniques, to the Director, OP Regulatory Information Division (2137), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. Please remember to include the OMB control number in any correspondence, but do not submit any completed forms to this address.

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 final rule may take effect, the Agency promulgating it must submit a final rule report, which includes a copy of the final rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this final 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 final rule in the Federal Register . This final rule is not a “major rule” as defined by 5 U.S.C. 804(2).

In rule document 00-25130 beginning on page 60060 in the issue of Friday, October 6, 2000, make the following corrections:

OMB has determined that this regulation is not a significant action requiring its review under Executive Order 12866. I hereby certify that this regulation does not apply to small businesses, and thus will have no significant economic impact on a substantial number of small entities within the meaning of the Small Business Regulatory Enforcement Fairness Act of 1996. This regulation relates to the Foundation's management and procedures, and thus is not a “rule” within the meaning of the Congressional Review Act, 5 U.S.C. et seq.

This is a synopsis of the Commission's Memorandum Opinion and Order, MM Docket No. 97-252, adopted December 6, 2000, and released December 15, 2000. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 12th Street, SW, Washington, DC. The complete text of this decision may also be purchased from the Commission's copy contractors, International Transcription Service, Inc., (202) 857-3800, located at 1231 20th Street, NW., Washington, DC 20036.

Operators of gas, hazardous liquid, and carbon dioxide pipelines and operators of liquefied natural gas facilities must annually submit Management Information System (MIS) reports of drug testing done in the previous calendar year (49 CFR 199.25(a)). One of the uses of this information is to calculate the minimum annual percentage rate at which operators must randomly drug test all covered employees during the next calendar year (49 CFR 199.11(c)(2)). If the minimum annual percentage rate for random drug testing is 50 percent, we may lower the rate to 25 percent if we determine that the positive rate reported for random tests for two consecutive calendar years is less than 1.0 percent (49 CFR 199.25(c)(3)). If the minimum annual percentage rate is 25 percent, we will increase the rate to 50 percent if we determine that the positive rate reported for random tests for any calendar year is equal to or greater than 1.0 percent (49 CFR 199.25(c)(4)). Part 199 defines “positive rate” as “the number of positive results for random drug tests * * * plus the number of refusals of random tests * * *, divided by the total number of random drug tests * * * plus the number of refusals of random tests. * * *”

Through calendar year 1996, the minimum annual percentage rate for random drug testing in the pipeline industry was 50 percent of covered employees. Based on MIS reports of random testing done in 1994 and 1995, we lowered the minimum rate from 50 to 25 percent for calendar year 1997 (61 FR 60206; November 27, 1996). The minimum rate remained at 25 percent in calendar years 1998 (62 FR 59297; Nov. 3, 1997), 1999 (63 FR 58324; Oct. 30, 1998), and 2000 (64 FR 66788; Nov. 30, 1999).

Using the MIS reports received this year for drug testing done in 1999, we calculated the positive rate of random testing to be 0.7 percent. Since the positive rate continues to be less than 1.0 percent, we are announcing that the minimum annual percentage rate for random drug testing is 25 percent of covered employees for the period January 1, 2001, through December 31, 2001.

On November 1, 2000, the TREAD Act, Public Law 106-414, was enacted. The statute was, in part, a response to congressional concerns related to manufacturers' inadequate reporting to NHTSA of information regarding possible defects in motor vehicles and motor vehicle equipment, with specific reference to tires. The TREAD Act directs the Secretary of Transportation (“the Secretary”) to issue various rules to improve reporting of information that is or could be related to defects and noncompliances with applicable Federal motor vehicle safety standards. The authority to carry out Chapter 301 of Title 49 of the United States Code, under which the rules directed by the TREAD Act are to be issued, has been delegated to NHTSA's Administrator pursuant to 49 CFR 1.50.

Under pre-TREAD law, 49 U.S.C. 30120(i), when a manufacturer of a motor vehicle or replacement equipment has notified a dealer (including a retailer of motor vehicle equipment) that a new motor vehicle or new item of replacement equipment does not comply with a safety standard or contains a safety-related defect, the dealer may not sell or lease the noncompliant or defective vehicle or equipment, absent certain exceptions. Section 30120(i) does not apply to the sale or lease of used vehicles or equipment, and there had been media reports during congressional consideration of the bill that eventually was adopted as the TREAD Act that some persons were selling defective Firestone ATX or Wilderness tires that had been returned to dealers for replacement tires under an ongoing safety recall. Although Congress chose not to explicitly prohibit such sales, it imposed the reporting requirement contained in Section 3(c) of the TREAD Act.

Section 3(c) of the TREAD Act adds a new subsection (n) to 49 U.S.C. 30166. That subsection directs NHTSA to issue, within 90 days of enactment, a final rule requiring any person who knowingly and willfully sells or leases for use on a motor vehicle a defective tire or a tire which is not compliant with an applicable tire safety standard, with actual knowledge that the manufacturer of such tire has notified its dealers of such defect or noncompliance as required under 49 U.S.C. 30118(c) or as required by an order under 49 U.S.C. 30118(b), to report that sale or lease to NHTSA. 1 Under 30166(n)(2), reporting of such sales or leases is not required where: (A) Prior to delivery of any such tire pursuant to a sale or lease, the defect or noncompliance is remedied as required under 49 U.S.C. 30120; or (B) notification of the defect or noncompliance is required pursuant to an order issued under section 30118(b), but enforcement of the order is restrained or the order is set aside in a civil action to which 49 U.S.C. 30121(d) applies.

Under 49 U.S.C. 30165, as amended by section 3(a) of the TREAD Act, a person who violates section 30166 or a regulation promulgated thereunder, including the requirement being promulgated today, is liable for civil penalties of up to $5,000 per violation per day, with a maximum penalty for a related series of daily violations of $15,000,000.

In order to implement the statutorily-mandated final rule concerning the reporting of knowing and willful sales or leases of defective or noncompliant tires, we are amending 49 CFR Part 573 to add a new section 573.10. Below is a brief summary and explanation of particular requirements of today's rule.

Subsection 30166(n) provides that the final rule shall require “any person who knowingly and willfully sells or leases for use on a motor vehicle a defective tire or a tire which is not compliant with an applicable tire safety standard * * * to report such sale or lease to the Secretary.” (emphasis added). In this subsection, Congress chose to use the general terms “any person,” as opposed to the more restricted categories of “manufacturer”and “dealer” used elsewhere within Section 30166 and Chapter 301. In view of the breadth of the terms “any person,” the subsection will not be limited to persons in particular classes or categories. Thus, the rule's reporting requirements will apply to the actions of all persons, including individuals and entities such as corporations.

To be covered by the rule, however, the person must engage in certain activities regarding tires. Subsection 30166(n) and the rule apply to all tires used on motor vehicles, including both new and used tires. Thus, unlike the limits in subsection 30120(i), subsection 30166(n) is not limited to new tires, and includes tires that are returned to dealers or other parties for replacement as part of a safety recall.

The activities that are covered by the statute and the rule are selling or leasing a defective or noncompliant tire “ for use on a motor vehicle ” (emphasis added). Congress' terminology in requiring reports from persons who sell or lease such tires “ for use on a motor vehicle ” effectively limits the applicability of the reporting requirement. Today's rule accordingly requires reports from those persons who sell or lease defective or noncompliant tires for use on a motor vehicle, but not from persons who sell or lease a new or used vehicle with a defective or noncompliant tire. 2 Thus, for example, a motor vehicle dealer is not subject to the reporting requirements of today's rule except with respect to tires that the dealer sells or leases separately from a vehicle. Similarly, motor vehicle lessors and motor vehicle rental companies are not subject to the rule because these groups are not selling or leasing tires for use on motor vehicles, but rather are selling and leasing vehicles. Thus, we would expect that today's rule will generally apply to tire retailers, including individuals.

To be covered by the reporting requirement, the person must have “actual knowledge that the manufacturer of such tire has notified its dealers of such defect or noncompliance * * *” Thus, the person need not have received the defect or noncompliance notification directly from the manufacturer. It is sufficient the person have actual knowledge that the notification was made to dealers.

Employers, principals and other persons who are legally accountable for the actions of their employees or agents are also subject to § 573.10, and are required to report any covered sales or leases that their employees or agents cause while acting within the scope of their employment or agency. Compliance with § 573.10 is required regardless of whether the covered sale or lease was or was not approved or ratified by the legally responsible party. Therefore, for example, if an employee of a tire retailer sells or leases a tire that is defective or not in compliance with an applicable safety standard, both the employee and the tire retailer would be obligated to report the sale, and both would be accountable if the sale is not reported or reported in a manner not in compliance with § 573.10. Only one report per covered sale or lease is required, so that in the example above either the employee or the retailer could file a report.

Reports required to be submitted pursuant to 573.10 must be mailed and/or submitted to NHTSA no more than five working days after the person to whom the tire was sold or leased took possession of the tire. We have chosen a five-day rule consistent with current 49 CFR 573.5, which requires defect and noncompliance information reports to be submitted within the same time frame. A five-day rule was also chosen in order to ensure the prompt reporting of covered sales or leases and to facilitate prompt follow up by the agency.

Reports must be submitted by any means which permits the sender to verify promptly that the report was in fact received by NHTSA and the day it was received by NHTSA.

Reports submitted pursuant to section 573.10 must contain the following information, to the extent available to the reporting person: (1) A statement that the report is being provided pursuant to section 573.10 regarding the sale or lease of a defective or noncompliant tire; (2) the name, address and telephone number of the person who purchased or leased the tire; (3) the name of the manufacturer of the tire; (4) the tire's brand name, model name, and size; (5) the tire's DOT identification number (this is an alphanumeric code, unique to each tire, located on the sidewall of a tire); (6) the date of sale or lease; and (7) the name, address, and telephone number of the seller or lessor. Each report must be dated and signed, with the name of the person printed or typed below the signature. For corporations, the official position of the individual signing the report on behalf of the corporation must also be provided.

“Available” information includes all information that a person who sells or leases a defective or noncompliant tire has within his or her possession or control, or could obtain using reasonable and diligent effort, as of the time of the report. Any person subject to § 573.10 is expected to take reasonable and diligent measures to learn or develop any information required to be reported of which he or she was not aware or did not have in his or her immediate custody at the time of the sale.

We have considered the impact of this rulemaking action under E.O. 12866 and the Department of Transportation's regulatory policies and procedures. This rulemaking was not reviewed under E.O. 12866, “Regulatory Planning and Review.” This rulemaking is not considered “significant” under the Department of Transportation's regulatory policies and procedures. The impacts of this rule are expected to be so minimal as not to warrant preparation of a full regulatory evaluation because this provision only involves reporting and the incidence of covered sales and leases of defective or noncompliant tires is expected to be small.

We have also considered the impacts of this notice under the Regulatory Flexibility Act. I certify that this rule will have no significant economic impact on a substantial number of small entities. The impacts of this rule are expected to be so minimal as not to warrant preparation of a full regulatory evaluation because this provision only involves reporting and the incidence of covered sales and leases of defective or noncompliant tires is expected to be small.

We have analyzed this proposal under the National Environmental Policy Act and determined that it will not have any significant impact on the quality of the human environment.

NHTSA has determined that this interim final rule will impose new collection of information burdens within meaning of the Paperwork Reduction Act of 1995 (PRA). Pursuant to 5 CFR 1320.13 Emergency processing, NHTSA is asking OMB for a temporary emergency clearance for this collection. In this interim final rule, NHTSA begins the process of requesting a 3-year clearance for this collection.

Under the PRA, before an agency submits a proposed collection of information to OMB for approval, it must publish a document in the Federal Register providing a 60-day comment period and otherwise consult with members of the public and affected agencies concerning each proposed collection of information. The OMB has promulgated regulations describing what must be included in such a document. Under OMB's regulations, (5 CFR 1320.8(d)), an agency must ask for public comment on the following:

(i.) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;

(ii.) The accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;

(iii.) How to enhance the quality, utility, and clarity of the information to be collected; and

(iv.) How to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.

In compliance with these requirements, NHTSA asks public comment on the collection of information— i.e., the reporting requirement— in this interim final rule.

Type of Request —New.

OMB Clearance Number —No clearance number has been provided for this collection.

Form Number —This proposed collection of information would not use any standard forms.

Requested Expiration Date of Approval —Three years from the date of the approval of the collection.

Summary of the Collection of Information —Any person required to report the sale or lease of a defective or noncompliant tire as prescribed under this rule will be required to report the following information to NHTSA: (1) A statement that the report is being submitted pursuant to 49 CFR 573.10(a); (2) the name, address and phone number of the person who purchased or leased the tire; (3) the name of the manufacturer of the tire; (4) the tire's brand name, model name, and size; (5) the tire's DOT identification number; (6) the date of the sale or lease; and (7) the name, address, and telephone number of the seller or lessor.

Description of the Need for the Information and Use of the Information —This information collection was mandated by Section 3(c) of the TREAD Act. The information collected will provide NHTSA with basic information relating to the defective or noncompliant tire that was sold or leased, such as the identities of both the seller and purchaser of the defective or noncompliant tire and a description of the tire. We anticipate using this information to do any of the following: Investigate the sale or lease of the tire; inform the purchaser of the tire of the existence of a defect or noncompliance; and/or facilitate the providing of a remedy to the purchaser of the tire.

Description of the Likely Respondents, Including Estimated Number and Proposed Frequency of Response to the Collection of Information —This new collection of information would apply to any person who knowingly and willfully sells or leases a defective or noncompliant tire for use on a motor vehicle, with actual knowledge that the manufacturer of the tire has notified dealers of the defect or noncompliance. Thus, the collection of information applies to tire dealers, including tire retailers. The collection of information does not apply to the sale or lease of new or used vehicles which have placed upon them defective or noncompliant tires. It also does not apply to ordinary leasing activities of motor vehicle lessors or motor vehicle rental companies.

We estimate that there will be relatively few sales or leases of defective or noncompliant tires and therefore relatively few persons subject to this new collection of information. We estimate the number of reports that will be submitted will be less than 10.

Estimate of the Total Annual Reporting and Recordkeeping Burdens Resulting From the Collection of Information —As stated before, we estimate that no more than nine persons a year would be subject to this new reporting requirement. We estimate that it will take no longer than one-half of one hour for a person to compile and submit the information we are requiring to be reported. Therefore, the total burden hours on the public per year is estimated to be a maximum of 4.5 hours.

Since nothing in this rule would require those persons required to submit reports pursuant to this rule to keep copies of any records or reports submitted to us, recordkeeping costs imposed would be zero hours and zero costs.

Executive Order 13132 on “Federalism” requires us 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.” The E.O. defines this phrase 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.” This rule, which requires the reporting of knowing and willful sales or leases of defective or noncompliant tires where the person selling or leasing the tire has actual knowledge that the manufacturer of such a tire has notified its dealers of that defect or noncompliance pursuant to either section 30118(c) or 30118(b) of the Safety Act, will not have substantial direct effect 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 E.O. 13132. This rule making does not have those implications because it applies to those persons who sell or lease defective or noncompliant tires, and not to the States or local governments.

This rule does not have a retroactive or preemptive effect. Judicial review of the rule may be obtained pursuant to 5 U.S.C. 702. That section does not require that a petition for reconsideration be filed prior to seeking judicial review.

The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires agencies to prepare a written assessment of the cost, benefits and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribunal governments, in the aggregate, or by the private sector, of more than $100 million annually. Because this rule will not have a $100 million annual effect, no Unfunded Mandates assessment is necessary and one will not be prepared.

Executive Order 12866 and the President's memorandum of June 1, 1998, require each agency to write all rules in plain language. Application of the principles of plain language includes consideration of the following questions:

If you have any responses to these questions, please include them in your comments on this rule.

NHTSA is promulgating this regulation as an interim final rule to comply with Section 3(c)'s mandate that the final rule be issued “within 90 days of the enactment of the [TREAD Act].” As an interim final rule, the regulation will be effective 30 days after the date of publication in the Federal Register . However, as described below, comments may be submitted for a period of 60 days from the date of publication in the Federal Register . NHTSA will review and respond to all timely comments, as appropriate.

In developing this interim final rule, we tried to address the anticipated concerns of all our stakeholders. Your comments will help us improve this rule. We invite you to provide different views on it, new approaches we have not considered, new data, how this rule may affect you, or other relevant information. Your comments will be most effective if you follow the suggestions below:

Explain your views and reasoning as clearly as possible.

• Provide solid information to support your views.

• If you estimate potential numbers or reports or costs, explain how you arrived at the estimate.

• Tell us which parts of the rule you support, as well as those with which you disagree.

• Provide specific examples to illustrate your concerns.

• Offer specific alternatives.

• Refer your comments to specific sections of the rule, such as the units or page numbers of the preamble, or the regulatory sections.

• Be sure to include the name, date, and docket number with your comments.

Your comments must be written and in English. To ensure that your comments are correctly filed in the Docket, please include the docket number of this document in your comments.

Your comments must not be more than 15 pages long. (49 CFR 553.21). We established this limit to encourage you to write your primary comments in a concise fashion. However, you may attach necessary additional documents to your comments. There is no limit on the length of the attachments.

Please submit two copies of your comments, including the attachments, to Docket Management at the address given above under ADDRESSES.

Comments may also be submitted to the docket electronically by logging onto the Dockets Management System website at http://dms.dot.gov. Click on “Help & Information” or “Help/Info” to obtain instructions for filing the document electronically.

If you wish Docket Management to notify you upon its receipt of your comments, enclose a self-addressed, stamped postcard in the envelope containing your comments. Upon receiving your comments, Docket Management will return the postcard by mail.

If you wish to submit any information under a claim of confidentiality, you should submit three copies of your complete submission, including the information you claim to be confidential business information, to the Chief Counsel (NCC-30), NHTSA, at the address given above under FOR FURTHER INFORMATION CONTACT. In addition, you should submit two copies, from which you have deleted the claimed confidential business information, to Docket Management at the address given above under ADDRESSES. When you send a comment containing information claimed to be confidential business information, you should include a cover letter setting forth the information specified in our confidential business information regulation. (49 CFR Part 512.)

We will consider all comments that Docket Management receives before the close of business on the comment closing date indicated above under DATES. To the extent possible, we will also consider comments that Docket Management receives after that date. If Docket Management receives a comment too late for us to consider it in developing a final rule (assuming that one is issued), we will consider that comment as an informal suggestion for future rulemaking action.

You may view the materials in the docket for this rulemaking on the Internet. These materials include the written comments submitted by other interested persons and the preliminary regulatory evaluation prepared by this agency. You may read them at the address given above under ADDRESSES. The hours of the Docket are indicated above in the same location.

You may also see the comments and materials on the Internet. To read them on the Internet, take the following steps:

(1) Go to the Docket Management System (DMS) Web page of the Department of Transportation (http://dms.dot.gov/).

(2) On that page, click on “search.”

(3) On the next page ( http://dms.dot.gov/search/ ), type in the four-digit docket number shown at the beginning of this document. Example: If the docket number were “NHTSA-2000-1234,” you would type “1234.” After typing the docket number, click on “search.”

(4) On the next page, which contains docket summary information for the materials in the docket you selected, click on the desired comments. You may download the comments.

Please note that even after the comment closing date, we will continue to file relevant information in the Docket as it becomes available. Further, some people may submit late comments. Accordingly, we recommend that you periodically check the Docket for new material.

On November 1, 2000, the TREAD Act, Public Law 106-414, was enacted in response, in part, to congressional concerns related to manufacturers' inadequate reporting to NHTSA of information regarding possible defects in motor vehicles and motor vehicle equipment, including tires. The TREAD Act expands 49 U.S.C. 30166, Inspections, investigations, and records, and provides for the Secretary to issue various rules thereunder. The authority to carry out Chapter 301 of Title 49 United States Code, under which the rules directed by the TREAD Act are to be issued, has been delegated to NHTSA's Administrator pursuant to 49 CFR 1.50.

Section 5(b) of the TREAD Act, adds a new section, 49 U.S.C. 30170, to Chapter 301. Section 30170(a)(1) establishes criminal liability for a “person who violates section 1001 of title 18 with respect to the reporting requirements of [49 U.S.C.] section 30166, with the specific intention of misleading the Secretary with respect to motor vehicle or motor vehicle equipment safety related defects that have caused death or serious bodily injury to an individual. . . .” Section 1001 of title 18 provides that whoever “. . . knowingly and willfully—(1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact; (2) makes any materially false, fictitious, or fraudulent statement or representation; or (3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry” in a matter within the jurisdiction of the federal government is subject to a fine and imprisonment.

Section 30170(a)(2)(A) contains a “safe harbor” provision, which states that a

NHTSA is promulgating this regulation on a reasonable time and on the manner of correction as an interim final rule to comply with 49 U.S.C. 30170(a)(2)(B)'s mandate that the final rule be issued “within 90 days of the date of the enactment of this section.” In order to implement the statutorily-mandated final rule concerning the safe harbor from criminal penalties under 49 U.S.C. 30170, we are amending 49 CFR Part 578. As an interim final rule, the regulation will be effective 30 days after the date of publication in the Federal Register . However, comments may be submitted for a period of 60 days from the date of publication in the Federal Register . NHTSA will review and respond to all timely comments.

49 U.S.C. 30170 creates a new criminal liability that is dependent on a violation of 18 U.S.C. 1001. The TREAD Act does not provide for the Secretary to engage in rulemaking with respect to the elements of 18 U.S.C. 1001 or the elements of the new 49 U.S.C. 30170. Accordingly, this rule does not do so.

The TREAD Act requires NHTSA to establish by regulation what constitutes a “reasonable time” for a person to correct any improper reports or failure to report. To delineate what constitutes a reasonable time, NHTSA considered its own rules and experiences with the current motor vehicle and motor vehicle equipment defects program. NHTSA also inquired about potentially comparable safe harbor rules and policies used by other federal agencies. NHTSA considered the Environmental Protection Agency's (EPA) evaluation of its Audit Policy, 64 FR 26745 (May 17, 1999), and the Final Policy Statement for its Audit Policy: “Incentives for Self-policing: Discovery, Disclosure, Correction and Prevention of Violation,” 65 FR 19618 (April 11, 2000); the Internal Revenue Service Chief Counsel's Directives Manual: Voluntary Disclosure, CCDM 31.3.3; and the Federal Aviation Administration's (FAA) Advisory Circulars on Aviation Safety Action Programs, AC120-66A, the Voluntary Disclosure Reporting Program, AC00-58, and the Aviation Safety Reporting Program, AC00-46D.

In considering the number of days available for compliance with the reasonable time requirement by a person seeking protection under the safe harbor provision, NHTSA considered various factors. First, the agency's mission under Chapter 301 is motor vehicle safety. Consistent with its mission, the agency needs to collect complete and accurate information in order to decide whether to open investigations of potential defects, to conduct those investigations efficiently and expeditiously, and to assure appropriate oversight of ongoing recalls. The reasonable time period should minimize the time that NHTSA is performing its safety responsibilities using an incorrect or incomplete factual record. Similarly, the time period must generate an urgency that will compel potential correctors to come forward before it expires. NHTSA has determined that this is best done by offering the protection of the safe harbor provision for a period that is not longer than reasonably necessary for such a person to decide to come forward and to do so.

Second, NHTSA does not intend to discourage the submission of corrected reports and reports that should have been submitted but were not submitted. This is not a new concept. Historically, NHTSA has allowed late submissions of information required under section 30166 where a late submission is justified. In order to encourage the use of the safe harbor provision, the time period must be long enough for the provision to be usable in real world situations. This includes allowing enough time for persons who would be willing to take corrective actions under the safe harbor provision to accept the responsibility associated with it and to come forward. We are mindful that the correction of a false report may involve complexities that do not arise in the instance of the initial report. There may be some contentious review and consultation within the company and/or with counsel, which may be compounded where a person may have to obtain or check information maintained by various corporate organizations and possibly contractors, and additional time may be required to prepare fully correct statements that conflict with the manufacturer's statement of record.

NHTSA has concluded that, in order to satisfy the “reasonable time” element of the safe harbor provision, the person seeking protection from criminal liability must correct each improper (i.e., incorrect, incomplete, or misleading) report required by 49 U.S.C. 30166, or a regulation, requirement, request or order issued thereunder, not more than twenty-one (21) calendar days after the date of the report to the agency and must correct each failure to report not more than twenty-one (21) calendar days after the information or documents were due to be sent to or received by the agency, as the case may be, pursuant to 49 U.S.C. 30166 or a regulation, requirement, request or order issued thereunder. These reports include, for example, answers and documents submitted in response to information requests propounded by NHTSA's Office of Defects Investigation or Special Orders issued by NHTSA's Chief Counsel, as well as information required to be submitted under the “early warning” provisions of the TREAD Act and the regulations to be issued thereunder.

The time period of “not more than 21 days” is similar to the window of opportunity of “within 21 days (or within such shorter time as may be required by law)” offered by the EPA in Section D(3) of its recently amended Audit Policy, which the EPA published as a Final Policy Statement at 65 FR 19618 (April 11, 2000). Under its Audit Policy, the EPA will waive or substantially reduce the “gravity” based component of civil penalties for violators of environmental requirements who discover, disclose, and correct these violations (the EPA's Audit Policy provides no basis for waiving civil liability associated with the “economic benefits” of an environmental violation or for any criminal liability). NHTSA did not include any language referring to shorter time periods from other legal requirements in this rule because Chapter 301 does not contain shorter periods that are applicable.

The time period of 21 days in the final Audit Policy, as published at 65 FR 19618 (April 11, 2000), is different from the original time period of 10 days used by the EPA in the previous version of its Audit Policy, as published at 60 FR 66705 (December 22, 1995). The EPA's recent changes to Audit Policy were based on its evaluation of the Audit Policy in use for the preceding three years, which the EPA published at 64 FR 26745 (May 17, 1999). One result of this evaluation was that the EPA increased the time period for coming forward to report violations from 10 days to 21 days after discovery of the violation because it found that “the 10-day time frame [was] a common reason for ineligibility under the [initial] Policy” and thus that “the 10-day disclosure period may be a significant impediment to increased use of the Audit Policy” by violators who otherwise would have come forward or did come forward soon after the 10 day period expired. The EPA's study of its Audit Policy concluded the “10 days is not sufficient time to analyze and decide whether to disclose potential violations, especially for larger corporations with several layers of management.” NHTSA believes that the EPA's appraisal of what time period constitutes a “reasonable time” for correction is reasonably applicable to the safe harbor provision of Section 30170(a)(2).

Finally, NHTSA believes that the starting point for calculating the 21-day period should be consistent with the underlying predicate crime. The predicate crime involves a violation of 18 U.S.C. 1001. As noted above, the standard under 18 U.S.C. 1001 is knowingly and willfully. Also, 49 U.S.C. 30170 applies to a person who acts “with the specific intention of misleading the Secretary.” Thus, any person subject to possible criminal liability under 49 U.S.C. 30170 would have known of the impropriety at the time that the person executed the improper report or failed to report to NHTSA. In light of this knowledge, the time period will run from date of the report to NHTSA or the date of the failure to report to NHTSA.

In order for the correction to be timely, it must be received by NHTSA on or before the 21st day, not merely mailed or otherwise sent before that day. NHTSA has also determined that the integrity of the process and the 21-day due date requires that submissions be made by a means which permits the sender to verify promptly that the correction was in fact received by NHTSA and the day it was received by NHTSA. These means include certified mail, an overnight delivery service, or delivery by hand.

The TREAD Act requires NHTSA to establish by regulation what constitutes a “correction” for a person to obtain protection under the safe harbor provision. To delineate what constitutes a correction, NHTSA considered its own rules and experiences with the current motor vehicle and motor vehicle equipment defects program. NHTSA has concluded that, in order for a correction of improper reports or a failure to report to be sufficient under the safe harbor provision's protections from criminal penalties, it must accomplish the following: (1) Identify with specificity all items of information and documents that were improper or were not provided and (2) correct all reporting improprieties and/or failures for which the protections of the safe harbor provision are sought, including providing NHTSA with all missing or corrected documents and information. Therefore, each person seeking protection from criminal penalties under 49 U.S.C. 30170 must sign and submit to NHTSA one or more reports identifying each previous item of information and/or document that was improper or not provided to NHTSA and is related to a required submission under 49 U.S.C. 30166, or a regulation, requirement, request or order issued thereunder, for which protection is sought. This report must also identify the specific predicate under which the missing or improper report should have been submitted (e.g., the report was required by a specific regulation, a NHTSA Information Request, a NHTSA Special Order, etc.). Further, the report must include or be accompanied by the complete and correct information and documents that should have been submitted.

Because NHTSA collects a range of information under 49 U.S.C. 30166, corrections could be made by a wide range of persons. For a corporation to make a correction, it must be signed by an authorized person (ordinarily the individual officer or employee who submitted the information and/or who should have provided missing information, or someone in the company with authority to make such a submission). If the person making the correction cannot submit the correct information, the individual must provide a full detailed description of that information or of the content of those documents and the reason why he or she cannot provide them to NHTSA (e.g., the information or documents are not in the individual's possession or control).

We have considered the impact of this rulemaking action under E.O. 12866 and the Department of Transportation's regulatory policies and procedures. This rulemaking was not reviewed under E.O. 12866, “Regulatory Planning and Review.” This rulemaking is not considered “significant” under the Department of Transportation's regulatory policies and procedures. The impacts of this rule are expected to be so minimal as not to warrant preparation of a full regulatory evaluation because this provision only involves a safe harbor for criminal sanctions associated with a criminal provision that NHTSA does not expect to be invoked often.

We have also considered the impact of this notice under the Regulatory Flexibility Act. I certify that this rule will have no significant economic impact on a substantial number of small entities. As stated above, this provision only involves a safe harbor for criminal penalties which NHTSA does not expect to be invoked often.

We have analyzed this proposal for the National Environmental Policy Act and determined that it would not have any significant impact on the quality of the human environment.

NHTSA has determined that this interim final rule will impose new collection of information burdens within meaning of the Paperwork Reduction Act of 1995 (PRA). Pursuant to 5 CFR 1320.13, Emergency processing, NHTSA is asking OMB for a temporary emergency clearance for this collection. In this interim final rule, NHTSA begins the process of requesting a 3-year clearance for this collection.

Under the PRA, before an agency submits a proposed collection of information to OMB for approval, it must publish a document in the Federal Register providing a 60-day comment period and otherwise consult with members of the public and affected agencies concerning each proposed collection of information. The OMB has promulgated regulations describing what must be included in such a document. Under OMB's regulations (5 CFR 1320.8(d)), an agency must ask for public comment on the following:

(i.) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;

(ii.) The accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;

(iii.) How to enhance the quality, utility, and clarity of the information to be collected; and

(iv.) How to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.

In compliance with these requirements, NHTSA asks public comment on the collection of information in this interim final rule.

Type of Request —New.

OMB Clearance Number— None assigned.

Form Number —This proposed collection of information would not use any standard forms.

Requested Expiration Date of Approval —Three years from the date of the approval of the collection.

Summary of the Collection of Information —Any person seeking protection from criminal liability under 49 U.S.C. 30170 related to an improper report or failure to report pursuant to 49 U.S.C. 30166, or a regulation, requirement, request or order issued thereunder, will be required to report the following information to NHTSA: (1) Each improper item of information or document and each failure to report an item of information or document that was required under 49 U.S.C. 30166, or a regulation, requirement, request or order issued thereunder, (2) the specific predicate under which the missing or improper report should have been provided, and (3) complete and correct reports that include all information that should have been submitted, including relevant documents that were not previously submitted to NHTSA or, if the person cannot do so, provide a full detailed description of that information or of the content of those documents and the reason why the individual cannot provide them to NHTSA.

Description of the Need for the Information and Use of the Information —This information collection was mandated by Section 5 of the TREAD Act. The information collected will provide NHTSA with information the agency should have received previously and will also promptly provide the agency with correct information to do its analyses, such as, for example, conducting tests or drawing conclusions about possible safety-related defects. NHTSA anticipates using this information to help it to accomplish its statutory assignment of identifying safety-related defects in motor vehicles and motor vehicle equipment and, when appropriate, seeking safety recalls.

Description of the Likely Respondents, Including Estimated Number and Proposed Frequency of Response to the Collection of Information —This new collection of information would apply to any person who seeks a “safe harbor” from potential criminal liability for knowingly and willfully acting with the specific intention of misleading the Secretary by an act or omission that violates section 1001 of title 18 with respect to the reporting requirements of 49 U.S.C. 30166, regarding a safety-related defect in motor vehicles or motor vehicle equipment that caused death or serious bodily injury to an individual. Thus, the collection of information could apply to the manufacturers, and any officers or employees thereof, who respond or have a duty to respond to an information provision requirement pursuant to 49 U.S.C. 30166 or a regulation, requirement, request or order issued thereunder.

We believe that there will be very few criminal prosecutions under section 30170, given its elements. Accordingly, it is not likely to be a substantial motivating force for a submission of a proper report. We estimate that no more than nine such persons a year would invoke this new collection of information, and we do not anticipate receiving more that one report a year from any particular person.

Estimate of the Total Annual Reporting and Recordkeeping Burdens Resulting From the Collection of Information —As stated before, we estimate that no more than nine persons a year would be subject to this new collection of information. Incrementally, we estimate that on average it will take no longer than two hours for a person to compile and submit the information we are requiring to be reported. Therefore, the total burden hours on the public per year is estimated to be a maximum of 18 hours.

Since nothing in this rule would require those persons who submit reports pursuant to this rule to keep copies of any records or reports submitted to us, recordkeeping costs imposed would be zero hours and zero costs.

Executive Order 13132 on “Federalism” requires us 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.” The E.O. defines this phrase 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.” This rule, which defines terms in a safe harbor provision for criminal penalties for a person who acts with the specific intention of misleading the Secretary regarding safety defects in motor vehicles or motor vehicle equipment, will not have substantial direct effect 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 E.O. 13132. This rule making does not have those implications because it applies to those persons who are required by 49 U.S.C. 30166 to provide information to NHTSA.

This rule does not have a retroactive or preemptive effect. Judicial review of the rule may be obtained pursuant to 5 U.S.C. 702. That section does not require that a petition for reconsideration be filed prior to seeking judicial review.

The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires agencies to prepare a written assessment of the cost, benefits and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribunal governments, in the aggregate, or by the private sector, of more than $100 million annually. Because this rule will not have a $100 million annual effect, no Unfunded Mandates assessment is necessary and one will not be prepared.

Executive Order 12866 and the President's memorandum of June 1, 1998, require each agency to write all rules in plain language. Application of the principles of plain language includes consideration of the following questions:

If you have any responses to these questions, please include them in your comments.

NHTSA is promulgating this regulation on a reasonable time and on the manner of correction as an interim final rule to comply with Section 5(b)'s mandate that the final rule be issued “within 90 days of the enactment of the [TREAD Act].” As an interim final rule, the regulation contained herein will be effective 30 days after the date of publication in the Federal Register . However, as described below, comments may be submitted for a period of 60 days from the date of publication in the Federal Register . NHTSA will review and respond to all timely comments, as appropriate.

In developing this interim final rule, we tried to address the anticipated concerns of all our stakeholders. Your comments will help us improve this rule. We invite you to provide different views on it, new approaches we have not considered, new data, how this rule may affect you, or other relevant information. We welcome your views on all aspects of this rule, but request comments on specific issues throughout this document. We grouped these specific requests near the end of the sections in which we discuss the relevant issues. Your comments will be most effective if you follow the suggestions below:

Explain your views and reasoning as clearly as possible.

• Provide solid information to support your views.

• If you estimate potential numbers of reports or costs, explain how you arrived at the estimate.

• Tell us which parts of the rule you support, as well as those with which you disagree.

• Provide specific examples to illustrate your concerns.

• Offer specific alternatives.

• Refer your comments to specific sections of the rule, such as the units or page numbers of the preamble, or the regulatory sections.

• Be sure to include the name, date, and docket number with your comments.

Your comments must be written and in English. To ensure that your comments are correctly filed in the Docket, please include the docket number of this document in your comments.

Your comments must not be more than 15 pages long. (49 CFR 553.21). We established this limit to encourage you to write your primary comments in a concise fashion. However, you may attach necessary additional documents to your comments. There is no limit on the length of the attachments.

Please submit two copies of your comments, including the attachments, to Docket Management at the address given above under ADDRESSES.

Comments may also be submitted to the docket electronically by logging onto the Dockets Management System website at http://dms.dot.gov. Click on “Help & Information” or “Help/Info” to obtain instructions for filing the document electronically.

If you wish Docket Management to notify you upon its receipt of your comments, enclose a self-addressed, stamped postcard in the envelope containing your comments. Upon receiving your comments, Docket Management will return the postcard by mail.

If you wish to submit any information under a claim of confidentiality, you should submit copies of your complete submission, including the information you claim to be confidential business information, to the Chief Counsel (NCC-30), NHTSA, at the address given above under FOR FURTHER INFORMATION CONTACT . In addition, you should submit two copies, from which you have deleted the claimed confidential business information, to Docket Management at the address given above under ADDRESSES . When you send a comment containing information claimed to be confidential business information, you should include a cover letter setting forth the information specified in our confidential business information regulation. (49 CFR Part 512.)

We will consider all comments that Docket Management receives before the close of business on the comment closing date indicated above under DATES . To the extent possible, we will also consider comments that Docket Management receives after that date. If Docket Management receives a comment too late for us to consider it in developing a final rule (assuming that one is issued), we will consider that comment as an informal suggestion for future rulemaking action.

You may view the materials in the docket for this rulemaking on the Internet. These materials include the written comments submitted by other interested persons and the preliminary regulatory evaluation prepared by this agency. You may read them at the address given above under ADDRESSES . The hours of the Docket are indicated above in the same location.

You may also see the comments and materials on the Internet. To read them on the Internet, take the following steps:

(1) Go to the Docket Management System (DMS) Web page of the Department of Transportation (http://dms.dot.gov/).

(2) On that page, click on “search.”

(3) On the next page (http://dms.dot.gov/search/), type in the four-digit docket number shown at the beginning of this document. Example: If the docket number were “NHTSA-2000-1234,” you would type “1234.” After typing the docket number, click on “search.”

(4) On the next page, which contains docket summary information for the materials in the docket you selected, click on the desired comments. You may download the comments.

Please note that even after the comment closing date, we will continue to file relevant information in the Docket as it becomes available. Further, some people may submit late comments. Accordingly, we recommend that you periodically check the Docket for new material.

Rhadine exilis and Rhadine infernalis were first collected in 1959 and described by Barr and Lawrence (1960) as Agonum exile and Agonum infernale, respectively. Barr (1974) assigned the species to the genus Rhadine. Batrisodes venyivi was first collected in 1984 and described by Chandler (1992). Texella cokendolpheri was first collected in 1982 and described in Ubick and Briggs (1992). Cicurina baronia, Cicurina madla, Cicurina venii, and Cicurina vespera were first collected in 1969, 1963, 1980, and 1965, respectively. In 1992, Gertsch described these species. Neoleptoneta microps was first collected in 1965 and described by Gertsch (1974) as Leptoneta microps. The species was reassigned to Neoleptoneta following Brignoli (1977) and Platnick (1986).

These nine invertebrates are obligate (capable of surviving in only one environment) karst or cave-dwelling species (troglobites) of local distribution in karst terrain in Bexar County, Texas. “Karst” is a type of terrain in which the rock is dissolved by water so that much of the drainage occurs into the subsurface rather than as runoff. The subsurface drainage leads to passages or other openings within the underground rock formations. Some of the features that develop in karst areas include cave openings, holes in rocks, cracks, fissures, and sinkholes.

Habitat required by the nine karst invertebrate species consists of underground, honeycomb limestone that maintains high humidity and stable temperatures. The surface environment of karst areas is also an integral part of the habitat needed by the animals inhabiting the underground areas. Openings to the surface allow energy and nutrients, in the form of leaf litter, surface insects, other animals, and animal droppings to enter the underground ecosystem. Mammal feces provide a medium for the growth of fungi and, subsequently, localized population blooms of several species of tiny, hopping insects. These insects reproduce rapidly on rich food sources and may become prey for some predatory cave invertebrates (Service 1994). While the life habits of the nine invertebrates are not well known, the species probably prey on the eggs, larvae, or adults of other cave invertebrates.

We funded a status survey (Veni 1994a; Reddell 1993) of all nine species through a grant to the Texas Parks and Wildlife Department (TPWD) under section 6 of the Act. Researchers obtained landowner permission to study and assess threats to 41 caves in north and northwest Bexar County, Texas. Landowners denied permission to access an additional 36 caves that biologists believed likely to contain species of concern. Researchers described all 77 caves, to some extent, before the status survey was conducted and some were already known to contain at least one of the nine invertebrates.

During the status survey, the researchers made a collection of the invertebrate fauna at each cave studied, assessed the condition of the cave environment and threats to the species, and collected geological data. They used this information to prepare two reports. One report discusses the overall karst geography in the San Antonio region and the potential geologic and geographic barriers to karst invertebrate migration (on an evolutionary time scale) and limits to their distribution (Veni 1994a). The other report (Reddell 1993) details the fauna of each cave visited during the study and presents information obtained from invertebrate collections.

Veni's (1994a) report delineates six karst areas (hereafter referred to as karst regions) within Bexar County. The karst regions he discusses are Stone Oak, UTSA (University of Texas at San Antonio), Helotes, Government Canyon, Culebra Anticline, and Alamo Heights. The boundaries of these karst regions are geological or geographical features that may represent obstructions to troglobite movement (on a geologic time scale) which has resulted in the present-day distribution of endemic (restricted in distribution) karst invertebrates in the San Antonio region.

The harvestman Texella cokendolpheri, Robber Baron Cave harvestman, is known only from Robber Baron cave in the Alamo Heights karst region on private property. The cave entrance has been donated to the Texas Cave Management Association (George Veni, Veni & Associates, pers. comm. 1995), which will likely be interested in protection and improvement of the cave habitat. However, this cave is relatively large, and the land over and around the cave is heavily urbanized. The cave has also been subject to extensive commercial and recreational use (Veni 1988). No confirmed specimens of T. cokendolpheri were collected during the 1993 status survey, but one Texella harvestman collected at Robber Baron Cave since completion of the status survey, the species of which could not be positively identified, is highly likely to be T. cokendolpheri (James Reddell, Texas Memorial Museum, and Dr. Darrell Ubick, California Academy of Sciences, pers. comm. 1995).

Batrisodes venyivi, the Helotes mold beetle, is known from only three caves in the vicinity of Helotes, Texas, northwest of San Antonio. Two of these caves are located in the Helotes karst region on private property. We do not have reliable information on the collection from the third cave. The collector of the specimen declined to give us a specific site collection record, but we believe it is located on private property.

Rhadine exilis is known from 35 caves in north and northwest Bexar County. Twenty-one are located on Department of Defense (DOD) land in the Stone Oak karst region. The remainder are distributed among the Helotes, UTSA, and Stone Oak karst regions, while one location lies in the Government Canyon region. One of the non-DOD sites is located in a county road right-of-way, one is located in a state-owned natural area, and the remainder are located on private property. Ongoing efforts by the DOD to locate and inventory karst features on Camp Bullis and to document the karst fauna communities in caves on Camp Bullis resulted in discovery of 18 of the 35 caves mentioned above (Veni 1994b; James Reddell, pers. comm. 1997).

Rhadine infernalis is known from 25 caves. This species occurs in five of the six karst regions— Helotes, UTSA, Stone Oak, Culebra Anticline, and Government Canyon. Scientists have delineated three subspecies ( Rhadine infernalis ewersi, Rhadine infernalis infernalis, Rhadine infernalis ssp.), and described and named two of these in scientific literature (Barr 1960, Barr and Lawrence 1960). In a recent report, scientists characterized the third subspecies as distinct, but not named (Reddell 1998). Only three caves, all on DOD land, contain the subspecies Rhadine infernalis ewersi. Sixteen caves contain the subspecies Rhadine infernalis infernalis and lie in the Government Canyon, Helotes, UTSA, and Stone Oak regions. Six caves in the Culebra Anticline region contain the unnamed subspecies.

Cicurina venii is known from only one cave, which is located on private property in the Culebra Anticline karst region. The species was collected in 1980 and 1983, but the cave itself was not initially described until 1988 (Reddell 1993). The cave entrance was filled during construction of a home in 1990. Without excavation, it is difficult to determine what effect this incident had on the species; however, there may still be some nutrient input, from a reported small side passage.

Cicurina baronia, the Robber Baron cave spider, is known only from Robber Baron Cave in the Alamo Heights karst region. Although the cave entrance is owned and operated by the Texas Cave Management Association, it is located in a heavily urbanized area.

Cicurina madla, Madla's cave spider, is known from six caves. One cave is within the Government Canyon karst region in Government Canyon State Natural Area, one is on DOD land, three are located in the Helotes karst region on private property, and one is located on private property in the UTSA karst region.

Biologists have found Cicurina vespera, the vesper cave spider, in two caves. One cave is Government Canyon Bat Cave in the Government Canyon State Natural Area, and the other is a cave 5 miles northeast of Helotes. The location and name of this latter cave have not been revealed to us, but we believe it is located on private property.

Neoleptoneta microps is known only from the Government Canyon karst region, from two caves within Government Canyon State Natural Area.

In the course of conducting the 1993 status survey, Veni contacted landowners and requested access to as many caves as possible that were believed to be potential habitat for the nine invertebrates. It is possible that these species occur in some of the caves that could not be visited and that new locations of the nine invertebrates will be discovered in the future. Although these new discoveries may increase the number of locations where the species are found, they are expected to fall within the same general range and are expected to face the same threats as the known occurrences of these species. The listing of these species is not based on a demonstrable decline in the number of individuals or the number of known locations of each species, but rather on reliable evidence that each species is subject to threats to its continued existence throughout all or a significant portion of its range.

On January 16, 1992, we received a petition dated January 9, 1992, to add the nine invertebrates to the List of Threatened and Endangered Wildlife. Patricia K. Cunningham of the Helotes Creek Association and individuals representing the Balcones Canyonlands Conservation Coalition, the Texas Speleological Association, the Alamo Group of the Sierra Club, and the Texas Cave Management Association submitted the petition. On December 1, 1993, we announced in the Federal Register (58 FR 63328) a 90-day finding that the petition presented substantial information that listing may be warranted. This 90-day finding resulted in the requirement under the Act that we review the status of the species and, within 12 months of receipt of the petition, issue a finding as to whether the petitioned action is warranted (12-month finding).

We added eight of the nine invertebrates to the Animal Notice of Review as category 2 candidate species in the Federal Register on November 15, 1994 (59 FR 58982). We intended to include Rhadine exilis in the notice of review, but an oversight occurred and it did not appear in the published notice. Category 2 candidates, a classification since discontinued, were those taxa for which we had data indicating that listing was possibly appropriate, but for which we lacked substantial data on biological vulnerability and threats to support proposed listing rules.

The endangered species listing program was disrupted by a listing moratorium (Public Law 104-6, April 10, 1995) and rescission of listing program funding in Fiscal Year 1996. The moratorium was lifted and listing program funding restored on April 26, 1996. On May 16, 1996 (61 CFR 24722), we issued guidance for priorities in restarting the listing program that included four tiers. New proposed listings and petition findings fell under tier three, the second-lowest priority. This precluded completion of the 12-month finding for these species in that Fiscal Year.

The 12-month petition finding and publication of the proposed rule were again precluded by higher priority activities under the listing priority guidance for fiscal year 1997, finalized December 5, 1996 (61 CFR 64475). Processing administrative findings on petitions and processing new proposals to add species to the lists were again a tier three priority.

With the publication of listing priority guidance for Fiscal Years 1998 and 1999 on May 8, 1998 (63 CFR 25502), we returned to a more balanced listing program. Processing administrative findings on petitions to add species to the lists became a tier two priority, and we resumed work on the 12-month finding. This 12-month finding resulted in a proposal to list the 9 invertebrates as endangered, which we published in the Federal Register on December 30, 1998 (63 FR 71855).

The processing of this final rule conforms with our current Listing Priority Guidance, published in the Federal Register on October 22, 1999 (64 FR 57114). Priority 1 (highest priority) is processing emergency listing rules for any species determined to face a significant and imminent risk to its well-being. Priority 2 is processing final determinations on proposed additions to the lists of endangered and threatened wildlife and plants. Priority 3 is processing new proposals to add species to the lists. The processing of administrative petition findings (petitions filed under section 4 of the Act) is the fourth priority. This final rule is a Priority 2 action. We updated this rule to reflect any changes in information concerning distribution, status, and threats since the publication of the proposed rule.

In 1994, we began discussions with a coalition of landowners, developers, and other interested parties about creating a conservation agreement that might preclude the need for listing these species. We continued working with interested parties to develop a conservation strategy and agreement. The issues that needed to be addressed in a conservation agreement related primarily to determining the needs for the species' conservation, responsibility and commitment for implementation and funding, and the amount of time required to implement the conservation measures. In January 1999, we provided a handout titled “Criteria and Measures for Long-term Conservation of Karst Invertebrates in Bexar Co., TX,” to the coalition as a guide for conservation of species-inhabited caves. However, actions required to address the above issues and to reach this goal have not yet occurred.

In the December 30, 1998, proposed rule and associated notifications, we requested that all interested parties submit factual reports or information that might contribute to the development of a final rule. We originally scheduled the comment period to close on April 29, 1999, but we extended it to May 31, 1999 (64 FR 16890). We contacted appropriate Federal and State agencies, county governments, scientific organizations, and other interested parties and requested that they comment. We requested comments on the proposed rule and literature cited from nine scientific experts. We received no comments from those nine. We published a newspaper notice in the San Antonio Express News on December 30, 1998, in which we invited general public comment. We received 38 comment letters through the mail.

Alan Glen, of Drenner and Stuart, and San Antonio Water System requested a public hearing. We published a notice of the public hearing in the Federal Register (64 FR 16890) and gave written notice to those on our mailing list for this topic. We held the public hearing in San Antonio at Lee High School on April 29, 1999; a court reporter made a verbatim transcript of the hearing testimony. Approximately 75 people attended. Of the 22 oral commenters, 8 also submitted written comment letters at the public hearing.

We updated the final rule to reflect comments and information we received during the comment period. We address both the written and oral comments in the following summary. These comments addressed a range of issues regarding the proposal. Because multiple respondents offered similar comments in some cases, we combined those comments in the following summary. Of the 60 comments (some commenters commented more than once) we received from the public hearing and through the mail, 5 directly opposed the listing, 27 supported continued efforts on the conservation agreement to preclude the need to list, 6 both directly opposed the listing and supported continued efforts on the conservation agreement, 19 supported the listing, and 3 were neutral. In this summary, we do not address comments that are not related to the listing decision, such as comments on habitat conservation plans (HCPs) or recovery planning.

Issue 1. So little is known about the species that the Service has not even defined habitat for the invertebrates beyond cave openings.

Our Response: We took this comment into consideration in this final rule and included more detailed habitat descriptions (see the Background section under Supplementary Information). The Available Conservation Measures portion of this final rule discusses criteria for habitat preservation and preserve design. Under section 4(b)(1) of the Act, we must make our listing decision on the best scientific and commercial information available. We believe that substantial evidence exists to support a listing determination for these species, but also recognize that additional research is important to assist in making sound management recommendations.

Issue 2: These nine invertebrates are insignificant to mankind.

Our Response: We are responsible for protecting species in danger of extinction and ecosystems on which they depend. The Act recognizes the importance of all species to properly functioning ecosystems and requires us to base listing decisions on the best scientific information available. Based on best available scientific information, we determined that the Bexar County invertebrates are in danger of extinction and warrant protection as endangered species.

Issue 3: It is inaccurate to describe these species as troglobitic without surveys conducted outside of the caves in the surrounding leaf litter. Evidence in support of additional habitats for these species includes the lack of collected specimens of pupae or larvae from within the caves, few records of some species from caves, and closely related species (including some with troglobitic features) known to exist in non-cave environments.

Our Response: The scientific literature, published by species experts and cited in this final rule, describe the nine Bexar County karst invertebrates as troglobitic. There has been no information submitted to us to indicate otherwise. As for lack of collections of pupae and larvae in caves, we have no evidence discounting the occurrence of reproduction and initial life phases in the humanly inaccessible recesses of caves. Barr (1974) states that there are significantly more caves than entrances, and that approximately ninety percent of them are closed off from human access.

Issue 4: Six of the nine species have common names that are not registered with the Entomological Society of America or the American Arachnological Society, and may not be accurate descriptors for those species.

Our Response: The official name for these species is the scientific name; we list them by their scientific name. The common names we used in this rule are for ease of reference for the general public. We understand that they are not officially registered common names. If the process to register common names is completed in the future, we will refer to those common names, but the listing of these species will not be affected. Until such time we will continue to use the names listed in this document.

Issue 5: It is believed Batrisodes venyivi is restricted to the Helotes karst region, based on past collections. “In Texas, each obligate cave species of [this beetle family] has been restricted to small geographic areas, and each is found in only a small number of closely situated caves.”

Our Response: In the “Background” section, we refer to three locations for this species; two are located in the Helotes karst region on private property. We do not have reliable information on the location of the third cave. The collector of the specimen declined to give us a specific site collection record, but we believe it is located on private property.

Issue 6: How can the threats be so imminent when so many caves are owned by governmental entities?

Our Response: We understand that for some of these species a significant number of locations are owned by governmental entities. Many of the government-owned sites have some limited protection, but fire ants are still a threat. Human activities facilitate movement of certain predators, such as fire ants, into an area. Both Camp Bullis and Government Canyon State Natural Area are increasingly being surrounded by development which provides habitat (construction areas, lawns, roadways, and landscaped areas) from which fire ants can disperse. The relative accessibility of the shallow caves in Bexar County leaves them especially vulnerable to invasion by nonnative species. Without continuously implemented management plans in place, this threat is still imminent.

Issue 7: Continued efforts toward developing a conservation agreement to preclude the need to list the species was desired. Many were disappointed that efforts to develop a conservation agreement were terminated in 1998 and the Service continued with publishing the proposed rule.

Our Response: Please see our discussion under the Previous Federal Action portion of this final rule. We agree that cooperative, voluntary efforts to conserve these species that remove or reduce threats would be an alternative to Federal listing if sufficient conservation measures were implemented so that the species were no longer in danger of extinction. Since 1994, we have been working with a coalition of interested parties to develop a conservation strategy and agreement. While, we acknowledge that some progress toward conservation of these species has been made by this coalition, actions required to address the above issues and to reach this goal have not yet occurred.

Issue 8: With regard to evidence of threats, some believe that in the time it has taken the proposed rule to be published there has been habitat loss and no protection for the species. Others believe that all of the known locations of the nine invertebrate species have been left undisturbed throughout the entire process, indicating a lack of evidence for perceived habitat-destruction threats. Additionally, the Service has not provided any evidence of contamination, predation on these species, and adverse effects from impervious (resistant to seepage of water) cover, closing of caves, and vandalism.

Our Response: During the comment period, we received San Antonio Water System (SAWS) documentation that recharge features were sealed since the petition was filed to preserve water quality and avoid contamination of the aquifer. The Texas Natural Resources Conservation Commission (TNRCC), the State agency responsible for water quality and filling karst features, does not require that any invertebrate surveys be done in assessing karst features and, therefore, may approve the filling of the feature even when the species may be present. We believe that habitat-destruction is a viable threat when sealing of features occurs without investigations for invertebrates.

In the “Summary of Factors Affecting the Species” section of this rule, we cite examples of other threats and their negative effects. We believe that these threats still exist. We included additional examples of contamination on caves under Factor A. Throughout the world there are many documented cases describing the effects of contamination on caves (IUCN 1997). Under Factor C, we also included additional information and citations regarding fire ants and their effects on the species and their habitat. In addition, as indicated in the “Background” section of this final rule, some of the known invertebrate locations suffered degradation prior to the petition to list them.

In addition, even where existing caves have not been filled or polluted, development that encroaches on the area around the cave entrance can significantly degrade the surface habitat, decreasing the potential for long-term persistence of the population of karst invertebrates in that cave. According to data provided by SWCA, Inc., ten of the known locations for these species have less than 10.1 hectares (ha) (25 acres (ac)) of undeveloped area remaining surrounding the caves and several of these have as little as 0.4 to 2 ha (1 to 5 ac). In February 2000, Service personnel observed construction within 30 meters (m) (100 feet (ft))of 2 known locations of Rhadine exilis, which is currently reducing the potential for preservation around these sites. We believe that such small areas of native, surface habitat are not sufficient for sustainable support of karst invertebrate populations.

Issue 9: How can fire ants be a predator on the nine invertebrates when Veni et al. (1995) found fire ants in different zones, or physical divisions within the cave, than the invertebrates during a survey at Camp Bullis, and Porter and Savignano (1990) found that crickets and roaches increased in the presence of fire ants?

Our Response: Veni (pers. comm. 1999) has since done additional work at Camp Bullis and believes the reduced observations of fire ants are due to low population numbers on the property as a result of minimal ground disturbance. Elliott ( in litt 1993-1997) found several instances, in two caves in the Austin area, when fire ants and troglobites were located within the same zones. Reddell (1993, in litt ) documented observations of fire ant predation on three species of troglobites and on cave crickets. Even if fire ants did not prey on the nine invertebrates, heavy predation on cave crickets would reduce available food for the nine invertebrates. As for Porter's and Savignano's (1990) findings, the crickets that increased in abundance with fire ants were ground crickets (Gryllidae: Nemobiinae), not cave crickets ( Ceuthophilus sp.), which are the species critical for nutrient input for the nine karst invertebrate species. Only very few species, including the ground cricket, the roach, and a beetle that is symbiotic with the imported fire ants, increased in abundance in infested areas. However, even when including the increase in these few species, the total abundance of arthropods (excluding fire ants) in infested areas was 75 percent less than uninfested areas. In addition, fire ant infestation reduced biodiversity; there were 40 percent fewer species in infested areas.

Issue 10: Some commenters believe the existing regulations of the TNRCC, City of San Antonio (City), and SAWS, the primary water and wastewater purveyor in Bexar County, are adequate to protect the species and their habitat, while other commenters believed they are inadequate.

Our Response: Our analysis of the adequacy of existing regulatory mechanisms found that additional measures are needed to protect these species from extinction. Although certain rules and regulations provide some protection, they do not alleviate all of the identified threats. We reviewed current programs and regulations of the TNRCC, the City, and SAWS. The purpose of the existing regulations is to protect water quality and the regulations are not adequate to fully protect the species from all threats. For further information please see Factor D in the “Summary of Factors Affecting the Species” section of this final rule.

Issue 11: SAWS initiated a Land Acquisition Program that is currently purchasing land in the karst regions. Certainly, this ongoing program serves to provide substantial protection to these species and their habitat.

Our Response: The focus of this program is preservation of lands for water quality in the Edward's Aquifer and not for caves containing the species. This program may have potential to contribute to species conservation. However, we have no information that indicates SAWS has located and/or preserved caves supporting the nine invertebrates.

Issue 12: Even if the perceived threats did have an impact on the species, the decision to list as endangered will not prevent future negative effects from occurring.

Our Response: Please see our discussion under the Available Conservation Measures section of this final rule. The Act provides numerous conservation mechanisms for listed species.

Issue 13: Some believe the listing is primarily for stopping development over the Edwards Aquifer and not for the species themselves. Others believe that protection of the species and their habitat will provide ancillary benefits by protecting their sole-source water supply.

Our Response: We are obligated under the Act to address the status of species in relation to the five factors discussed under the Summary of Factors Affecting the Species section of this final rule. Other benefits or effects of listing cannot be considered in our determination whether to list a species.

Issue 14: The proposed rule does not indicate the nine karst invertebrates are bred or hunted for commercial purposes, or that they move in interstate commerce. The nine karst invertebrates are intrastate species having no effect in commerce and, therefore, are beyond Congress’ authority to regulate. Thus, the Service lacks authority under the Act pursuant to the Commerce Clause of Article 1, Section 8 of the United States Constitution to regulate the nine proposed karst invertebrates.

Our Response: A decision in the United States Court of Appeals for the District of Columbia circuit ( National Association of Homebuilders v. Babbitt, 130 F. 3d 1041, D.C. Cir. 1997) makes it clear in its application of the test used in the United States Supreme Court case, United States v. Lopez, 514 U.S. 549 (1995), that regulation of species limited to one State under the Act is within Congress’ commerce clause power. On June 22, 1998, the Supreme Court declined to review this case (118 S. Ct. 2340 1998). Therefore, our application of the Act to the nine karst invertebrates, currently known to be endemic to only one county in the State of Texas, is constitutional.

Issue 15: Listing the nine karst invertebrates as endangered will add additional costs and delays to urban development projects.

Our Response: While economic effects and related concerns cannot be considered in listing decisions, such factors are considered in recovering listed species. In a Federal Register notice published July 1, 1994 (59 FR 34272), the Secretaries of Interior and Commerce established an interagency policy to minimize social and economic impacts consistent with timely recovery of listed species. Thus, it is our desire that any recovery actions associated with these nine invertebrates minimize adverse social and economic impacts to the extent practicable.

In addition, we have been encouraging voluntary consideration of these invertebrates in development planning for several years. We believe early coordination can avoid unnecessary increases in costs or delays for construction-related activities in areas containing the listed species. We encourage Federal or State agencies, private developers, and others to contact us during early phases of project design so that the necessary measures to minimize or avoid impacts to listed species can be incorporated into development projects as early as possible. We are committed to working with landowners and others to develop cooperative solutions to species conservation that avoid or minimize the need for regulatory burdens on landowners.

After a thorough review and consideration of all information available, we determined that nine Bexar County karst invertebrates should be classified as endangered species. We followed procedures found at section 4(a)(1) of the Act and regulations implementing the listing provisions of the Act (50 CFR part 424). A species may be determined to be an endangered or threatened species due to one or more of the five factors described in section 4(a)(1). These factors and their application to the nine invertebrates are as follows:

A. The present or threatened destruction, modification, or curtailment of their habitat or range. The ranges of the nine invertebrates are limited to limestone karst strata in the northern portion of Bexar County, which includes a portion of northern San Antonio, Texas. Their historical ranges are unknown, but were likely similar to their present ranges with the exception of caves that have been destroyed or suffered adverse impacts due to the factors discussed in the proposed rule and this final rule.

The proximity of the caves and karst features inhabited by these species to the City of San Antonio makes them vulnerable to negative impacts as a result of continuing expansion of the San Antonio metropolitan area. Destruction of caves in Bexar County and throughout central Texas is common (Elliott 1990, Veni 1991). Veni (1991) estimated that about 26 percent of known caves in Bexar County have been destroyed through filling with dirt, rocks, concrete, or other materials; capping or covering by roads or buildings; and blasting by construction and quarrying operations.

Several sources of information from 1991 to 1997 illustrate that considerable development has occurred and is expected to continue in the San Antonio area in general and in the karst regions in particular. For example, a report prepared by the City of San Antonio (1991) indicates that 69 percent of the increase in human population that occurred in Bexar County between 1980 and 1990, occurred in the northwest and northeast quadrants, where the nine invertebrates occur. The report describes this period as characterized by “tremendous growth” in the residential sector with significant increases also occurring in non-residential growth. A City of San Antonio Department of Planning (2000) map shows that growth of San Antonio from 1971 to 1999 has been primarily to the northwest. During the 1980s, Bexar County saw a 26 percent increase in the single family housing market (88 percent of which occurred in the northwest and northeast quadrants), a 46 percent increase in the multi-family housing market, and an approximate 150 percent increase in availability of non-residential space (City of San Antonio 1991).

Overall, the northwest and northeast quadrants of Bexar County contain 69 percent of the county's population and 73 percent of the available housing (City of San Antonio 1991). From 1980-1990, changes in population for the specific census tracts where the nine invertebrates occur (census tracts numbering in the 1200s, 1700s, 1800s, and 1900s) range from a 2.4 percent decrease (tract 1208, Alamo Heights) to a 201 percent increase (tract 1720, Culebra Anticline area). For the 1200, 1700, 1800, and 1900 census tracts the average population increase has been 35.4 percent, 13.1 percent, 54.3 percent, and 24.1 percent, respectively. The majority of the increase in development and population during that period occurred during the early 1980s with a drastic decline by 1989.

A report by the City of San Antonio (1993) showed a steady increase in building permit activity, number of plats approved, number of acres and lots platted, and new electrical connections during the period from 1990-1992. That report also indicated that the majority of the growth (about 81 percent, as measured by new electrical connections) occurred in the northwest and northeast quadrants.

The recent revitalization of the real estate market and the construction industry has intensified the threat to the nine invertebrates. A review of new electrical connections for all Bexar County census tracts from 1990-1996 (San Antonio Planning Department 1997) reveals that tracts within the northwest and northeast quadrants of the city continued to be the fastest growing areas in the county. Census tracts numbering in the 1200s, 1700s, 1800s, and 1900s accounted for 21 percent, 10 percent, 31 percent, and 21 percent, respectively, of the new electrical connections in the county from 1990 to 1996 (San Antonio Planning Department 1997). Further review of the data reveals that the majority of the fastest growing sub-tracts are located in karst areas.

Population growth in Texas and Bexar County is expected to continue at a rapid rate. The Texas Water Development Board (1997) estimated that the current Texas human population size is 19 million; it is expected it to nearly double in the next 50 years, reaching over 36 million residents in the year 2050. Bexar County alone experienced an estimated 1.3% population increase between 1998 and 1999, with a 1999 population estimate of 1.37 million (US Census Bureau 2000). Estimates from the Texas State Data Center and the Center for Demographic and Socioeconomic Research and Education (2000) indicate that the total population size in Bexar County from the year 2000 to the year 2030 would increase anywhere from 17.2% (assuming no net migration) to 56.9% (assuming migration rates are consistent with those observed between 1990 and 1998), with population sizes of 1.54 million to 2.25 million people by the year 2030.

Plotting cave locations on 1993 land use maps prepared by the Bexar County Appraisal District for northwest Bexar County and the Edwards Aquifer recharge zone shows that most of the privately owned caves lie on land classified as one of the following: single family residential, vacant platted, vacant mixed-use, tax exempt, or ranchland (Table 1). Land classified as single family residential is currently occupied by single-family dwellings. Land classified as vacant platted is mostly interspersed with or surrounded by single family residential areas and, since plats have been approved, can be developed at any time. Vacant mixed-use land either has no agricultural exemption or includes areas where rollback taxes have been paid in preparation for a change in land use. Caves located on single family residential, vacant platted, or vacant mixed-use land are most vulnerable to negative impacts related to development.

Ranchland is land with an existing agricultural exemption. These areas may be vulnerable to fire ant infestations, siltation due to overgrazing, or to chemicals such as pesticides.

Tax exempt land is government-owned or otherwise tax exempt, and is owned primarily by Federal, State, and local governments or church groups. These caves may be subject to any of the threats associated with other land-use types, depending on the landowner and current land use practices. Five caves in TPWD's Government Canyon State Natural Area contain a total of five of the nine invertebrates (Reddell 1993). The TPWD will likely protect habitat at these sites; however, fire ants are present in some of the caves and throughout the property (see discussion under Factor C, below). Thus, the invertebrate species within those caves are at risk because methods of controlling fire ants are only partially effective. To date, there is no management or maintenance plan in place that adequately reduces these threats to the species.

A total of 23 caves containing the species are located on Federal property at the Camp Bullis Training Site. Twenty caves contain only Rhadine exilis, two caves contain only Rhadine infernalis, and one cave contains both Rhadine species and Cicurina madla. Efforts are underway through the Department of Defense's Legacy program to inventory karst features within the recharge zone on Camp Bullis and to determine adequate areas for protection of biologically and/or hydrologically significant karst features. While the habitat on DOD lands is fairly secure, complete protection of the species in these features may require additional steps, such as control of fire ants, cave gates, and long-term management. Currently DOD is drafting a management plan, but until the plan is completed and implemented these threats may not be adequately reduced.

A number of the caves containing the nine invertebrates occur within the recharge zone for the Edwards Aquifer. The Edwards Underground Water District (1993) presented data suggesting that the Edwards Aquifer recharge zone in northwest Bexar County is “poised for explosive development as the economy rebounds.” Spills, leaking storage tanks, and other sources of surface and groundwater pollution can harm cave and karst communities as pollutants pass through the karst. Since karst systems are affected by both surface and subsurface drainage, it is necessary to protect these areas to avoid infiltration of contaminants. In a study of small invertebrates that live in underground spaces too small to allow human access (interstitial spaces), Danielopol (1981) found with increased infiltration of pollution into the interstitial spaces, the invertebrates were replaced by surface species. He concluded that the ratio between surface and interstitial species is proportional to pollution.

The Texas Water Commission (TWC), now part of the TNRCC, reported that in 1988 within the San Antonio segment of the Edwards Aquifer, 28 oil and chemical spills occurred in Bexar County. This represented the greatest number of land-based spills in central Texas that affect surface and/or groundwater (TWC 1989). As of July 1988, Bexar County had between 26 and 50 confirmed leaking underground storage tanks (TWC 1989), placing it second among central Texas counties in the number of confirmed underground storage tank leaks. The TWC estimates that, on average, every leaking underground storage tank will leak about 500 gallons per year of contaminants before the leak is detected. These tanks are considered one of the most significant sources of groundwater contamination in the State (TWC 1989).

Increasing urbanization in Bexar County will increase the risk that leaks and spills may harm karst ecosystems. The TNRCC (1994) summarizes information on groundwater contamination and lists contaminant spills on a county-by-county basis as reported by the TNRCC, the Texas Department of Agriculture, the Railroad Commission of Texas, the Texas Alliance of Groundwater Districts, and the Interagency Pesticide Database. Table 1 in TNRCC (1994) lists 350 groundwater contamination cases that occurred in Bexar County within the past 2 decades. The majority of these cases involve spills or leaks of petroleum products, and many of them remain unresolved at present.

While a number of the cave entrances concerned may not be in imminent danger from development at the entrance site, cave environments can be negatively impacted by runoff, chemical spills, sewer leaks, pesticide use, and septic effluent associated with development on nearby properties within the karst zone. Many of these caves are situated within the porous limestone that forms the Edwards Aquifer and are susceptible to contamination originating on properties containing the cave entrances, as well as on properties that lie above and adjacent to subterranean reaches of the caves.

Attributes of cave environments that are conducive to occupation by karst invertebrates include a relatively constant high humidity, stable temperature, and some energy input (Howarth 1983; Holsinger 1988; Elliott and Reddell 1989). Nutrient availability and moisture are critical limiting factors for karst animals occupying terrestrial cave environments (Barr 1968). Adaptations to the high relative humidity and low nutrient availability typical of caves are common among troglobites (Howarth 1983; Mitchell 1967; Barr 1968), and the nine invertebrates exhibit many of these adaptations (Barr 1960; Barr 1974; Gertsch 1974).

Nearly all food energy in caves must be imported from the exterior (Holsinger 1988). Energy enters areas near the cave entrance via species that move between the surface and the cave (including cave crickets, bats, racoons, and other small mammals) and by means of organic matter that washes or falls into the caves. In deeper reaches of the cave, primary input of energy is through water containing dissolved organic matter percolating through the karst vertically through fissures and solution features (Howarth 1983; Holsinger 1988; Elliott and Reddell 1989).

Culver (1986) discusses several documented threats to caves, and indicates that the covering or closing of caves greatly affects nutrient input because major food sources for troglobites come in through cave entrances. Many caves extend beyond humanly accessible points, thereby restricting our knowledge of other access points not readily noticeable from the surface. Rapid urbanization in northern Bexar County would likely result in a dramatic increase in impermeable cover in areas surrounding many of the caves. An increase in impermeable cover could result in decreased percolation of water into the caves via the karst and have a detrimental effect on the moisture regime and nutrient input critical to karst-dwelling species.

Several of the caves containing the nine invertebrates have been subject to vandalism, trash dumping, and other threats that may be associated with visitation by humans. Excessive visitation by humans can result in habitat disturbance or loss of habitat due to soil compaction or changes in atmospheric conditions as well as direct mortality of invertebrates. Vandalism may result in the destruction or deterioration of the karst ecosystem. Dumping of trash (such as alkaline batteries) can lead to contamination of the karst ecosystems. Disposal of household and other wastes may attract fire ants or other surface-dwelling species harmful to the karst ecosystem.

B. Overutilization for commercial, recreational, scientific, or educational purposes . These species are of little interest in the insect trade or to amateur collectors. They are collected only occasionally by scientists conducting studies of cave fauna. While it is true that positive identification of karst invertebrates usually requires collection and permanent preservation of individual specimens, the number of individuals taken for this purpose is small, and such collections are made infrequently. We do not believe that collection of a few individuals has significantly reduced their numbers. Habitat disturbance resulting from searching for species is relatively minor when done by experienced collectors, and usually involves turning over rocks on the cave floor, which are then returned to their previous positions. Thus, we do not consider scientific collecting to be a threat at this time. Consequently, any threat from overutilization of these species for commercial, recreational, scientific, or educational purposes is insignificant at this time.

C. Disease or predation . Human activities facilitate movement of certain predators, such as fire ants, into an area. Construction areas, lawns, roadways, and landscaped areas provide habitat from which these species can disperse. The relative accessibility of the shallow caves in Bexar County leaves the nine invertebrates especially vulnerable to invasion by nonnative species.

Nonnative fire ants are a major threat to the nine invertebrates. Fire ants are voracious predators and there is evidence that overall arthropod diversity drops in their presence (Vinson and Sorensen 1986, Porter and Savignano 1990). Reddell ( in litt. 1993) lists ten cave-inhabiting species he has observed being preyed upon by fire ants. Although none of the species covered in this final rule are the species he observed being preyed upon, several of those observed are closely related to the nine invertebrates or to endangered karst invertebrates in Travis and Williamson Counties, Texas. It is reasonable to expect that the nine Bexar County invertebrates are similiarly affected in areas where fire ants are present.

Elliott (1992) cites other examples of predation and notes that fire ant activity has increased dramatically in central Texas since 1989. Even in the unlikely event that fire ants do not affect the listed species directly, their presence in and around caves could have a drastic detrimental effect on the cave ecosystem through loss of species, inside the cave and out, that provide nutrient input and critical links in the food chain. Elliott (1994) found fire ants competing intensively with cave crickets during foraging; since cave crickets transport nutrients from outside to inside the caves, this will probably lead to the eventual decline of cave communities. Porter and Savignano (1990) found arthropod species richness and abundance was lower in fire ant-infested areas compared to uninfested areas.

Of 36 caves Veni and Reddell visited while conducting a status survey for the nine invertebrates, fire ants were found in 26 caves (Reddell 1993). The 1993 status survey revealed that, of 24 caves confirmed to contain one or more of the nine invertebrates, at least 15 had fire ant infestations at the time the study was conducted (Reddell 1993). Most of the collections for the status survey were done between April and June of 1993, at a time during that year when fire ants had likely not reached peak densities (Reddell, pers. comm. 1995). Consequently, fire ant infestations could be worse than reflected by the status survey. The rate of infestation is expected to be similar for the rest of the 57 caves known to contain one or more of the nine invertebrates.

Controlling fire ants once they have invaded a cave and its vicinity is difficult. Chemical control methods have some effectiveness, but the effect of these agents on non-target species is unclear. Consequently, use of chemicals to control fire ants in and close to caves is not currently advisable. At present, we recommend only boiling water treatment for control of fire ant colonies near caves inhabited by endangered karst invertebrates. This method is labor-intensive and only moderately effective. Carefully controlled chemical treatment may be appropriate in certain circumstances. Although control methods are available, the burden of carrying out such practices in areas occupied by these species is not a designated or mandated duty of any agency, organization, or individual. This type of control will likely be needed indefinitely or until a long term method of fire ant control is developed.

D. The inadequacy of existing regulatory mechanisms. Invertebrates are not included on the TPWD list of threatened and endangered species and are provided no protection by the State. Furthermore, TPWD's regulations do not contain provisions for protecting habitat of any listed species.

The TNRCC regulations may give some degree of protection to significant aquifer recharge features, but may apply to only a few of the caves in which the nine invertebrates are found since the majority do not meet TNRCC's definition of “sensitive feature”. TNRCC defines a sensitive feature as a “permeable geologic or manmade feature located on the recharge zone or transition zone where: (A) A potential for hydrologic interconnectedness between the surface and the Edwards Aquifer exists, and (B) rapid infiltration to the subsurface may occur.”

The TNRCC regulations are designed to protect the water quality of the Edwards Aquifer. This is typically accomplished by prohibiting certain activities (for example, locating waste disposal wells or concentrated animal feed lots on the recharge zone), filing a Water Pollution Abatement Plan, and through the use of Best Management Practices. Complying with TNRCC regulations may also entail the capping (concrete sealing) of some features to prevent contaminated water from entering the aquifer. Such alteration or blocking of natural drainage patterns could result in drying of the subterranean habitat and a reduction in nutrient input into the karst feature. Karst features supporting the nine invertebrates may also be exempted from TNRCC regulations because a number are not found in either the recharge or transition zone.

The City of San Antonio regulates development and impervious cover within the recharge area of the Edwards Aquifer through Ordinance #81491, made effective January 23, 1995. This Ordinance limits types of development and impervious cover within the city limits, the extraterritorial jurisdiction, and the recharge zone. This Ordinance requires, in part, identification of critical environmental features and may provide some protection for caves and karst features that provide recharge to the Edwards Aquifer. Development setbacks provided for in the Ordinance range from 18.3 to 30.5 m (60 to 100 ft). These setback distances translate into buffer areas of 0.13 to 0.37 ha (0.33 to 0.92 ac). Setbacks from recharge features required by the Ordinance may not always be adequate to protect entire hydrogeological areas that provide surface and subsurface moisture to the karst habitat and surface communities that provide nutrient input into the cave. We believe that the amount of surface habitat needed for perpetual sustainability of the karst ecosystem is on the order of 40 ha (100 ac) based upon such factors as foraging distances of cave crickets; minimum viable population sizes of the dominant, native plant species; and the distance of edge effects on both the floral and faunal communities. In addition, most of the caves known to contain the nine invertebrates are relatively small and do not provide significant recharge, so it is uncertain how these caves would be considered under the Ordinance. Many of the caves known to have the nine invertebrates lie outside the recharge zone.

The Ordinance classifies property into three categories. Category 1 is any property having already filed official documents; such as development plats, water or sewer contracts, water pollution abatement plans, or zoning changes, or having a valid permit with the City prior to the effective date of the Ordinance. The Ordinance does not apply to these properties, allowing up to 100 percent impervious cover. Category 2 properties are those not already designated as Category 1 and that lie within the corporate limits of the City of San Antonio. This category allows 30 percent, 50 percent, and 65 percent impervious cover, respectively, for single-family residential, multi-family, and commercial development. Category 3 property is not within Category 1 or 2, but is within the extra-territorial jurisdiction (ETJ) of the City of San Antonio and within the Edwards Aquifer Recharge Zone. Impervious cover is limited to 15 percent on Category 3 property. In an update by SAWS on January 14, 1998, they noted that from January 23, 1995 to the end of 1997, 29.25 percent (9,695 ha (23,958 ac)) of development within the recharge zone was redesignated from Category 2 or 3 to Category 1. As San Antonio grows and extends the corporate limits, impervious cover limits for non-developed land will increase with those extensions.

We are not aware of other regulations that will specifically address the protection of the karst features that serve as habitat for these invertebrate species. At present, adequate, long term conservation of the karst fauna is not assured in any of the caves containing one or more of the nine invertebrates.

E. Other natural or manmade factors affecting their continued existence. Just as human activities may facilitate movement of fire ants into an area (see discussion under Factor C, above), competitors such as cockroaches and sow bugs can also be introduced into cave ecosystems in association with human activity. Native and nonnative species may increase and compete with the nine invertebrates directly by consuming the same foods and using the same habitats, or they may compete indirectly by using resources needed by species such as cave crickets that provide nutrient input to karst ecosystems. Fire ants can be considered both predators and competitors (see discussion under Factor C, above).

Possible impacts from human entry into caves for recreational purposes include habitat disturbance or loss due to soil compaction or changes in atmospheric conditions; abandonment of the cave by animals, including bats, that inhabit caves but must return to the surface for food or other necessities, and in so-doing provide nutrient input to the cave ecosystem; and direct mortality of karst fauna. These impacts may be reduced or avoided depending on the caving skills and caution of the person(s) entering the cave.

Vandalism is also a threat to karst ecosystems and can contribute to an alteration of the cave ecosystem through soil compaction, temperature changes, and contamination from household chemicals such as insecticides (Reddell 1993). Additionally, disturbance of habitat and introduction of excess nutrients, such as garbage, may facilitate the establishment or increase the numbers of competitors and/or predators (including nonnative species) as discussed above. Certain caves have frequently been used for parties and other unauthorized activities. Trash dumping has occurred in numerous Bexar County caves. Reddell (1993) noted that vandalism contributed to the degradation of several caves that contain one or more of the nine invertebrates.

We carefully assessed the best scientific and commercial information available regarding the past, present, and future threats faced by these species in determining to make this rule final. Based on this evaluation, the preferred action is to list Rhadine exilis, Rhadine infernalis, Batrisodes venyivi, Texella cokendolpheri, Cicurina baronia, Cicurina madla, Cicurina venii, Cicurina vespera, and Neoleptoneta microps as endangered.

The Act defines an endangered species as one that is in danger of extinction throughout all or a significant portion of its range. A threatened species is one that is likely to become an endangered species in the foreseeable future throughout all or a significant portion of its range. We believe that these species are endangered because of the high degree and immediacy of threats and their limited ranges.

In accordance with 5 U.S.C. 553(d)(3), we find good cause to make this rule effective immediately. Because of the extremely isolated nature of the populations of these species, the corresponding negligible possibility for recolonization of destroyed habitat, and our knowledge that permanent destruction of habitat quality for at least two caves, in which some of these invertebrates live, is imminent, the protection provided by the Act is granted to the nine invertebrates in Bexar County immediately upon publication of this final rule. We believe that habitat destruction would temporarily intensify if the final rule does not become effective until 30 days after rule publication. Through consultations for other threatened and endangered species, we are currently aware of numerous developments in the range of the nine invertebrates.

Several in-progress developments have known karst features on the property, but it is unknown whether these features support any of the nine invertebrates. By making this rule effective immediately, developers may experience temporary delays in order to conduct any needed surveys for karst features and for the nine invertebrates, and to determine how their projects may proceed in compliance with the Act. However, the majority of these developments would experience these delays regardless of the effective date. Making the rule effective immediately upon publication may prevent the destruction of a number of significant but as yet unknown locations for these species and speed the recovery of the species.

Critical habitat is defined in section 3 of the Act as: (i) The specific areas within the geographical area occupied by the species, at the time it is listed in accordance with the Act, on which are found those physical or biological features (I) essential to the conservation of the species and (II) that may require special management considerations or protection; and (ii) specific areas outside the geographical area occupied by a species at the time it is listed, upon determination that such areas are essential for the conservation of the species. “Conservation” as defined in the Act means the use of all methods and procedures needed to bring the species to the point at which listing under the Act is no longer necessary.

Section 4(a)(3) of the Act and implementing regulations (50 CFR 424.12) require that, to the maximum extent prudent and determinable, the Secretary designate critical habitat at the time the species is listed. The regulations (50 CFR 424.12(a)(1)) state that designation of critical habitat is not prudent when one or both of the following situations exist—(1) The species is threatened by taking or other human activity, and identification of critical habitat can be expected to increase the degree of threat to the species, or (2) such designation of critical habitat would not be beneficial to the species.

In the proposed rule, we indicated that designation of critical habitat was not prudent for the nine invertebrates because the publication of precise species locations and maps and descriptions of critical habitat in the Federal Register would make the nine invertebrates more vulnerable to incidents of vandalism through increased recreational visits to their cave habitat and through purposeful destruction of the caves. We also indicated that designation of critical habitat was not prudent because it would not provide any additional benefit beyond that provided through listing as endangered.

In the last few years, a series of court decisions have overturned a number of our determinations that designation of critical habitat for other species would not be prudent (for example, Natural Resources Defense Council v. U.S. Department of the Interior 113 F. 3d 1121 (9th Cir. 1997); Conservation Council for Hawaii v. Babbitt, 2 F. Supp. 2d 1280 (D. Hawaii 1998)). Based on the standards applied in those judicial opinions, we have reexamined the question of whether critical habitat for the nine invertebrates would be prudent.

We examined the available evidence for the nine invertebrates and did not find specific evidence of collection or trade of these or any similarly situated species. There have been instances of vandalism to caves due to recreational cave use. By designating critical habitat in a manner that does not identify specific cave locations, the threat of vandalism by recreational visits to the cave or purposeful destruction by unknown parties should not be increased.

In the absence of a finding that critical habitat would demonstrably increase threats to a species, if there are any benefits to critical habitat designation, then a prudent finding is warranted. In the case of these species, there may be some benefits to designation of critical habitat. Critical habitat also identifies areas that may require special management considerations or protection, and may provide protection to areas where significant threats to the species have been identified. Critical habitat receives protection from destruction or adverse modification through required consultation under section 7 of the Act with regard to actions carried out, funded, or authorized by a Federal agency. Section 7 also requires conferences on Federal actions that are likely to result in the adverse modification or destruction of proposed critical habitat. Aside from the protection that may be provided under section 7, the Act does not provide other forms of protection to lands designated as critical habitat.

Section 7(a)(2) of the Act requires Federal agencies to consult with the Service to ensure that any action they carry out, authorize, or fund does not jeopardize the continued existence of a federally listed species or destroy or adversely modify designated critical habitat. Our implementing regulations (50 CFR part 402) define “jeopardize the continuing existence of” (a species) and “destruction or adverse modification of” (critical habitat) in very similar terms. To jeopardize the continuing existence of a species means to engage in an action “that reasonably would be expected, directly or indirectly, to reduce appreciably the likelihood of both the survival and recovery of a listed species by reducing the reproduction, numbers, or distribution of that species.” Destruction or adverse modification of critical habitat means a “direct or indirect alteration that appreciably diminishes the value of critical habitat for both the survival and recovery of a listed species in the wild.” Both definitions describe an action that would result in an appreciable detrimental effect to both the survival and recovery of a listed species.

A critical habitat designation for habitat currently occupied by these species would usually result in the same outcome under section 7 consultation as if the critical habitat had not been designated because an action that destroys or adversely modifies such critical habitat would also be likely to result in jeopardy for these species. However, there may be a few instances where section 7 consultation would be triggered only if critical habitat is designated, such as areas where the primary constituent elements of critical habitat are present but adequate surveys have not yet been conducted to find any of the nine invertebrates. Because the nine species are small, inconspicuous, and reclusive, and their population levels are low, surveys may have been inadequate to detect them based on insufficient number of surveys, insufficient effort in surveying, inappropriate climatic conditions for surveying, or other factors. It is common that no individuals are seen in surveys of caves where they are known to be present.

Designation of critical habitat can help focus conservation activities for a listed species by identifying areas that contain the physical and biological features essential for the conservation of that species. Designation of critical habitat alerts the public as well as land-managing agencies to the importance of these areas.

We find that critical habitat designation is prudent for the nine invertebrates due to the increased benefits to the species described above. We find that these benefits are not outweighed by potential increased threats of designating critical habitat.

The Final Listing Priority Guidance for FY 2000 (64 FR 57114) states that we will undertake critical habitat determinations and designations during FY 2000 as allowed by our funding allocation for that year. As explained in detail in the Listing Priority Guidance, our listing budget is currently insufficient to allow us to immediately complete all of the listing actions required by the Act. Listing these nine invertebrate species without designation of critical habitat will allow us to concentrate our limited resources on higher-priority listing actions, while allowing us to invoke protections needed for the conservation of the nine invertebrates without further delay. We will propose designation of critical habitat in the future at such time when our available resources and priorities allow.

Conservation measures provided to species listed as endangered or threatened under the Act include recognition, recovery actions, requirements for Federal protection, and prohibitions against certain practices. Recognition through listing encourages and results in conservation actions by Federal, State, and local agencies, private organizations, and individuals. The Act provides for possible land acquisition and cooperation with the States and requires that recovery actions be carried out for all listed species. The protection required of Federal agencies and the prohibitions against taking and harm are discussed, in part, below.

Section 7(a) of the Act requires Federal agencies to evaluate their actions with respect to any species that is proposed or listed as endangered or threatened and with respect to its critical habitat, if any is being designated. Regulations implementing this interagency cooperation provision of the Act are codified at 50 CFR part 402. Section 7(a)(4) requires Federal agencies to confer with us on any action that is likely to jeopardize the continued existence of a species proposed for listing or result in destruction or adverse modification of proposed critical habitat. If a species is listed subsequently, section 7(a)(2) requires Federal agencies to ensure that activities they authorize, fund, or carry out are not likely to jeopardize the continued existence of the species or to destroy or adversely modify its critical habitat. If a Federal action may affect a listed species or its critical habitat, the responsible Federal agency must enter into formal consultation with us.

In addition, section 7(a)(1) of the Act requires all Federal agencies to review the programs they administer and use these programs in furtherance of the purposes of the Act. All Federal agencies, in consultation with us, are to carry out programs for the conservation of endangered species and threatened species listed pursuant to section 4 of the Act.

Examples of Federal agency actions that may require consultation as described in the preceding paragraphs include operations at Camp Bullis Military Reservation; Environmental Protection Agency authorization, registration, and regulation of pesticides and of discharges under the Clean Water Act (33 U.S.C. 1344 et seq. ) such as Construction General Permits and any applicable National Pollution Discharge and Elimination System permits; Federal Highway Administration and Army Corps of Engineers (Corps) involvement in such projects as road and bridge construction and maintenance; other Corps projects subject to section 404 of the Clean Water Act; and U.S. Department of Housing and Urban Development activities, funding, and authorizations.

The Act and implementing regulations set forth a series of general prohibitions and exceptions that apply to all endangered wildlife. The prohibitions, codified at 50 CFR 17.21, in part, make it illegal for any person subject to the jurisdiction of the United States to take (includes harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect; or to attempt any of these), import or export, ship in interstate commerce in the course of commercial activity, or sell or offer for sale in interstate or foreign commerce any listed species. It also is illegal to possess, sell, deliver, carry, transport, or ship any such wildlife that has been taken illegally. Certain exceptions apply to our agents and agents of State conservation agencies.

We may issue permits to carry out otherwise prohibited activities involving endangered wildlife under certain circumstances. Regulations governing permits for endangered wildlife are codified at 50 CFR 17.22 and 17.23. Such permits are available for scientific purposes, to enhance propagation or survival of the species, and/or for incidental take in the course of otherwise lawful activities. Because these species are not in trade, we do not expect requests for hardship exemption permits.

To obtain a copy of regulations regarding listed wildlife or to ask about prohibitions and permits, contact the Legal Instruments Examiner, U.S. Fish and Wildlife Service, Division of Endangered Species, P. O. Box 1306, Albuquerque, NM 87103-1306 (telephone 505/248-6920; facsimile 505/248-6788).

The karst features inhabited by these species and the ecosystems on which they depend have developed slowly over millions of years and cannot be recreated once they are destroyed. Protection of the ecosystems that support the nine invertebrates requires maintaining moist, humid conditions and stable temperatures in the air-filled voids; maintaining an adequate nutrient supply; preventing contamination of the water entering the ecosystem; preventing or controlling invasion of nonnative species such as fire ants; maintaining of a healthy ecosystem surrounding the karst features; and other actions as deemed necessary.

Protecting the karst features inhabited by the nine invertebrates entails protecting sufficient natural surface and subsurface area surrounding the karst features to maintain the integrity of the karst ecosystem. Due to the paucity of light and limited capability for photosynthesis, karst ecosystems are almost entirely dependent upon surface plant and animal communities for nutrient and energy input.

Water quality is also an important factor in the conservation of karst invertebrates. Caves and karst features are susceptible to pollution from contaminated water entering the ground because karst has little capacity for purification. Transmission of groundwater flows in karst is comparatively rapid and provides little opportunity for natural filtering or other purifying effects (IUCN 1997). The area that has the greatest potential to contribute water-borne contaminants into the karst ecosystem is the surface and subsurface drainage basin that supplies water to the ecosystem. Certain activities within this hydrologically sensitive area, such as application of pesticides and fertilizers, leakage from sewer lines, and urban runoff, could contaminate the karst ecosystem. The potential for contaminants to travel through karst systems may be increased in some areas relative to others due to local geologic features. Areas surrounding the karst features providing habitat for the nine invertebrates should be maintained so as to minimize the possibility of introducing contaminants into the karst ecosystem.

In addition to providing nutrients to the karst ecosystem, the surface plant community also serves to buffer the karst ecosystem against changes in temperature and moisture regimes, pollutants entering from the surface (Biological Advisory Team 1990, Veni & Associates 1988), and other factors such as sedimentation resulting from soil erosion. Protecting native vegetation may also help control certain nonnative species (such as fire ants) that may compete with and/or prey upon the listed species and other karst fauna (Service 1994). Soil disturbance, introduction of nursery plants and sod containing fire ants, dumping of garbage (a potential food source), and installation of electrical equipment (fire ants appear to be attracted to electrical fields) are some of the factors contributing to fire ant infestations.

It is our policy (July 1, 1994; 59 FR 34272) to identify to the maximum extent practicable at the time a species is listed those activities that would or would not likely constitute a violation of section 9 of the Act. The intent of this policy is to increase public awareness of the effect of the listing on proposed and ongoing activities within a species' range.

Veni 1994(a) defines five karst zones in the San Antonio area based on geology, distribution of known caves, distribution of cave fauna, and primary factors that determine the presence, size, shape, and extent of caves with respect to cave development (see map 1). The five zones reflect the likelihood of finding a karst feature that will provide habitat for endemic invertebrates as follows:

Veni (1994a) includes detailed discussion of the geologic makeup of these karst zones. Map 1 simplifies Veni's karst zone maps to show where actions may or may not be likely to take karst invertebrates. Zones 1 and 2 are combined in the shaded areas, zones 3 and 4 are combined in the hatched areas, and the remaining area falls in zone 5. Zone 5 does not have karst-forming strata and the nine invertebrates are not expected to occur in these areas.

The likelihood that activities in zones 1-4 will result in take of listed invertebrates is related to the likelihood of species occurrence, which in turn is related to the likelihood of karst features being present and may require specialized knowledge and familiarity with caves, geology of karst areas, and local geology to determine. The following paragraphs outline steps suggested to avoid the possibility of taking karst invertebrates for properties that lie entirely or partially within zones 1, 2, 3, or 4. If a property is in zone 5, then no precautions to avoid taking these species should be necessary.

In zone 1 or 2, a survey by a qualified geologist or geohydrologist to search for karst features is recommended. In zones 3 and 4, where the presence of karst features is possible, but less likely, we recommend that landowners visually inspect their property for obvious karst features, noticeable sinks, or caves. If the inspection reveals no karst features, and no subterranean voids are encountered during subsequent activities, then no further precautions should be necessary. However, if an inspection reveals caves, noticeable sinks, or karst features on the property, and/or caves, karst features, or subterranean voids are discovered during the course of any activity carried out on the property, the features should be examined by a qualified biologist, who has a U.S. Fish and Wildlife Service section 10(a)(1)(A) scientific permit, for the presence of the listed karst invertebrates. If karst invertebrates are found, contact us for additional advice and information on how to avoid taking the species or, if taking cannot be avoided, the process for obtaining incidental take authorization (see ADDRESSES ).

If property is adjacent to a known occupied cave and within geohydrologically sensitive zones of influence on that cave, then activities discussed below could lead to take of species on that adjacent property. If you are in or adjacent to zone 1 karst, consultation with us is advisable to determine if you are adjacent to a known occupied cave or within geohydrologically sensitive zones of influence on that cave.

Persons qualified to identify and evaluate the significance of karst features may include professional geologists or hydrogeologists, biological consultants familiar with cave and karst ecosystems, and other similarly knowledgeable persons. Property owners should take care in conducting karst surveys or selecting a person to conduct a karst survey so as to obtain the most accurate information possible and to avoid doing any damage to a karst feature or the karst ecosystem during the survey.

Collection and identification of karst invertebrates requires specialized knowledge and familiarity with cave biology and ecology and the life histories of karst invertebrates. Identification of some specimens will require microscopic examination and expert taxonomic assistance. Persons qualified to search for karst invertebrates and make preliminary identifications of specimens should also be able to evaluate various karst features' suitability as habitat for the species. Extreme care must be taken when surveying for invertebrates in karst ecosystems, and these invertebrate surveys must only be done by qualified individuals who are permitted by the Fish and Wildlife Service to conduct such surveys.

We believe that, based on the best available information, activities in zones 1-4 that could potentially result in take include, but are not limited to:

(1) Collecting or handling of the species;

(2) Surface or subsurface activities that may directly result in destruction or alteration of species' habitat (such as trenching for installation of utility or sewer lines, excavation, etc.);

(3) Alteration of the topography within the surface or subsurface drainage area or other alterations to any cave or karst feature providing habitat for the species that results in changes to the cave environment. This may include, but is not limited to, such activities as filling cave entrances or otherwise reducing airflow, which limits oxygen availability; increasing airflow that results in drying; altering natural drainage patterns with the result of changing the amount of water entering the cave or karst feature; removal or disturbance of native surface vegetation; increasing impervious cover within the surface or subsurface drainage areas of the cave or karst feature; and altering the entrance or opening of the cave or karst feature in a way that would disrupt movements of raccoons, opossums, cave crickets, or other animals that provide nutrient input, or otherwise negatively altering the movement of nutrients into the cave or karst feature;

(4) Discharge or dumping of chemicals, silt, pollutants, household or industrial waste, or other harmful material into karst features or areas that drain into karst features or that affect surface plant and animal communities that support karst ecosystems;

(5) Pesticide or fertilizer application in or near karst features containing the nine invertebrates or areas that drain into these karst features or that affect surface plant and animal communities that support karst ecosystems. Careful use of pesticides in the vicinity of karst features may be necessary in some instances to control nonnative fire ants. Guidelines for controlling fire ants in the vicinity of karst features are available from us (see ADDRESSES section);

(6) Activities within caves that lead to soil compaction, changes in atmospheric conditions, abandonment of the cave by bats or other fauna, or direct mortality of the species; and

(7) Activities that attract or increase access for fire ants, cockroaches, or other invasive predators or competitors to caves or karst features (for example, dumping of garbage in or around caves or karst features).

We believe that, based on the best available information, the following actions will not result in take, provided such activities do not result in any of the situations described above:

(1) Construction activities in non-karstic areas;

(2) Maintenance of existing roads (this does not include widening);

(3) Recreational activities on the surface, including camping, hiking, and hunting; and,

(4) Chemical-free maintenance of established lawns and other landscaping features, including mowing, pruning, seeding, removing dead trees, and planting trees and shrubs that are free of fire ants, particularly using native plant species.

We welcome the involvement of landowners in conservation efforts for the nine invertebrates. Conservation measures for these species may include careful fire ant control in the vicinity of occupied karst features (following Service-recommended methods); construction/disturbance setbacks from caves; and avoidance of the use of chemical pesticides or fertilizers, surface topography alteration, and trenching within specific areas.

This rule does not contain new or revised information collection for which Office of Management and Budget approval is required under the Paperwork Reduction Act. Information collections associated with Habitat Conservation Plans (HCP) is covered by an existing OMB approval, and is assigned OMB Control Number 1018-0094. The Service may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number.

We determined that we do not need to prepare Environmental Assessments and Environmental Impact Statements, as defined under the authority of the National Environmental Policy Act of 1969, in connection with regulations adopted pursuant to section 4(a) of the Endangered Species Act of 1973, as amended. We published a notice outlining our reasons for this determination in the Federal Register on October 25, 1983 (48 FR 49244).

A complete list of references we cited in this rule is available upon request from the Field Supervisor, U.S. Fish and Wildlife Service (see ADDRESSES section).

The primary author of this final rule is Christina Longacre, Fish and Wildlife Service (see ADDRESSES section).