Pursuant to 5 U.S.C. 553(b)(3)(B) and (d)(3), good cause exists for publishing this amendment without a notice of proposed rulemaking and a 30-day delay in effectiveness. This amendment is non-substantive and will not affect current compliance.

I certify that these regulations will not have a significant economic impact on a substantial number of small entities because they will affect only Federal agencies and employees.

The Agricultural Marketing Act (AMA) of 1946 (7 U.S.C. 1621 et seq. ) authorizes official voluntary grading and certification on a user-fee basis of eggs, poultry, and rabbits. The AMA provides that reasonable fees be collected from users of the program services to cover, as nearly as practicable, the costs of services rendered.

The AMS regularly reviews these programs to determine if fees are adequate and if costs are reasonable. This rule will amend the schedule for fees and charges for grading services rendered to the egg, poultry, and rabbit industries to reflect the costs currently associated with them.

A recent review of the current fee schedule, effective October 1, 2000, revealed that anticipated revenue would not adequately cover increasing program costs. Without a fee increase, FY 2002 revenues for grading services are projected at $24.1 million, costs are projected at $26.0 million, and trust fund balances would be $14.8 million. With a fee increase, FY 2002 revenues are projected at $25.3 million, costs are projected at $26.0 million, and trust fund balances would be $16.0 million.

Employee salaries and benefits account for approximately 81 percent of the total operating budget. A general and locality salary increase for Federal employees, ranging from 3.56 to 4.46 percent, depending on locality, became effective in January 2001 and has materially affected program costs. Another general and locality salary increase estimated at 3.6 percent is expected in January 2002. Also, from October 2000 through September 2001, salaries and fringe benefits of federally licensed State employees will have increased by about 6.0 percent.

The impact of these cost increases was determined for resident, nonresident, and fee services. To offset projected cost increases, the hourly resident and nonresident rate will be increased by approximately 5 percent and the fee rate will be increased by approximately 6 percent. The hourly rate for resident and nonresident service covers graders' salaries and benefits. The hourly rate for fee service covers graders' salaries and benefits, plus the cost of travel and supervision.

Administrative charges that cover the cost of supervision for resident poultry and shell egg grading will also be increased as shown in the table below. Administrative charges for resident rabbit grading and nonresident services will not be changed.

The following table compares current fees and charges with the revised fees and charges for egg, poultry, and rabbit grading as found in 7 CFR parts 56 and 70:

Based on an analysis of costs to provide these services, a proposed rule to increase the fees for these services was published in the Federal Register (66 FR 42456) on August 13, 2001. Comments on the proposed rule were solicited from interested parties until September 12, 2001.

The Agency received one comment during the 30-day comment period from an egg industry association. The association requested that the Agency not implement the fee increase, or delay implementation of the increase, because current economic conditions of the shell egg industry are abysmal. Although the Agency seeks to minimize or negate any fee increases for the poultry, rabbit, and egg grading programs, it must operate these programs on a sound financial basis. Therefore, the Agency must implement these increases, as proposed, to ensure the financial stability of its grading programs.

This action has been determined to be not significant for purposes of Executive Order 12866 and has not been reviewed by the Office of Management and Budget (OMB).

Pursuant to the requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ), the AMS has considered the economic impact of this action on small entities. It is determined that its provisions would not have a significant economic impact on a substantial number of small entities.

There are about 400 users of Poultry Programs' grading services. These official plants can pack eggs, poultry, and rabbits in packages bearing the USDA grade shield when AMS graders are present to certify that the products meet the grade requirements as labeled. Many of these users are small entities under the criteria established by the Small Business Administration (13 CFR 121.201). These entities are under no obligation to use grading services as authorized under the Agricultural Marketing Act of 1946.

The AMS regularly reviews its user fee financed programs to determine if the fees are adequate. The most recent review determined that the existing fee schedule would not generate sufficient revenues to cover program costs while maintaining an adequate reserve balance. Without a fee increase, FY 2002 revenues for grading services are projected at $24.1 million, costs are projected at $26.0 million, and trust fund balances would be $14.8 million. With a fee increase, FY 2002 revenues are projected at $25.3 million, costs are projected at $26.0 million, and trust fund balances would be $16.0 million.

This action will raise the fees charged to users of grading services. The AMS estimates that overall, this rule will yield an additional $1.2 million during FY 2002. The hourly rate for resident and nonresident service will increase by approximately 5 percent and the fee rate will increase by approximately 6 percent. The impact of these rate changes in a poultry plant will range from less than 0.006 to 0.02 cents per pound of poultry handled. In a shell egg plant, the range will be less than 0.028 to 0.033 cents per dozen eggs handled.

This action has been reviewed under Executive Order 12988, Civil Justice Reform. This action is not intended to have retroactive effect. This rule will not preempt any State or local laws, regulations, or policies, unless they present an irreconcilable conflict with this rule. There are no administrative procedures which must be exhausted prior to any judicial challenge to the provisions of this rule.

The information collection requirements that appear in the sections to be amended by this action have been previously approved by OMB and assigned OMB Control Numbers under the Paperwork Reduction Act (44 U.S.C. Chapter 35) as follows: § 56.52(a)(4)—No. 0581-0128; and § 70.77(a)(4)—No. 0581-0127.

Pursuant to 5 U.S.C. 553, it is found and determined that good cause exists for not postponing the effective date of the action until 30 days after publication in the Federal Register . The revised fees need to be implemented on an expedited basis in order to avoid further financial losses in the grading program. The effective date of the fee increase will be set to coincide with the billing cycle that begins on the first day of the first month after date of publication in the Federal Register .

On November 14, 2001, DNFSB published in the Federal Register a notice of proposed rulemaking proposing to establish procedures governing testimony by DNFSB employees and the production of official records in legal proceedings to which DNFSB is not a party (66 FR 57003-57007). This rule establishes a new part 1707 of our regulations, which sets forth the DNFSB rules for responding to requests for information, records, or testimony in legal proceedings.

The Defense Nuclear Facilities Safety Board may receive subpoenas and requests for DNFSB employees to provide evidence in litigation in which the DNFSB is not a party. These subpoenas and requests may also be for DNFSB records that are not available to the public under the Freedom of Information Act. Also, DNFSB could receive subpoenas or requests for DNFSB employees to appear as witnesses in litigation in conjunction with a request for nonpublic records.

Responding to such demands and requests could divert DNFSB resources from their congressionally mandated functions. This regulation will ensure a more efficient use of DNFSB resources, minimize the possibility of involving DNFSB in issues unrelated to its responsibilities, promote uniformity in responding to such requests and subpoenas, and maintain impartiality of DNFSB in matters that are in dispute between other parties. It also serves DNFSB's duty to protect sensitive, confidential, and privileged information and records.

This rule, issued under the authority of 5 U.S.C. 301, is similar to rules issued by numerous Government agencies and departments. Section 301 of Title 5, the “housekeeping statute,” authorizes the head of an executive agency to issue “regulations for the government of his department, the conduct of its employees, the distribution and performance of its business, and the custody, use, and preservation of its records, papers, and property.” In United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951), the Supreme Court upheld the authority of Federal agencies to establish procedures pursuant to section 301 similar to those established here. Federal courts have consistently held that a person seeking testimony or records from an agency must comply with the agency's “Touhy regulation” before seeking judicial enforcement of a subpoena. In addition, under section 2286b of the enabling statute of the Defense Nuclear Facilities Safety Board, 42 U.S.C. 2286 et seq., the DNFSB has authority to promulgate regulations necessary to the efficient administration of the DNFSB functions.

In the notice of proposed rulemaking published in the Federal Register on November 14, 2001, the DNFSB requested comments by December 14, 2001. DNFSB received no comments on the proposed rule.

This rule establishes DNFSB policies and procedures applicable to requests for official agency information, records, or testimony in legal proceedings.

This rule will prohibit disclosure of nonpublic official records or testimony by DNFSB employees unless authorization is provided pursuant to this rule (sections 1707.201 and 1707.203). This rule identifies the factors that DNFSB will consider in making determinations in response to such requests and what information requesters must provide (sections 1707.202 and 1707.203). This rule also specifies when the request should be submitted (section 1707.203), the time period for review (section 1707.205), potential fees (section 1707.301), and, if a request is granted, any restrictions that may be placed on the disclosure of records or the appearance of a DNFSB employee as a witness (sections 1707.207 and 1707.208).

This rule applies to a broad range of matters in any legal proceeding in which DNFSB is not a named party. It also applies to former and current DNFSB employees (as well as DNFSB consultants and advisors). Former employees are prohibited from testifying about specific matters for which they had responsibility during their active employment unless permitted to testify as provided in the proposed rule. They would not be barred from appearing to testify about general matters unconnected with the specific matters for which they had responsibility.

DNFSB will certify that records in DNFSB's possession as true copies in order to facilitate their use as evidence.

We charge a fee for production of records or information and certification. The fee schedules for duplication are the same as those established in 10 CFR 1703.107(b)(6) of the Board's regulations, as appropriate. The charges for witnesses are the same as those provided by the Federal courts. The fees related to production of records are the same as those charged under FOIA. The charges for time spent by an employee to prepare for testimony and for certification of records by DNFSB are authorized under 31 U.S.C. 9701, which permits an agency to charge for services or things of value that are provided by the agency.

The DNFSB rule is internal to the agency, and is essentially procedural, not substantive. It does not create a right to obtain official records or the testimony of a DNFSB employee nor does it create any additional right or privilege not already available to DNFSB to deny any demand or request therefor. However, failure to comply with the procedures in this rule would be a basis for denying a demand or request submitted to DNFSB.

For purposes of the Regulatory Flexibility Act (5 U.S.C. chapter 6), this rule will not have a significant economic impact on a substantial number of small entities. The rule addresses only the procedures to be followed in the production or disclosure of DNFSB materials and information in litigation where DNFSB is not a party. Accordingly, DNFSB has determined that a Regulatory Flexibility Analysis is not required.

For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 25, subchapter II), this rule would not significantly or uniquely affect small governments and would not result in increased expenditures by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (as adjusted for inflation).

In issuing this regulation, the Defense Nuclear Facilities Safety Board has adhered to the regulatory philosophy and the applicable principles of regulation as set forth in section 1 of Executive Order 12866, Regulatory Planning and Review. This rule has not been reviewed by the Office of Management and Budget under that Executive Order since it is not a significant regulatory action within the meaning of the Executive Order.

The Defense Nuclear Facilities Safety Board, has reviewed this regulation in light of section 3 of Executive Order 12988, Civil Justice Reform, and certifies that it meets the applicable standards provided therein.

The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply because this regulation does not contain information collection requirements that require approval by the Office of Management and Budget. The Defense Nuclear Facilities Safety Board expects the collection of information that is called for by the regulation would involve fewer than ten persons each year.

The Defense Nuclear Facilities Safety Board has determined that this rulemaking does not involve a rule within the meaning of the Congressional Review Act (5 U.S.C. chapter 8).

On December 20, 2000, in accordance with the Gramm-Leach-Bliley Act, Pub. L. No. 106-102, 133 Stat. 1338 (November 12, 1999) (GLB Act), the Finance Board adopted a final rule to implement the new capital structure that the GLB Act established for the Banks. 66 FR 8262 (January 30, 2001). As part of the final capital rule, the Finance Board adopted § 932.9 of its rules, 12 CFR 932.9, which set new limits on a Bank's unsecured credit exposures to a single counterparty or a group of affiliated counterparties. Id. at 8318-19. These new limits represented a revision and codification of the unsecured credit guidelines of section VI of the FMP, Finance Board Res. No. 96-45 (July 3, 1996), as amended by Finance Board Res. No. 96-90 (December 6, 1996), Finance Board Res. No. 97-05 (January 14, 1997), and Finance Board Res. No. 97-86 (December 17, 1997). Given concerns raised by the Banks about the unsecured limits adopted in December 2000, the Finance Board delayed the effective date of these requirements on the condition that the FMP restrictions remained in effect, and, on March 7, 2001, published a proposed rule requesting comment on potential amendments to the unsecured credit requirements. See 66 FR 13688 (Mar. 7, 2001).

After considering comments on this rule proposal, the Finance Board believed more changes were needed than those it had previously considered and, as a consequence, published for comment in the Federal Register a new set of proposed amendments to § 932.9 on August 8, 2001 (the proposed rule). See 66 FR 41474 (Aug. 8, 2001). The Finance Board also again extended the effective date for compliance with § 932.9 subject to the condition that section VI of the FMP remained in effect. Id. at 41475. The comment period on the second proposed rule closed on September 7, 2001. After considering the comments received, the Finance Board has made a number of changes to the rule proposed in August 2001, and is adopting an amended version of § 932.9, as discussed below.

The Finance Board received seven comment letters on the proposed rule, all of which were from Banks. Two commenters submitted follow-up comment letters to the Finance Board, after the close of the comment period. Nevertheless, these follow-up letters were considered in developing this rule. The comments requested both changes to the proposed rule and amendments and clarifications of how the proposed rule would be applied. The Finance Board agrees with many of the comments made, and as a result has made a number of changes to the proposed rule. The Finance Board addresses the comments received on its proposed changes to § 932.9 below.

Four of the commenters requested that the Finance Board delay the effective date of § 932.9, which had been scheduled to take effect on October 1, 2001 or on the date the proposed rule was adopted in final form, whichever was earlier. See Fin. Brd. Res. No. 2001-11 (June 5, 2001). The commenters suggested that the effective date of the rule be set at various dates that ranged from three to six months after a final rule had been published. The commenters stated that the extension was necessary to give the Banks sufficient time to conform recordkeeping and reporting systems to whatever limits were ultimately adopted by the Finance Board.

The Finance Board generally agrees with these comments. On September 26, 2001, it extended the effective date of § 932.9 until January 28, 2002 to provide sufficient time to complete the rulemaking process. See Fin. Brd. Res. No. 2001-20 (Sept. 26, 2001). However, given the date of approval of these final rule amendments, the Banks will have less than ninety days to prepare for implementing the amended version of § 932.9 adopted herein if the January 28, 2002 date for complying with § 932.9 is not changed. 1 Thus, the Finance Board is also adopting separate from these rule amendments, a resolution that delays the date for complying with § 932.9 until the effective date of these final rule amendments. This new effective date will be 90 days from the date this final rule is published in the Federal Register . 2 The delay in the effective date is conditioned upon the Banks' continued compliance with the unsecured credit limits in section VI of the FMP. The Finance Board believes that this time frame should be sufficient for the Banks to conform their recordkeeping and reporting systems to the rule as amended.

The proposed rule would have required a Bank to determine the applicable maximum capital exposure limits for a particular counterparty based on the long-term credit rating received by that counterparty from an organization regarded as a Nationally Recognized Statistical Rating Organization (NRSRO) by the Securities and Exchange Commission, except in certain limited circumstances. The proposed amendment represented a change from the approach adopted in December 2000 which required a Bank to determine the maximum capital exposure limit for a short-term credit based on an NRSRO's short-term credit rating for the counterparty and to determine the maximum capital exposure limit for a long-term credit based on an NRSRO's long-term credit rating for the counterparty. Under the proposed rule (as under the rule adopted in December 2000), the unsecured credit limit for a particular counterparty (subject to certain exceptions set forth in the rule) would equal the maximum capital exposure limit for that counterparty multiplied by the lesser of the Bank's total capital or the counterparty's Tier 1 or total capital.

Two commenters objected to the reliance on long-term credit ratings, as proposed. The commenters argued that short-term credit exposures presented a markedly different credit risk to a Bank than would a long-term exposure to the same counterparty, and that by disregarding short-term ratings, the Finance Board was ignoring important information about a counterparty embodied in that rating. The commenters also believed that the proposed approach would greatly restrict the amount of unsecured credit a Bank could provide from levels permitted under the FMP or under § 932.9 as adopted in December 2000. One commenter stated that this reduction would force the Banks to seek lower-rated counterparties and increase the term of their lending, thereby raising overall credit risk. The other commenter stated the proposed change, if adopted, would reduce the amount of unsecured credit that a Bank would have available to its members, which may result in membership becoming less attractive to some institutions.

Given these concerns, one commenter urged the Finance Board not to adopt the proposed change and continue to base unsecured credit limits for short-term exposures on short-term credit ratings. The other commenter suggested the Finance Board provide the Banks the option of using short-term credit ratings. The second commenter also urged the Finance Board to develop new short- and long-term limits and a new total limit which would be the sum of the short- and long-term limits plus capacity for additional overnight lending.

A third commenter believed that it was inappropriate to use the counterparty's capital as a basis for setting the unsecured credit limits because this approach could result in unduly large Bank System-wide unsecured credit exposures to a counterparty in relation to that counterparty's total assets. The commenter urged the Finance Board to set the unsecured credit limits at the lesser of a percentage of a Bank's total capital or a counterparty's total assets.

The Finance Board has considered these comments but has decided not to make any changes to the proposed rule in response. In the SUPPLEMENTARY INFORMATION section of the Federal Register proposing release for this rule, the Finance Board noted three reasons to require the Banks to determine the applicable maximum capital exposure limit based solely a counterparty's long-term credit rating. First, the Finance Board stated that the reliance on long-term credit ratings was consistent with the approach being suggested by the Basel Committee on Banking Supervision (Basel Committee) for establishing risk-weightings under its standardized approach in the proposed New Capital Accord, which generally proposes using long-term ratings assigned by rating agencies ( i.e., NRSROs) and disregarding the maturity of a credit in setting risk weightings. See 66 FR at 41479-80 ( citing Basel Committee, “A New Capital Adequacy Framework” 26-36 (June 1999); and Basel Committee, “Overview of the New Basel Accord” 13-14 (Jan. 2000)). 3 Second, the Finance Board noted that parties that would be assigned the same short-term credit rating may have markedly different maximum 30-day default rates, depending on a party's long-term credit rating, so that use of long-term ratings would assure more restrictive limits were imposed on borrowers with the higher maximum 30-day default rate. 66 FR at 41480. Finally, the Finance Board stated that exclusive reliance on long-term credit ratings for determining the maximum exposure limits would simplify the Banks' monitoring of their counterparties' ratings. Id.

The comments received do not alter the Finance Board's basic reasoning for proposing exclusive use of long-term credit ratings to determine the maximum capital exposure limit applicable to a counterparty. In this regard, the Finance Board emphasizes that its approach is consistent with the standardized approach being proposed by the Basel Committee in the New Capital Accord for establishing risk weightings. The Basel Committee decided generally to ignore maturity of claims in establishing risk weighting in large part because of “the difficulties in pursuing greater precision in differentiating among the maturities of claims through capital charges” and the “broad brush” nature of the proposed capital requirements. See Basel Committee, “A New Capital Adequacy Framework” at 33. The same reasoning can be applied to the unsecured credit limits being adopted herein, especially given that the credit limits are designed to provide a broad framework to prevent concentration of credit in single counterparties or groups of affiliated counterparties and not to differentiate with precision the risks of lending to particular counterparties. See 66 FR at 8302 (explaining reasoning for adopting § 932.9).

The Finance Board also disagrees with the suggestions of the one commenter that the unsecured credit limits will create more risk by lowering the quality of the Bank's credit portfolios. The unsecured credit limits adopted herein are themselves restrictive as to the amounts of credit that can be lent to lower rated counterparties. At the same time, before undertaking any significant lending or investment activity that was not allowed under the FMP, a Bank will first have to demonstrate pursuant to part 980 of the Finance Board rules, 12 CFR part 980, that it is able to undertake the new lending in a safe and sound manner. In addition, the lending undertaken by a Bank will eventually be subject to the capital requirements of part 932 of the Finance Board rules, helping to assure a Bank holds sufficient capital if it is indeed engaging in lending to lower quality counterparties. Even before the requirements of part 932 become effective, however, a Bank will be subject to the capital requirements set forth in § 956.4 of the Finance Board rules, 12 CFR 956.4, if the Bank undertakes unsecured transactions with any counterparty rated below the second highest credit rating by an NRSRO. Further, with regard to the second commenter's concern about unsecured lending to members, the unsecured credit rules will not in any way limit a Bank's ability to continue to provide liquidity to members using short-term advances.

The Finance Board also continues to believe that it is appropriate to base the unsecured credit limits on the lesser of the capital of the Bank or the capital of the counterparty rather than adopt the commenter's suggestion of using a percentage of a counterparty's assets. The approach adopted herein addresses the Finance Board's concerns with potential concentrations of unsecured credit as a percentage of Bank capital on both the individual Bank and Bank System level. See 66 FR at 8302. The approach also is relatively straightforward to implement so the Finance Board sees no reason to alter it in response to the commenter's concerns.

Further, basing the limit on a percentage of counterparty assets rather than counterparty capital would result in higher limits as a percentage of counterparty capital for counterparties with lower capital ratios. For example, two counterparties with the same credit rating and same amount of total assets would be subject to the same limit. If one of the two has a lower capital ratio than the other, however, the Bank's lending to the less capitalized counterparty could equal a higher percentage of that counterparty's capital ( i.e., the limit as a percentage of capital would be higher). Because capital serves as a cushion against loss, this methodology suggested by the commenter would allow the Bank a higher exposure relative to capital to the less-capitalized counterparty and provide less protection against potential losses. Thus, the Finance Board believes that limiting extensions of unsecured credit to a percent of capital is the more appropriate methodology.

The proposed rule would have amended § 932.9 to require a Bank to meet two unsecured credit limits for each private counterparty. The first, the term limit, would have applied to all unsecured credit transactions except sales of federal funds with a maturity of one day or less or sales of federal funds subject to a continuing contract (together “overnight federal funds”). The term limit for a particular counterparty equaled the maximum capital exposure limit times the lesser of the Bank's total capital or the appropriate measure of the counterparty's capital. The second limit, the overall limit, would have applied to all transactions with a particular counterparty including any overnight federal funds transactions. The overall limit for a particular counterparty equaled twice the counterparty's term limit.

The Finance Board received two comments on this proposed amendment. One commenter felt that the special treatment afforded overnight Federal Funds transactions by the proposed amendment offered only limited relief to, what the commenter believed were, the unnecessarily restrictive limits of § 932.9. This commenter urged the Finance Board to exclude all overnight federal funds transactions from the unsecured credit limits, or in the alternative, to allow a flat 15 percent of capital add-on to the term limit for overnight federal funds transactions for counterparties with the highest short-term rating and at least the third highest long-term rating. The commenter argued that the “funding advantage” that may be enjoyed by the Banks, which the commenters viewed as the reason the Finance Board failed to exclude all overnight federal funds transactions from the rule, was a myth, noting that if such an advantage existed, depository institutions would get most of their funds from the Banks. The commenter also pointed out that given the low spread on advances, the Banks needed to maintain leverage through short-term investments such as selling overnight federal funds. More generally, the commenter believed that the Finance Board's “conservative” approach to the unsecured credit limits was inconsistent with the GLB Act because the GLB Act made clear that the Finance Board's responsibility was safety and soundness regulation and not management of the Banks. The other commenter on the proposed amendment recommended that the Finance Board apply the proposed special limits only to overnight investment transactions between a Bank and a member institution, and that the Finance Board include in the overall limit all types of unsecured overnight transactions, not just overnight federal funds transactions.

As the Finance Board has previously stated, it adopted the unsecured credit limits as a safety and soundness regulation to prevent undue concentrations of credit in a single counterparty or groups of affiliated counterparties. See 66 FR at 8301-02. Other banking regulators have similar limits in effect. 4 These types of regulations also are consistent with practices for sound management of credit risk as articulated by the Basel Committee. See Basel Committee, “Principles for Management of Credit Risk” 10 (Sept. 2000). Thus, the Finance Board is confident that these regulations are consistent with its obligations and authority to ensure that the Banks operate in a financially safe and sound manner, and are not inconsistent with the GLB Act or the Bank Act more generally. See 12 U.S.C. 1422a(a)3 and 1422b.

Further, as noted in the SUPPLEMENTARY INFORMATION section of the preamble of the proposed rule, the Finance Board considered excluding overnight federal funds transactions from its unsecured credit limits because other banking regulators excluded these transactions from their lending limits. See 66 FR at 41476. The Finance Board also noted that the Banks have different incentives than commercial depository institutions to lend into the federal funds markets. The differing incentives include both the funding advantage enjoyed by GSEs in borrowing and the more varied lending and investment opportunities available to commercial banking enterprises which reduces these institutions' incentives to engage in federal funds lending. Id. The Finance Board also emphasized that overnight federal funds transactions are currently subject to the unsecured credit limits of the FMP and that completely excluding overnight federal funds transactions from the restrictions of § 932.9 would have represented a significant loosening of its restrictions, which was not the purpose of adopting these limits. Given these considerations, the Finance Board concluded that it was not appropriate to completely exclude overnight federal funds transactions from the unsecured credit limits, and instead, proposed the overall limit discussed above.

The Finance Board continues to believe that its initial reasoning remains sound. In particular, the Finance Board believes there is a basis for concluding that Banks have a financial incentive to lend to the federal funds markets, and that to permit such lending without limits would be imprudent. The Finance Board also believes that the rule as adopted provides the Banks with sufficient flexibility to invest funds to both meet their liquidity needs and to counter cyclical fluctuations in their business. Based on the same reasoning discussed above, the Finance Board also sees no compelling reasons to extend the treatment offered to overnight federal funds transactions to other types of overnight transactions in which a Bank may engage or to limit the additional lending capacity for overnight federal funds transactions just to transactions with members. Such restrictions would unnecessarily limit a Bank's investment opportunities with little apparent gain from a safety and soundness perspective. Moreover, nothing would prevent a Bank from implementing internal policies that would achieve this goal so long as the policies were consistent with § 932.9 and other Finance Board regulations.

In response to concerns that the unsecured credit limits were too restrictive, the Finance Board proposed to amend § 932.9 so that the unsecured credit limit applicable to groups of affiliated counterparties would equal 30 percent of the Banks total capital. 66 FR at 41482. The Finance Board explained that the proposed aggregate limit on extensions of unsecured credit to affiliated counterparties would have allowed the Banks to extend somewhat larger amounts of credit to large financial conglomerates than did the provisions in § 932.9 as adopted in December 2000. Id. at 41480.

The Finance Board also proposed amending the definition of “affiliated counterparty.” Id. at 41481. The Finance Board believed that new definition was more understandable and was more consistent with the meaning of the phrase “corporate group” as used in regulations issued by the Office of the Comptroller of the Currency (OCC), which addressed lending to affiliated counterparties. Id. at 41480. The effects of the proposed definition would have generally been to raise the threshold for control when defining an affiliate from (either direct or indirect) ownership of 25 percent of the voting securities or interests of an entity to 50 percent of such securities or interests. The Finance Board did not believe the change would generally alter the number or groupings of affiliated counterparties covered by the restrictions in § 932.9. Id.

The Finance Board received only one comment on the proposed changes to the unsecured credit limits applicable to extensions to a Bank's unsecured lending to groups of affiliated counterparties. The commenter urged the Finance Board to raise the limit from 30 percent of a Bank's total capital to 50 percent of a Bank's total capital because, as the commenter believed, there was only an indirect link between affiliates related by a common holding company and failure of one affiliate would seldom cause another affiliate to fail. The commenter also recommended that counterparties related by a common holding company and special bankruptcy-remote subsidiaries should not be considered affiliates for purposes of § 932.9.

The Finance Board considered this comment but has not altered the proposed unsecured lending limits for groups of affiliated counterparties or the proposed definition of affiliated counterparty as a result. The Finance Board disagrees with the commenter's suggestion that there is only minimal risk that the failure of one affiliated counterparty would affect the financial standing of other affiliates. As the Finance Board previously pointed out, applying credit exposure limits to groups of affiliated counterparties is consistent with sound principles of risk management and with practices of other regulators. See 66 FR at 41477. The Finance Board believes that the new limit suggested by the commenter would be too lenient and allow Banks too great an exposure to groups of affiliated counterparties. The limit adopted herein on extensions of credit to groups of affiliated counterparties, however, is consistent with limits adopted by other bank regulators. 5 See 12 CFR 932.5(d) and 12 CFR 560.93(c). As already stated, the Finance Board also believes that the definition of “affiliated counterparty,” as proposed and as adopted herein, is consistent with similar terms used by other banking regulators.

The Finance Board proposed raising the limit on extensions of unsecured credit to a GSE to 100 percent of the lesser of a Bank's or GSE's total capital. Id. at 41482. This change basically would have re-instituted the limit on extensions of unsecured credit to GSEs that had been in effect under the FMP. 6 Id. at 41475-76. As the Finance Board explained, the proposal resulted from Banks' concerns that the limits as adopted in December 2000 may have disrupted the Banks' investment strategies. At the same time, the Finance Board did not believe the proposal raised any safety and soundness concerns. Id. The proposed amendment also would have required a Bank to treat a GSE like other private counterparties should any NRSRO have assigned a credit rating to, or downgraded a credit rating of, any long-term senior unsecured credit obligation issued by a GSE to below the highest investment grade or placed a GSE on a credit watch for such a downgrade. Id. at 41482. This trigger provision was proposed to assure the preferential GSE limit was not applied to an entity undergoing obvious financial difficulty. Id. at 41475.

The Finance Board received two comments on this proposed rule. The first commenter believed the trigger provision would have resulted in too drastic a cut in future credit to a troubled GSE and recommended that the deadline for applying the lower limits applied to a GSE after a downgrade in its credit rating be keyed to the extent of the downgrade ( e.g., six months if downgraded to the second highest investment grade credit rating, three months if downgraded to the third highest investment grade credit rating, etc.). The commenter argued that reducing future extensions of credit to a GSE in times of financial difficulty could increase the risk of default by that entity. The second commenter requested that the Finance Board clarify that the preferential unsecured lending limit for GSEs would not be applied to subordinated debt issued by the GSE.

The Finance Board does not believe that any change in the proposed trigger provision is necessary in response to the comment and is adopting it as proposed. The commenter's suggestion, if adopted, could leave the Banks with the risk of maintaining the liquidity of other GSEs in the unlikely occurrence that another GSE experienced severe financial difficulties. More importantly, to the extent that special action were needed to help a GSE, or any other large financial institution, such action would have to be coordinated with other financial regulators, and the Finance Board would have to take appropriate action at that time ( e.g., waiver of the trigger provision) to allow the Banks to adjust their lending positions accordingly. At the same time, the Finance Board would expect that a Bank would take steps to reduce its exposure to a GSE (or any other counterparty) as soon as the GSE's potential financial difficulties became apparent. Thus, the reduction in extensions of unsecured credit may be spread over time, and the reduction in unsecured credit triggered when the credit rating downgrade actually occurs may not be as drastic as the commenter suggested.

The Finance Board agrees with the second commenter, however, and has altered the final rule to make clear that the special unsecured credit limits applicable to GSEs do not apply to subordinated debt. GSE subordinated debt is generally perceived as providing an indication of the entity's financial standing, independent of any implied government guarantee. As such, the risk of holding GSE subordinated debt would be similar to the risks associated with holding non-GSE debt. The amendments to § 932.9 adopted by the Finance Board will restrict a Bank's holding of GSE debt to the level calculated using the maximum capital exposure limit associated with the credit rating assigned to the GSE's subordinated debt. This rule would apply even if the GSE's subordinated debt received the highest investment grade rating from an NRSRO. Further, a Bank's holdings of a GSE's subordinated debt would be included in the total amount of unsecured credit extended to that GSE for purposes of applying the preferential lending limit for GSEs ( i.e., 100 percent of the lesser of the Bank's or the GSE's total capital).

The Finance Board also recognizes that the commenter's concerns with regard to GSE subordinated debt would also apply to the subordinated debt of any other counterparty. Thus, the Finance Board is also adopting new § 932.9(a)(4)(iii) as part of these final rule amendments. This provision imposes a special sub-limit on any debt issued by a counterparty if that debt obligation received an issue rating from an NRSRO that is lower than the counterparty's long-term credit rating. This sub-limit would be calculated using the rating assigned to the lower-rated debt obligation for purposes of determining the maximum capital exposure limit. Because the lower credit rating assigned to a particular obligation would indicate that holding that obligation is more risky than holding other obligations of the issuer-counterparty, it is appropriate to limit the Bank's holdings of that specific obligation. Generally, the Finance Board believes that an issue rating will be lower than the issuer's long-term rating only in cases where the issue in question is subordinated debt.

The Finance Board proposed amending § 932.9 to require a Bank to measure the unsecured credit exposure arising from a derivative contract in accordance with §§ 932.4(g) and 932.4(h) of the Finance Board rules. 12 CFR 932.4(g) and 932.4(h). As adopted in December 2000, § 932.9 contained no provision indicating how a Bank should measure its unsecured credit exposure to a counterparty, and this change would have conformed the measurement for derivative contracts with that undertaken when calculating a Bank's credit risk capital charges for derivative contracts under § 932.4 of the Finance Board rules.

Four commenters pointed out that when read strictly this provision as proposed would not take account of collateral held against derivative exposure. These commenters pointed out that the proper measure of the unsecured credit exposure from a derivative contract should be the net marked-to-market value of the contract less the collateral posted by the counterparty. Two of these commenters also specifically stated that it was inappropriate to include the potential future credit exposure (PFE) of a contract in the calculation of the Bank's extension of unsecured credit to a counterparty. The two commenters pointed out that the exposure of a Bank upon default of a counterparty would be the marked-to-market value of the contract at the time of default. Further, these commenters stated risk management techniques, such as the right to value derivatives and call for additional collateral at any time, mitigate the need to include PFE in exposure calculations. One of these two commenters also requested that the Finance Board specify the frequency with which a Bank must measure its credit exposure from a derivative contract and recommended a frequency of once a month, which would coincide with minimum requirements in agreements for measuring exposure and settling collateral.

The Finance Board did not intend that derivative exposure against which collateral is properly held be included in the amount of unsecured credit extended to a counterparty, but agrees that the proposed wording in § 932.9(f) did not make this clear. Thus, this provision, as adopted, has been reworded to make clear that any portion of a derivative exposure against which the Bank holds collateral shall not be counted toward the total amount of unsecured credit extended to a counterparty. To be counted, however, this collateral must be held in accordance with § 932.4(e)(2)(ii)(B) of the Finance Board's rules, which among other things requires the value of the collateral to be appropriately discounted to protect the Bank against a price decline during the holding period and to account for the potential cost of liquidation of the collateral.

The Finance Board, however, believes that it is appropriate to continue to include a derivative contract's PFE in the calculation of extension of unsecured credit. Such practice appears to be standard for derivative dealers when setting counterparty credit limits. See e.g., Bank for International Settlements, “OTC Derivatives: Settlement Procedures and Counterparty Risk Management” 15-16 (Sept. 1998). The Finance Board believes that it is also appropriate here since the value of certain derivative contracts may be fast changing and the use of collateral may reduce losses but generally does not eliminate credit risk. Id. at 4. Thus, as adopted, § 932.9(f) requires a Bank to include both the current credit exposure and the PFE in its calculation of the amount of unsecured credit extended to a counterparty. This provision, both as proposed and as adopted, allows a Bank, however, to calculate its exposure on a net basis for derivative contracts subject to a qualifying bilateral netting contract, as that phrase is defined under § 932.4(h)(3).

The Finance Board has also decided not to place in the rule a minimum frequency for calculating exposures under a derivative contract. Instead, Banks should establish clear policies to govern such calculations, and these policies will be reviewed by the Finance Board in the course of Bank examinations. In setting this policy, a Bank should consider the complexity of its derivative holdings and the volatility of the value of those holdings as well as other relevant factors. The Finance Board generally believes, however, that a Bank should value its derivative contracts more frequently than once a month for purposes of applying § 932.9.

Two commenters asked that the Finance Board add a provision to the rule to clarify the status of bonds issued by state and local housing finance agencies (HFAs). Both commenters pointed out that investment in HFA bonds helped Banks achieve their housing finance missions and provided Banks with investment flexibility and that treating HFAs like other counterparties severely restricts the Banks' investment in HFA bonds because HFAs often have low capital. These commenters also noted that HFA bonds were considered outside the scope of the unsecured credit limits of section VI of the FMP. As a follow up to its comment letter, one commenter sent an additional letter stating that they believe that most HFA bonds were secured by mortgage collateral and therefore should have been exempt from the unsecured credit limits, but provided no justification or legal rationale to support such a conclusion. Another commenter requested that the Finance Board add a provision that if a third-party guaranteed repayment by the counterparty, the unsecured credit limits should be applied to the guarantor and not to the counterparty itself, as has been required under the FMP.

The Finance Board has considered these comments and has made changes in the final rule as a result. With regard to the HFA obligations, the Finance Board believes that generally these obligations should be subject to the unsecured credit limitations. While the structure of the HFA obligations held by the Banks may vary widely, it does not appear that these obligations are usually secured in the sense that the HFA provides the Bank with collateral that the Bank holds in accordance with the principles set forth in § 932.4(e)(2)(ii)(B) or in the same sense that a Bank secures an advance. Nevertheless, given that the structure of these transactions may vary, the Finance Board is willing to consider on a case-by-case basis that a specific HFA transaction may be considered secured and therefore should be excluded from the limits of § 932.9.

The Finance Board agrees with the commenters, however, that application of the proposed limits in § 932.9 may restrict the Banks' ability to purchase the HFA obligation and be detrimental to the Banks' housing finance mission. Investments in HFA obligations are also subject to other Finance Board regulations. Thus, the Finance Board is adopting new § 932.9(a)(3) which sets a special limit for certain HFA obligations. As is explained more fully in the next section of this preamble, this special limit for qualified HFA obligations will be calculated based upon the Bank's total capital and the maximum capital exposure limit associated with the rating of the instrument purchased by the Bank. To qualify for treatment under § 932.9(a)(3), the HFA obligation must either be an acquired member asset, as defined in § 955.2 of the Finance Board rules, or be the type of obligation excluded by § 956.3(a)(4)(iii) from the general prohibition against the Banks' investing in whole mortgages or loans (or interests therein). The Finance Board believes that the approach adopted in these amendments will provide the Banks with sufficient capacity to invest in HFA obligations in support of their housing finance mission while still preventing undue concentrations of these instruments on the Banks' books.

More generally, the Finance Board recognizes that, given the comment concerning the status of HFA bonds, there may be some confusion concerning the intended scope of this rule. This is especially true where a bond or other debt securities may be backed by a pledge of specific property or by revenues, such as may occur with certain HFA bonds, so that the debt security may be considered secured in some context. In developing this rule, however, the Finance Board has viewed the purchase of a debt security or other debt obligation generally to be an unsecured extension of credit, unless the Bank, itself, holds or controls collateral against its exposure from the debt obligation, in accordance with the requirements of § 932.4(e)(2)(ii)(B). To make this view clear, the Finance Board has adopted new § 932.9(f)(2). New § 932.9(f) also makes clear that the Finance Board continues to exempt mortgage-backed securities from the unsecured credit limits and that loans purchased as acquired member assets (AMA) and identified in §§ 955.2(a)(1) and (2), 12 CFR 955.2(a)(1) and (2), are also exempt.

The AMA exemption under new § 932.9(f)(2) does not extend to HFA bonds purchased under the AMA. Generally, a member or housing associate does not need to provide added credit enhancements and collateralize that credit enhancement for HFA bonds as it would for mortgages purchased under the AMA program. See 12 CFR 955.3(b)(3). This is because the HFA bonds purchased under the AMA program are already enhanced by collateral (not held by the Bank) and rated sufficiently high that additional enhancement or collateral is not required. Further, the unsecured credit provision for HFA bonds already takes account of this higher rating by allowing the maximum capital exposure limits to be determined based on the issue rating of the HFA bond itself rather than on the rating of the HFA. The new provision also makes clear that the Finance Board is willing to consider on a case-by-case basis that any debt obligation or debt security purchased by the Bank should not be subject to the limits of § 932.9 because the Bank's credit exposure is adequately secured.

The Finance Board also agrees with the commenter that where a third-party has provided an unconditional and irrevocable guarantee covering a credit extended by the Bank, the Bank's exposure will ultimately be to the guarantor. Given this fact, the Finance Board has modified proposed § 932.9(a) to make clear that if repayment of a credit is guaranteed unconditionally and irrevocably by a third-party, the resulting unsecured credit exposure would be treated as if it were to the third-party guarantor. This means that in calculating the unsecured credit limits for these guaranteed transactions, a Bank would consider the credit rating and capital of the third-party guarantor and would aggregate the credit exposure arising from the guarantee with any other unsecured credit extended to the third-party guarantor. The Finance Board recognizes that for regulatory or other reasons, a third-party may not provide, or be able to provide, an irrevocable guarantee, but may provide some other form of support or credit enhancement. While the rule as adopted only allows unconditional, irrevocable guarantees to be attributed to the third-party guarantor, the Finance Board would be willing to consider allowing this treatment to be extended on a case-by-case basis to other specific support arrangements, if a Bank can demonstrate that the support or credit enhancement provided by the third-party provides a level of protection equivalent to an irrevocable guarantee.

One commenter requested clarification as to whether the phrase “affiliated counterparties’ combined * * * capital” as used in the reporting requirements of proposed § 932.9(e)(1)(ii) meant the consolidated capital of the affiliated group or the combined capital of only those affiliated counterparties’ to which a Bank had actually extended credit. The Finance Board believes that the phrase “affiliated counterparties’ combined * * * capital” should be interpreted to mean the consolidated capital of the holding company for the affiliated group. Use of this figure would help avoid double counting of capital of affiliated members of a group.

This commenter also requested clarification whether the Finance Board expected data as of the month-end or some other date under the “monthly” reporting that would be required under § 932.9(e). This requirement applies to extensions of credit outstanding at any time during the month, not just at month-end, although the Bank does not have to submit its report to the Finance Board until after the last business day of the month. Such report should be provided promptly after that date.

Another commenter asked for clarification of the meaning of the phrase “net payments due a Bank” as used in proposed § 932.9(f)(1), a provision which addresses the measurement of unsecured credit exposures from on-balance sheet transactions. The Finance Board notes that this phrase was used in section VI of the FMP, and the Finance Board intends that it has the same meaning as under the FMP. Thus, the phrase indicates an amount due to or accrued by the Bank as of a point in time (i.e., the time a Bank measures its exposure from the on-balance sheet transaction) and not the future amounts due over the life of the transaction.

One commenter requested that the Finance Board specifically rescind in the final version of § 932.9 provisions in section VI of the FMP concerning maximum maturities for derivative contracts and contingent collateralization of interest rate exchange agreements. The Finance Board does not believe a specific provision needs to be added to § 932.9 as requested by the commenter. Upon the effective date of § 932.9, the unsecured credit limitations of section VI of the FMP will be superseded and replaced by the rule. Any provision of section VI of the FMP which has not been adopted as part of § 932.9, such as the two cited by the commenter, will no longer apply to the Banks.

Another commenter asked the Finance Board to clarify whether restrictions contained in certain parts of the FMP would still be applicable after the effective date of § 932.9. Specifically, the commenter requested clarification of the applicability of: footnote 1 which defines “eligible financial institutions” and effectively limits the counterparties to which a Bank may lend overnight and term funds; footnote 3 which sets forth qualifications for issuers of commercial paper, bank notes and thrift notes that a Bank may buy; and footnote 6 which sets forth the criteria for eligible non-member counterparties for hedging transactions. Footnotes 1 and 3 appear in section II.B of the FMP, and footnote 6 is found in section V of the FMP. The Finance Board believes that because these provisions restrict, based on credit ratings, the counterparties to which the Bank may extend credit or with which a Bank may transact business which would create a credit exposure, these restrictions should be superseded upon the effective date of § 932.9. Section 932.9 is intended to address concerns about the credit rating of the Banks' counterparties. It does so, however, by limiting the amount of credit a Bank can extend to parties rated at these various levels and not by restricting the counterparties with which the Bank can transact. The new business activity requirements of Part 980 of the Finance Board's rules would apply to any investments involving counterparties the Bank intends to transact with that were not permitted under the FMP. See 66 FR at 41477-78.

Except as noted below, the Finance Board is adopting the amendments to § 930.1 and § 932.9 of its rules, generally as proposed. The notices of proposed rulemaking published in the Federal Register on March 7, 2001, 66 FR 13688, and August 8, 2001, 66 FR 41474, contain additional explanatory information about the changes being adopted herein, and interested parties should review these document for a more complete understanding of the rule provisions discussed below.

The Finance Board is amending § 930.1 of its rules, as proposed, to change the definition for “affiliated counterparty” and to add a new definition for the phrase “sales of federal funds subject to a continuing contract.” The definition of “affiliated counterparty” being adopted herein reads as follows:

In addition, the Finance Board is defining the phrase “sales of federal funds subject to a continuing contract” as an overnight federal funds loan that is automatically renewed each day unless terminated by either the lender or the borrower. This definition is consistent with the generally understood meaning of this phrase, and makes clear the types of federal funds transactions that will benefit from treatment under the overall limit of § 932.9(a)(2) of the Finance Board rules. See Id. at 41478.

The Finance Board is adopting proposed § 932.9(a) with additional provisions designed primarily to address subordinated debt issued by a counterparty and a Banks' purchases of certain obligations issued by HFAs. In addition, the Finance Board has adopted a change to the proposed rule that requires a Bank to attribute the unsecured credit exposure arising from a transaction for which repayment is irrevocably and unconditionally guaranteed by a third-party to the guarantor. The Finance Board also has restructured § 932.9(a) slightly to accommodate the new provisions.

As adopted, § 932.9(a) of the Finance Board rules sets forth the limits on a Bank's extensions of unsecured credit to a single, non-GSE counterparty. Specifically, a Bank must always meet two limits. Under the first limit, all unsecured extensions of credit, except sales of overnight federal funds, by a Bank to single non-GSE counterparty can not exceed the term limit set forth in § 932.9(a)(1). Under the second limit, which is twice the term limit, all unsecured extensions of credit including overnight federal funds transactions by a Bank to a single counterparty can not exceed the overall limit set forth in § 932.9(a)(2). See Id. The effect of these limits is to allow the Banks to increase their lending of overnight federal funds to non-GSE counterparties beyond the term limit applicable to other types of unsecured lending.

Section 932.9(a) also sets out the criteria for calculating the term limit and the overall limit applicable to non-GSE counterparties. Under the rule, the term limit equals the product of the maximum capital exposure limit multiplied by the lesser of: (i) The Bank's total capital or (ii) the counterparty's Tier 1 capital, or, if Tier 1 capital is not available total capital (as defined by the counterparty's principal regulator), or some comparable measure identified by the Bank. This approach is the same approach adopted in § 932.9 in December 2000. See 66 FR at 8301-02. The overall limit is twice the term limit calculated for the counterparty.

Further, as adopted, § 932.9(a) clarifies how a Bank attributes the credit exposure arising from a transaction that is subject to an unconditional and irrevocable guarantee by a third-party. Under the rule, if repayment of any unsecured credit is irrevocably and unconditionally guaranteed by a third party, the third-party guarantor shall be considered the counterparty. The Bank would therefore attribute the credit exposure to the third-party guarantor and calculate the applicable unsecured credit limits based upon the long-term credit rating of the third-party guarantor and the lesser of the Bank's total capital or the relevant capital measure for the third-party guarantor. If the third-party only guarantees a portion of the repayment of the credit, only that portion of the credit exposure so guaranteed shall be attributable to the third party guarantor, and the remainder of the exposure shall be attributable to the direct counterparty and subject to the limits applicable to the direct counterparty. As discussed above, the Finance Board is willing to consider requests from the Bank on a case-by-case basis that it apply this approach to other forms of credit enhancement that may not clearly constitute an irrevocable unconditional guarantee, but may nonetheless offer a equivalent level of support.

As previously discussed, the limits for qualifying obligations issued by an HFA also are calculated somewhat differently, and, as set forth in § 932.9(a)(3), the limit for these HFA obligations will always equal the product of the applicable maximum capital exposure limit and the Bank's total capital. Furthermore, the maximum capital exposure limit will be determined based on the credit rating assigned to the particular obligation purchased by the Bank. This approach could conceivably result in different limits applying to different classes or series of obligations issued by the same HFA (if each class or series received different issue ratings from the NRSROs). In such a case, however, the rule makes clear that limits will not be separately and independently applied so that the total amount of unsecured credit extended to a HFA by a Bank could never exceed the limit associated with the highest rated qualifying obligation purchased by the Bank. For example, if a Bank purchased two classes of qualifying obligations from a HFA with different structures such that one class was rated in the highest investment grade category and the other was rated in the second highest investment grade category by an NRSRO, the Bank's combined total purchase of both classes of instruments could not exceed 15 percent of the Bank's total capital. At the same time, the Bank's purchase of the instrument rated in the second highest investment grade category could not exceed 14 percent of the Bank's total capital.

To qualify for treatment under § 932.9(a)(3), the HFA obligation must either be an acquired member asset, as defined in § 955.2 of the Finance Board rules, or be the type of obligation excluded by § 956.3(a)(4)(iii) from the general prohibition against the Banks' investing in whole mortgages or loans (or interests therein). Any other type of obligation issued by an HFA or any other form of unsecured extension of credit to the HFA would not qualify for treatment under § 932.9(a)(3), and the limit for that investment would be calculated under § 932.9(a)(1). Of course, the Bank would also have to be authorized to invest in or provide such other form of unsecured credit under part 956 of the Finance Board rules or some other applicable Finance Board regulation or order.

The maximum capital exposure limits are set forth in Table 4. Each maximum capital exposure limit corresponds to a different investment grade rating so that more restrictive maximum capital exposure limits are imposed on lower-rated, and therefore potentially riskier, counterparties. The applicable maximum capital exposure limit for a counterparty rated at the highest investment grade by an NRSRO is set at 15 percent. This level is broadly consistent with federal lending limits pertaining to commercial banks as set forth by statute and regulation. The maximum capital exposure limits corresponding to credit ratings below the highest investment grade, however, are calibrated to the 15 percent maximum capital exposure limit based upon the ratio of the average credit risk percentage requirement (over all maturity bucket groupings) for the highest investment grade to the average credit risk percentage requirement for each investment grade. 7 A more complete explanation of the derivation of the maximum capital exposure limits is found in the SUPPLEMENTARY INFORMATION section of the Federal Register release proposing this rule. See 66 FR at 41478-80.

As set forth in § 932.9(a)(4)(i), a Bank will determine the maximum capital exposure limit applicable to a counterparty based on the counterparty's long-term credit rating, subject to two exceptions. 8 Under the first exception, a short-term credit rating will be used to determine the applicable maximum credit exposure limit if NRSROs have provided a short-term credit rating for a counterparty but have not provided a long-term rating for that counterparty. See Infra § 932.9(a)(4)(ii). If a short-term credit rating for a counterparty is used, however, the highest short-term investment grade rating is deemed to correspond to the maximum capital exposure limit assigned to the third highest long-term investment grade rating in Table 4 ( i.e., nine percent), and the second and third highest short-term investment grade ratings would correspond to the maximum capital exposure limit assigned to the fourth highest long-term investment grade rating in Table 4 ( i.e., 3 percent). This treatment of the short-term investment grade credit ratings is more fully discussed in the proposing release. 66 FR at 41480.

The second exception to exclusive use of long-term credit ratings is set forth in § 932.9(a)(4)(iii), and has been added by the Finance Board in adopting this final rule. This provision states that if a Bank purchases a debt obligation from a counterparty that has an investment rating from an NRSRO that is lower than the counterparty's long-term rating, the amount of the lower-rated obligation held by the Bank can not exceed a special sub-limit. Specifically, this sub-limit equals the maximum capital exposure limit from Table 4 corresponding to the rating assigned the lower-rated debt obligation multiplied by the lesser of the Bank's total capital or the counterparty's applicable capital measurement. While the Bank's purchases of the lower-rate obligation could not exceed the sub-limit, the total amount of unsecured credit extended by the Bank to the counterparty (including amounts of the lower rated obligation) would be restricted by the term limit and overall limit calculated using the counterparty's long-term credit rating. As already noted, the Finance Board recognized the need to adopt this provision when considering comments that the special unsecured credit limits for GSEs should not be applied to subordinated debt issued by the GSE because the same concerns arise whether a GSE or a non-GSE counterparty issues subordinated debt. 9

Section 932.9(a)(5) establishes the criteria that a Bank will use to determine a counterparty's long-term credit rating. The same criteria should be used whenever § 932.9 requires a Bank to determine the short-term rating of a counterparty or the issue rating of a specific obligation. This criteria is generally the same as that adopted in § 932.9 in December 2000, and has been altered only to remove provisions that are no longer necessary given other changes adopted in this final rule. See Id. at 41481. In determining a counterparty's long-term credit rating, the rule requires a Bank to use the most recent rating issued by an NRSRO, and if more than one NRSRO has rated the counterparty, to use the lowest rating from among those ratings. A Bank should also ignore modifiers ( e.g., +, −, or 1, 2, 3), so that, for example, ratings of A+ or A−would both correspond to the same maximum capital exposure limit in Table 4 ( i.e., third highest investment grade or 9 percent). Further, if a counterparty is placed on a credit watch by an NRSRO, the rule states that the credit rating from that NRSRO at the next lower grade shall be used. In cases where a counterparty is not rated by an NRSRO, the rule allows a Bank to determine the applicable credit rating using standards available from an NRSRO or similar standards.

The Finance Board is adopting the unsecured credit limit on groups of affiliated counterparties in § 932.9(b), as proposed. See Id. at 41480 (discussing proposed affiliated counterparty limit). Under § 932.9(b), the aggregate limit on the extension of unsecured credit to a group of affiliated counterparties would equal 30 percent of the FHLBank's total capital. In calculating the amounts of unsecured credit extended to a group of affiliated counterparties, a Bank should include the amounts of sales of overnight federal funds to those affiliated counterparties. The rule also makes clear that unsecured credit limitations on individual counterparties continue to apply to each counterparty within a group of affiliated counterparties.

The Finance Board is adopting the special limit for GSEs generally as proposed, see id. at 41475-76, 41478, but, as already explained above, has added a provision to establish a lower, sub-limit for GSE subordinated debt held by a Bank. In adopting the final version of § 932.9(c), the Finance Board also has made some technical and conforming changes to the proposed rule.

Section 932.9(c) establishes the credit limits that a Bank should impose on its unsecured lending to GSEs. Under § 932.9(c)(1), a Bank's unsecured credit exposure to a GSE may not exceed 100 percent of the lesser of either the Bank's total capital or the GSE's total capital (as defined by the GSE's principal regulator, or some similar measure of the GSE's capital identified by the Bank). In applying this limit, a Bank must include in its calculation of the total amount of unsecured credit extended to a GSE all forms of unsecured lending, including sales of overnight federal funds and a Bank's purchases of the GSE's subordinated debt. In addition, § 932.9(c)(2) requires that a Bank's total purchase of a GSE's subordinated debt not exceed a special sub-limit, which equals the maximum capital exposure limit corresponding to the credit rating assigned to the subordinated debt multiplied by the lesser of the Bank's total capital or the applicable capital measurement of the GSE. For example, if a GSE's subordinated debt were rated AA and the GSE's total capital were larger than the Bank's total capital, the sub-limit on purchases of the GSE's subordinated debt would equal 14 percent of the Bank's total capital. A Bank must calculate and apply the sub-limit on subordinated debt even if the subordinated debt is rated at the highest investment grade.

Section 932.9(c)(3) requires a Bank to treat GSEs like private counterparties in the event any NRSRO assigns a credit rating to, or downgrades the credit rating of, any long-term, senior debt obligation issued by a GSE to below the highest investment grade, or places the GSE on a credit watch for a potential downgrade. In this case, the Bank must calculate the maximum amount of its unsecured extensions of credit to that GSE in accordance with paragraph (a)(1) of the proposed rule. After a GSE's credit rating is downgraded or the GSE is placed on a watch list for a potential downgrade, § 932.9(d) applies to a Bank's extensions of unsecured credit to that GSE.

Section 932.9(c)(4) exempts a Bank's unsecured lending to another Bank from all the unsecured credit limits of this rule, although a Bank still must report its credit exposure to another Bank to the extent required by § 932.9(e). In adopting § 932.9(c)(4), the Finance Board is incorporating into the unsecured credit rule a similar inter-Bank exclusion that was contained in the FMP's unsecured credit provision. See Id. at 41476, 41478.

The Finance Board has adopted the transition provision of § 932.9(d), as proposed. See Id. at 41480-81. This provision provides that in the event a lower maximum credit limit is imposed on a counterparty (including on a GSE) because an NRSRO has downgraded the credit rating applicable to a counterparty or has placed a counterparty on a credit watch for a potential downgrade, a Bank is not required to unwind or liquidate any transaction or position that was entered into prior to the date of the downgrade or the placement on credit watch so long as the transaction or position complied with the limits at the time it was entered. 10 However, any new unsecured extensions of credit to the counterparty would have to comply with the new lower maximum exposure limit. The rule makes clear that a renewal of an existing unsecured extension of credit, including any decision not to terminate a sale of federal funds subject to a continuing contract, would be considered a new extension of unsecured credit.

The Finance Board is adopting the reporting requirements contained in § 932.9(e), generally as proposed. These requirements are in substance the same as those that were contained in § 932.9(c) of the version of the unsecured credit rule adopted by the Finance Board in December 2000. However, in adopting the final version of § 932.9, the Finance Board has added new provision to § 932.9(e) which requires the Banks promptly to report any positions in excess of the term limit, the overall limit or the special GSE limit set forth in the rule.

Under this provision, the Banks must report monthly to the Finance Board the amount of unsecured credit to a single counterparty, or group of affiliated counterparty, that exceeds five percent of either a Bank's total capital or the counterparty's, or the affiliated counterparties' combined, Tier 1 capital, or if Tier 1 capital is not available the counterparty's total capital (as defined by the counterparty's principal regulator) or some other comparable measure identified by the Bank. As discussed above, the consolidated capital of the holding company of the group of affiliated counterparties would be considered the combined capital of that affiliated group. In addition, the Banks must report monthly to the Finance Board the amount of the Bank's total combined secured and unsecured extensions of credit to a single counterparty or group of affiliated counterparties that exceed five percent of a Bank's total assets.

These reporting obligations apply to all extensions of credit by a Bank (including extensions of credit to other Banks), except those arising from a Bank's purchase of obligations of, or guaranteed by, the United States. As discussed above Banks must report promptly after the last business day of the month any extensions of credit in excess of the limits set forth in §§ 932.9(e)(1) and (e)(2) that occurred during that month.

New § 932.9(e)(3) requires that a Bank report promptly to the Finance Board any time its extensions of unsecured credit exceed any one or more of the limits set forth in §§ 932.9(a), (b) or (c). The Banks should report the name of the counterparty or group of affiliated counterparties involved, the date or dates for which the Bank was not in compliance, the level of the limit calculated in accordance with the rule and the amount by which the Bank's extension of unsecured credit exceeded the limit. The Bank may also include a brief statement describing any extenuating circumstances or other factors that may have led to non-compliance with the limits. The Finance Board believes that the initial report by the Bank need only be brief. If additional information is needed, the Finance Board will request it from the Bank depending on the particular circumstances of the situation. The Finance Board has not set a specific deadline for submitting a report required under § 932.9(e)(3) to provide some flexibility in this area. By way of guidance, however, the Finance Board believes that a report would be prompt if it occurred within two business days of when the Bank recognizes that a limit had been breached.

The Finance Board is adopting this new provision to help it closely monitor the effectiveness of these unsecured credit limits, and the Banks' concentration of credit. The Finance Board also believes that it is more effective and provides an opportunity for quick action (if needed) to require that reports be made to the Finance Board as soon as a Bank finds that it is not in compliance with the unsecured credit limits rather than seek such information on an ad hoc basis or wait for the monthly credit reporting required under the rule. The requirement also closes gaps in the reporting provision in that a Bank could be in violation of the unsecured credit limits with regard to a lower-rated counterparty but not necessarily be required to report the credit concentration under §§ 932.9(e)(1) or (2).

The Finance Board has adopted proposed § 932.9(f) as § 932.9(f)(1) with one change to make clear that any credit exposure from a derivative contract against which the Bank holds collateral is not counted as unsecured credit. The provision, as adopted, also makes clear that the Bank must hold this collateral in accordance with § 932.4(e)(2)(ii)(B) in order for the value of the collateral to be subtracted from the credit exposure arising from the derivative contract. As discussed in Section II of this preamble, the Finance Board has also adopted new § 932.9(f)(2) to clarify the status of certain debt securities and debt obligations purchased by the Bank. Section 932.9(f) also has been restructured to accommodate the new provision. Other parts of § 932.4(f)(1) are adopted as proposed. See Id. at 41481. Thus, the amount of unsecured credit arising from on-balance sheet transactions will equal the sum of the book value of the item plus any amounts accrued by the Bank but not yet paid with respect to that item. The rule also requires a Bank to measure exposures from off-balance sheet and derivative transactions in accordance with § 932.4 of the Finance Board rules, which sets forth the requirements for calculating a Bank's credit risk-based capital charge. Thus, unsecured credit exposures arising from off-balance sheet transactions should be measured in accordance with § 932.4(f); unsecured credit exposures from single derivatives contracts should be measured in accordance with § 932.4(g); and unsecured credit exposures for derivative contracts subject to a qualifying bilateral netting contract should be measured in accordance with § 932.4(h). The Banks should include both the current credit exposure and the PFE in calculations of exposures arising from derivative contracts.

As previously discussed, § 932.9(f)(2) has been adopted to clarify the Finance Board's view that any debt obligation or debt security purchased by the Bank will be subject to the unsecured credit limits unless the Bank's credit exposure arising from these instruments is collateralized in accordance with § 932.4(e)(2)(ii)(B) or the Finance Board has made a determination on a case-by-case basis that the debt obligation should not be subject to the unsecured credit limits. The new provision specifically states that MBS are not subject to the unsecured credit limits nor are loans identified in §§ 955.2(a)(1) and (2) and purchased by the Bank as AMA under authority granted in part 955. HFA bonds purchased under a Bank's AMA authority, however, would be subject to the unsecured credit limits unless the Finance Board determines otherwise. Further, § 932.9(f)(2) only addresses debt obligations or debt securities purchased by the Bank. Thus, transactions with members originated by the Bank such as advances or letters of credit would be considered secured and not subject to the rules as long as collateral is posted and held in accordance with any applicable Finance Board rules and Bank policies.

The Finance Board is adopting § 932.9(g), as proposed. See Id. at 41481. This provision makes clear that obligations of, or guaranteed by, the United States are not subject to the any of requirements of § 932.9 (including the reporting requirements that are contained in § 932.9(e)).

The final rule applies only to the Banks, which do not come within the meaning of small entities as defined in the Regulatory Flexibility Act (RFA). See 5 U.S.C. 601(6). Therefore, in accordance with section 605(b) of the RFA, 5 U.S.C. 605(b), the Finance Board hereby certifies that this final rule, will not have a significant economic effect on a substantial number of small entities.

The final rule does not contain any collections of information pursuant to the Paperwork Reduction Act of 1995. See 44 U.S.C. 3501 et seq. Therefore, the Finance Board has not submitted any information to the Office of Management and Budget for review.

What events have caused this AD? The Luftfahrt-Bundesamt (LBA), which is the airworthiness authority for Germany, recently notified FAA that an unsafe condition may exist on all Dornier Model 228-212 airplanes equipped with brake assembly part-number 5009850-1, 5009850-2, 5009850-3, or 5009850-4. The LBA reports one occurrence of failure of the right-hand main landing gear (MLG) brake housing subassembly on one of the above-referenced airplanes. Failure of the brake housing assembly resulted in total loss of braking power.

The brake manufacturer, Aircraft Braking Systems Corporation (ABSC), has developed a modification to the torque take-out cavity of the brake housing assembly. The incorporation of this modification on Dornier Model 228-212 airplanes would prevent surface damage from developing into fatigue damage.

What is the potential impact if FAA took no action? Damage to the brake housing assembly, if not detected and corrected, could result in failure of this assembly. Such failure could result in loss of braking action on landing and possible loss of control of the airplane.

Has FAA taken any action to this point? We issued a proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an AD that would apply to all Dornier Model 228-212 airplanes that have a certain brake assembly installed. This proposal was published in the Federal Register as a notice of proposed rulemaking (NPRM) on October 2, 2001 (66 FR 50125). The NPRM proposed to require you to inspect the brake housing subassembly for cracks, nicks, or corrosion (referred to as damage), replace damaged brake housing assemblies, and modify the torque take-out cavity.

Was the public invited to comment? The FAA encouraged interested persons to participate in the making of this amendment. We did not receive any comments on the proposed rule or on our determination of the cost to the public.

What is FAA's final determination on this issue? After careful review of all available information related to the subject presented above, we have determined that air safety and the public interest require the adoption of the rule as proposed except for minor editorial corrections. We have determined that these minor corrections:

How many airplanes does this AD impact? We estimate that this AD affects 1 airplane in the U.S. registry.

What is the cost impact of this AD on owners/operators of the affected airplane? We estimate the following costs to accomplish the inspection:

You will not need parts or special equipment to accomplish any necessary repairs after the inspection. The time necessary to accomplish any repairs is included in the inspection labor cost.

We estimate the following costs to accomplish any necessary replacements that will be required based on the results of the inspection. We have no way of determining the number of airplanes that may need such replacements.

ABSC will provide labor reimbursement for the modification to the torque take-out cavity of the brake housing to the extent noted in Service Bulletin Do228-212-13, dated December 15, 2000.

Does this AD impact various entities? 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.

Does this AD involve a significant rule or regulatory action? 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 copy of the final evaluation prepared for this action is contained in the Rules Docket. A copy of it may be obtained by contacting 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 all Airbus Model A300 B2 and B4 series airplanes was published in the Federal Register on August 28, 2001 (66 FR 45192). That action proposed to require identifying the types and areas of repairs on the airplane between frame 10 and frame 80, and performing follow-on actions for certain repairs.

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 requests that the FAA revise the applicability statement of the proposed AD to exclude Model A300 B4-600 series airplanes. The commenter states that this is an appropriate change because French airworthiness directive 2000-261-312(B), dated June 28, 2000 (which is the French airworthiness directive corresponding to the proposed AD), and Airbus Service Bulletin A300-53-0313, Revision 01, dated April 27, 1999 (which the proposed AD refers to as the appropriate source of service information for certain actions therein), do not apply to Model A300 B4-600 series airplanes.

We concur with the commenter's request. We do not intend this AD to apply to Model A300 B4-600 series airplanes. However, based on the commenter's request, we recognize that the identification of the affected airplanes models in the proposed rule could potentially confuse some owner/operators. Therefore, we have revised the applicability statement of this AD, as well as the title and summary sections in the preamble of this AD, to clarify that this AD applies to all Airbus Model A300 B2 series airplanes and Model A300 B4-2C, B4-103, and B4-203 series airplanes.

One commenter, a supplemental type certificate (STC) holder, requests that we provide a different follow-on action for airplanes that have been converted from passenger airplanes to freighters according to a specific STC. The commenter explains that such conversion results in increased loads on certain fuselage skin panels on the airplane. The commenter states that, if an operator of a converted airplane identifies an existing repair that is subject to this AD on one of the fuselage skin panels affected by the conversion, the operator should contact the STC holder for assistance in evaluating the repair.

We do not concur that any change is necessary in this regard, though we do concur that the operator should contact the STC holder for assistance in evaluating the repair. Note 1 of this AD specifies that, if an airplane has been modified in such a way that the AD requirements have been affected, the owner/operator must request approval of an alternative method of compliance in accordance with paragraph (d) of this AD. This provision would apply to airplanes modified per the commenter's STC.

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 change described previously. The FAA has determined that this change will neither increase the economic burden on any operator nor increase the scope of the AD.

The FAA estimates that 13 airplanes of U.S. registry will be affected by this AD, that it will take approximately 2 work hours per airplane to accomplish the required actions, and that the average labor rate is $60 per work hour. Based on these figures, the cost impact of this AD on U.S. operators is estimated to be $1,560, or $120 per airplane.

The cost impact figure discussed above is 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 767-200 series airplanes was published in the Federal Register on May 14, 2001 (66 FR 24306). That action proposed to require replacement of certain duct assemblies of the air distribution system for the flight compartment with new duct assemblies with improved insulation, and 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.

Two commenters concur with the proposed rule.

Three commenters ask that paragraph (a) of the proposed rule be changed, as follows:

One commenter states that the proposed AD is similar to AD 2000-26-05, amendment 39-12055 (65 FR 82898, December 29, 2000). That AD requires modification of the environmental control system ducts for Model 737, 747, 757, and 767 series airplanes within 6 years after the effective date of the AD. The commenter asks that the compliance time in this proposed AD be changed to allow 18 months for verification of proper clearance between the water line heater tape and the duct assemblies of the air distribution system for the flight compartment, and 6 years for duct insulation replacement, similar to the compliance time allowed by AD 2000-26-05.

The second commenter asks that the compliance time be changed to specify doing the one-time general visual inspection of the water line heater tape, as specified in paragraph (a)(2) of the proposed rule, within 18 months, and then the replacement of the duct assemblies, as specified in paragraph (a)(1) of the proposed rule, within 6 years. The commenter states that, since the burned duct was ignited by an overheated water line heater tape routed too close to a duct assembly, this sequence of actions would ensure an equivalent level of safety, while providing operators the opportunity to replace the duct assemblies at an aircraft's heavy maintenance visit.

The third commenter, Air Transport Association, states that the original equipment manufacturer is developing a service bulletin which will allow replacement of the BMS 8-39 foam insulation on the ducts of the air distribution system for the flight compartment with BMS 8-300 foam. Inclusion of this option in the AD would minimize any need for the replacement of the duct assemblies as the means for installing the new insulation material. The commenter adds that requiring inspection and corrective action to ensure proper clearance between the duct and heater tape within 18 months after the effective date of the AD is prudent. The commenter states that once these actions are satisfactorily completed, an acceptable level of safety would be attained, and safe operations could be continued. The commenter also recommends issuing a supplemental notice of proposed rulemaking to address the revised instructions specified above.

We concur with the commenters. Since the issuance of the proposed rule the FAA has reviewed and approved Boeing Alert Service Bulletin 767-21A0154, Revision 1, dated August 9, 2001. The service bulletin adds an option to replace the existing BMS 8-39 foam insulation on the ducts of the air distribution system for the flight compartment with BMS 8-300 polyimide foam insulation, and recommends inspection of the water line heater tape within 18 months. Therefore, per the revised bulletin and the above comments, the FAA agrees to require either replacement of the duct assemblies or the foam insulation, and to extend the compliance time for that replacement. Revision 1 also has been added as the source of service information for accomplishment of the required actions, and a new Note 3 has been added to give credit for previous accomplishment of certain actions per Boeing Alert Service Bulletin 767-21A0154, dated March 16, 2000 (which was listed as the source of service information for accomplishment of the actions specified in the proposed rule). This new requirement gives operators the option of either replacement of the duct assemblies or the foam insulation, and does not add any additional work. Therefore, issuing a supplemental notice of proposed rulemaking is not necessary.

Paragraph (a) of the final rule has been changed to require an 18-month compliance time for the one-time general visual inspection of the water line heater tape for damage, and follow-on actions; and a new paragraph (b) has been added to expand the compliance time to 6 years for either replacement of the duct assemblies or replacement of the existing BMS 8-39 foam insulation on the ducts with BMS 8-300 polyimide foam insulation. The Summary section in this final rule also has been revised accordingly.

One commenter expands on the language in the Discussion section in the preamble of the proposed rule by stating that the foam insulation was compliant with flammability regulations at the time of airplane delivery. The FAA infers that the commenter wants this information added to the final rule. We acknowledge that certain information in that section could be changed for clarification purposes. However, since that section of the proposed rule does not appear in the final rule, 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 81 airplanes of the affected design in the worldwide fleet. The FAA estimates that 52 airplanes of U.S. registry will be affected by this AD, that it will take approximately 1 work hour per airplane to do the general visual inspection, at an average labor rate of $60 per work hour. Based on these figures, the cost impact of the inspection required by this AD on U.S. operators is estimated to be $3,120, or $60 per airplane.

The replacement of the duct assemblies is one option for compliance with this AD action and will take approximately 2 work hours to accomplish, at an average labor rate of $60 per work hour. Required parts will cost a maximum of $7,285 per airplane. Based on these figures, the cost impact of the replacement of the duct assemblies required by this AD is estimated to be $7,405 per airplane.

In lieu of replacement of the duct assemblies, this AD provides for replacement of the foam insulation on the ducts. It will take approximately 3 work hours to accomplish, at an average labor rate of $60 per work hour. Based on these figures, the cost impact of the replacement of the foam insulation required by this AD is estimated to be $180 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.

The FAA has received a report that, during an inspection of a Gulfstream Model G-IV series airplane, the electrical connections for the left and right fire extinguisher bottle squibs were found to be improperly installed. The improper installation occurred either during manufacturing or during subsequent maintenance affecting the fire extinguisher bottles. The manufacturer states that a contributing factor for improper connection of the fire extinguisher bottle is the potential for the identification labels to migrate up the wiring harness, which increases the possibility for a technician to connect the wiring to incorrect terminals. This condition, if not corrected, could cause fire extinguishing agent to be discharged into the wrong location, which could result in failure to extinguish an in-flight fire on an affected engine and jeopardize operation of the opposite engine.

The FAA has determined that issuance of this AD, applicable to Gulfstream Model G-IV series airplanes, serial numbers 1253 through 1464 inclusive, is necessary because of the potential for improper connection of the electrical connections, as described previously. The FAA adds that wire marking tags often have been found much farther from the terminal ends than intended by the design, and it is uncertain when the discrepancies in tag installation began during production.

However, the FAA has been notified by the manufacturer that the identified unsafe condition has been addressed on Model G-IV series airplanes, serial numbers 1465 and subsequent, by a clarification in the build instructions. Therefore, it is unnecessary to include those airplanes in the applicability of this AD.

The FAA has reviewed and approved Gulfstream GIV Alert Customer Bulletin No. 30, dated November 2, 2001, which describes procedures for an inspection of the electrical connections for the engine fire extinguisher bottles; and corrective action, if necessary.

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design, this AD is being issued to prevent fire extinguishing agent from being discharged into the wrong location, which could result in failure to extinguish an in-flight fire on an affected engine and jeopardize operation of the opposite engine. This AD requires accomplishment of the actions specified in the alert customer bulletin described previously, except as discussed below. This AD also requires that operators report the results of the inspection findings (both positive and negative) to the FAA.

Because it is not known whether the improper installation of the electrical connections for the fire extinguisher bottles occurred during the manufacturing process or during subsequent maintenance, this AD requires inspection of those electrical connections following any maintenance affecting the fire extinguisher bottles. The alert customer bulletin does not refer to inspection following maintenance. This AD also requires that inspection findings be reported to the FAA, whereas the alert customer bulletin recommends notice to Gulfstream that the Accomplishment Instructions of the alert customer bulletin have been performed.

This is considered to be interim action until final action is identified, at which time the FAA may consider further rulemaking.

Since a situation exists that requires the immediate adoption of this regulation, it is found that notice and opportunity for prior public comment hereon are impracticable, and that good cause exists for making this amendment effective in less than 30 days.

Although this action is in the form of a final rule that involves requirements affecting flight safety and, thus, was not preceded by notice and an opportunity for public comment, comments are invited on this rule. Interested persons are invited to comment on this rule by submitting such written data, views, or arguments as they may desire. Communications shall identify the Rules Docket number and be submitted in triplicate to the address specified under the caption ADDRESSES. All communications received on or before the closing date for comments will be considered, and this rule may be amended in light of the comments received. Factual information that supports the commenter's ideas and suggestions is extremely helpful in evaluating the effectiveness of the AD action and determining whether additional rulemaking action would be needed.

Submit comments using the following format:

• Organize comments issue-by-issue. For example, discuss a request to change the compliance time and a request to change the service bulletin reference as two separate issues.

• For each issue, state what specific change to the AD is being requested.

• Include justification (e.g., reasons or data) for each request.

Comments are specifically invited on the overall regulatory, economic, environmental, and energy aspects of the rule that might suggest a need to modify the rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report that summarizes each FAA-public contact concerned with the substance of this AD will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this rule must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2001-NM-361-AD.” The postcard will be date stamped and returned to the commenter.

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.

The FAA has determined that this regulation is an emergency regulation that must be issued immediately to correct an unsafe condition in aircraft, and that it is not a “significant regulatory action” under Executive Order 12866. It has been determined further that this action involves an emergency regulation under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979). If it is determined that this emergency regulation otherwise would be significant under DOT Regulatory Policies and Procedures, a final regulatory evaluation will be prepared and placed in the Rules Docket. A copy of it, if filed, may be obtained from the Rules Docket at the location provided under the caption ADDRESSES .

The Direction Générale de l'Aviation Civile (DGAC), which is the airworthiness authority for France, recently notified the FAA that an unsafe condition may exist on certain Airbus Model A319, A320, and A321 series airplanes having manufacturer serial numbers 1035 through 1384 inclusive. The DGAC advises that an operator reported foam pads missing from some Dräeger Type I (three/four-mask) and Dräeger Type II (two-mask) oxygen containers. The foam pads, located at the end of the oxygen generator, prevent the lanyard between the oxygen mask and oxygen release pin from getting twisted around the generator starter lever arm. In such a configuration, and in case of sudden release of cabin pressure, the oxygen supply to passengers may not be ensured. Findings indicate that the foam pads, erroneously thought to be packing material, were removed during installation of the oxygen containers on the airplane. The foam pads are necessary to prevent entanglement of the mask lanyards if the masks are required in an emergency.

Airbus has issued Service Bulletin A320-35-1022, dated June 27, 2001, which describes procedures for an inspection of Dräeger Type I oxygen containers, located in the power supply units, and Dräeger Type II oxygen containers, located in the utility areas, for the presence of foam pads; the installation of a new foam pad, if necessary; and other actions to ensure proper operation of the masks. Other actions include repacking the masks in the correct position; checking the masks, tubes, and lanyards for correct stowage; and doing a manual release test and an operational test. Accomplishment of the actions specified in the service bulletin is intended to adequately address the identified unsafe condition. The DGAC classified this service bulletin as mandatory and issued French airworthiness directive 2001-363(B), dated August 8, 2001, in order to assure the continued airworthiness of these airplanes in France.

These airplane models are manufactured in France and are type certificated for operation in the United States under the provisions of section 21.29 of the Federal Aviation Regulations (14 CFR 21.29) and the applicable bilateral airworthiness agreement. Pursuant to this bilateral airworthiness agreement, the DGAC has kept the FAA informed of the situation described above. The FAA has examined the findings of the DGAC, reviewed all available information, and determined that AD action is necessary for products of this type design that are certificated for operation in the United States.

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, this AD is being issued to prevent failure of the oxygen containers to deliver oxygen to the passengers in the event of a rapid decompression or cabin depressurization. This AD requires an in-situ one-time detailed visual inspection of Dräeger Type I oxygen containers, located in the passenger service unit, and Dräeger Type II oxygen containers, located in the utility areas, for the presence of foam pads; installation of new foam pads, if necessary; and other actions to ensure proper operation of the masks. The actions are required to be accomplished in accordance with the service bulletin described previously.

Since a situation exists that requires the immediate adoption of this regulation, it is found that notice and opportunity for prior public comment hereon are impracticable, and that good cause exists for making this amendment effective in less than 30 days.

Although this action is in the form of a final rule that involves requirements affecting flight safety and, thus, was not preceded by notice and an opportunity for public comment, comments are invited on this rule. Interested persons are invited to comment on this rule by submitting such written data, views, or arguments as they may desire. Communications shall identify the Rules Docket number and be submitted in triplicate to the address specified under the caption ADDRESSES . All communications received on or before the closing date for comments will be considered, and this rule may be amended in light of the comments received. Factual information that supports the commenter's ideas and suggestions is extremely helpful in evaluating the effectiveness of the AD action and determining whether additional rulemaking action would be needed.

Submit comments using the following format:

• Organize comments issue-by-issue. For example, discuss a request to change the compliance time and a request to change the service bulletin reference as two separate issues.

• For each issue, state what specific change to the AD is being requested.

• Include justification (e.g., reasons or data) for each request.

Comments are specifically invited on the overall regulatory, economic, environmental, and energy aspects of the rule that might suggest a need to modify the rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report that summarizes each FAA-public contact concerned with the substance of this AD will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this rule must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2001-NM-354-AD.” The postcard will be date stamped and returned to the commenter.

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.

The FAA has determined that this regulation is an emergency regulation that must be issued immediately to correct an unsafe condition in aircraft, and that it is not a “significant regulatory action” under Executive Order 12866. It has been determined further that this action involves an emergency regulation under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979). If it is determined that this emergency regulation otherwise would be significant under DOT Regulatory Policies and Procedures, a final regulatory evaluation will be prepared and placed in the Rules Docket. A copy of it, if filed, may be obtained from the Rules Docket at the location provided under the caption ADDRESSES.

The FAA published this direct final rule with a request for comments in Federal Register on September 24, 2001 (66 FR 48794). The FAA uses the direct final rulemaking procedure for a non-controversial rule where the FAA believes that there will be no adverse public comment. This direct final rule advised the public that no adverse comments were anticipated, and that unless a written adverse comment, or a written notice of intent to submit such an adverse comment, were received within the comment period, the regulation would become effective on December 27, 2001. Adverse comments were received, and thus this document confirms that this direct final rule will become effective on that date.

In the Federal Register of November 6, 2001 (66 FR 56034), FDA amended its regulations to reflect that on December 14, 2001, CFSAN's address was changed to 5100 Paint Branch Pkwy., College Park, MD 20740. This change of address will make room numbers cited in certain regulations invalid. Therefore, FDA is amending its regulations in 21 CFR parts 73, 101, 172, 173, 177, 178, and 184 to remove the phrase “rm. 3321” wherever it appears. FDA also is amending 21 CFR 10.20(f) to add a period after “20857” and to remove the following phrase: “, except that a submission which is required to be received by the Branch by a specified date may be delivered in person to the FDA building in Washington (Room 6819, 200 C Street, SW., Washington, DC 20204) and will be considered as received by the Branch on the date on which it is delivered.” This alternate site, originally provided for the convenience of the public, is no longer available because CFSAN's address has changed to College Park.

Publication of this document constitutes final action on these changes under the Administrative Procedure Act (5 U.S.C. 553). Notice and public procedure are unnecessary because FDA is merely correcting nonsubstantive errors.

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, 21 CFR chapter I is amended as follows:

1. Section 10.20(f) is amended by adding a period after “20857” and by removing the rest of the sentence.

2. Parts 73, 101, 172, 173, 177, 178, and 184 are amended by removing the words “rm. 3321” wherever they appear.

Phibro Animal Health, One Parker Plaza, Fort Lee, NJ 07024, has informed FDA of a change of sponsor's address to 710 Rt. 46 East, suite 401, Fairfield, NJ 07004. Accordingly, the agency is amending the regulations in 21 CFR 510.600(c)(1) and (c)(2) to reflect the change.

This rule does not meet the definition of “rule” in 5 U.S.C. 804(3)(A) because it is a rule of “particular applicability.” Therefore, it is not subject to the congressional review requirements in 5 U.S.C. 801-808.

Administrative practice and procedure, Animal drugs, Labeling, Reporting and recordkeeping requirements.

1. The authority citation for 21 CFR part 510 continues to read as follows:

Section 503(a) of the Act permits a State to assume primacy for the regulation of surface coal mining and reclamation operations on non-Federal and non-Indian lands within its borders by demonstrating that its program includes, among other things, “ * * * a State law which provides for the regulation of surface coal mining and reclamation operations in accordance with the requirements of this Act * * *; and rules and regulations consistent with regulations issued by the Secretary pursuant to this Act.” See 30 U.S.C. 1253(a)(1) and (7). On the basis of these criteria, the Secretary of the Interior conditionally approved the Iowa program on January 21, 1981. You can find background information on the Iowa program, including the Secretary's findings, the disposition of comments, and the conditions of approval in the January 21, 1981, Federal Register (46 FR 5885). You can find later actions on the Iowa program at 30 CFR 915.10, 915.15, and 915.16.

By letter dated August 17, 2001 (Administrative Record No. IA-446), Iowa sent us an amendment to its program under SMCRA and the Federal regulations at 30 CFR 732.17(b). Iowa sent the amendment in response to required program amendments at 30 CFR 915.16(b), (d), and (e). Iowa proposed changes to its April 1999 revegetation success guidelines entitled “Revegetation Success Standards and Statistically Valid Sampling Techniques.”

We announced receipt of the amendment in the September 24, 2001, Federal Register (66 FR 48841). In the same document, we opened the public comment period and provided an opportunity for a public hearing or meeting on the adequacy of the amendment. The public comment period closed on October 24, 2001. We did not receive any comments. Because no one requested a public hearing or meeting, we did not hold one.

During our review of the amendment, we identified concerns about a typographical error in a provision for interseeding at Section III.H.4.(c)(ii); the interpretation of the revegetation success standards for recreational, wildlife, and forested lands at Section IV.E; and the interpretation of the dry weight determination for grain samples at Section V.A.2(l). We notified Iowa of the error at Section III.H.4.(c)(ii) and explained our interpretation of its provisions at Sections IV.E and V.A.2(l) in a letter dated September 12, 2001 (Administrative Record No. IA-446.3A).

By letter dated September 28, 2001 (Administrative Record No. IA-446.5), Iowa agreed to correct the typographical error and concurred with our interpretation of its provisions at Sections IV.E and V.A.2(l).

This section contains our findings concerning the amendment to the Iowa program. We are making these findings in accordance with the criteria and procedural requirements of the Federal regulations at 30 CFR 732.15 and 732.17. Any revisions that we do not discuss below are minor wording changes or revised cross-references and paragraph notations to reflect organizational changes resulting from this amendment.

Section III, Part H of Iowa's April 1999 revegetation success guidelines describes normal husbandry practices that a permittee can use in the repair of rills and gullies without restarting the responsibility period for successful revegetation and bond liability. A permittee may address rill and gully erosion within the permit or partial permit area without restarting the responsibility period only if repairs are completed using the normal husbandry practice guidelines provided in this section. If the repair work requires augmented seeding, fertilization, or irrigation, the period of responsibility will restart. Normal husbandry practices do not include any temporary erosion control structures, such as silt fencing, straw, or hay bale dikes. This section includes requirements for terrace repair and maintenance; riprap repair and maintenance; land smoothing and reseeding; and liming, fertilizing, and interseeding.

The Federal regulations at 30 CFR 816.116(c)(4) for surface mining operations and 30 CFR 817.116(c)(4) for underground mining operations allow the regulatory authority, under specified conditions, to approve selective husbandry practices (excluding augmented seeding, fertilization, or irrigation) without extending the period of responsibility for revegetation success and bond liability. The regulatory authority must obtain prior approval from OSM in accordance with 30 CFR 732.17 that the practices are normal husbandry practices that can either be expected to continue as part of the postmining land use or will not reduce the probability of permanent revegetation success if the practices are discontinued after the responsibility period expires. Approved practices must be normal husbandry practices within the region for unmined lands having land uses similar to the approved postmining land use of the disturbed area. In the September 7, 1988, preamble for the Federal regulations at 30 CFR 816.116(c)(4) and 817.116(c)(4), we discussed the type of documentation that the regulatory authority must submit to support its proposed normal husbandry practices (53 FR 34641). The regulatory authority must submit documentation that demonstrates that the practice is the usual or expected state, form, amount, or degree of management performed habitually or customarily to prevent exploitation, destruction, or neglect of the resource and to maintain a prescribed level of use or productivity on similar unmined lands. The documentation may include either conservation practice guidelines or agronomy guidelines and fact sheets for the management of unmined lands in the applicable State. The guidelines and fact sheets could be those distributed by the Natural Resources Conservation Service (NRCS) or other organizations with similar expertise in management of a State's natural resources, including agricultural lands.

In our final rule dated November 26, 1999, we did not approve Section III, Part H because Iowa did not submit documentation that demonstrated that the proposed normal husbandry practices were the usual or expected state, form, amount, or degree of management performed habitually or customarily to prevent exploitation, destruction, or neglect of the resources on similar unmined lands in the State (64 FR 66385). We required Iowa to either remove its guidelines for normal husbandry practices at Section III, Part H or submit documentation that supports the proposed normal husbandry practices. We codified this requirement at 30 CFR 915.16(b).

In response to the required program amendment at 30 CFR 915.16(b), Iowa made changes to Section III, Part H and submitted documentation for support of the proposed normal husbandry practices. The documentation included copies of five publications: (1) NRCS Conservation Practice Standard 600, Terrace; (2) NRCS Conservation Practice Standard 468, Lined Waterway or Outlet; (3) NRCS Conservation Practice Standard 466, Land Smoothing; (4) NRCS Conservation Practice Standard 590, Nutrient Management; and (5) Iowa State University Extension Service Publication Pm-1097, Interseeding and No-till Pasture Renovation. Based on the findings below, we are approving Iowa's normal husbandry practice guidelines at Section III, Part H and removing the required program amendment at 30 CFR 915.16(b).

1. Part H.1 provides that terrace repair and maintenance required because of specified occurrences will be considered normal husbandry practices and will not require restarting the responsibility period. First, the permittee may repair terraces damaged because of rainfall events that exceed their designed capacities. Second, the permittee may clean out and reestablish terrace flow lines during the first year or two after the initial terrace construction and seeding when sediment deposition into a terrace flow line exceeds the designed sediment storage capacity. Third, the permittee may clean out and reestablish terrace flow lines and repair or replace tile lines that have been plugged or crushed due to differential settling. Part H.1 includes a listing of the types of terrace repair and maintenance options that the State will consider as normal husbandry practices. Iowa submitted NRCS Conservation Practice Standard 600 (Terrace) to support these practices.

Based on the supporting documentation provided by Iowa, we find that the proposed guidelines for terrace repair and maintenance at Part H.1 meet the requirements of the Federal regulations at 30 CFR 816.116(c)(4) and 817.116(c)(4) for normal husbandry practices.

2. Part H.2 provides guidelines for riprap repair and maintenance on ditches and structures due to storm events that exceed the maximum design standard. Part H.2 includes a listing of the types of riprap repair and maintenance practices that Iowa will consider for normal husbandry practices. Iowa submitted NRCS Conservation Practice Standard 468 (Lined Waterway or Outlet) to support these practices.

Based on the supporting documentation provided by Iowa, we find that the proposed guidelines for riprap repair and maintenance on ditches and structures at Part H.2 meet the requirements of the Federal regulations at 30 CFR 816.116(c)(4) and 817.116(c)(4) for normal husbandry practices.

3. Part H.3 provides that normal husbandry practices can include limited land smoothing and reseeding as long as the individual areas are no larger than one acre in size and the cumulative acreage is no greater than 10 percent of the entire permit area. Iowa submitted NRCS Conservation Practice Standard 466 (Land Smoothing) to support these practices.

Based on the supporting documentation and the acreage limitations provided by Iowa, we find that Iowa's proposed guidelines for land smoothing and reseeding at Part H.3 meet the requirements of the Federal regulations at 30 CFR 816.116(c)(4) and 817.116(c)(4) for normal husbandry practices.

4. Part H.4 provides normal husbandry practices for applications of lime and fertilizer at paragraphs (a) and (b). It also provides normal husbandry practices for interseeding at paragraph (c).

Part H.4(a) and (b) provide, respectively, that lime and fertilizer applications may be made based on soil test recommendations for the appropriate crop or vegetation. Before any lime and fertilizer applications, the permittee must submit to the Division the original copies of the soil test recommendations and a map of the permit areas indicating where each soil sample was taken. Iowa requires the permittee to follow the lime and fertilizer maintenance application guidelines of NRCS Conservation Practice Standard 590 (Nutrient Management). For lime and fertilizer applications, the permittee must submit the original weight tickets for the applications to the Division at the times specified in section III, part B.3. If subsequent submittals of lime and fertilizer weight tickets prove that actual applications were in excess of the soil test recommendations, Iowa will restart the responsibility period. Iowa submitted NRCS Conservation Practice Standard 590 (Nutrient Management) to support its normal husbandry practice guidelines for liming and fertilizing.

Part H.4(c) requires the Division to approve any species to be interseeded before the seed is planted. The permittee must submit the original seed tickets to the Division at the times specified in Section III, Part B.3. Iowa will restart the responsibility period if any interseeding completed on the permit area fails to meet any of the criteria listed below.

Iowa submitted Iowa State University Extension Service Publication Pm-1097 (Interseeding and No-till Pasture Renovation) to support its normal husbandry practice guidelines for interseeding.

Based on the documentation submitted by Iowa, we find that the proposed guidelines for liming, fertilizing, and interseeding at Part H.4 meet the requirements of the Federal regulations at 30 CFR 816.116(c)(4) and 817.116(c)(4) for normal husbandry practices.

Section IV, Part E of Iowa's April 1999 revegetation success guidelines contains the revegetation success standards for recreational areas, wildlife areas, and forested lands. In our final rule dated November 26, 1999, we approved section IV, part E with two exceptions (64 FR 66388). First, Iowa's guidelines did not contain any planting arrangement provisions for these land uses as required by 30 CFR 816.116(b)(3)(i) and 817.116(b)(3)(i). Second, Iowa did not submit any documentation to prove that the State agencies responsible for the administration of forestry and wildlife programs approved its minimum stocking provisions as required by 30 CFR 816.116(b)(3)(i) and 817.116(b)(3)(i). We required Iowa to either add planting arrangement provisions for recreational, wildlife, and forested land to its guidelines and obtain program-wide concurrence from the State agencies responsible for the administration of forestry and wildlife programs or add a provision to its guidelines that requires permit-specific concurrence for planting arrangements from the State agencies responsible for the administration of forestry and wildlife programs. We also required Iowa to either obtain program-wide concurrence for its minimum stocking provisions or add a provision to its guidelines that requires permit-specific concurrence for minimum stocking from the State agencies responsible for the administration of forestry and wildlife programs. We codified these requirements at 30 CFR 915.16(d)(1) and (2).

Iowa made the following changes to section IV, part E to address these requirements.

1. Iowa added the following new provision to the beginning of the second paragraph of section IV, part E:

We are interpreting the language of this provision to mean that Iowa requires permit specific concurrence from the Iowa Department of Natural Resources for both planting arrangements and stocking rates for recreational, wildlife, and forested land uses. In its letter dated September 28, 2001, Iowa agreed with our interpretation (Administrative Record No. IA-446.5). Based on this interpretation, we find that section IV, part E is no less effective than the Federal regulations at 30 CFR 816.116(b)(3)(i) and 817.116(b)(3)(i). We are also removing the required program amendments at 30 CFR 915.16(d)(1) and (2).

2. Iowa added the following new provision for tree and shrub stocking requirements at Section IV, Part E, Step 2:

We find that this provision provides additional guidance to permittees for addressing planting arrangements and stocking rates for recreational, wildlife, and forested land uses in their permits. As discussed above, Iowa requires permit specific concurrence from the Iowa Department of Natural Resources for both planting arrangements and stocking rates for these land uses. Therefore, we find that Section IV.E.2 is no less effective than the Federal regulations at 30 CFR 816.116(b)(3)(i) and 817.116(b)(3)(i).

Section V of Iowa's April 1999 revegetation success guidelines contains sampling procedures and techniques to determine productivity for corn, soybeans, oats, wheat, and forage crops; to determine ground cover percentage; and to determine if trees and shrubs meet minimum density standards. In our final rule dated November 26, 1999, we approved Section V of Iowa's April 1999 revegetation success guidelines with one exception (64 FR 66388). We did not fully approve Section V, Part A, Step 2, which contains the grain sampling techniques for test plot harvesting, because it did not specify how the permittee is to obtain the dry weight of the test plot grain samples. The dry weight is used in a calculation to determine the moisture percentage for each test plot sample. We required Iowa to revise its April 1999 revegetation success guidelines at Section V, Part A, Step 2 by adding a provision that specifies the standard method that permittees are to use for obtaining the dry weight of test plot grain samples. We codified this requirement at 30 CFR 915.16(e).

In response to the required amendment at 30 CFR 915.16(e), Iowa added the following new provision to the beginning of Step 2(l):

We interpret the first sentence of Iowa's new provision to mean that the permittees must use the standard air-oven method to obtain dry weights. The air-oven method is recognized by the United States Department of Agriculture as a means of determining the moisture content of grain. In its letter dated September 28, 2001, Iowa agreed with our interpretation (Administrative Record No. IA-446.5). Based on Iowa's concurrence with our interpretation, we are approving Section V, Part A, Step 2(l) and removing the required amendment at 30 CFR 915.16(e).

On August 30, 2001, under section 503(b) of SMCRA and 30 CFR 732.17(h)(11)(i) of the Federal regulations, we requested comments on the amendment from various Federal agencies with an actual or potential interest in the Iowa program (Administrative Record No. IA-446.1A). We did not receive any comments.

Under 30 CFR 732.17(h)(11)(ii), we are required to obtain the written concurrence of the EPA for those provisions of the program amendment that relate to air or water quality standards issued under the authority of the Clean Water Act (33 U.S.C. 1251 et seq. ) or the Clean Air Act (42 U.S.C. 7401 et seq. ). None of the revisions that Iowa proposed to make in this amendment pertain to air or water quality standards. Therefore, we did not ask the EPA for its concurrence.

Under 30 CFR 732.17(h)(11)(i), we requested comments on the amendment from the EPA (Administrative Record No. IA-446.1A). The EPA did not respond to our request.

Under 30 CFR 732.17(h)(4), we are required to request comments from the SHPO and ACHP on amendments that may have an effect on historic properties. On August 31, 2001, we requested comments on Iowa's amendment (Administrative Record No. IA-446.2A), but we received no response to our request.

We requested public comments on the proposed amendment, but we did not receive any.

Based on the above findings, we approve the amendment as sent to us by Iowa on August 17, 2001.

To implement this decision, we are amending the Federal regulations at 30 CFR Part 915, which codify decisions concerning the Iowa program. We find that good cause exists under 5 U.S.C. 553(d)(3) to make this final rule effective immediately. Section 503(a) of SMCRA requires that the State's program demonstrate that the State has the capability of carrying out the provisions of the Act and meeting its purposes. Making this rule effective immediately will expedite that process.

This rule is exempt from review by the Office of Management and Budget under Executive Order 12866.

This rule does not have takings implications. This determination is based on the analysis performed for the counterpart Federal regulations.

This rule does not have federalism implications. SMCRA delineates the roles of the Federal and State governments with regard to the regulation of surface coal mining and reclamation operations. One of the purposes of SMCRA is to “establish a nationwide program to protect society and the environment from the adverse effects of surface coal mining operations.” Section 503(a)(1) of SMCRA requires that State laws regulating surface coal mining and reclamation operations be “in accordance with” the requirements of SMCRA, and section 503(a)(7) requires that State programs contain rules and regulations “consistent with” regulations issued by the Secretary under SMCRA.

The Department of the Interior has conducted the reviews required by section 3 of Executive Order 12988 and has determined that, to the extent allowed by law, this rule meets the applicable standards of subsections (a) and (b) of that section. However, these standards are not applicable to the actual language of State regulatory programs and program amendments because each program is drafted and promulgated by a specific State, not by OSM. Under sections 503 and 505 of SMCRA (30 U.S.C. 1253 and 1255) and 30 CFR 730.11, 732.15, and 732.17(h)(10), decisions on proposed State regulatory programs and program amendments submitted by the States must be based solely on a determination of whether the submittal is consistent with SMCRA and its implementing Federal regulations and whether the other requirements of 30 CFR Parts 730, 731, and 732 have been met.

On May 18, 2001, the President issued Executive Order 13211 which requires agencies to prepare a Statement of Energy Effects for a rule that is (1) considered significant under Executive Order 12866 and (2) likely to have a significant adverse effect on the supply, distribution, or use of energy. Because this rule is exempt from review under Executive Order 12866 and is not expected to have a significant adverse effect on the supply, distribution, or use of energy, a Statement of Energy Effects is not required.

Section 702(d) of SMCRA (30 U.S.C. 1292(d)) provides that a decision on a proposed State regulatory program provision does not constitute a major Federal action within the meaning of section 102(2)(C) of the National Environmental Policy Act (NEPA) (42 U.S.C. 4332(2)(C)). A determination has been made that such decisions are categorically excluded from the NEPA process (516 DM 8.4.A).

This rule does not contain information collection requirements that require approval by the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. 3507 et seq. ).

The Department of the Interior has determined 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. ). The State submittal which is the subject of this rule is based upon counterpart Federal regulations for which an economic analysis was prepared and certification made that such regulations would not have a significant economic effect upon a substantial number of small entities. Accordingly, this rule will ensure that existing requirements previously promulgated by OSM will be implemented by the State. In making the determination as to whether this rule would have a significant economic impact, the Department relied upon the data and assumptions for the counterpart Federal regulations.

This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule:

a. Does not have an annual effect on the economy of $100 million.

b. Will not cause a major increase in costs or prices for consumers, individual industries, federal, state, or local government agencies, or geographic regions.

c. Does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises.

This determination is based upon the fact that the State submittal which is the subject of this rule is based upon counterpart Federal regulations for which an analysis was prepared and a determination made that the Federal regulation was not considered a major rule.

This rule will not impose a cost of $100 million or more in any given year on any governmental entity or the private sector.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. 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 . The permit application was not received in time to publish an NPRM followed by a final rule before the effective date. Delaying this rule would be contrary to the public interest of ensuring the safety of spectators and vessels during this event and immediate action is necessary to prevent possible loss of life or property. The Coast Guard has not received any complaints or negative comments previously with regard to this event.

A temporary safety zone is necessary to ensure the safety of vessels and spectators from the hazards associated with fireworks displays. Based on recent accidents that have occurred in other Captain of the Port zones, and the explosive hazard of fireworks, the Captain of the Port Chicago has determined firework launches in close proximity to watercraft pose significant risks to public safety and property. The likely combination of large numbers of recreational vessels, congested waterways, darkness punctuated by bright flashes of light, alcohol use, and debris falling in the water could easily result in serious injuries or fatalities. Establishing a safety zone to control vessel movement around the location of the launch platforms will help ensure the safety of person and property at this event and help minimize the associated risk.

The safety zone encompasses the waters of the Chicago Harbor bounded by the following positions: 41° 52.43 N, 087° 36.43 W, thence east to 41° 52.43 N, 087° 36.16 W, thence south to 41° 52.28 N, 087° 36.16 W, thence west to 41° 52.28 N, 087° 36.43 W, thence north back to the point of origin. These coordinates are based upon North American Datum 1983 (NAD 83). This area includes a portion of the Monroe Street Harbor including the Grant Park anchorage areas (33 CFR 110.83), the entrance to the Monroe Street Harbor, as well as a portion outside the breakwall for the Monroe Street Harbor. Only that portion of the anchorage area encompasses by the safety zone will be suspended.

All persons and vessels shall comply with the instructions of the Coast Guard Captain of the Port or the designated on scene patrol personnel. Entry into, transiting, or anchoring within the safety zone is prohibited unless authorized by the Captain of the Port Chicago or his designated on scene representative. The Captain of the Port or his designated on scene representative may be contacted via VHF Channel 16.

This temporary rule is not a significant regulatory action under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that order. It has not been reviewed by the Office of Management and Budget under that order. It is not significant under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040; February 26, 1979). The Coast Guard expects the economic impact of this proposal to be so minimal that a full Regulatory Evaluation under paragraph 10(e) of the regulatory policies and procedures of DOT is unnecessary.

This determination is based on the minimal time that vessels will be restricted from the zone, and the zone is in an area where the Coast Guard expects insignificant adverse impact to mariners from the zones' activation.

Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) the Coast Guard considered whether this rule will have a significant impact on a substantial number of small businesses and not-for-profit organizations that are not dominant in their respective fields, and government jurisdictions with populations less than 50,000. For the same reasons set fourth in the above regulatory evaluations, the Coast Guard certifies under section 605 (b) of the Regulatory Flexibility Act (5 U.S.C.601 et seq. ) that this temporary final rule will not have a significant economic impact on a substantial number of small entities.

This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons. At this time of year there the amount of vessel traffic is at a minimum level and the safety zone will only be in place for a very short duration. In addition, those vessels requiring transit of the area may request permission from the Captain of the Port Chicago to transit the zone.

In accordance with section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), the Coast Guard wants to assist small entities in understanding this rule so that they can better evaluate its effectiveness and participate in the rulemaking process. If your small business or organization is affected by this rule, and you have questions concerning its provisions or options for compliance, please contact the office listed in ADDRESSES in this preamble.

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 contains no information collection requirements under the Paperwork Reduction Act (44 U.S.C. 3501 et seq. ).

The Coast Guard has analyzed this rule under the principles and criteria contained in Executive Order 12612 and has determined that this rule does not federalism implication under that order.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

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.

The Coast Guard has 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 regulation and concluded that, under figure 2-1, paragraph (34)(g) of Commandant Instruction M16475.1C, it is categorically excluded from further environmental documentation. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under ADDRESSES.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM, and, under 5 U.S.C. 553(d)(3), good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Following the catastrophic nature and extent of damage realized from the aircraft flown into the World Trade Center towers, this rulemaking is urgently necessary to protect the national security interests of the United States against future potential terrorists strikes against public and governmental targets. A similar attack was conducted against the Pentagon on the same day. National security and intelligence officials warn that future terrorist attacks against civilian targets may be anticipated. Publication of a notice of proposed rulemaking and delay of effective date would be contrary to the public interest because immediate action is necessary to protect against the possible loss of life, injury, or damage to property.

On September 11, 2001, both towers of the World Trade Center, New York City, New York, were destroyed as a result of two commercial airliner crashes, an act of terrorism. This regulation establishes a security zone over the waters of Lake Michigan encompassed by a line drawn from the northeast corner of the Central District Filtration Plant, at 41° 53′46″ N, 87° 36′09″ W; then east to the breakwall at 41° 53′46″ N, 87° 35′30″ W; south to 41° 53′20″ N, 87° 35′30″ N; west to 41° 53′20″ N, 87° 36′20″ W; and then following the shoreline back to the point of origin. These coordinates are based upon North American Datum 1983 (NAD 83).

Since this security zone will encompass an already established anchorage area, this anchorage area will be suspended for the duration of this temporary security zone. The anchorage areas are described in 33 CFR 110.205, Chicago Harbor, Illinois. The anchorage areas specified in paragraph (a)(1), Anchorage A, exterior breakwaters and (a)(5), Anchorage E, Chicago Harbor Lock North, will be suspended.

This security zone is necessary to protect the public, the facilities, and the surrounding area from possible acts of sabotage or other subversive acts. All persons and vessels other that those approved by the Captain of the Port Chicago, or his authorized patrol representative, are prohibited from entering or moving within the zone without the prior approval of the Captain of the Port Chicago.

The Captain of the Port Chicago will generally permit those passenger vessels that normally operate from the Navy Pier to regularly transit the area. However, should the Captain of the Port Chicago determine it is appropriate, he will require even those vessels which normally operate from the Navy Pier to request permission before leaving or entering the security zone. The Captain of the Port Chicago may be contacted via VHF Channel 16.

In addition to publication in the Federal Register , the public will be made aware of the existence of this security zone, its exact location within these boundaries, and the restrictions involved, via Broadcast Notice to Mariners.

Pursuant to 33 U.S.C. 1232, any violation of the security zone described herein, is punishable by civil penalties (not to exceed $27,500 per violation, where each day of a continuing violation is a separate violation), criminal penalties (imprisonment for not more than 6 years and a fine of not more than $250,000), in rem liability against the offending vessel, and license sanctions. Any person who violates this regulation, using a dangerous weapon, or who engages in conduct that causes bodily injury or fear of imminent bodily injury to any officer authorized to enforce this regulation, also faces imprisonment up to 12 years (class C felony).

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

The Coast Guard expects the economic impact of this proposal to be so minimal that a full Regulatory Evaluation under paragraph 10 (e) 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 security zone will not have a significant economic impact on a substantial number of small entities for the following reasons. This rule will not obstruct the regular flow of traffic and will allow vessel traffic to pass safely around the security zone. In addition, those passenger vessels that normally operate out of Navy Pier will be permitted to transit the zone. However, should the Captain of the Port Chicago determine it is appropriate, he may require even those vessels which normally operate from the Navy Pier to request permission from his on-scene representative before leaving or entering the security zone. The Captain of the Port Chicago's on-scene representative will be the Patrol Commander. The Captain of the Port Chicago will notify these vessels via Broadcast Notice to Mariners if they must notify the Coast Guard before transiting the security zone.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offer to assist small entities in understanding the rule so that they could better evaluate its effects on them and participate in the rulemaking process. If you are a small entity and you need assistance in how the rule applies to you, please contact the office listed in ADDRESSES in this preamble.

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) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this rule will not result in such expenditure, we do discuss the effects of this rule elsewhere in this preamble.

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.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

We have analyzed this rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

The Coast Guard considered the environmental impact of this rule and concluded that under figure 2-1, paragraph (34)(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)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. This rule is being promulgated without an NPRM due to the short time frame allowed between the submission of the request by the Department of the Army, Rock Island Arsenal and the date of requested closure. The Coast Guard received the request from the Department of the Army, Rock Island Arsenal, on 25 October 2001. Winter conditions on the Upper Mississippi River coupled with the closure of the Army Corps of Engineers' Lock No. 24 (Mile 273.4 UMR) until March 2, 2002 and Lock No. 12 (Mile 556.7) until March 11, 2002, will preclude any significant navigation demands for the drawspan opening .

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 temporary drawbridge operation amendment has been coordinated with the commercial waterway operators. No objections were raised.

On October 25, 2001, the Department of the Army, Rock Island Arsenal requested a temporary change to the operation of the Rock Island Railroad and Highway Drawbridge across the Upper Mississippi River, Mile 482.9 at Rock Island, Illinois. The Department of the Army, Rock Island Arsenal requested that the drawbridge be temporarily closed to navigation in order to perform necessary maintenance and bridge repair during the winter months.

The Rock Island Railroad and Highway Drawbridge has a vertical clearance of 23.8 feet above normal pool in the closed-to-navigation position. Navigation on the waterway consists primarily of commercial tows and recreational watercraft. Presently, the draw opens on signal for passage of river traffic. The Department of the Army, Rock Island Arsenal requested the drawbridge be permitted to remain closed-to-navigation from 8 a.m., December 19, 2001, until 8 a.m., March 11, 2002. Winter conditions on the Upper Mississippi River coupled with the closure of the Army Corps of Engineers' Lock No. 24 (Mile 273.4 UMR) until March 2, 2002 and Lock No. 12 (Mile 556.7) until March 11, 2002, will preclude any significant navigation demands for the drawspan opening. The Rock Island Railroad and Highway Drawbridge, Mile 482.9 Upper Mississippi River, is located upstream from Lock 24. Performing maintenance on the bridge during the winter months when no vessels are impacted is preferred to bridge closures or advance notification requirements during the commercial navigation season. This temporary drawbridge operation amendment has been coordinated with the commercial waterway operators. No objections were raised.

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, 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 the temporary rule to be so minimal that a full Regulatory Evaluation under paragraph 10(e) of the regulatory policies and procedures of DOT is unnecessary. This is because river traffic will be extremely limited by lock closures and ice during this period.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have 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.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), we offered to assist small entities in understanding the rule so that they can better evaluate its effects on them and participate in the rulemaking process. Any individual that qualifies or, believes he or she qualifies as a small entity and requires assistance with the provisions of this rule, may contact Mr. Roger K. Wiebusch, Bridge Administrator, Eighth Coast Guard District, Bridge Branch, at (314) 539-3900, extension 378.

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

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this rule under that Order and have determined that this rule does not have implications for federalism.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector or $100,000,000 or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not affect 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.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

We have analyzed this rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

We have considered the environmental impact of this rule and concluded that under figure 2-1, paragraph (32)(e), of Commandant Instruction M16475.1 (series), this rule is categorically excluded from further environmental documentation. Promulgation of changes to drawbridge regulations has been found not to have significant effects on the human environment. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under ADDRESSES.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation and the rule takes effect immediately. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. Immediate action is necessary to ensure the safety and security of the public, naval vessels moored at Naval Station Norfolk, and the commercial shipping industry in Hampton Roads, VA. There have been recent reports, all a matter of public record, that indicate a continuing high risk of terrorist activity in the United States. Based on these reports, the Fifth Coast Guard District Commander has determined a heightened security condition in the Port of Hampton Roads is required. Delay in implementing these changes, therefore, would be contrary to the public interest.

For similar reasons, under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this temporary rule effective less than 30 days after publication in the Federal Register .

This temporary rule is necessary for the District Commander to reduce the potential threat to the Port of Hampton Roads, VA and surrounding waterways. The Coast Guard, as lead federal agency for maritime homeland security, must have the means to be aware of, deter, detect, intercept, and respond to asymmetric threats, acts of aggression, and attacks by terrorists on the American homeland while at the same time maintaining our freedoms and sustaining the flow of commerce. The Coast Guard implements Limited Access Areas, listed in 33 CFR part 165, in order to control vessel movements within Captain of the Port Zones. A Regulated Navigation Area is a type of Limited Access Area that may be used to control vessel traffic by specifying times of vessel entry, movement, or departure to, from, within, or through ports, harbors or other waters. The temporary rule the District Commander has established by this rulemaking allows for differentiation between lawful and unlawful maritime activities without unreasonably disrupting the free flow of commerce.

The District Commander has created a series of validation procedures to identify legitimate users of the Port of Hampton Roads. Validation procedures for vessels in excess of 300 GT, including tug and barge combinations in excess of 300 gross tons combined, include the following:

1. Vessels must check in with the Captain of the Port or his representative at least 30 minutes prior to entry to obtain permission to transit the Regulated Navigation Area.

2. Upon authorization and approval by the Captain of the Port or his representative, the vessel may enter the Regulated Navigation Area.

3. All vessels that receive permission to enter the Regulated Navigation Area remain subject to a Coast Guard port security boarding.

4. Thirty (30) minutes prior to getting underway, vessels departing or moving within the Regulated Navigation Area must contact the Captain of the Port or his representative via VHF-FM channel 13 or 16, call (757) 444-5209/5210, or call (757) 441-3298 for the Captain of the Port Command Duty Officer.

This temporary final rule is not a significant regulatory action under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. It has not been reviewed by the Office of Management and Budget under that Order. It is not significant under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040, February 26, 1979). This temporary final rule will affect only those vessels in excess of 300 GT that enter and depart the Port of Hampton Roads and it is implemented for a limited duration. Therefore, we expect the economic impact of this temporary final rule to be so minimal that a full Regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this temporary rule will not have a significant economic impact on a substantial number of small entities. This temporary rule will affect only the following entities, some of which may be small entities: owners and operators of commercial vessels larger than 300 gross tons intending to transit or anchor in the Regulated Navigation Area. Because the number of small entities owning/operating commercial vessels of this size is not substantial, the rule is for a limited duration, and there is little anticipation of delay when requesting entry into the Area, the economic impact of this temporary rule should be minimal.

If, however, you believe that your business or organization qualifies as a small entity and that this temporary rule will have a significant economic impact on your business or organization, please submit a comment (see ADDRESSES ) explaining why you believe it qualifies and in what way and to what degree this temporary rule will economically affect it.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), we offer 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 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 temporary rule does not provide for a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this temporary rule under that Order and have determined that it does not have implications for federalism.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this temporary rule will not result in such expenditure, we do discuss the effects of this temporary rule elsewhere in this preamble.

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

This temporary rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

We have analyzed this temporary rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

The Coast Guard considered the environmental impact of this temporary final rule and concluded that under figure 2-1, paragraph (34)(g) of Commandant Instruction M16475.1C, this temporary final rule is categorically excluded from further environmental documentation. This temporary rule seeks to modify a well-established Regulated Navigation Area, and will be in effect for 6 months. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under ADDRESSES .

Section 802 of the National Parks Omnibus Management Act, Pub. L. 105-391 (Section 802), authorizes NPS to grant leases for the use of buildings and associated property located within areas of the national park system to persons and governmental entities under certain conditions. This new leasing authority supplements existing NPS leasing authority concerning historic properties set forth in 16 U.S.C. 470h-3 and implemented in 36 CFR part 18. This amendment of 36 CFR part 18 combines in one regulation the leasing authority provided by Section 802 with the leasing authority provided by 16 U.S.C. 470h-3. In general, this rule permits NPS to lease buildings, lands associated with such buildings, and, historic land located within the boundaries of park areas. It does not permit the leasing of non-historic land.

This amendment of 36 CFR part 18 achieves simplification of the NPS historic leasing process as also called for by Section 802 and expands the scope of NPS leasing authority to all eligible properties. NPS also has authority to lease certain property located within units of the national park system under 16 U.S.C. 460l-22(a). This authority is implemented by NPS in 36 CFR part 17 which remains unchanged by the amended 36 CFR part 18. Eight public comments were received in response to the proposed rule. Several changes were made in response to them. In addition, the final rule contains a number of editorial changes and clarifications.

The following discussion describes the general content of each section of the final regulation. Public comments on these sections are also addressed as appropriate.

Authority and Purposes. Section 18.1 describes the authority for the rule. The basic authority is 16 U.S.C. 1 et seq. , (the National Park Service Organic Act), particularly 16 U.S.C. 1a-2(k) (the general NPS leasing authority contained in section 802 of Pub. L. 105-391), and 16 U.S.C. 470h-3 (government-wide leasing authority applicable to historic properties). NPS has included a “grandfather” provision in this section of the final regulation to permit the execution of proposed leases that were solicited under 36 CFR part 18 prior to the effective date of this part. In response to comments, NPS has clarified the particular categories of NPS property to which this part applies. In addition, NPS notes that although this part is couched in terms of leasing particular properties, nothing in this part precludes NPS from leasing a number of properties in a combined solicitation or from engaging management companies (where otherwise authorized) to assist in implementing an appropriate overall park area leasing program in accordance with the terms of this part.

Section 18.2 defines the terms used in the proposed rule. NPS has clarified the definition of “associated property” in the final regulation to make clear that associated property may relate to one or more buildings. NPS has also clarified the definition of “fair market value” by making clear that the particular terms and conditions of the lease being offered are to be taken into account in determining the fair market value of the lease. Finally, NPS has clarified the definitions of property types as used in the regulation and added a definition of non-historic property as a clarification. A comment asked whether a limited liability company qualifies as a “person” for purposes of this part. It does. A comment suggested that the definition historic property be expanded to include properties determined historic by state or local governments. NPS notes that the definition used is statutory and, in any event, includes properties of state or local significance listed in the National Register of Historic Places.

Section 18.3 describes the types of property that NPS may lease under this part. In general, this part applies to leases of both historic and non-historic property located within the boundaries of park areas. However, Section 18.3(b) makes clear that non-historic land, i.e., vacant land that is not located within the boundaries of an historic district, may not be leased under this part. This is because of the express limitations on the types of property that may be leased under the authorities for this part. However, certain types of vacant land located in eligible units of the national park system may be leased under 36 CFR part 17.

Section 18.4 describes the types of determinations NPS must make before it may lease property under this part. Before leasing property under this part, NPS must determine that the lease: (1) Will not result in degradation of the purposes and values of the park area; (2) will not deprive the park area of property necessary for appropriate park protection, interpretation, visitor enjoyment, or administration of the park area; (3) contains such terms and conditions as will assure the leased property will be used for an activity and in a manner that is consistent with the purposes established by law for the park area in which the property is located; (4) is compatible with the programs of the National Park Service; (5) is for rent at least equal to the fair market value rent of the leased property as described in Section 18.5; (6) does not authorize activities that are subject to authorization through a concession contract, commercial use authorization or similar instrument; and (7), if the lease is to include historic property, that the lease will adequately insure the preservation of the historic property.

With respect to the first determination, NPS considers the term “degradation” of park area purposes and values (a term which tracks the provisions of Section 802) to provide the same protective standard as the terms “derogation” and “impairment” of park area resources as used in other NPS authorities.

A comment suggested that distinctions be made between the types of determinations necessary for “big” leases and “small” leases. However, NPS considers that the determinations required by this section are necessary for all leases, noting that a “small” lease” may have a significant impact on park area resources.

Section 18.5 describes the rent NPS must receive for property leased under this part. The rent must be at fair market value, determined after taking into account any restrictions NPS may place on the use of the leased property and any requirements for rehabilitation and maintenance of the leased property. The final regulation has been clarified in this respect. Comments suggested that consideration of year round occupancy, educational or governmental purposes be taken into account when determining fair market value rent. The regulation, however, does not preclude consideration of any relevant factor in determining fair market value. Another comment suggested that the regulation should provide authority for NPS to waive the fair market value rent requirement. NPS does not consider that this is within its leasing authority or otherwise appropriate. However, in response to a comment, NPS notes that cooperative agreements with non-profit organizations otherwise authorized by law may provide for assignment of government property to the cooperator without requiring the payment of fair market value rent. Such agreements are outside the scope of this regulation. A comment asked for examples as to the types of restrictions on use of the property that may reduce its fair market value. Examples are where NPS may not permit a property to be used for industrial purposes or may require that a property be used for educational purposes in the circumstances of a particular park area.

Section 18.6(a) describes the types of uses that are permissible for property leased under this part. In general, leased property may be used for any lawful purpose subject to the determinations called for in Section 18.4. These uses may include, among others, office or other commercial uses. Innovative uses that are consistent with the requirements of this part are encouraged. Section 18.6(b) states that a lease issued under this part may not authorize the lessee to engage in activities that are subject to authorization through a concession contract, commercial use authorization or similar instrument. Proposed lease activities are subject to authorization under a concession contract if the Director determines in accordance with 36 CFR part 51 and park area planning documents and related guidelines and policies that the proposed activities meet applicable requirements for issuance of a concession contract. Proposed activities are subject to authorization under a commercial use authorization if the Director determines in accordance with park area planning documents and related guidelines and policies that the proposed activities meet applicable requirements for issuance of a commercial use authorization.

Section 18.7 describes the procedures for leasing property through a public bid process. The bid process may only be used if the amount of rent is the sole criterion for award of a lease. The bid process calls for public notice of the lease opportunity, submission of offers on a date certain, and a public bid opening and selection by NPS. One comment suggested that award of leases under a bid system should be eliminated and another suggested an informal process that does not require publication or the submission of bids. NPS considers that the public bidding procedures of this section are appropriate. Another comment suggested that the bid system should not be used to lease historic property. NPS considers that the bid process will not be not frequently utilized. However, it wishes to retain the flexibility to do so in appropriate circumstances. For example, short-term leases of historic farmland for agricultural purposes may most efficiently be awarded through the bid process. Another comment in effect asked for further guidance on how general federal historic preservation requirements and procedures (e.g., 36 CFR part 800) apply to the leasing of historic property under this part. This is a subject that is beyond the scope of these regulations. However, 36 CFR part 800 discusses these matters in detail. NPS, in response to a comment, has added a financial capability determination as a request for bids requirement.

Section 18.8 describes the procedures for leasing property through a proposal solicitation process. In general, the proposal solicitation process calls for public issuance of a Request for Proposals (“RFP”) that describes the leasing opportunity and the criteria for selection. After submission of proposals, NPS will select the best proposal upon application of established selection criteria. These include the compatibility of the proposal to the park area and its visitors, the experience and financial capability of the offeror, and the ability and commitment of the offeror to conduct its activities in an environmentally enhancing manner.

One comment suggested that the publication period for the solicitation should be reduced to thirty days. However, the regulation permits the sixty-day publication period to be shortened in appropriate circumstances. Another comment suggested that the rent offered be a separate selection factor. NPS does not consider this to be appropriate and that it would difficult to administer. A comment suggested that the “tie-breaker” standard contained in Section 18.8(f) be eliminated. NPS has changed the “tie-breaker” standard to a more general determination as to which proposal is the most beneficial on an overall basis. A comment also suggested that the regulations include a “best and final offer” provision. NPS, however, considers that the process described for proposal amendment is efficient and provides to the extent appropriate an equivalent of a “best and final offer” procedure in the event that two or more proposals are considered as substantially equal. A comment suggested that the “specified” period of time for negotiation of a final lease be changed so as to allow an unlimited period for negotiation, subject to termination by NPS. NPS considers that requiring a specified negotiation period (which is subject to extension by NPS) is a more effective means to conclude the negotiation in a timely manner. Another comment suggested that the regulation reference the ability of NPS to enter into exclusive negotiating agreements with the successful offeror. NPS has included reference to such agreements in Section 18.8(d) in the form of a letter of intent to negotiate.

Section 18.9 permits NPS to lease property to non-profit organizations and governmental units without competitive procedures if NPS determines that the non-profit or governmental use of the property will contribute to the purposes and programs of the park area. This is a clarification of the proposed regulation that stated that such leases could be entered into when it is in the public interest to do so. NPS considers this authority necessary for appropriate implementation and integration of park area management and leasing program objectives.

A comment suggested that the authority for non-competitive award of leases should only apply when no proposals were received in response to a competitive solicitation. NPS considers this limitation too restrictive in light of NPS program needs and objectives. Another comment suggested that there should be authority to award leases non-competitively with private property owners. NPS, however, does not consider this to be consistent with its general policy of competitive leasing procedures. A comment misunderstood this section as permitting receipt of less than fair market value rent and suggested that “small” leases should be awarded through informal processes. Fair market value rent is required under this section. NPS considers that the formal leasing processes required by this part are necessary for effective implementation of NPS authorities.

Section 18.10 describes the term of leases to be granted under the authority of this part. The term is to be no more than 60 years. Several comments suggested a longer-term limitation or no limitation at all. However, it has been the experience of NPS that a lease term of sixty years (or less) is sufficient for investment purposes (the maximum sixty year term permits two thirty year mortgage periods) and that a transaction that is seen to need a longer term to be successful is not likely to viable in the first instance. NPS notes the provisions of Title IV of the National Parks Omnibus Management Act of 1998 that limits the term of concession contracts to twenty years (reduced from thirty years under prior legislation) and which states that concession contracts should be for the shortest possible term. NPS considers that this statement of Congressional policy is equally applicable to leases. Another comment suggested specific terms for leases for historic property. NPS does not consider the inclusion of specific terms to be appropriate as the property's historic character will be taken into account when determining the lease term. Other comments suggested that NPS should have the authority to extend leases. However, NPS in general considers extensions to be anti-competitive and that they may result in leases that extend beyond any reasonable period of time to the detriment of the government. NPS, however, has added language to the final regulation that permits leases to be extended for up to one year if required by circumstances beyond the control of NPS. This is consistent with similar provisions contained in the concession contracting provisions of Title IV of the National Parks Omnibus Management Act of 1998 that permit short term extensions of concession contracts in limited circumstances.

Section 18.11 describes the general terms and conditions that a lease granted under authority of this part must contain. These include provisions that assure use of the property in a manner consistent with the purposes of the applicable park area, and, if applicable, the preservation of historic property that may be leased.

Section 18.12 describes a number of specific terms and conditions that a lease granted under the authority of this part must contain. These include a termination for cause provision, a clause requiring the lessee to maintain the leased property, provisions regarding the use of the leased property, and, provisions that state that any improvements a lessee may make may only be undertaken with the approval of NPS. 18.12(c). A comment suggested that Section 18.12(c) should be amended to delete the mandatory reference to subleases with respect to financial capability determinations. NPS does not agree with this suggestion as sublessees are, as a practical matter, the lessee of a specified portion of the leased property and therefore should be financially capable to carry out applicable terms of the lease.

18.12(d). NPS deleted reference to the disposition of insurance proceeds in this section. The terms of specific leases will address this subject. It also deleted specific reference to replacement cost insurance in response to a comment.

18.12(g). A comment suggested that fees NPS may collect from lessees for services provided by NPS be referenced in this section. NPS, however, does not consider that reference to such fees is appropriate as such fees, if any, are variable and implemented on a park by basis. Another comment suggested that Section 18.12(g) be amended to delete the reference to lease termination with respect to compensation for improvements. NPS deleted this provision in its entirety from the regulation as unnecessary in light of general legal limitations on the authority of NPS to contractually obligate the expenditure of unappropriated funds.

18.12(h). The provisions regarding lease extensions and renewal rights have been deleted from this subsection as redundant. A comment suggested that the reference in this subsection to the sovereign authority of the government to cancel leases may preclude a lender from obtaining a reinstated lease in the event of foreclosure and thus make the lease unfinancable. However, this subsection does not preclude this right in the event of lease foreclosure.

18.12(i). A comment suggested that leases should permit new construction in park areas. NPS considers that the terms of this subsection, which do permit new construction in park areas in limited circumstances, are necessary in order to avoid impairment of park area resources and values.

18.2(m). A comment suggested modifying the term “obligations” in this subsection by the term “monetary.” However, this “subject to availability of appropriated funds” clause is a standard provision contained in government contracts.

Section 18.13 describes the information collection requirements of the rule. A comment suggested that 40 hours for preparing a large lease proposals seems low. NPS notes that the time estimates are averages only.

The primary authors of this rule are the members of a task force comprised of NPS officials involved in the leasing of national park system properties.

This rule is a significant rule within the meaning of Executive Order 12866 because of novel policy issues.

a. This rule will not have an annual economic effect of $100 million or more or adversely affect an economic sector, productivity, jobs, the environment or other units of government. The rule imposes no obligations on any entity except for persons that may seek to be awarded an NPS lease. It does not apply to existing NPS leases.

b. This rule will not create inconsistencies with other agencies' actions as it only applies to the National Park Service.

c. This rule will not materially affect entitlements, grants, user fees, loan programs, or the rights and obligations of their recipients. The rule only prescribes policies and procedures for leasing lands of the national park system.

d. This rule raises novel policy issues as it prescribes new policies and procedures for leasing lands of the national park system in accordance with the requirements of Section 802 of Public Law 105-319 and 16 U.S.C. 470h-3.

This rule is not subject to the Regulatory Flexibility Act as it is not required to be published for comment before adoption by 5 U.S.C. 553 or other law. NPS solicited public comment on this proposed rule as a matter of policy. The Department of the Interior also considers that the final rule will not have a significant effect on a substantial number of small entities as defined under the Regulatory Flexibility Act (5 U.S.C 601 et seq. ). NPS anticipates that less than one hundred leases a year will be awarded under this authority. In addition, the rule is only applicable to prospective lessees. It has no effect on existing NPS leases.

This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Fairness Enforcement Act. This rule does not have an annual effect on the economy of $100 million or more; will not cause a major increase in costs or prices for consumers, individual entities, Federal, State, or local government agencies, or geographic regions; and does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises. The primary effect of the proposed rule is to establish policies and procedures for the granting of leases of certain property located within areas of the national park system. Potential lessees will only submit lease proposals if the effects are positive.

In accordance with Executive Order 12630, this rule does not have significant takings implications as this rule does not apply to private property. A takings assessment is not required.

In accordance with Executive Order 13132, this rule does not have sufficient federalism implications to warrant the preparation of a federalism assessment. The rule imposes no requirements on any governmental entity other than NPS.

In accordance with Executive Order 12988, the Office of the Solicitor has determined that this rule does not unduly burden the judicial system and does not meet the requirements of sections 3(a) and 3(b)(2) of the Order.

This rule (NPS Leasing Regulations—36 CFR part 18) requires an information collection from ten or more parties so a submission under the Paperwork Reduction Act was required. OMB has approved the information collection requirements of this part. OMB Control No. 1024-0223, expiration date 01/31/2004. The information collection requirements of this rule are for the purpose of awarding and administering NPS leases. A federal agency 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.

Six categories of information collection are contained in the rule: Section 18.7 (Request for Bids); Section 18.8 (Requests for Qualifications/Proposals); Section 18.12(c) (Subletting and Assignment of Leases); Section 18.12(i)-(j) (Approval of Lessee Construction/Demolition); Section 18.12(l) (Approval of Lessee Encumbrances); and Section 18.12(k) (Amendment of Leases). NPS will use the information collected to make administrative decisions with respect to these six categories. The respondents to these collections will be NPS lessees and prospective NPS lessees. NPS anticipates that there will be a total of approximately six hundred respondents per year with respect to Sections 18.7 and 18.8 and a total of approximately twenty-seven respondents per year with respect to the other information collection categories. NPS estimates that the total annual reporting and recordkeeping burden that will result from these collections of information will be 4392 hours, as set forth in the following chart.

Please send comments regarding this burden or estimate or any other aspect of this collection of information, including suggestions for reducing the burden, to the Desk Officer for the Interior Department, Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20503 (with a copy to the Information Collection Officer, National Park Service, 1849 C Street, Washington, DC 20240. information technology).

This rule does not constitute a major federal action affecting the quality of the human environment. A detailed statement under the National Environment Policy Act is not required. The rule will not increase public use of park areas, introduce noncompatible uses into park areas, conflict with adjacent land ownerships or land uses, or cause a nuisance to property owners or occupants adjacent to park areas. Accordingly, this rule is categorically excluded from procedural requirements of the National Environmental Policy Act by 516 DM 6, App. 7.4A(10).

Executive Order 12866 requires federal agencies to write regulations that are easy to understand. Comment is invited on how to make this rule easier to understand, including answers to the following questions: (1) Are the requirements in the rule clearly stated?; (2) Does the rule contain undefined technical language or jargon that interferes with its clarity?; (3) Does the format of the rule (groupings and order of sections, use of headings, paragraphing, etc.) aid in or reduce its clarity?; (4) Would the rule be easier to understand if it were divided into more but shorter sections?; (5) Is the description of the rule in the Supplementary Information section of the preamble helpful in understanding the proposed rule?; (6) What else could be done to make the rule easier to understand? Please send a copy of any comments that concern how this rule could be made easier to understand to: Office of Regulatory Affairs, Department of the Interior, Room 7229, 1849 C Street NW, Washington, DC 20240.

The Philippine Islands achieved independence from the United States in 1946. The Philippines was still a commonwealth of the United States when America entered World War II, and President Roosevelt ordered many Filipinos into service. In the years that followed, a variety of VA benefits were provided to Filipinos based on service in different military units. One long-standing provision, 38 U.S.C. 107, gave certain Filipino veterans certain VA benefits at half the rate paid to United States veterans.

On October 27, 2000, the President signed into law the Departments of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 2001, Pub. L. 106-377, 114 Stat. 1441. Section 501 of Pub. L. 106-377 amended 38 U.S.C. 107 to provide full-rate payments of benefits for Filipino veterans who had “[s]ervice before July 1, 1946, in the organized military forces of the Government of the Commonwealth of the Philippines, while such forces were in the service of the Armed Forces of the United States under the military order of the President dated July 26, 1941, including among such military forces organized guerrilla forces under commanders appointed, designated, or subsequently recognized by the Commander in Chief, Southwest Pacific Area, or other competent authority in the Army of the United States. * * *” In order to be entitled to full-dollar rate benefits, Pub. L. 106-377 requires that the veteran be “residing in the United States” and also be either a U.S. citizen or an alien lawfully admitted for permanent residence in the U.S. To implement this new law, this document adds new §§ 3.42 and 3.43 to 38 CFR, redesignates §§ 3.8 and 3.9 as §§ 3.40 and 3.41, respectively, and amends § 3.40.

By increasing compensation to Filipino veterans residing in the U.S., Congress indicated its recognition that Filipino veterans residing in the U.S. have a higher cost of living than Filipino veterans living in the Philippines. However, Congress did not intend to create a windfall for Filipino veterans who do not actually face the higher cost of living in the U.S. In order to avoid that potential result, Congress required that Filipino veterans be residing in the U.S. and either be citizens of the U.S. or aliens lawfully admitted for permanent residence in the U.S.

Although Congress did not define the term “residing in the United States” in Pub. L. 106-377, we believe Congress intended that VA pay Filipino veterans the full-dollar rate for compensation only while they are actually residing in the U.S. We are therefore defining the term to require that the veteran's principal, actual dwelling place must be in the U.S. We have used simple, objective criteria for determining whether a veteran meets that definition: requiring that the veteran be present in the U.S. for at least the majority of each calendar year, beginning with the calendar year in which he or she applies for the full-dollar rate, and continuing in each year in which the veteran receives full-dollar rate benefits; and that the veteran not be absent from the U.S. for more than 60 consecutive days. If a veteran is absent from the U.S. for longer than these periods, it is reasonable to conclude that he or she is not residing in the U.S. In addition, this definition will be understandable to veterans and readily applied by VA employees. This rule will also allow veterans reasonable periods to travel outside of the U.S. for business or personal reasons without having their benefits reduced.

Congress did not define “United States” in Pub. L. 106-377, but we believe that Congress intended to more adequately compensate Filipino veterans for the cost-of-living in the states, territories and possessions of the United States, the District of Columbia, and the Commonwealth of Puerto Rico. Therefore, this rule specifically references the states, territories and possessions of the United States, the District of Columbia, and the Commonwealth of Puerto Rico.

Congress did not define the terms “citizen” of the U.S. and ”lawfully admitted for permanent residence” in Pub. L. 106-377. However, these terms are well defined by existing federal immigration and naturalization laws found in title 8, United States Code, and we believe that Congress intended for the terms to have the same meaning. Therefore, we are defining “citizen” of the U.S. to mean any individual who acquires U.S. citizenship through birth in the territorial U.S., birth abroad as provided under title 8, United States Code, or through naturalization, and has not renounced his or her U.S. citizenship, or had such citizenship cancelled, revoked, or otherwise terminated. We are defining “lawfully admitted for permanent residence” to mean lawfully accorded the privilege of residing permanently in the United States as an immigrant in accordance with title 8, United States Code, such status not having changed.

VA has an obligation to ensure that veterans receiving full-dollar rate benefits meet the residency and citizenship/permanent-resident-alien requirements in the law. As proof that the veteran is residing in the U.S., this rule requires satisfactory evidence (which may include, for example, a driver's license, lease agreement, or utility bills) that he or she is residing at a valid street address in the U.S. and receiving mail at that address. Furthermore, this rule provides that VA will not pay benefits at the full rate if the veteran's mailing address is a Post Office box, unless evidence from the U.S. Postal Service shows that it does not deliver mail to the veteran's street address. We believe these provisions will help ensure program integrity and reduce the possibility of fraud.

This rule states that a valid original or copy of one of the following documents is required to prove that a veteran is a natural born citizen of the U.S.:

A valid U.S. passport;

• A birth certificate showing that he or she was born in the U.S.; or

• A Report of Birth Abroad of a Citizen of the U.S. issued by a U.S. consulate abroad.

We believe this is a reasonable requirement, since these documents are standardized, reliable means of proving an individual's U.S. citizenship. A U.S. passport is issued only to individuals who have provided acceptable proof of U.S. citizenship to the U.S. Department of State. One of the latter two documents listed above are generally issued at birth.

The U.S. Immigration and Naturalization Service (INS) is the federal agency responsible for granting naturalized citizen status and keeping records on such status. Therefore, this rule states that only verification of that status by INS to VA will be sufficient proof for purposes of eligibility for full-dollar rate benefits.

INS documents all aliens who receive permanent-resident-alien status in the U.S. Therefore, this rule requires that, in order to establish status as a permanent resident alien for purposes of receiving compensation at the full-dollar rate, only verification of that status by INS to VA will be sufficient proof for purposes of eligibility for full-dollar rate benefits.

We believe that Congress intended that Filipino veterans receive an increased rate of benefit payment due to the relatively high cost-of-living in the U.S., if the U.S. is their principal, actual dwelling place. Therefore, we believe it is reasonable to establish limits on how long a veteran may be absent from the U.S. but yet continue to receive benefits at the full-dollar rate. Under this rule, in order to continue receiving benefits at the full-dollar rate under this section, a veteran must be physically present in the U.S. for at least 183 days of each calendar year in which he or she receives payments at the full-dollar rate, and may not be absent from the U.S. for more than 60 consecutive days at a time. If a veteran is absent from the U.S. for longer than these periods, it is reasonable to conclude that the U.S. is not his or her principal, actual dwelling place. However, if a veteran becomes eligible for full-dollar rate benefits on an initial basis, on or after July 1 of any calendar year, the 183-day rule will not apply during that calendar year. Further, VA will not consider a veteran to have been absent from the U.S. if he or she left and returned to the U.S. on the same date. To ensure program integrity, we have included in this rule a requirement that a veteran receiving full-dollar rate benefits must notify VA within 30 days of leaving the U.S.

Also to ensure program integrity, we are requiring that a Filipino veteran receiving benefits at the full-dollar rate must notify VA within 30 days if he or she loses his or her U.S. citizenship or lawful-permanent-resident-alien status. This rule also states that, when a veteran no longer meets the citizenship/ permanent-resident-alien eligibility requirements, VA will reduce his or her payment to the rate of $0.50 for each dollar authorized under the law.

These requirements will be understandable to veterans and readily applied by VA employees. This rule will also allow veterans reasonable periods to travel outside of the U.S. for business or personal reasons without having their benefits reduced.

In addition, this rule states that a veteran receiving full-dollar rate benefits must provide VA with satisfactory evidence that he or she continues to meet the residency and citizenship/naturalization requirements, whenever VA requests such evidence. This rule incorporates 38 CFR 3.652, which contains VA's procedure for requesting proof of continued eligibility and reducing a benefits award if it is not submitted in a timely manner. Section 3.652 states that VA beneficiaries must provide VA with proof, when requested, that any or all of the eligibility factors which established entitlement continue to exist. This rule specifically restates that requirement and the requirement that VA advise the veteran at the time of the request that the proof must be furnished within 60 days and that failure to do so will result in the reduction of benefits under § 3.652. We believe these concepts from § 3.652 are fair, reasonable and efficient.

To further ensure program integrity, a veteran receiving benefits at the full-dollar rate under this section must notify VA promptly if the veteran changes his or her address. For the same reason, if mail from VA to the veteran is returned as undeliverable, VA will attempt to verify a more current address. If this attempt at verification proves unsuccessful, VA will reduce his or her payment to the rate of $0.50 for each dollar authorized under law. We believe this is necessary, since such returned mail may indicate that the veteran no longer resides at the address that was the basis for his or her entitlement to the full-dollar rate benefits.

We are adding a new § 3.405 containing the effective date rules for the full-dollar rate benefit. Section 501(a) of Pub. L. 106-377 states that the amendments allowing full-dollar rate benefits for certain Filipino veterans “shall take effect on the date of the enactment of this Act and shall apply to benefits paid for months beginning on or after that date.” In order to be consistent with congressional intent, for veterans who met the eligibility requirements in § 3.42 on October 27, 2000, and maintained such eligibility continuously from that date to the date of an administrative determination of entitlement, the effective date of awards of compensation at the full-dollar rate will be October 27, 2000. For all other veterans, awards of compensation for Filipino veterans under § 3.42 will be effective on the latest of the following dates, which are consistent with existing effective date rules:

• Date entitlement arose;

• Date on which the veteran first met the residency and citizenship/ permanent-resident-alien status requirements in § 3.42, if VA receives evidence of this within 1 year of that date;

• Effective date of the rating establishing service connection, provided VA receives evidence that the veteran meets the residency and citizenship/permanent-resident-alien status requirements in § 3.42 within 1 year of notification of such rating action.

• Date the veteran returned to the U.S. after absence of more than 60 consecutive days.

• First day of the year following the year in which the veteran was absent from the U.S. for a total of 183 days or more, or the first day after that date that the veteran returns to the U.S.

As stated above, Pub. L. 106-377 does not address the issue of effective dates for the new full-dollar rate payments, so we will apply existing effective date regulations. We believe this is consistent with congressional intent, and that application of existing rules will avoid unnecessarily complicating the adjudication process.

This rule also gives VA authority to verify continued eligibility for full-dollar rate payments. If VA requests information for this purpose, and the veteran does not provide it within 60 days, the eligibility factor(s) for which certification was requested will, pursuant to § 3.652(a), be considered to have ceased to exist as of the end of the month in which it was last shown by the evidence of record to have existed. Under § 3.652(b), if the required certification is submitted to VA after benefits have been reduced, the benefits will be adjusted in accordance with the facts found. We believe the general rules provided in § 3.652 are fair and easy to administer. Accordingly, we will rely on them in cases of increased rate payments under Pub. L. 106-377; this rule provides that reductions for failure to verify continued eligibility will be as provided in § 3.652.

Under this rule, when a veteran no longer meets the residence or citizenship/permanent-resident-alien eligibility requirements of Pub. L. 106-377, VA will reduce his or her payment to the rate of $0.50 for each dollar authorized under the law, effective on the date determined under new § 3.505, discussed below. The rule also states that, if mail from VA to the veteran is returned as undeliverable, VA will reduce his or her payment to the rate of $0.50 for each dollar authorized under law, effective on the date determined under § 3.505.

We are adding a new § 3.505 to state that if a veteran receiving benefits at the full-dollar rate under § 3.42 is physically absent from the U.S. for a total of 183 days or more during any calendar year, VA will reduce the payment of any compensation to the rate of $0.50 for each dollar authorized under the law, effective on the 183rd day of absence from the U.S. In addition, it states that, if a veteran receiving benefits at the full-dollar rate under § 3.42 is physically absent from the U.S. for more than 60 consecutive days, VA will reduce his or her compensation to the rate of $0.50 for each dollar authorized under the law, effective on the 61st day of the absence. It further states that a veteran receiving benefits at the full-dollar rate under § 3.42 loses either U.S. citizenship or status as an alien lawfully admitted for permanent residence in the U.S., VA will reduce the compensation to the rate of $0.50 for each dollar authorized under the law, effective on the day he or she no longer satisfies one of these criteria. Finally, it also states that if mail to a veteran receiving benefits at the full-dollar rate under § 3.42 is returned to VA as undeliverable, VA will reduce his or her payment to the rate of $0.50 for each dollar authorized under law, effective on the date of the last payment of compensation benefits.

Under this rule, if a veteran who stopped meeting the residency or citizenship/permanent-resident-alien requirements in Pub. L. 106-377 again meets these requirements, and provides VA with proof of this, VA will restore the veteran's full-dollar rate benefits, effective the date the veteran meets the eligibility requirements in 3.42. However, such increased payments will be retroactive no more than one year prior to the date on which VA receives evidence that he or she meets the requirements again. These rules are consistent with VA's existing effective date regulations. If a veteran's payments are reduced based on an absence from the U.S. of 183 or more days during a calendar year, under no circumstances will VA resume payments at the full-dollar rate before the beginning of the following calendar year. This is consistent with what we believe is Congress' intent that these higher payments be paid only to veterans whose principal, actual dwelling place is in the U.S.

On November 1, 2000, the President signed into law the Veterans Benefits and Health Care Improvement Act of 2000, Pub. L. 106-419, 114 Stat. 1822. Section 332 of Pub. L. 106-419 authorizes VA to pay burial benefits to the survivors of certain Filipino veterans at the full-dollar rate, instead of the half-dollar rate. It includes the same requirements as Pub. L. 106-377 regarding residency and citizenship and also requires that the deceased veteran must have been receiving compensation or have met the disability and income requirements for pension, on the date of his or her death. (Generally, Filipino veterans are not eligible for pension, see 38 U.S.C. 107.) Specifically, with regard to compensation and pension, the veteran must have been receiving compensation under chapter 11 of title 38 or, if the veteran's service had been deemed to be active military, naval, or air service, he or she would have been entitled to pension under 38 U.S.C. 1521 without denial or discontinuance by reason of 38 U.S.C. 1522's net worth restriction. This rule adds a new 38 CFR 3.43 to implement this new law.

Although Congress did not define the term “residing in the United States” in Pub. L. 106-419, we believe that, when Congress enacted Section 332 of Pub. L. 106-419, it intended to more adequately compensate the survivors of Filipino veterans for the cost of burial in the U.S., which is higher than the cost of burial in the Philippines. We believe that, for the purposes of burial benefits, the relevant issues under this statute are whether the deceased veteran was residing in the U.S. on the date of death (regardless of how long he or she was residing in this country) and whether he or she met the citizenship or resident-alien requirements. We believe this standard is consistent with the governing statute, will not impose an undue evidentiary burden on claimants, and will be relatively simple for VA to administer. In addition, VA does not believe Congress intended to exclude from this added benefit the survivors of veterans who resided in the U.S. but happened to die while temporarily out of the U.S., and we have included a sentence to that effect in § 3.43.

Congress did not define “United States,” “citizen of the United States,” or “lawfully admitted for permanent residence” in Section 332 of Pub. L. 106-419. For the reasons stated in the discussion of compensation benefits above, we are defining these terms in a similar manner, but with minor modifications applicable to burial benefits.

VA has an obligation to ensure that claimants receive full-dollar rate benefits only if the deceased veteran met the residency and citizenship/ permanent-resident-alien requirements in the law on the date of death. As proof that the deceased was residing in the U.S., we are requiring that a claimant provide VA with satisfactory evidence (which may include, for example, a driver's license, lease agreement, or utility bills) that the deceased was residing on the date of death at a valid street address in the U.S. We believe these provisions will help ensure program integrity and reduce the possibility of fraud.

For the reasons stated in the discussion of compensation benefits above, this rule states that in claims for full-dollar-rate burial benefits in which the claimant asserts that the deceased veteran was a natural born citizen of the U.S., a valid original or copy of one of the following documents is required:

• A valid U.S. passport;

• A birth certificate showing that he or she was born in the U.S.; or

• A Report of Birth Abroad of a Citizen of the U.S. issued by a U.S. consulate abroad.

For the reasons stated in the discussion of compensation benefits above, this rule states that only verification of naturalized citizen or permanent-resident-alien status by INS to VA will be sufficient proof of such status for purposes of eligibility for full-dollar rate benefits.

We are making this document effective on an emergency basis because there is good cause under the provisions of 5 U.S.C. 553 to publish this interim final rule without regard to prior notice and comment and effective date provisions. Compliance with these provisions would be impracticable, unnecessary, and contrary to the public interest. This interim final rule is necessary to implement legislation that provides additional benefits to disabled Filipino veterans and their survivors, most of whom are elderly. Many of these Filipino veterans, and their survivors, have chronic health problems and financial hardships. Publication of this amendment as an interim final rule will enable VA to immediately provide to these beneficiaries the increased benefits they need in order to better cope with the cost of living in the United States.

On October 27, 2000, the President signed into law the Departments of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 2001, Pub. L. 106-377, 114 Stat. 1441. Section 501 of Pub. L. 106-377 amended 38 U.S.C. 107 to provide full-rate payments of VA compensation benefits for certain Filipino veterans who had “[s]ervice before July 1, 1946, in the organized military forces of the Government of the Commonwealth of the Philippines, while such forces were in the service of the Armed Forces of the United States under the military order of the President dated July 26, 1941, including among such military forces organized guerrilla forces under commanders appointed, designated, or subsequently recognized by the Commander in Chief, Southwest Pacific Area, or other competent authority in the Army of the United States. . . .” Therefore, the provisions of this interim final rule regarding compensation benefits, 38 CFR 3.42, 38 CFR 3.405, and 38 CFR 3.505, apply beginning October 27, 2000.

On November 1, 2000, the President signed into law the Veterans Benefits and Health Care Improvement Act of 2000, Pub. L. 106-419, 114 Stat. 1822. Section 332 of Pub. L. 106-419 authorizes VA to pay burial benefits to the survivors of certain Filipino veterans at the full-dollar rate (instead of the half-dollar rate), if the veteran died after the date of enactment. Therefore, the provision of this interim final rule regarding burial benefits, 38 CFR 3.43, applies when the veteran has died after November 1, 2000.

Proposed 38 CFR 3.42 and 3.43 contain collections of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). Section 3.42 deals with the payment of compensation at the full dollar rate under the provisions of Pub. L. 106-377. Section 3.43 deals with the payment of burial benefits at the full dollar rate under the provisions of Pub. L. 106-419. Accordingly, under section 3507(d) of the Act, VA has submitted a copy of this rulemaking action to OMB for its review of the collections of information.

OMB assigns a control number for each collection of information it approves. VA 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. The collection of information provisions in this document will not be effective until approved by the OMB and assigned an OMB control number.

Comments on the proposed collections of information should be submitted to the Office of Management and Budget, Attention: Desk Officer for the Department of Veterans Affairs, Office of Information and Regulatory Affairs, Washington, DC 20503, with copies mailed or hand-delivered to: Director, Office of Regulations Management (02D), Department of Veterans Affairs, 810 Vermont Ave., NW, Room 1154, Washington, DC 20420. Comments should indicate that they are submitted in response to “RIN 2900-AK65.”

Title: Rate of Compensation Payments for Filipino Veterans Residing in the United States.

Summary of collection of information: In proposed 38 CFR 3.42, VA requests information from certain Filipinos ordered into service during World War II to determine their entitlement to VA compensation at the full-dollar rate.

Description of the need for information and proposed use of information: The information is necessary to determine the entitlement of certain Filipinos ordered into service during World War II to VA compensation at the full-dollar rate.

Description of likely respondents: Estimated number of respondents: 800.

Estimated frequency of responses: 1.

Estimated total annual reporting and record keeping burden: 400 hours.

Estimated annual burden per collection: 30 minutes.

Title: Payment Rate of Burial Benefits for certain Filipino veterans of WWII.

Summary of collection of information: In proposed 38 CFR 3.43, VA requests information from survivors of certain Filipinos ordered into service during World War II to determine their entitlement to VA burial benefits at the full-dollar rate.

Description of the need for information and proposed use of information: The information is necessary to determine the entitlement survivors of certain Filipinos ordered into service during World War II to VA burial benefits at the full-dollar rate.

Description of likely respondents: Estimated number of respondents: 250.

Estimated frequency of responses: 1.

Estimated total annual reporting and record keeping burden: 375 hours.

Estimated annual burden per collection: 90 minutes.

The Department considers comments by the public on proposed collections of information in—

• Evaluating whether the proposed collections of information are necessary for the proper performance of the functions of the Department, including whether the information will have practical utility;

• Evaluating the accuracy of the Department's estimate of the burden of the proposed collections of information, including the validity of the methodology and assumptions used;

• Enhancing the quality, usefulness, and clarity of the information to be collected; and

• Minimizing the burden of the collections of information on those who are to respond, including responses through 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.

OMB is required to make a decision concerning the collections of information contained in this proposed rule between 30 and 60 days after publication of this document in the Federal Register . Therefore, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication. This does not affect the deadline for the public to comment on the proposed rule.

This document has been reviewed by the Office of Management and Budget Under Executive Order 12866.

The Secretary hereby certifies that this regulatory amendment will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612. The reason for this certification is that these amendments would not directly affect any small entities. Only VA beneficiaries could be directly affected. Therefore, under 5 U.S.C. 605(b), these amendments are exempt from the initial and final regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604.

In Title 40 of the Code of Federal Regulations, part 52 (§ § 52.01 to 52.1018), revised as of July 1, 2001, § 52.120 is corrected by removing paragraph (c)(94)(i)(E).

In Title 40 of the Code of Federal Regulations, Parts 72 to 80, revised as of July 1, 2001, § 80.81 is corrected by revising paragraph (a) to read as follows:

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. 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 this table could also be affected. The North American Industrial Classification System (NAICS) codes are provided to assist you and others in determining whether or not this action might apply to certain entities. If you have questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT .

1. Electronically . You may obtain electronic 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/. To access this document, 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/. A frequently updated electronic version of 40 CFR parts 153 and 180 are available at: http://www.access.gpo.gov/nara/cfr/cfrhtml_153/Title_40/40cfr153_00.html and http://www.access.gpo.gov/nara/cfr/cfrhtml_180/Title_40/40cfr180_00.html, a beta site currently under development.

2. In person . The Agency has established an official record for this action under docket control number OPP-301026A. 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 Public Information and Records Integrity Branch (PIRIB), Rm. 119, Crystal Mall #2, 1921 Jefferson Davis Hwy., Arlington, VA, from 8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The PIRIB telephone number is (703) 305-5805.

In the Federal Register of August 2, 2001 (66 FR 40170) (FRL-6598-4), EPA issued a proposal pursuant to section 408 of the FFDCA, 21 U.S.C. 346a as amended by the FQPA (Public Law 104-170) to amend 40 CFR by creating a new subpart E, and to revoke two unlimited tolerance exemptions for the inert ingredient Rhodamine B (CAS Reg. No. 81-88-9). New subpart E will contain a list of the pesticide chemicals (including, as appropriate, their limitations and use patterns) for which the Agency has determined that neither a tolerance nor an exemption from the requirement of a tolerance is needed under the FFDCA. The only chemical included in subpart E at its creation is the inert ingredient Rhodamine B (CAS Reg. No. 81-88-9) when used as a dye for seed treatment. The revocations of the Rhodamine B tolerance exemptions were based on EPA's conclusion that the exemptions are for uses of Rhodamine B that are no longer extant other than the use included in subpart E. Three comments were received in response to the proposed rule.

The comments from both the American Chemistry Council and from Gustafson supported the creation of the new subpart E. Gustafson has also suggested an additional chemical (an active ingredient) that it believes could be appropriately added to the new subpart. The Agency will consider this request, and, if appropriate, initiate such procedures as necessary to add this additional chemical to subpart E. A comment was also received from Boehringer Ingelheim Vetmedica, Inc. (BIVI) informing the Agency that currently there are two animal ear tag products containing Rhodamine B that are being manufactured and distributed. BIVI has agreed to remove the Rhodamine B from their products. To allow time for BIVI to reformulate and then for the ear tags containing Rhodamine B to clear the channels of trade, the Agency will time-limit the Rhodamine B tolerance exemption under 40 CFR 180.1001 (e) to expire in 3 years.

Based on the reasons set forth in the preamble to the proposed rule, and considering the comments received by the Agency in response to the proposed rule, EPA is creating a new subpart E, revoking one unlimited tolerance exemption, and revising one tolerance exemption by time-limiting the exemption to expire in three years.

These regulatory actions are part of the tolerance reassessment requirements of section 408(q) of the FFDCA, as amended by the FQPA of 1996. By law, EPA is required to reassess 66% of the tolerances in existence on August 2, 1996, by August 2002, or about 6,400 tolerances. The regulatory actions in this document, the revocation of two tolerance exemptions, would be counted toward the August 2002 deadline.

Under section 408(g) of the FFDCA, as amended by the FQPA, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. The EPA procedural regulations which govern the submission of objections and requests for hearings appear in 40 CFR part 178. Although the procedures in those regulations require some modification to reflect the amendments made to the FFDCA by the FQPA of 1996, EPA will continue to use those procedures, with appropriate adjustments, until the necessary modifications can be made. The new section 408(g) provides essentially the same process for persons to “object” to a regulation for an exemption from the requirement of a tolerance issued by EPA under new section 408(d), as was provided in the old FFDCA sections 408 and 409. However, the period for filing objections is now 60 days, rather than 30 days.

You must file your objection or request a hearing on this regulation in accordance with the instructions provided in this unit and in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket control number OPP-301026A in the subject line on the first page of your submission. All requests must be in writing, and must be mailed or delivered to the Hearing Clerk on or before February 25, 2002.

1. Filing the request . Your objection must specify the specific provisions in the regulation that you object to, and the grounds for the objections (40 CFR 178.25). If a hearing is requested, the objections must include a statement of the factual issues(s) on which a hearing is requested, the requestor's contentions on such issues, and a summary of any evidence relied upon by the objector (40 CFR 178.27). Information submitted in connection with an objection or hearing request may be claimed confidential 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. A copy of the information that does not contain CBI must be submitted for inclusion in the public record. Information not marked confidential may be disclosed publicly by EPA without prior notice.

Mail your written request to: Office of the Hearing Clerk (1900), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. You may also deliver your request to the Office of the Hearing Clerk in Rm. C400, Waterside Mall, 401 M St., SW., Washington, DC 20460. The Office of the Hearing Clerk is open from 8 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Office of the Hearing Clerk is (202) 260-4865.

2. Tolerance fee payment . If you file an objection or request a hearing, you must also pay the fee prescribed by 40 CFR 180.33(i) or request a waiver of that fee pursuant to 40 CFR 180.33(m). You must mail the fee to: EPA Headquarters Accounting Operations Branch, Office of Pesticide Programs, P.O. Box 360277M, Pittsburgh, PA 15251. Please identify the fee submission by labeling it “Tolerance Petition Fees.”

EPA is authorized to waive any fee requirement “when in the judgement of the Administrator such a waiver or refund is equitable and not contrary to the purpose of this subsection.” For additional information regarding the waiver of these fees, you may contact James Tompkins by phone at (703) 305-5697, by e-mail at tompkins.jim@epa.gov, or by mailing a request for information to Mr. Tompkins at Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

If you would like to request a waiver of the tolerance objection fees, you must mail your request for such a waiver to: James Hollins, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

3. Copies for the Docket . In addition to filing an objection or hearing request with the Hearing Clerk as described in Unit VI.A., you should also send a copy of your request to the PIRIB for its inclusion in the official record that is described in Unit I.B.2. Mail your copies, identified by docket control number OPP-301026A, to: Public Information and Records Integrity Branch, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. In person or by courier, bring a copy to the location of the PIRIB described in Unit I.B.2. You may also send an electronic copy of your request via e-mail to: opp-docket@epa.gov. Please use an ASCII file format and avoid the use of special characters and any form of encryption. Copies of electronic objections and hearing requests will also be accepted on disks in WordPerfect 6.1/8.0 or ASCII file format. Do not include any CBI in your electronic copy. You may also submit an electronic copy of your request at many Federal Depository Libraries.

A request for a hearing will be granted if the Administrator determines that the material submitted shows the following: There is a genuine and substantial issue of fact; there is a reasonable possibility that available evidence identified by the requestor would, if established resolve one or more of such issues in favor of the requestor, taking into account uncontested claims or facts to the contrary; and resolution of the factual issues(s) in the manner sought by the requestor would be adequate to justify the action requested (40 CFR 178.32).

The Agency is acting on its own initiative under FFDCA section 408(e) in revoking these tolerances and in establishing a new subpart E in 40 CFR part 180 that will contain a list of the pesticide chemicals (including, as appropriate, their limitations and use patterns) for which the Agency has determined that neither a tolerance nor an exemption from the requirement of a tolerance is needed under FFDCA. Under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” subject to review by the Office of Management and Budget (OMB). Because this rule has been exempted from review under Executive Order 12866 due to its lack of significance, this rule is not subject to Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001).

This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. , or impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Public Law 104-4). Nor does it require any special considerations under Executive Order 12898, entitled Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994); or OMB review or any Agency action under Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997).

This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to 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).

This rule simply establishes a new subpart E in 40 CFR part 180 that will contain a list of the pesticide chemicals (including, as appropriate, their limitations and use patterns) for which the Agency has determined that neither a tolerance nor an exemption from the requirement of a tolerance is needed under FFDCA, and only amends an existing unlimited tolerance exemption to make it time limited. The Agency has determined that this action will not result in significant adverse economic impacts. Pursuant to the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ), the Agency previously assessed whether revocations of tolerances or tolerance exemptions might significantly impact a substantial number of small entities and concluded that, as a general matter, these actions do not impose a significant economic impact on a substantial number of small entities. This analysis was published on December 17, 1997 (62 FR 66020), and was provided to the Chief Counsel for Advocacy of the Small Business Administration. Taking into account this analysis, the available information concerning the pesticide chemicals listed in this rule, the Agency knows of no extraordinary circumstances that exist as to the present revocation that would change EPA's previous analysis. Therefore, the Agency hereby certifies pursuant to the section 605(b) of the RFA that this rule will not have a significant negative economic impact on a substantial number of small entities.

In addition, the Agency has determined that this action will not 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). Executive Order 13132 requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” This final rule directly regulates growers, food processors, food handlers and food retailers, not States. This action does not alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4).

For these same reasons, the Agency has determined that this rule does not have any “tribal implications” as described in Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments (65 FR 67249, November 6, 2000). Executive Order 13175, requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that have “substantial direct effects on one or more Indian tribes, on the relationship between the Federal government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes.” This rule will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does 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 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).

You may be affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. 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 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 might apply to certain entities. If you have questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT .

1. Electronically .You may obtain electronic 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/. To access this document, 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/. To access the OPPTS Harmonized Guidelines referenced in this document, go directly to the guidelines at http://www.epa.gov/opptsfrs/home/guidelin.htm. A frequently updated electronic version of 40 CFR part 180 is available at http://www.access.gpo.gov/nara/cfr/cfrhtml_180/Title_40/40cfr180_00.html, a beta site currently under development.

2. In person . The Agency has established an official record for this action under docket control number OPP-301205. The official record consists of the documents specifically referenced in this action, 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 Public Information and Records Integrity Branch (PIRIB), Rm. 119, Crystal Mall #2, 1921 Jefferson Davis Hwy., Arlington, VA, from 8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The PIRIB telephone number is (703) 305-5805.

In the Federal Register of March 29, 2000 (65 FR 16594) (FRL-6498-5), EPA issued a notice pursuant to section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a as amended by the Food Quality Protection Act of 1996 (FQPA) (Public Law 104-170) announcing the filing of a pesticide petition (PP) for tolerance by American Cyanamid Company, P.O. Box 400, Princeton, NJ 08543-0400. This notice included a summary of the petition prepared by American Cyanamid Company, the registrant. There were no comments received in response to the notice of filing. The petition was subsequently transferred to BASF Corporation, P.O. Box 400, Princeton, NJ 08543-0400.

The petition requested that 40 CFR 180.508 be amended by establishing a tolerance for residues of the herbicide imazamox, (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-5-(methoxymethyl)-3-pyridinecarboxylic acid, in or on the raw agricultural commodities: vegetable, legume, group at 0.05 ppm; canola, seed at 0.05 ppm. Tolerances are established for the combined residues of the herbicide imazamox, and its metabolite, AC263284 (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-5-(hydroxymethyl)-3-pyridinecarboxylic acid in or on the following raw agricultural commodities wheat, grain, forage and hay at 0.3 ppm, wheat, straw at 0.2 ppm, wheat, bran at 1.0 ppm, wheat, shorts at 0.8 ppm, and wheat, germ at 0.6 ppm. Tolerances are established for the combined residues of the herbicide imazamox, and its metabolite, AC263284 (free and conjugated), and AC312622, (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-3,5-pyridinecarboxylic acid in or on the following raw agricultural commodities: alfalfa, seed at 0.4 ppm, alfalfa, forage at 2.0 ppm and alfalfa, hay at 4.0 ppm respectively.

Section 408(b)(2)(A)(i) of the FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue....”

EPA performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. For further discussion of the regulatory requirements of section 408 and a complete description of the risk assessment process, see the final rule on Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997) (FRL-5754-7).

Consistent with section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure, consistent with section 408(b)(2), for tolerances for residues of the herbicide imazamox, (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-5-(methoxymethyl)-3-pyridinecarboxylic acid, in or on the raw agricultural commodities: vegetable, legume, group at 0.05 ppm; canola, seed at 0.05 ppm. Tolerances are established for the combined residues of the herbicide imazamox, and its metabolite, AC263284 (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-5-(hydroxymethyl)-3-pyridinecarboxylic acid in or on the following raw agricultural commodities wheat, grain, forage and hay at 0.3 ppm, wheat, straw at 0.2 ppm, wheat, bran at 1.0 ppm, wheat, shorts at 0.8 ppm, and wheat, germ at 0.6 ppm. Tolerances are established for the combined residues of the herbicide imazamox, and its metabolite, AC263284 (free and conjugated), and AC312622, (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-3,5-pyridinecarboxylic acid in or on the following raw agricultural commodities: alfalfa, seed at 0.4 ppm, alfalfa, forage at 2.0 ppm and alfalfa, hay at 4.0 ppm respectively. EPA's assessment of exposures and risks associated with establishing the tolerance follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The nature of the toxic effects caused by imazamox are discussed in the following Table 1 as well as the no observed adverse effect level (NOAEL). There was no lowest observed adverse effect level (LOAEL) in any of the subchronic or chronic toxicity studies reviewed.

1. Dietary exposure from food and feed uses . Tolerances have been established (40 CFR 180.508) for the residues of imazamox, in or on the raw agricultural commodity soybeans. Due to low toxicity, it was determined that a dietary risk assessment of imazamox in food is not needed and, therefore, none was conducted.

i. Acute exposure . Acute dietary risk assessments are performed for a food-use pesticide if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a one day or single exposure. No appropriate endpoint attributable to a single exposure (dose) was identified in the imazamox toxicity database including oral developmental toxicity studies in rats and rabbits.

ii. Chronic exposure . There were no observed adverse effects at the highest dose tested (1,000 mg/kg/day or higher) in any of the subchronic or chronic toxicity tests conducted and the August 1998 OPPTS Series 870 Harmonized Test Guidelines for health effects recommend for subchronic and chronic testing the highest dose tested should not exceed 1,000 mg/kg/day using the procedures described for these studies, unless potential human exposure data indicate the need for higher doses. When imazamox was tested up to or above the limit dose, no significant adverse effects were observed. Therefore, it was determined that a chronic dietary risk assessment of imazamox in food is not needed and, therefore, none was conducted.

2. Dietary exposure from drinking water . The Agency uses the First Index Reservoir Screening Tool (FIRST) or the Pesticide Root Zone/Exposure Analysis Modeling System (PRZM/EXAMS), to produce estimates of pesticide concentrations in an index reservoir. The screening concentration in ground water (SCI-GROW) model is used to predict pesticide concentrations in shallow groundwater. For a screening-level assessment for surface water EPA will use FIRST (a tier 1 model) before using PRZM/EXAMS (a tier 2 model). The FIRST model is a subset of the PRZM/EXAMS model that uses a specific high-end runoff scenario for pesticides. While both FIRST and PRZM/EXAMS incorporate an index reservoir environment, the PRZM/EXAMS model includes a percent crop area factor as an adjustment to account for the maximum percent crop coverage within a watershed or drainage basin.

None of these models include consideration of the impact processing (mixing, dilution, or treatment) of raw water for distribution as drinking water would likely have on the removal of pesticides from the source water. The primary use of these models by the Agency at this stage is to provide a coarse screen for sorting out pesticides for which it is highly unlikely that drinking water concentrations would ever exceed human health levels of concern.

Based on the FIRST and SCI-GROW models the estimated environmental concentrations (EECs) of imazamox for acute exposures are estimated to be 32 parts per billion (ppb) for surface water and 0.62 ppb for ground water. The EECs for chronic exposures are estimated to be 3.4 ppb for surface water and 0.62 ppb for ground water. These concentrations were compared to the lowest high dose tested in the toxicity studies (900 mg/kg) divided by an uncertainty factor of 100, i.e., 9 mg/kg. For chronic exposure in surface water, the EEC of 3.4 ppb is 5/10,000% of 9 mg/kg. For acute exposure in surface water, the EEC of 32 ppb is 4/1,000% of 9 mg/kg. For chronic and acute exposure in ground water, the EEC of 0.62 ppb is 7/10,000% of 9 mg/kg. Because the concentration of imazamox in drinking water are much smaller than 9 mg/kg, the contribution of consumption of imazamox via drinking water to total dietary consumption of imazamox (food plus water) is not significant.

3. From non-dietary exposure . The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). Imazamox is not registered for use on any sites that would result in residential exposure.

4. Cumulative exposure to substances with a common mechanism of toxicity . Section 408(b)(2)(D)(v) requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

EPA does not have, at this time, available data to determine whether imazamox has a common mechanism of toxicity with other substances or how to include this pesticide in a cumulative risk assessment. Unlike other pesticides for which EPA has followed a cumulative risk approach based on a common mechanism of toxicity, imazamox does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has not assumed that imazamox has a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see the final rule for Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997).

1. In general . FFDCA section 408 provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines that a different margin of safety will be safe for infants and children.

2. Prenatal and postnatal sensitivity . No significant toxicity or pre- or post-natal toxicity was seen in any of the studies conducted with imazamox.

3. Conclusion . Due to its low toxicity a risk assessment using a safety factor approach was not conducted for imazamox. For similar reasons, it would not be appropriate to use an additional 10x safety factor to protect infants and children.

1. Acute risk . Since the acute toxicity is low (toxicity categories III and IV) for all tests conducted, the occurrence of an effect of concern as a result of a one day or single exposure is highly unlikely. It was determined that contribution of additional dietary risk due to drinking water consumption is insignificant as described in section C. 2. above.

2. Chronic risk . There were no observed adverse effects at the highest dose tested (1,000 mg/kg/day or higher) in any of the subchronic or chronic toxicity tests conducted and the August 1998 OPPTS Series 870 Harmonized Test Guidelines for health effects recommend for subchronic and chronic testing the highest dose tested should not exceed 1000 mg/kg/day using the procedures described for these studies, unless potential human exposure data indicate the need for higher doses. When imazamox was tested up to or above the limit dose, no significant adverse effects were observed. Therefore, it was determined that a chronic dietary risk assessment of imazamox in food is not needed and, therefore, none was conducted.

3. Determination of safety . Based on the low toxicity of imazamox and the rationales described above, EPA concludes that there is a reasonable certainty that no harm will result to the general population, and to infants and children from aggregate exposure to imazamox residues.

The method may be requested from Francis Griffith, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Road, Fort George G. Mead, Maryland, 20755-5350; telephone number: (410) 305-2905; e-mail address: griffith.francis@epa.gov.

There are no established or proposed Codex Maximum Residue Limits (MRLs) for imazamox.

Therefore, tolerances are established for residues of the herbicide imazamox, (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-5-(methoxymethyl)-3-pyridinecarboxylic acid, in or on the raw agricultural commodities: vegetable, legume, group at 0.05 ppm; canola, seed at 0.05 ppm. Tolerances are established for the combined residues of the herbicide imazamox, and its metabolite, AC263284 (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-5-(hydroxymethyl)-3-pyridinecarboxylic acid in or on the following raw agricultural commodities wheat, grain, forage and hay at 0.3 ppm, wheat, straw at 0.2 ppm, wheat, bran at 1.0 ppm, wheat, shorts at 0.8 ppm, and wheat, germ at 0.6 ppm. Tolerances are established for the combined residues of the herbicide imazamox, and its metabolite, AC263284 (free and conjugated), and AC312622, (±)-2-[4,5-dihydro-4-methyl-4-(1-methylethyl)-5-oxo-1H-imidazol-2-yl]-3,5-pyridinecarboxylic acid in or on the following raw agricultural commodities: alfalfa, seed at 0.4 ppm, alfalfa, forage at 2.0 ppm and alfalfa, hay at 4.0 ppm respectively

Under section 408(g) of the FFDCA, as amended by the FQPA, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. The EPA procedural regulations which govern the submission of objections and requests for hearings appear in 40 CFR part 178. Although the procedures in those regulations require some modification to reflect the amendments made to the FFDCA by the FQPA of 1996, EPA will continue to use those procedures, with appropriate adjustments, until the necessary modifications can be made. The new section 408(g) provides essentially the same process for persons to “object” to a regulation for an exemption from the requirement of a tolerance issued by EPA under new section 408(d), as was provided in the old FFDCA sections 408 and 409. However, the period for filing objections is now 60 days, rather than 30 days.

You must file your objection or request a hearing on this regulation in accordance with the instructions provided in this unit and in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket control number OPP-301205 in the subject line on the first page of your submission. All requests must be in writing, and must be mailed or delivered to the Hearing Clerk on or before February 25, 2002.

1. Filing the request . Your objection must specify the specific provisions in the regulation that you object to, and the grounds for the objections (40 CFR 178.25). If a hearing is requested, the objections must include a statement of the factual issues(s) on which a hearing is requested, the requestor's contentions on such issues, and a summary of any evidence relied upon by the objector (40 CFR 178.27). Information submitted in connection with an objection or hearing request may be claimed confidential 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. A copy of the information that does not contain CBI must be submitted for inclusion in the public record. Information not marked confidential may be disclosed publicly by EPA without prior notice.

Mail your written request to: Office of the Hearing Clerk (1900), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. You may also deliver your request to the Office of the Hearing Clerk in Rm. C400, Waterside Mall, 401 M St., SW., Washington, DC 20460. The Office of the Hearing Clerk is open from 8 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Office of the Hearing Clerk is (202) 260-4865.

2. Tolerance fee payment . If you file an objection or request a hearing, you must also pay the fee prescribed by 40 CFR 180.33(i) or request a waiver of that fee pursuant to 40 CFR 180.33(m). You must mail the fee to: EPA Headquarters Accounting Operations Branch, Office of Pesticide Programs, P.O. Box 360277M, Pittsburgh, PA 15251. Please identify the fee submission by labeling it “Tolerance Petition Fees.”

EPA is authorized to waive any fee requirement “when in the judgement of the Administrator such a waiver or refund is equitable and not contrary to the purpose of this subsection.” For additional information regarding the waiver of these fees, you may contact James Tompkins by phone at (703) 305-5697, by e-mail at tompkins.jim@epa.gov, or by mailing a request for information to Mr. Tompkins at Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

If you would like to request a waiver of the tolerance objection fees, you must mail your request for such a waiver to: James Hollins, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

3. Copies for the Docket . In addition to filing an objection or hearing request with the Hearing Clerk as described in Unit VI.A., you should also send a copy of your request to the PIRIB for its inclusion in the official record that is described in Unit I.B.2. Mail your copies, identified by docket control number OPP-301205, to: Public Information and Records Integrity Branch, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. In person or by courier, bring a copy to the location of the PIRIB described in Unit I.B.2. You may also send an electronic copy of your request via e-mail to: opp-docket@epa.gov. Please use an ASCII file format and avoid the use of special characters and any form of encryption. Copies of electronic objections and hearing requests will also be accepted on disks in WordPerfect 6.1/8.0 or ASCII file format. Do not include any CBI in your electronic copy. You may also submit an electronic copy of your request at many Federal Depository Libraries.

A request for a hearing will be granted if the Administrator determines that the material submitted shows the following: There is a genuine and substantial issue of fact; there is a reasonable possibility that available evidence identified by the requestor would, if established resolve one or more of such issues in favor of the requestor, taking into account uncontested claims or facts to the contrary; and resolution of the factual issues(s) in the manner sought by the requestor would be adequate to justify the action requested (40 CFR 178.32).

This final rule establishes a tolerance under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993). Because this rule has been exempted from review under Executive Order 12866 due to its lack of significance, this rule is not subject to Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. , or impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Public Law 104-4). Nor does it require any special considerations under Executive Order 12898, entitled Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994); or OMB review or any Agency action under Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997). This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to 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). Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ) do not apply. In addition, the Agency has determined that this action will not 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). Executive Order 13132 requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” This final rule directly regulates growers, food processors, food handlers and food retailers, not States. This action does not alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). For these same reasons, the Agency has determined that this rule does not have any “tribal implications” as described in Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments (65 FR 67249, November 6, 2000). Executive Order 13175, requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that have “substantial direct effects on one or more Indian tribes, on the relationship between the Federal government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes.” This rule will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does 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 this final rule in the Federal Register . This final rule is not a “major rule” as defined by 5 U.S.C. 804(2).

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. 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 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 might apply to certain entities. If you have questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT .

1. Electronically . You may obtain electronic 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/. To access this document, 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/. A frequently updated electronic version of 40 CFR part 180 is available at http://www.access.gpo.gov/nara/cfr/cfrhtml_180/Title_40/40cfr180_00.html, a beta site currently under development.

2. In person . The Agency has established an official record for this action under docket control number OPP-301197. The official record consists of the documents specifically referenced in this action, 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 Public Information and Records Integrity Branch (PIRIB), Rm. 119, Mall #2, 1921 Jefferson Davis Hwy., Arlington, VA, from 8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The PIRIB telephone number is (703) 305-5805.

EPA, on its own initiative, in accordance with sections 408(e) and 408(l)(6) of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a, is establishing a tolerance for residues of the herbicide halosulfuron-methyl, methyl 5-[(4,6-dimethoxy-2-pyrimidinyl) amino]carbonylaminosulfonyl-3-chloro-1-methyl-1H-pyrazole-4-carboxylate, in or on asparagus at 2.0 parts per million (ppm). This tolerance will expire and is revoked on 12/31/03. EPA will publish a document in the Federal Register to remove the revoked tolerance from the Code of Federal Regulations (CFR).

Section 408(l)(6) of the FFDCA requires EPA to establish a time-limited tolerance or exemption from the requirement for a tolerance for pesticide chemical residues in food that will result from the use of a pesticide under an emergency exemption granted by EPA under section 18 of FIFRA. Such tolerances can be established without providing notice or period for public comment. EPA does not intend for its actions on section 18 related tolerances to set binding precedents for the application of section 408 and the new safety standard to other tolerances and exemptions. Section 408(e) of the FFDCA allows EPA to establish a tolerance or an exemption from the requirement of a tolerance on its own initiative, i.e., without having received any petition from an outside party.

Section 408(b)(2)(A)(i) of the FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”

Section 18 of FIFRA authorizes EPA to exempt any Federal or State agency from any provision of FIFRA, if EPA determines that “emergency conditions exist which require such exemption.” This provision was not amended by the Food Quality Protection Act (FQPA). EPA has established regulations governing such emergency exemptions in 40 CFR part 166.

Washington, Idaho and Oregon requested the use of halosulfuron-methyl to control nutsedge infesting asparagus fields. Michigan requested the use of halosulfuron-methyl to control nutsedge and pigweed infesting asparagus fields. In the Pacific Northwest nutsedge has spread throughout the asparagus growing region and has been declared a Class B noxious weed in Washington. Asparagus growers are especially vulnerable to nutsedge because of the difficulty in controlling a perennial monocot weed in a perennial monocot crop. The information provided by the four applicant states indicates that nutsedge is reducing asparagus yields and reducing the life span of the crop. EPA agrees that heavily infested fields can have severe yield losses. Additionally, EPA expects that yield reductions in Michigan due to redroot pigweed could be quite high due to coverage of the crop during the harvest period. EPA has authorized under FIFRA section 18 the use of halosulfuron-methyl on asparagus for control of nutsedge in Washington, Idaho, Oregon and Michigan and also for control of pigweed in Michigan. After having reviewed the submissions, EPA concurs that emergency conditions exist for these States.

As part of its assessment of this emergency exemption, EPA assessed the potential risks presented by residues of halosulfuron-methyl in or on asparagus. In doing so, EPA considered the safety standard in FFDCA section 408(b)(2), and EPA decided that the necessary tolerance under FFDCA section 408(l)(6) would be consistent with the safety standard and with FIFRA section 18. Consistent with the need to move quickly on the emergency exemption in order to address an urgent non-routine situation and to ensure that the resulting food is safe and lawful, EPA is issuing this tolerance without notice and opportunity for public comment as provided in section 408(l)(6). Although this tolerance will expire and is revoked on December 31, 2003, under FFDCA section 408(l)(5), residues of the pesticide not in excess of the amounts specified in the tolerance remaining in or on asparagus after that date will not be unlawful, provided the pesticide is applied in a manner that was lawful under FIFRA, and the residues do not exceed a level that was authorized by this tolerance at the time of that application. EPA will take action to revoke this tolerance earlier if any experience with, scientific data on, or other relevant information on this pesticide indicate that the residues are not safe.

Because this tolerance is being approved under emergency conditions, EPA has not made any decisions about whether halosulfuron-methyl meets EPA's registration requirements for use on asparagus or whether a permanent tolerance for this use would be appropriate. Under these circumstances, EPA does not believe that this tolerance serves as a basis for registration of halosulfuron-methyl by a State for special local needs under FIFRA section 24(c). Nor does this tolerance serve as the basis for any State other than Washington, Idaho, Oregon and Michigan to use this pesticide on this crop under section 18 of FIFRA without following all provisions of EPA's regulations implementing section 18 as identified in 40 CFR part 166. For additional information regarding the emergency exemption for halosulfuron- methyl, contact the Agency's Registration Division at the address provided under FOR FURTHER INFORMATION CONTACT .

EPA performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. For further discussion of the regulatory requirements of section 408 and a complete description of the risk assessment process, see the final rule on Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997) (FRL-5754-7).

Consistent with section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of halosulfuron-methyl and to make a determination on aggregate exposure, consistent with section 408(b)(2), for a time-limited tolerance for residues of halosulfuron-methyl in or on asparagus at 2.0 ppm. EPA's assessment of the dietary exposures and risks associated with establishing the tolerance follows.

The dose at which no adverse effects are observed (the NOAEL) from the toxicology study identified as appropriate for use in risk assessment is used to estimate the toxicological endpoint. However, the lowest dose at which adverse effects of concern are identified (the LOAEL) is sometimes used for risk assessment if no NOAEL was achieved in the toxicology study selected. An uncertainty factor (UF) is applied to reflect uncertainties inherent in the extrapolation from laboratory animal data to humans and in the variations in sensitivity among members of the human population as well as other unknowns. An UF of 100 is routinely used, 10X to account for interspecies differences and 10X for intraspecies differences.

For dietary risk assessment (other than cancer) the Agency uses the UF to calculate an acute or chronic reference dose (acute RfD or chronic RfD) where the RfD is equal to the NOAEL divided by the appropriate UF (RfD = NOAEL/UF). Where an additional safety facto is retained due to concerns unique to the FQPA, this additional factor is applied to the RfD by dividing the RfD by such additional factor. The acute or chronic Population Adjusted Dose (aPAD or cPAD) is a modification of the RfD to accommodate this type of FQPA Safety Factor.

For non-dietary risk assessments (other than cancer) the UF is used to determine the level of concern (LOC). For example, when 100 is the appropriate UF (10X to account for interspecies differences and 10X for intraspecies differences) the LOC is 100. To estimate risk, a ratio of the NOAEL to exposures (margin of exposure (MOE) = NOAEL/exposure) is calculated and compared to the LOC.

The linear default risk methodology (Q*) is the primary method currently used by the Agency to quantify carcinogenic risk. The Q* approach assumes that any amount of exposure will lead to some degree of cancer risk. A Q* is calculated and used to estimate risk which represents a probability of occurrence of additional cancer cases (e.g., risk is expressed as 1 x 10 - 6 or one in a million). Under certain specific circumstances, MOE calculations will be used for the carcinogenic risk assessment. In this non-linear approach, a “point of departure” is identified below which carcinogenic effects are not expected. The point of departure is typically a NOAEL based on an endpoint related to cancer effects though it may be a different value derived from the dose response curve. To estimate risk, a ratio of the point of departure to exposure (MOE cancer = point of departure/exposures) is calculated. A summary of the toxicological endpoints for halosulfuron-methyl used for human risk assessment is shown in the following Table 1:

1. Dietary exposure from food and feed uses. Tolerances have been established (40 CFR 180.479) for the residues of halosulfuron-methyl, in or on a variety of raw agricultural commodities. The established tolerances include tree nuts (crop group 14); sugarcane; corn rice and cotton, and their associated commodities. Additionally, tolerances are established for residues of halosulfuron-methyl and its metabolites determined as 3-chloro-1-methyl-5-sulfamoylpyrazole-4-carboxylic acid (also referred to as CSA, expressed as parent equivalents) in/on meat by-products of cattle, goats, hogs, horses and sheep. Risk assessments were conducted by EPA to assess dietary exposures from halosulfuron-methyl in food as follows:

i. Acute exposure. Acute dietary risk assessments are performed for a food-use pesticide if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a one day or single exposure. The Dietary Exposure Evaluation Model (DEEM®) analysis evaluated the individual food consumption as reported by respondents in the USDA 1989-1992 nationwide Continuing Surveys of Food Intake by Individuals (CSFII) and accumulated exposure to the chemical for each commodity. The following assumptions were made for the acute exposure assessments: A Tier 1 acute dietary exposure analysis was conducted. The assumptions of the Tier 1 analysis were tolerance level residues and 100 percent crop-treated for all commodities for which halosulfuron-methyl tolerances are established and for the section 18 subject crop (asparagus). Percent crop treated and anticipated residues were not used.

ii. Chronic exposure. In conducting this chronic dietary risk assessment the DEEM® analysis evaluated the individual food consumption as reported by respondents in the USDA 1989-1992 nationwide CSFII and accumulated exposure to the chemical for each commodity. The following assumptions were made for the chronic exposure assessments: A Tier 1 chronic dietary exposure analysis was conducted. The assumptions of this Tier 1 analysis were tolerance level residues and 100 percent crop-treated for all commodities for which halosulfuron-methyl tolerances are established and for the subject section 18 crop (asparagus). Percent crop treated and anticipated residues were not used.

iii. Cancer . There is no evidence of carcinogenicity for halosulfuron-methyl in the mouse or rat. EPA has classified halosulfuron-methyl as a “Not-Likely” human carcinogen.

2. Dietary exposure from drinking water . The Agency lacks sufficient monitoring exposure data to complete a comprehensive dietary exposure analysis and risk assessment for halosulfuron-methyl in drinking water. Because the Agency does not have comprehensive monitoring data, drinking water concentration estimates are made by reliance on simulation or modeling taking into account data on the physical characteristics of halosulfuron-methyl.

The Agency uses the First Index Reservoir Screening Tool (FIRST) or the Pesticide Root Zone/Exposure Analysis Modeling System (PRZM/EXAMS) to produce estimates of pesticide concentrations in an index reservoir. The screening concentration in ground water (SCI-GROW) model is used to predict pesticide concentrations in shallow ground water. For a screening-level assessment for surface water EPA will generally use FIRST (a tier 1 model) before using PRZM/EXAMS (a tier 2 model). The FIRST model is a subset of the PRZM/EXAMS model that uses a specific high-end runoff scenario for pesticides. While both FIRST and PRZM/EXAMS incorporate an index reservoir environment, the PRZM/EXAMS model includes a percent crop area factor as an adjustment to account for the maximum percent crop coverage within a watershed or drainage basin.

None of these models include consideration of the impact processing (mixing, dilution, or treatment) of raw water for distribution as drinking water would likely have on the removal of pesticides from the source water. The primary use of these models by the Agency at this stage is to provide a coarse screen for sorting out pesticides for which it is highly unlikely that drinking water concentrations would ever exceed human health levels of concern.

Since the models used are considered to be screening tools in the risk assessment process, the Agency does not use estimated environmental concentrations (EECs) from these models to quantify drinking water exposure and risk as a %RfD or %PAD. Instead drinking water levels of comparison (DWLOCs) are calculated and used as a point of comparison against the model estimates of a pesticide's concentration in water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food, and from residential uses. Since DWLOCs address total aggregate exposure to halosulfuron-methyl they are further discussed in the aggregate risk sections below.

Based on the FIRST and SCI-GROW models the EECs of halosulfuron-methyl for acute exposures are estimated to be 5.39 parts per billion (ppb) for surface water and 0.049 ppb for ground water. The EECs for chronic exposures based on FIRST and SCI-GROW models are estimated to be 0.245 ppb for surface water and 0.049 ppb for ground water.

3. From non-dietary exposure . The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets).

Halosulfuron-methyl is currently registered for use on the following residential non-dietary sites: Residential turf. The risk assessment was conducted using the following exposure assumptions: Halosulfuron-methyl (trade name: “Manage”) is a sulfonylurea herbicide used for control of broadleaf weeds and nutsedge. Manage may be broadcast applied at a rate of 0.031 to 0.062 lb ai/acre. For residential handlers and postapplication activities, short-term to intermediate-term exposures may occur. Chronic exposures (greater than or equal to 6 months of continuous exposure) are not expected. Adults may be dermally exposed after treatment to lawns, and children may be exposed through dermal, hand-to-mouth and incidental oral sources.

4. Cumulative exposure to substances with a common mechanism of toxicity . Section 408(b)(2)(D)(v) requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

EPA does not have, at this time, available data to determine whether halosulfuron-methyl has a common mechanism of toxicity with other substances or how to include this pesticide in a cumulative risk assessment. Unlike other pesticides for which EPA has followed a cumulative risk approach based on a common mechanism of toxicity, halosulfuron-methyl does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has not assumed that halosulfuron-methyl has a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see the final rule for Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997).

1. In general . FFDCA section 408 provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the data base on toxicity and exposure unless EPA determines that a different margin of safety will be safe for infants and children. Margins of safety are incorporated into EPA risk assessments either directly through use of a margin of exposure (MOE) analysis or through using uncertainty (safety) factors in calculating a dose level that poses no appreciable risk to humans.

2. Developmental toxicity studies . In a prenatal developmental toxicity study in rats, the NOAEL for maternal toxicity was 250 mg/kg/day and the LOAEL was 750 mg/kg/day based on increased incidence of clinical observations (primarily alopecia and urine stains) and reduced body weight gains, food consumption, and food efficiency. For developmental toxicity, the NOAEL was 250 mg/kg/day and the LOAEL was 750 mg/kg/day based on decreased mean litter size, increased number of resorptions (total and per litter), significantly decreased mean fetal body weight, and increases in fetal and litter incidences of soft tissue (primarily dilation of the lateral ventricles and other anomalies in the development of the fetal nervous system) and skeletal variations (anomalies or delays in ossification in the thoracic vertebrae, sternebrae, and ribs). EPA noted that both the fetal and litter incidences of dilated lateral ventricles of the brain were statistically significant, and appeared to be dose related, since the finding was also observed at the mid-dose in 2 fetuses of 2 litters. Due to the lack of historical control data, it was not possible to evaluate the biological significance of the low incidence of this finding at the mid-dose level. EPA recommends that the study developmental NOAEL and LOAEL as defined by the data evaluation record not be revised at this time.

In a prenatal developmental toxicity study in the rabbit, the NOAEL for maternal toxicity was 50 mg/kg/day and the LOAEL was 150 mg/kg/day based on decreased body weight gain, food consumption, and food efficiency. For developmental toxicity, the NOAEL was 50 mg/kg/day and the LOAEL was 150 mg/kg/day based on decreased mean litter size, increased number of resorptions (total and per dam) and increased postimplantation loss. EPA notes that these developmental findings, while not statistically significant, define a consistent pattern of effect. The developmental NOAEL is 50 mg/kg/day based on decreased mean litter size, increased number of resorptions (total and per dam) and increased postimplantation loss at 150 mg/kg/day (LOAEL). EPA recommends that this dose and effect be used for assessing acute dietary risks for the sub-populations, Females 13+ as well as Infants and Children. Although the endpoint is developmental toxicity occurring in utero , and thus may not be suitable for use in risk assessment for Infants and Children, EPA determined that it is appropriate to use for this subpopulation (infants and children) because there is evidence of alteration to the development of the fetal nervous system in the developmental study in rats (see above). Thus, EPA determined that potential effects on functional development mandate the use of this endpoint for females of child bearing age (Females 13+) as well as for infants and children. This endpoint is not applicable for adult males. A dose and endpoint was not identified for this subpopulation since there were no toxicological effects applicable to adult males and attributable to a single exposure (dose) observed in oral toxicity studies including the developmental toxicity studies in rats and rabbits.

3. Reproductive toxicity study . In the 2-generation reproduction study in rats, effects in the offspring were observed only at or above treatment levels which resulted in evidence of parental toxicity.

4. Prenatal and postnatal sensitivity. There was no evidence of increased susceptibility of rats or rabbits to in utero and/or postnatal exposure to halosulfuron-methyl. In the prenatal developmental toxicity studies in rats and rabbits and the 2-generation reproduction study in rats, effects in the offspring were observed only at or above treatment levels which resulted in evidence of parental toxicity.

5. Conclusion . There is a complete toxicity data base for halosufuron-methyl and exposure data are complete or are estimated based on data that reasonably accounts for potential exposures. EPA determined that the 10X safety factor to protect infants and children should be removed. The FQPA factor is removed because there was no indication of increased susceptibility of rats or rabbits to in utero and/or postnatal exposure to halosulfuron-methyl. In the prenatal developmental toxicity studies in rats and rabbits and the 2-generation reproduction study in rats, effects in the offspring were observed only at or above treatment levels which resulted in evidence of parental toxicity. EPA determined that the requirement of a developmental neurotoxicity study in rats did not warrant an application of additional safety factors because: (a) The alterations in the fetal nervous system occurred in only one species (in rats and not in rabbits); (b) the fetal effects which will be investigated in the required developmental neurotoxicity study were seen only at a dose of 750 mg/kg/day which is close to the Limit-Dose (1,000 mg/kg/day); (c) there was no evidence of clinical signs of neurotoxicity, brain weight changes, or neuropathology in the subchronic or chronic studies in rats; (d) the developmental neurotoxicity study is required only as confirmatory data to understand what the effect is at a high exposure (dose) level.

To estimate total aggregate exposure to a pesticide from food, drinking water, and residential uses, the Agency calculates DWLOCs which are used as a point of comparison against the model estimates of a pesticide's concentration in water (EECs). DWLOC values are not regulatory standards for drinking water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food and residential uses. In calculating a DWLOC, the Agency determines how much of the acceptable exposure (i.e., the PAD) is available for exposure through drinking water e.g., allowable chronic water exposure (mg/kg/day) = cPAD - (average food + chronic non-dietary, non-occupational exposure). This allowable exposure through drinking water is used to calculate a DWLOC.

A DWLOC will vary depending on the toxic endpoint, drinking water consumption, and body weights. Default body weights and consumption values as used by the USEPA Office of Water are used to calculate DWLOCs: 2L/70 kg (adult male), 2L/60 kg (adult female), and 1L/10 kg (child). Default body weights and drinking water consumption values vary on an individual basis. This variation will be taken into account in more refined screening-level and quantitative drinking water exposure assessments. Different populations will have different DWLOCs. Generally, a DWLOC is calculated for each type of risk assessment used: acute, short-term, intermediate-term, chronic, and cancer.

When EECs for surface water and groundwater are less than the calculated DWLOCs, EPA concludes with reasonable certainty that exposures to halosulfuron-methyl in drinking water (when considered along with other sources of exposure for which EPA has reliable data) would not result in unacceptable levels of aggregate human health risk at this time. Because EPA considers the aggregate risk resulting from multiple exposure pathways associated with a pesticide's uses, levels of comparison in drinking water may vary as those uses change. If new uses are added in the future, EPA will reassess the potential impacts of halosulfuron-methyl on drinking water as a part of the aggregate risk assessment process.

1. Acute risk . Using the exposure assumptions discussed in this unit for acute exposure, the acute dietary exposure from food to halosulfuron-methyl will occupy < 1.0% of the aPAD for females 13 years and older, 1.0% of the aPAD for All Infants, < 1 year old and < 1.0% of the aPAD for Children, 1-6 years old. In addition, despite the potential for acute dietary exposure to halosulfuron-methyl in drinking water, after calculating DWLOCs and comparing them to conservative model EECs of halosulfuron-methyl in surface and ground water, EPA does not expect the aggregate exposure to exceed 100% of the aPAD, as shown in the following Table 2:

2. Chronic risk . Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that exposure to halosulfuron-methyl from food will utilize < 1.0% of the cPAD for the U.S. population, < 1.0% of the cPAD for All infants, < 1 year old and < 1.0% of the cPAD for Children, 1-6 years old. Based on the use pattern, chronic residential exposure to residues of halosulfuron-methyl is not expected. In addition, despite the potential for chronic dietary exposure to halosulfuron-methyl in drinking water, after calculating DWLOCs and comparing them to conservative model estimated environmental concentrations of halosulfuron-methyl in surface and ground water, EPA does not expect the aggregate exposure to exceed 100% of the cPAD, as shown in the following Table 3:

3. Short-term risk . Short-term aggregate exposure takes into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

Halosulfuron-methyl is currently registered for use(s) that could result in short-term residential exposure and the Agency has determined that it is appropriate to aggregate chronic food and water and short-term exposures for halosulfuron-methyl. EPA concludes with reasonable certainty that residues of halosulfuron-methyl in drinking water will not contribute significantly to the short-term aggregate human health risk and that the short-term aggregate exposure from halosulfuron-methyl residues in food and drinking water will not exceed the Agency's level of concern (MOE ≤ 100) for short-term aggregate exposure by any population subgroup.

Using the exposure assumptions described in this unit for short-term exposures, EPA has concluded that food and residential exposures aggregated result in aggregate MOEs of 2,200 for females and 2,900 for children. These aggregate MOEs do not exceed the Agency's level of concern for aggregate exposure to food and residential uses. Short-term dermal MOEs for residential handlers are all above 100 and do not exceed EPA's level of concern. Non-occupational postapplication risk was estimated for adults and children.Risk estimates for all residential exposure scenarios and time periods result in MOEs that are 100 or greater, and therefore do not exceed EPA's level of concern. In addition, short-term DWLOCs were calculated and compared to the EECs for chronic exposure of halosulfuron-methyl in ground water and surface water. After calculating DWLOCs and comparing them to the EECs for surface and ground water, EPA does not expect short-term aggregate exposure to exceed the Agency's level of concern, as shown in the following Table 4:

4. Intermediate-term risk . Intermediate-term aggregate exposure takes into account non-dietary, non-occupational exposure plus chronic exposure to food and water (considered to be a background exposure level).

Halosulfuron-methyl is currently registered for use(s) that could result in intermediate-term residential exposure and the Agency has determined that it is appropriate to aggregate chronic food and water and intermediate-term exposures for halosulfuron-methyl.

Using the exposure assumptions described in this unit for intermediate-term exposures, EPA has concluded that food and residential exposures aggregated result in aggregate MOEs of 1,700 for females, 2,000 for males, and 1,000 for children. These aggregate MOEs do not exceed the Agency's level of concern for aggregate exposure to food and residential uses. In addition, intermediate-term DWLOCs were calculated and compared to the EECs for chronic exposure of halosulfuron-methyl in ground water and surface water. After calculating DWLOCs and comparing them to the EECs for surface and ground water, EPA does not expect intermediate-term aggregate exposure to exceed the Agency's level of concern, as shown in the following Table 5:

5. Aggregate cancer risk for U.S. population . Halosulfuron-methyl is classified as a “not likely” human carcinogen based on a lack of evidence of carcinogenicity in male and female mice and rats. A cancer risk assessment is not required.

6. Determination of safety . Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, and to infants and children from aggregate exposure to halosulfuron-methyl residues.

Analytical enforcement methodology for the determination of halosulfuron-methyl in various plant commodities has been sent to the Food and Drug Administration for publication in the Pesticide Analytical Methods, Volume II (PAM II). Quantitation of residues is by gas chromotography with nitrogen specific detection (GC/TSD).

There are no Codex, Canadian, or Mexican maximum residue limits for halosulfuron-methyl in/on asparagus. Therefore, harmonization is not an issue.

Therefore, the tolerance is established for residues of halosulfuron-methyl, methyl 5-[(4,6-dimethoxy-2-pyrimidinyl) amino]carbonylaminosulfonyl-3-chloro-1-methyl-1H- pyrazole-4-carboxylate in or on asparagus at 2.0 ppm.

Under section 408(g) of the FFDCA, as amended by the FQPA, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. The EPA procedural regulations which govern the submission of objections and requests for hearings appear in 40 CFR part 178. Although the procedures in those regulations require some modification to reflect the amendments made to the FFDCA by the FQPA of 1996, EPA will continue to use those procedures, with appropriate adjustments, until the necessary modifications can be made. The new section 408(g) provides essentially the same process for persons to “object” to a regulation for an exemption from the requirement of a tolerance issued by EPA under new section 408(d), as was provided in the old FFDCA sections 408 and 409. However, the period for filing objections is now 60 days, rather than 30 days.

You must file your objection or request a hearing on this regulation in accordance with the instructions provided in this unit and in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket control number OPP-301197 in the subject line on the first page of your submission. All requests must be in writing, and must be mailed or delivered to the Hearing Clerk on or before February 25, 2002.

1. Filing the request . Your objection must specify the specific provisions in the regulation that you object to, and the grounds for the objections (40 CFR 178.25). If a hearing is requested, the objections must include a statement of the factual issues(s) on which a hearing is requested, the requestor's contentions on such issues, and a summary of any evidence relied upon by the objector (40 CFR 178.27). Information submitted in connection with an objection or hearing request may be claimed confidential 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. A copy of the information that does not contain CBI must be submitted for inclusion in the public record. Information not marked confidential may be disclosed publicly by EPA without prior notice.

Mail your written request to: Office of the Hearing Clerk (1900), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. You may also deliver your request to the Office of the Hearing Clerk in Rm. C400, Waterside Mall, 401 M St., SW., Washington, DC 20460. The Office of the Hearing Clerk is open from 8 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Office of the Hearing Clerk is (202) 260-4865.

2. Tolerance fee payment . If you file an objection or request a hearing, you must also pay the fee prescribed by 40 CFR 180.33(i) or request a waiver of that fee pursuant to 40 CFR 180.33(m). You must mail the fee to: EPA Headquarters Accounting Operations Branch, Office of Pesticide Programs, P.O. Box 360277M, Pittsburgh, PA 15251. Please identify the fee submission by labeling it “Tolerance Petition Fees.”

EPA is authorized to waive any fee requirement “when in the judgement of the Administrator such a waiver or refund is equitable and not contrary to the purpose of this subsection.” For additional information regarding the waiver of these fees, you may contact James Tompkins by phone at (703) 305-5697, by e-mail at tompkins.jim@epa.gov, or by mailing a request for information to Mr. Tompkins at Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

If you would like to request a waiver of the tolerance objection fees, you must mail your request for such a waiver to: James Hollins, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

3. Copies for the Docket . In addition to filing an objection or hearing request with the Hearing Clerk as described in Unit VII.A., you should also send a copy of your request to the PIRIB for its inclusion in the official record that is described in Unit I.B.2. Mail your copies, identified by the docket control number OPP-301197, to: Public Information and Records Integrity Branch, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. In person or by courier, bring a copy to the location of the PIRIB described in Unit I.B.2. You may also send an electronic copy of your request via e-mail to: opp-docket@epa.gov. Please use an ASCII file format and avoid the use of special characters and any form of encryption. Copies of electronic objections and hearing requests will also be accepted on disks in WordPerfect 6.1/8.0 or ASCII file format. Do not include any CBI in your electronic copy. You may also submit an electronic copy of your request at many Federal Depository Libraries.

A request for a hearing will be granted if the Administrator determines that the material submitted shows the following: There is a genuine and substantial issue of fact; there is a reasonable possibility that available evidence identified by the requestor would, if established resolve one or more of such issues in favor of the requestor, taking into account uncontested claims or facts to the contrary; and resolution of the factual issues(s) in the manner sought by the requestor would be adequate to justify the action requested (40 CFR 178.32).

This final rule establishes a time limited tolerance under FFDCA section 408. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993). Because this rule has been exempted from review under Executive Order 12866 due to its lack of significance, this rule is not subject to Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. , or impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Public Law 104-4). Nor does it require any special considerations under Executive Order 12898, entitled Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994); or OMB review or any Agency action under Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997). This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to 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). Since tolerances and exemptions that are established on the basis of a FIFRA section 18 exemption under FFDCA section 408, such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ) do not apply. In addition, the Agency has determined that this action will not 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). Executive Order 13132 requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” This final rule directly regulates growers, food processors, food handlers and food retailers, not States. This action does not alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). For these same reasons, the Agency has determined that this rule does not have any “tribal implications” as described in Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments (65 FR 67249, November 6, 2000). Executive Order 13175, requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that have “substantial direct effects on one or more Indian tribes, on the relationship between the Federal government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes.” This rule will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does 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 this final rule in the Federal Register . This final rule is not a “major rule” as defined by 5 U.S.C. 804(2).

You may be affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. 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 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 might apply to certain entities. If you have questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT .

1. Electronically . You may obtain electronic 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/. To access this document, 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/. A frequently updated electronic version of 40 CFR part 180 is available at http://www.access.gpo.gov/nara/cfr/cfrhtml_180/Title_40/40cfr180_00.html, a beta site currently under development.

2. In person . The Agency has established an official record for this action under docket control number OPP-301180. The official record consists of the documents specifically referenced in this action, 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 Public Information and Records Integrity Branch (PIRIB), Rm. 119, Crystal Mall #2, 1921 Jefferson Davis Hwy., Arlington, VA, from 8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The PIRIB telephone number is (703) 305-5805.

In the Federal Register of July 19, 2001 (66 FR 37677-37681 (FRL-6793-9), EPA issued a notice pursuant to section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a as amended by the Food Quality Protection Act of 1996 (FQPA) (Public Law 104-170) announcing the filing of a pesticide petition (PP) for tolerance by, Syngenta Crop Protection of Greensboro, North Carolina 27419. This notice included a summary of the petition prepared by Syngenta, the registrant. There were no comments received in response to the notice of filing.

The petition requested that 40 CFR 180.556 be amended by establishing a tolerance for residues of the insecticide pymetrozine 1,2,4-triazin-3(2H)-one,4,5-dihydro-6- methyl-4-[(3-pyridinylmethylene) amino] in or on cotton seed, undelinted at 0.4 ppm; cotton gin byproducts at 3.0 ppm; fruiting vegetables at 0.2 ppm; cucurbit vegetables at 0.1 ppm; leafy vegetables (except Brassica ) at 6.0 ppm; head and stem Brassica vegetables at 2.0 ppm; leafy Brassica greens at 5.0 ppm; hops (dried) at 5.0 ppm; and pecans at 0.02 ppm.

Section 408(b)(2)(A)(i) of the FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue....”

EPA performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. For further discussion of the regulatory requirements of section 408 and a complete description of the risk assessment process, see the final rule on Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997) (FRL-5754-7).

Consistent with section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure, consistent with section 408(b)(2), for a tolerance for residues of pymetrozine in or on cotton seed, undelinted at 0.3 ppm; cotton gin byproducts at 2.0 ppm; fruiting vegetables at 0.2 ppm; cucurbit vegetables at 0.1 ppm; leafy vegetables (except Brassica ) at 0.6 ppm; head and stem Brassica vegetables at 0.5 ppm; leafy Brassica and turnip greens at 0.25 ppm; hops (dried) at 6.0 ppm; and pecans at 0.02 ppm. EPA's assessment of exposures and risks associated with establishing the tolerance follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The nature of the toxic effects caused by pymetrozine are discussed in this unit and in a previous Federal Register notice.

1. Acute toxicity . In general, technical pymetrozine has low acute toxicity, being classified as Toxicity Category III for acute dermal and primary eye irritation studies and Toxicity Category IV for acute oral, acute inhalation and primary dermal studies. It is a slight sensitizer.

2. Subchronic and chronic toxicity . EPA's September 29, 1999, Federal Register notice (64 FR 52438-52450) (FRL-6385-6) summarized the results of the subchronic and chronic toxicity, metabolism, and dermal penetration studies in animals.

The dose at which no adverse effects are observed (the NOAEL) from the toxicology study identified as appropriate for use in risk assessment is used to estimate the toxicological level of concern (LOC). However, the lowest dose at which adverse effects of concern are identified (the LOAEL) is sometimes used for risk assessment if no NOAEL was achieved in the toxicology study selected. An uncertainty factor (UF) is applied to reflect uncertainties inherent in the extrapolation from laboratory animal data to humans and in the variations in sensitivity among members of the human population as well as other unknowns. An UF of 100 is routinely used, 10X to account for interspecies differences and 10X for intra species differences.

For dietary risk assessment (other than cancer) the Agency uses the UF to calculate an acute or chronic reference dose (acute RfD or chronic RfD) where the RfD is equal to the NOAEL divided by the appropriate UF (RfD = NOAEL/UF). Where an additional safety factor is retained due to concerns unique to the FQPA, this additional factor is applied to the RfD by dividing the RfD by such additional factor. The acute or chronic Population Adjusted Dose (aPAD or cPAD) is a modification of the RfD to accommodate this type of FQPA Safety Factor.

For non-dietary risk assessments (other than cancer) the UF is used to determine the LOC. For example, when 100 is the appropriate UF (10X to account for interspecies differences and 10X for intraspecies differences) the LOC is 100. To estimate risk, a ratio of the NOAEL to exposures (margin of exposure (MOE) = NOAEL/exposure) is calculated and compared to the LOC.

The linear default risk methodology (Q*) is the primary method currently used by the Agency to quantify carcinogenic risk. The Q* approach assumes that any amount of exposure will lead to some degree of cancer risk. A Q* is calculated and used to estimate risk which represents a probability of occurrence of additional cancer cases (e.g., risk is expressed as 1 x 10 - 6 or one in a million). Under certain specific circumstances, MOE calculations will be used for the carcinogenic risk assessment. In this non-linear approach, a “point of departure” is identified below which carcinogenic effects are not expected. The point of departure is typically a NOAEL based on an endpoint related to cancer effects though it may be a different value derived from the dose response curve. To estimate risk, a ratio of the point of departure to exposure (MOE cancer = point of departure/exposures) is calculated. A summary of the toxicological endpoints for pymetrozine used for human risk assessment was discussed in a previous Federal Register notice of September 29, 1999 (64 FR 52438-52450) (FRL-6385-6).

1. Dietary exposure from food and feed uses . Prior to this Rule, the Agency had established tolerances for pymetrozine in or on corm and tuberous vegetables (Crop Subgroup 1-C) at 0.02 ppm, cucurbit vegetables (Crop Group 8) at 0.05 ppm, and fruiting vegetables (Crop Group 9) at 0.05 ppm (40 CFR 180.556). This Rule establishes new tolerances for residues of pymetrozine in or on a variety of raw agricultural commodities: cotton seed, undelinted at 0.3 ppm; cotton gin byproducts at 2.0 ppm; fruiting vegetables at 0.2 ppm; cucurbit vegetables at 0.1 ppm; leafy vegetables (except Brassica ) at 0.6 ppm; head and stem Brassica vegetables at 0.5 ppm; leafy Brassica and turnip greens at 0.25 ppm; hops (dried) at 6.0 ppm; and pecans at 0.02 ppm. Risk assessments were conducted by EPA to assess dietary exposures from pymetrozine in food as follows:

i. Acute exposure . Acute dietary risk assessments are performed for a food-use pesticide if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a one day or single exposure. The Dietary Exposure Evaluation Model (DEEM® analysis evaluated the individual food consumption as reported by respondents in the USDA 1989-1992 nationwide Continuing Surveys of Food Intake by Individuals (CSFII) and accumulated exposure to the chemical for each commodity. The following assumptions were made for the acute exposure assessments. 100% of the crop were treated, and the residue levels were assumed to be at the tolerance level.

Using these conservative assumptions, the acute dietary (food only) exposure to pymetrozine from all existing and proposed uses (tuberous and corm, fruiting, and cucurbit vegetables; cotton seed (undelinted); cotton gin byproducts; hops, dried; leafy vegetables (except Brassica ); head and stem Brassica vegetables; leafy Brassica greens; turnip greens; and pecans will be below EPA's level of concern (100% of the acute Population-Adjusted Dose (aPAD)) and will not occupy more than 5.9% of the aPAD for any population subgroup, including those of infants and children. For the maximum-exposed subgroup, the 95 th percentile of exposure (Females 13-50 years old) is predicted to be 5.9% of the aPAD. Due to pymetrozine's lower acute endpoint for females 13-50 years old (0.033 mg/kg) versus that of other population subgroups (0.14 mg/kg for infants and children), the percentage of the aPAD occupied for females 13-50 years old (5.9%) is higher than that estimated for children 1-6 years old. For an exposure analysis based on the assumptions that 100% of the crop is treated and residues are at the tolerance level, EPA considers exposure at the 95 th percentile of exposure to be a reasonable estimate of high end of exposure. Even at the 99 th percentile of exposure, the acute risk is well below EPA's level of concern.

ii. Chronic exposure . In conducting this chronic dietary risk assessment the Dietary Exposure Evaluation Model (DEEM®) analysis evaluated the individual food consumption as reported by respondents in the USDA 1989-1992 nationwide Continuing Surveys of Food Intake by Individuals (CSFII) and accumulated exposure to the chemical for each commodity. The following assumptions were made for the chronic exposure assessments. The chronic analysis was a Tier 3 analysis. See Table 1 below. It was necessary to use both projected percent of crop treated (%CT) estimates and anticipated residues in the chronic analysis because when %CT alone was used, one population subgroup exceeded the Agency's level of concern.

The Tier 3 DEEM® chronic analysis indicates that exposure to pymetrozine from tuberous and corm, fruiting, and cucurbit vegetables; cotton seed (undelinted); cotton gin byproducts; hops, dried; leafy vegetables (except Brassica ); head and stem Brassica vegetables; leafy Brassica greens; turnip greens; and pecans will occupy less than 3.4% of the cPAD for children ages 1-6 (the most highly exposed population subgroup). Chronic dietary risk to all other subgroups is less than that of children ages 1-6.

iii. Cancer . The Agency's level of concern for cancer exposure is 1 x 10 -6 . The lifetime risk of developing cancer from pymetrozine exposure is determined for the U.S. population (total) only. The estimated exposure to pymetrozine is 0.000034 mg/kg/day. Applying the Q1 1 * of 0.0119 (mg/kg/day) - 1 to the exposure value results in a cancer risk estimate of 4.0 x 10 -7 . Therefore, the lifetime risk to the U.S. population of developing cancer from dietary exposure to pymetrozine is below EPA's level of concern.

iv. Anticipated Residue and Percent Crop Treated Information . Section 408(b)(2)(E) authorizes EPA to use available data and information on the anticipated residue levels of pesticide residues in food and the actual levels of pesticide chemicals that have been measured in food. If EPA relies on such information, EPA must require that data be provided 5 years after the tolerance is established, modified, or left in effect, demonstrating that the levels in food are not above the levels anticipated. Following the initial data submission, EPA is authorized to require similar data on a time frame it deems appropriate. As required by section 408(b)(2)(E), EPA will issue a data call-in for information relating to anticipated residues to be submitted no later than 5 years from the date of issuance of this tolerance.

Section 408(b)(2)(F) states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if the Agency can make the following findings: Condition 1, that the data used are reliable and provide a valid basis to show what percentage of the food derived from such crop is likely to contain such pesticide residue; Condition 2, that the exposure estimate does not underestimate exposure for any significant subpopulation group; and Condition 3, if data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area. In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of percent crop treated (PCT) as required by section 408(b)(2)(F), EPA may require registrants to submit data on PCT.

The registrant provided projected percent crop treated data for pymetrozine, and the Agency revised them, as shown in the following Table 2.

The Agency believes that the three conditions listed above have been met. With respect to Condition 1, for new and existing uses, the Agency received estimates from Syngenta based upon its analysis of the marketing data that compared all of the potential major pesticides for cost, efficacy, and demand. EPA received these figures and performed its own independent analysis. The Agency examined the registrant's data and assumptions for all these factors. Based on the information that the registrant has provided, together with in-house data and information from outside contacts if necessary, the Agency agreed with the company's estimate of projected PCT for many crops. For some crops, the Agency revised the company's estimates upward.

For existing uses, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. EPA uses a weighted average PCT for chronic dietary exposure estimates. This weighted average PCT figure is derived by averaging State-level data for a period of up to 10 years, and weighting for the more robust and recent data. A weighted average of the PCT reasonably represents a person's dietary exposure over a lifetime, and is unlikely to underestimate exposure to an individual because of the fact that pesticide use patterns (both regionally and nationally) tend to change continuously over time, such that an individual is unlikely to be exposed to more than the average PCT over a lifetime. For acute dietary exposure estimates, EPA uses an estimated maximum PCT. The exposure estimates resulting from this approach reasonably represent the highest levels to which an individual could be exposed, and are unlikely to underestimate an individual's acute dietary exposure. The Agency is reasonably certain that the values for the percentage of the food treated, as shown in Table 2 of this preamble, are reasonable and are not likely to be an underestimation.

As to Conditions 2 and 3, regional consumption information and consumption information for significant subpopulations is taken into account through EPA's computer-based model for evaluating the exposure of significant subpopulations including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available information on the regional consumption of food to which pymetrozine may be applied in a particular area.

2. Dietary exposure from drinking water . The Agency lacks sufficient monitoring exposure data to complete a comprehensive dietary exposure analysis and risk assessment for pymetrozine in drinking water. Because the Agency does not have comprehensive monitoring data, drinking water concentration estimates are made by reliance on simulation or modeling taking into account data on the physical characteristics of pymetrozine.

The Agency uses FIRST (FQPA Index Reservoir Screening Tool) or PRZM/EXAMS (Pesticide Root Zone/Exposure Analysis Modeling System) program to predict pesticide concentrations in surface water; and SCI-GROW (Screening Concentration In GROund Water version 1.0) program to predict pesticide concentrations in groundwater.

The 'FIRST' program is a tier I screening model recently developed by EPA. It is used as a coarse screen for estimation of pesticide concentrations based on index agricultural watershed-drinking water reservoir or index reservoir (IR) scenario and percent cropped area (CPA). The FIRST model produces both a peak value (acute) and an annual average (chronic) pesticide concentration, or Estimated Environmental Concentrations (EECs). If the FIRST EECs are within 10% of a DWLOC, EFED will move to the next tier and perform a PRZM/EXAMS assessment.

The PRZM/EXAMS is a tier II model that provides an upper-bound estimate of a pesticide's concentration in a 1 hectare pond resulting from surface water runoff from a 10 hectare field, and is used to refine EECs generate by the lower tier FIRST model. As with FIRST, PRZM/EXAMS incorporates an index reservoir environment and includes a percent crop area factor as an adjustment to account for the maximum percent crop coverage within a watershed or drainage basin. However, this tier II model also uses NOAA climatological (rainfall) data for a 36-year period that allows for more realistic runoff events. PRZM/EXAMS produces maximum and annual concentrations for each of the 36 years for which there is rainfall data.

The Agency modeled six different scenarios, using the maximum application rate allowed for each crop: cotton, cucurbits, tomatoes, cabbage, pecans; and hops. The surface water concentrations for these crops were estimated using the Pesticide Root Zone Model (PRZM version 3.12) (Carsel et al., 1998) coupled with the Exposure Analysis Modeling System ( EXAMS version 2.97.5) (Burns, 1997) adjusted with the appropriate (or default) percent cropped area (PCA) factor. The PCA factor reflects the maximum percentage of a basin planted in the agricultural crop being considered in the risk assessment. EPA adapted a PCA factor of 0.20 for cotton. However, PCA factors are not available for cucurbits, tomatoes, cabbage, pecans, or hops, and a default value of 0.87 was used. This may result in an overestimation of the surface water concentrations for these crops compared to the cotton crop. The pecan scenario gives the highest estimated surface water concentrations, mainly due to a high level of rainfall in the areas where pecans are grown (sometimes as high as three times the level of other crops considered in this assessment) especially during the summer season. The peak (acute) EEC is 5.23 ppb and the average annual (chronic) EEC is 1.58 ppb.

PRZM is used to simulate pesticide transport as a result of runoff and erosion from an agricultural field. EXAMS estimates environmental fate and transport of pesticides in a receiving water body. For human health risk assessment, simulations were done using the Index Reservoir scenario with the consideration of a PCA factor. Weather and agricultural practices are simulated over 36 years so that the 10-year exceedance probability at the site can be estimated.

The SCI-GROW screening model was also developed by EPA, and is a regression model based upon actual groundwater monitoring data collected for the registration of a number of pesticides. The current version of SCI-GROW appears to provide a realistic estimate of pesticide concentrations in shallow, highly vulnerable ground water sites (i.e., sites with sandy soils and depth to ground water of 10 to 20 feet) for use in both chronic and acute ground water estimates.

None of these models include consideration of the impact processing (mixing, dilution, or treatment) of raw water for distribution as drinking water would likely have on the removal of pesticides from the source water. The primary use of these models by the Agency at this stage is to provide a coarse screen for sorting out pesticides for which it is highly unlikely that drinking water concentrations would ever exceed human health levels of concern.

Since the models used are considered to be screening tools in the risk assessment process, the Agency does not use estimated environmental concentrations (EECs) from these models to quantify drinking water exposure and risk as a %RfD or %PAD. Instead, drinking water levels of comparison (DWLOCs) are calculated and used as a point of comparison against the model estimates of a pesticide's concentration in water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food, and from residential uses. Since DWLOCs address total aggregate exposure to pymetrozine they are further discussed in the aggregate risk sections below.

Based on the FIRST, SCI-GROW, and PRZM/EXAMS models the EECs of pymetrozine for acute exposures are estimated to be 5.23 parts per billion (ppb) for surface water and < 0.02 ppb for ground water. The EECs for chronic exposures are estimated to be 1.58 ppb for surface water and < 0.02 ppb for ground water. See Tables 3 and 4 below.

3. From non-dietary exposure . The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). Since the current proposed uses do not result in additional residential exposure, the Agency's earlier evaluation of approved residential uses, found in the Federal Register of August 9, 2000 (65 FR 48626-48634), will not be repeated here.

4. Cumulative exposure to substances with a common mechanism of toxicity . Section 408(b)(2)(D)(v) requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

Based on the information available to EPA, there are no other pesticides that have a common mechanism of toxicity with pymetrozine. Unlike other pesticides for which EPA has followed a cumulative risk approach based on a common mechanism of toxicity, pymetrozine does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has not assumed that pymetrozine has a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see the final rule for Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997).

1. In general . FFDCA section 408 provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the data base on toxicity and exposure unless EPA determines that a different margin of safety will be safe for infants and children. Margins of safety are incorporated into EPA risk assessments either directly through use of a margin of exposure (MOE) analysis or through using uncertainty (safety) factors in calculating a dose level that poses no appreciable risk to humans.

2. Conclusion . There is a complete toxicity database for pymetrozine and exposure data are complete or are estimated based on data that reasonably accounts for potential exposures. EPA determined that the 10X safety factor to protect infants and children could be reduced to 3. The FQPA factor is reduced after assessing the potential for additional sensitivity of infants and children to residues of pymetrozine in the following studies: developmental toxicity studies in rabbit and rat and two-generation reproduction study in the rat. There was no evidence of increased susceptibility in these studies. The FQPA safety factor was not reduced to one due to the need for a developmental neurotoxicity study.

To estimate total aggregate exposure to a pesticide from food, drinking water, and residential uses, the Agency calculates DWLOCs which are used as a point of comparison against the model estimates of a pesticide's concentration in water (EECs). DWLOC values are not regulatory standards for drinking water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food and residential uses. In calculating a DWLOC, the Agency determines how much of the acceptable exposure (i.e., the PAD) is available for exposure through drinking water [e.g., allowable chronic water exposure (mg/kg/day) = cPAD - (average food + residential exposure)]. This allowable exposure through drinking water is used to calculate a DWLOC.

A DWLOC will vary depending on the toxic endpoint, drinking water consumption, and body weights. Default body weights and consumption values as used by the USEPA Office of Water are used to calculate DWLOCs: 2L/70 kg (adult male), 2L/60 kg (adult female), and 1L/10 kg (child). Default body weights and drinking water consumption values vary on an individual basis. This variation will be taken into account in more refined screening-level and quantitative drinking water exposure assessments. Different populations will have different DWLOCs. Generally, a DWLOC is calculated for each type of risk assessment used: acute, short-term, intermediate-term, chronic, and cancer.

When EECs for surface water and groundwater are less than the calculated DWLOCs, the Office of Pesticide Programs (OPP) concludes with reasonable certainty that exposures to the pesticide in drinking water (when considered along with other sources of exposure for which OPP has reliable data) would not result in unacceptable levels of aggregate human health risk at this time. Because OPP considers the aggregate risk resulting from multiple exposure pathways associated with a pesticide's uses, levels of comparison in drinking water may vary as those uses change. If new uses are added in the future, OPP will reassess the potential impacts of residues of the pesticide in drinking water as a part of the aggregate risk assessment process.

1. Acute risk . The Tier 1 exposure estimates provided by the acute dietary analysis are based on the assumption that tolerance-level residues are present in/on all commodities on which pymetrozine will be used and that 100% of these commodities are treated. The exposure estimates are therefore conservative ones. As shown in Table 3 of this preamble the acute EECs for pymetrozine are below EPA's level of concern. That is, they are below the DWLOC values calculated for the various population subgroups. Thus, residues of pymetrozine in food and drinking water do not exceed the EPA's level of concern (100% of the aPAD) for acute aggregate exposure for any of the population subgroups. Based on its assumptions and underlying data, this risk assessment is considered confident, very conservative, and highly protective of human health.

2. Chronic risk . The Tier 3 exposure estimates provided by the chronic dietary analysis are based on anticipated residues and projected percent crop treated data. Anticipated residues (average field trial values) were calculated for the crops. The resulting exposure estimates are therefore refined ones. The chronic EECs for pymetrozine are below the Agency's level of concern. That is, as shown in Table 4 of this preamble, they are below the DWLOC values calculated for the various population subgroups. Thus, residues of pymetrozine in food and drinking water do not exceed the Agency's level of concern (100% of the cPAD) for chronic aggregate exposure for any of the population subgroups.

3. Short-term risk . Short-term aggregate exposure takes into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level). In aggregating short-term risk, the Agency considered background average dietary exposure and short-term, non-dietary oral exposure. Non-dietary oral exposure may occur with toddlers as hand-to-mouth transfer of residues from ornamental plants or incidental ingestion of treated ornamental plants and/or surrounding soil. The highest estimated exposure via these routes is 0.0046 mg/kg/day which results from hand-to-mouth transfer of residues. Combining this exposure with the chronic dietary exposure estimate of 0.000045 mg/kg/day results in an aggregate exposure of 0.0046 mg/kg/day. In the absence of a short-term oral endpoint, EPA has used the acute dietary endpoint for infants and children (125 mg/kg/day) to estimate aggregate short-term risk. Note that this endpoint is based on a LOAEL and therefore has a 300-fold uncertainty factor associated with it. Combining the exposure estimate with the toxicological endpoint gives an MOE of 27,000. For this scenario, the Agency would be concerned with an MOE of less than 900; thus, this exposure is below EPA's level of concern. Aggregated short-term exposure results in a DWLOC of 1,400 ppb. This value is in excess of the peak EEC of 5.23 ppb for pymetrozine. Therefore, the short-term aggregate risk is below the Agency's level of concern.

4. Intermediate-term risk . Intermediate-term aggregate exposure takes into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level). There are no intermediate-term residential exposure scenarios for pymetrozine based on the current uses. Therefore, aggregate intermediate-term risks do not exceed the Agency's level of concern.

5. Aggregate cancer risk for U.S. population . As with the chronic dietary exposure analysis, the cancer risk assessment is also based on a Tier 3 estimate of dietary exposure. The cancer aggregate risk consists of chronic dietary exposure as well as non-occupational exposure resulting from pruning and planting treated ornamental plants. The sum of the food and residential exposure is 0.000034 (food) + 0.0000012 (residential) = 3.5 x 10 - 5 mg/kg/day. Assuming a cancer risk limit of 1 x 10 - 6 , the cancer dose of concern is 8.4 x 10 - 5 mg/kg/day (0.000001/Q 1 * = 0.000001/0.0119). As 3.5 x 10 - 5 mg/kg/day is less than 8.4 x 10 - 5 mg/kg/day, the aggregate food and residential exposure is below the level of concern. With respect to drinking water, the cancer DWLOC is calculated to be 1.7 ppb. The highest EEC for any of the crops in these petitions is 1.6 ppb (pecans). As a result, the aggregate cancer risk resulting from use of pymetrozine is below the Agency's level of concern.

6. Determination of safety . Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, and to infants and children from aggregate exposure to pymetrozine residues.

The Agency's Analytical Chemistry Laboratory has validated an enforcement methodology for pymetrozine (Syngenta Analytical Method AG-643A). It will be available to enforce the tolerance expression. The method may be requested from: Francis D. Griffith, Jr., Analytical Chemistry Branch, BEAD (7503C), 702 mapes Rd., Ft. George Meade, MD 20755-5350; telephone number: (410) 305-2905; e-mail address: griffin.francis@epa.gov.

There are no established European (CODEX), Canadian, or Mexican Maximum Residue Limits (MRL's) for pymetrozine. There are provisional MRLs in Germany for hops, dried (10 ppm) and potatoes (0.02 ppm). The European Union is currently evaluating a proposed tolerance of 5 ppm on hops, dried. There are proposed tolerances in Canada for tuberous and corm vegetables at 0.02 ppm, fruiting vegetables at 0.2 ppm, head and stem Brassica vegetables at 2.0 ppm, leafy Brassica vegetables at 5.0 ppm, leafy vegetables at 6.0 ppm, pecans at 0.02 ppm, hops (dried) at 5.0 ppm, citrus at 0.2 ppm, and cucurbits at 0.1 ppm. At this time, international harmonization of residue levels is not an issue.

The Agency imposed the following conditions on pymetrozine at the time of the original Notices of Registration in the fall of 1999:

1. Storage stability (due December 2000).

2. Corrosion characteristics (due December 2000).

3. Acute estuarine/marine toxicity in shrimp (due October 2000)

4. Photodegradation on soil, 161-3, (due October 2000).

5. Developmental neurotoxicity Study, 870-6300 or 83-6, (due October 2001).

6. Avian reproduction (mallard), 71-4(b), (due October 2001).

7. Drinking water monitoring (originally due October 2002 but the requirement was no longer applicable after Cancer Q* was changed).

Therefore, the tolerances are established for residues of pymetrozine in or on cotton seed, undelinted at 0.3 ppm; cotton gin byproducts at 2.0 ppm; fruiting vegetables at 0.2 ppm; cucurbit vegetables at 0.1 ppm; leafy vegetables (except Brassica ) at 0.6 ppm; head and stem Brassica vegetables at 0.5 ppm; leafy Brassica and turnip greens at 0.25 ppm, hops (dried) at 6.0 ppm; and pecans at 0.02 ppm.

Under section 408(g) of the FFDCA, as amended by the FQPA, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. The EPA procedural regulations which govern the submission of objections and requests for hearings appear in 40 CFR part 178. Although the procedures in those regulations require some modification to reflect the amendments made to the FFDCA by the FQPA of 1996, EPA will continue to use those procedures, with appropriate adjustments, until the necessary modifications can be made. The new section 408(g) provides essentially the same process for persons to “object” to a regulation for an exemption from the requirement of a tolerance issued by EPA under new section 408(d), as was provided in the old FFDCA sections 408 and 409. However, the period for filing objections is now 60 days, rather than 30 days.

You must file your objection or request a hearing on this regulation in accordance with the instructions provided in this unit and in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket control number OPP-301180 in the subject line on the first page of your submission. All requests must be in writing, and must be mailed or delivered to the Hearing Clerk on or before February 25, 2002.

1. Filing the request . Your objection must specify the specific provisions in the regulation that you object to, and the grounds for the objections (40 CFR 178.25). If a hearing is requested, the objections must include a statement of the factual issues(s) on which a hearing is requested, the requestor's contentions on such issues, and a summary of any evidence relied upon by the objector (40 CFR 178.27). Information submitted in connection with an objection or hearing request may be claimed confidential 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. A copy of the information that does not contain CBI must be submitted for inclusion in the public record. Information not marked confidential may be disclosed publicly by EPA without prior notice.

Mail your written request to: Office of the Hearing Clerk (1900), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. You may also deliver your request to the Office of the Hearing Clerk in Rm. C400, Waterside Mall, 401 M St., SW., Washington, DC 20460. The Office of the Hearing Clerk is open from 8 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Office of the Hearing Clerk is (202) 260-4865.

2. Tolerance fee payment . If you file an objection or request a hearing, you must also pay the fee prescribed by 40 CFR 180.33(i) or request a waiver of that fee pursuant to 40 CFR 180.33(m). You must mail the fee to: EPA Headquarters Accounting Operations Branch, Office of Pesticide Programs, P.O. Box 360277M, Pittsburgh, PA 15251. Please identify the fee submission by labeling it “Tolerance Petition Fees.”

EPA is authorized to waive any fee requirement “when in the judgement of the Administrator such a waiver or refund is equitable and not contrary to the purpose of this subsection.” For additional information regarding the waiver of these fees, you may contact James Tompkins by phone at (703) 305-5697, by e-mail at tompkins.jim@epa.gov, or by mailing a request for information to Mr. Tompkins at Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

If you would like to request a waiver of the tolerance objection fees, you must mail your request for such a waiver to: James Hollins, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460.

3. Copies for the Docket . In addition to filing an objection or hearing request with the Hearing Clerk as described in Unit VI.A., you should also send a copy of your request to the PIRIB for its inclusion in the official record that is described in Unit I.B.2. Mail your copies, identified by docket control number OPP-301180, to: Public Information and Records Integrity Branch, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460. In person or by courier, bring a copy to the location of the PIRIB described in Unit I.B.2. You may also send an electronic copy of your request via e-mail to: opp-docket@epa.gov. Please use an ASCII file format and avoid the use of special characters and any form of encryption. Copies of electronic objections and hearing requests will also be accepted on disks in WordPerfect 6.1/8.0 or ASCII file format. Do not include any CBI in your electronic copy. You may also submit an electronic copy of your request at many Federal Depository Libraries.

A request for a hearing will be granted if the Administrator determines that the material submitted shows the following: There is a genuine and substantial issue of fact; there is a reasonable possibility that available evidence identified by the requestor would, if established resolve one or more of such issues in favor of the requestor, taking into account uncontested claims or facts to the contrary; and resolution of the factual issues(s) in the manner sought by the requestor would be adequate to justify the action requested (40 CFR 178.32).

This final rule establishes a tolerance under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993). Because this rule has been exempted from review under Executive Order 12866 due to its lack of significance, this rule is not subject to Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. , or impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Public Law 104-4). Nor does it require any special considerations under Executive Order 12898, entitled Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994); or OMB review or any other Agency action under Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997). This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to 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). Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ) do not apply. In addition, the Agency has determined that this action will not 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). Executive Order 13132 requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” This final rule directly regulates growers, food processors, food handlers and food retailers, not States. This action does not alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). For these same reasons, the Agency has determined that this rule does not have any tribal implications as described in Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments (65 FR 67249, November 6, 2000). Executive Order 13175, requires EPA to develop an accountable process to ensure meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications. Policies that have tribal implications is defined in the Executive Order to include regulations that have substantial direct effects on one or more Indian tribes, on the relationship between the Federal government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes. This rule will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does 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 this final rule in the Federal Register . This final rule is not a “major rule” as defined by 5 U.S.C. 804(2).

The General Services Administration (GSA), after an analysis of additional data, is revising previous entries and adding new entries that were inadvertently omitted from FTR Amendment 97 published as Part II in the Federal Register of Friday, August 31, 2001 (66 FR 46070). This final rule revises the key city for Pontiac/Troy, Michigan, and the county and/or other defined locations for Denver, Colorado; Anoka County, Minnesota; Harrisburg and Hershey, Pennsylvania; and Sturgis, South Dakota. This final rule further adds new per diem city/county localities and rates for Dinwiddie County, Hopewell, Petersburg, and Prince George County, Virginia. In addition, this final rule revises footnote four (4) of the per diem rate table.

GSA has determined that this final rule is not a significant regulatory action for the purposes of Executive Order 12866 of September 30, 1993.

This final rule is not required to be published in the Federal Register for notice and comment; therefore, the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. , does not apply.

The Paperwork Reduction Act does not apply because this final rule does not impose recordkeeping or information collection requirements, or the collection of information from offerors, contractors, or members of the public which require the approval of the Office of Management and Budget under 44 U.S.C. 501 et seq.

This final rule is also exempt from congressional review prescribed under 5 U.S.C. 801 since it relates solely to agency management and personnel.

a. On the page that includes entries for the State of Colorado, under the State of Colorado, city of Denver, column two (County and/or other defined location) is revised to read “Denver, Adams, and Arapahoe Counties, that portion of Westminster located in Jefferson County, and Lone Tree in Douglas County”.

The revised pages containing the amendments to the table set forth above and a new page containing the notes to the table as amended above read as follows:

This is a synopsis of the Commission's Report and Order in MM Docket No. 00-173, adopted December 5, 2001, and released December 7, 2001. The full text of this 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 contractor, Qualex International, Portals ll, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com

The Tumbling Creek cavesnail ( Antrobia culveri ) was described as a new species by Hubricht (1971) from specimens taken by David Culver, Thomas Aley, and Leslie Hubricht in 1969 and 1970. Antrobia culveri is the type species for the genus Antrobia , also described new to science in 1971 by Hubricht. Hershler and Hubricht (1988) examined specimens of Antrobia culveri and confirmed the taxonomic placement of this species in the subfamily Littoridininae of the Gastropod family Hydrobiidae. They also noted the apparent close relatedness of the genus Antrobia to the genus Fontigens , which contains cave-adapted snails found in other Missouri caves and springs. The Tumbling Creek cavesnail is a small, white, blind, aquatic snail (height 2.3 millimeters (mm) (0.09 inches (in); diameter 2.0 mm (0.08 in); aperture height 1.2 mm (0.05 in); aperture diameter 1.1 mm (0.04 in)) with a small, conical, well-rounded, pale-yellow shell containing about 3.5 whorls (Hubricht 1971). The Tumbling Creek cavesnail is restricted to a single cave stream in Tumbling Creek Cave in Taney County, southwestern Missouri.

Greenlee (1974) provided the first information on the habitat of the species. He reported that the species was found primarily on “3 inch gravel substrate” (presumably meaning small stones or cobble of 3-inch diameter), with a few individuals observed using the recesses of a solid rock stream bottom. Greenlee (1974) did not note whether the snails used the upper or lower surface of the 3-inch gravel he observed them on, or whether the species was ever observed using larger rocks within the cave stream. Subsequent surveyors, however, have failed to document Antrobia culveri using a solid rock bottom, and the species is usually observed on the undersurface of rocks with a diameter greater than 3 inches (Ashley 2000). Additionally, Greenlee (1974) stated that the Tumbling Creek cavesnail was absent from areas of the stream that contained bat guano. Subsequent observers (McKenzie in litt. 1996; Ashley 2000, 2001a, 2001b) have noted Antrobia culveri in portions of Tumbling Creek where bat guano occurs. Finally, Greenlee (1974) and subsequent observers have all noted that the species appears to prefer areas of the stream that lack silt.

Although little is known regarding the life history of this cavesnail, Greenlee (1974) postulated that the species feeds on aquatic microfauna. Because Tumbling Creek cavesnails have been concentrated in sections of Tumbling Creek Cave that are usually adjacent to large deposits of bat guano, it has been theorized that Antrobia culveri is indirectly dependent upon these deposits for food (Greenlee 1974). Other life history aspects of this species, including its reproductive behavior, are unknown. Although little is known about the longevity or movements of this species, some limited information is available on the frequency of shell sizes within the population across different seasons. Ashley (2000) examined shell length data collected between 1996 and 2000 and noted that the average length of Antrobia culveri shells exhibited a slight peak during summer months but further noted that the difference was not statistically significant. Ashley (2000) also analyzed the frequency distribution of cavesnail shell lengths from fall data collected between 1997 and 2000 and noted a decrease in the frequency of smaller shells over that period. Ashley (2000) concluded that both fewer snails and fewer snails in the younger age classes were observed in the more recent fall visits conducted from 1997 through 2000. This suggests that there has been a reduction in recruitment of younger age classes into the population between 1997 and 2000.

Tumbling Creek Cave is a highly diverse cave (Thomas Aley, Ozark Underground Laboratory (OUL), in litt. 1978; Cecil Andrus, USDI, in litt. 1980). In addition to species included in the Missouri Department of Conservation's (MDC) Checklist of Species of Conservation Concern (Missouri Natural Heritage Program 2001) (e.g., a cave millipede ( Scoterpes dendropus )), Antrobia culveri is associated with at least three, possibly six, species that are new to science but have not yet been formally described: a millipede ( Chaetaspis sp.), a terrestrial isopod ( Caucasonethes sp.), an amphipod ( Stygobromus sp.), a dipluran ( Plusiocampa sp. ), a phalangodid harvestman ( Phalangium sp.), and a cave spider ( Islandiana sp.). Tumbling Creek Cave also provides habitat for a large maternity colony of federally listed gray bats ( Myotis grisescens ), with a recent estimated breeding population of 12,400 in 1998 (Dr. William Elliott, MDC, in litt. October 9, 2001). Historically, the breeding population included an estimated 50,000 individuals (MDC 1992, Missouri Natural Heritage Program 2000). There have also been historical observations of a very small hibernating population of the federally listed Indiana bat ( Myotis sodalis ). However, the Indiana bat has not been documented at the site since 1989 (Missouri Natural Heritage Program 2000). The Gray Bat Recovery Plan lists Tumbling Creek Cave as a “Priority 1” cave. Priority 1 gray bat caves have the highest level of biological significance for a gray bat maternity site (i.e., a cave deemed to be “absolutely essential” in preventing the extinction of the endangered gray bat) (U.S. Fish and Wildlife Service 1982).

Tumbling Creek Cave is owned by Tom and Cathy Aley of Protem, Missouri. Because of its rich cave fauna, the large maternity colony for the endangered gray bat, and its diverse physical features, Tumbling Creek Cave was designated as a National Natural Landmark and approved for inclusion on the National Registry of Natural Landmarks under the authority of the Historic Sites Act of 1935 (49 Stat. 666; 16 U.S.C. 461 et seq. ) (Cecil Andrus, USDI, in litt. , 1980; 48 FR 8693). Tumbling Creek Cave and approximately 395 acres surrounding the cave were embodied in the designation, including about 140 surface acres owned by the Aleys and about 255 surface acres owned by two adjacent property owners.

Antrobia culveri is known only from Tumbling Creek Cave in Taney County, southwestern Missouri. In an extensive survey of publicly and privately owned Missouri caves, no additional populations of this cavesnail were discovered (Gardner 1986). Recent surveys conducted in nearby caves and springs by Dr. David Ashley of Missouri Western State College, St. Joseph, Missouri, have also failed to locate this species at any other sites (David Ashley, in litt. November 2001). The fact that no additional populations were found in springs in close proximity to Tumbling Creek Cave supports the long-held contention that Tumbling Creek cave is the only location where this species occurs.

Antrobia culveri was historically known from an estimated area of 1,016 square meters (m 2 ) (10,900 square feet (ft 2 ) or 0.25 acres) (Greenlee 1974) of Tumbling Creek along approximately 229 meters (m) (750 feet (ft)) of the stream in the approximate middle one-third of the lower stream passage in Tumbling Creek Cave (Greenlee 1974). Based on a survey of approximately 630 m 2 (6,800 ft 2 ) of suitable habitat within the 457 m (1,500 ft) of human-accessible cave-stream habitat, Greenlee (1974) estimated the population of Tumbling Creek cavesnails at 15,118 individuals.

In 1995, we reviewed the status of the species, including the survey methodology originally established by Greenlee (1974), and determined that an inadequate description of the survey methods made it difficult to determine the number of plots taken. Our lack of knowledge on the number of plots sampled by Greenlee made it difficult to interpret his population estimates and impossible to duplicate his survey methods. Therefore, we concluded that a more rigorous statistical survey design would be necessary to establish population trends for the species. Following meetings with Dr. Pam Haverland of the U.S. Geological Survey, Columbia Environmental Research Center in Columbia, Missouri, and Mr. Tom Aley, President of Ozark Underground Laboratory (OUL) and owner of Tumbling Creek Cave, a sampling protocol was established within an approximate 75 m (247 ft) section of Tumbling Creek that was known to be inhabited by Antrobia culveri but that would minimize any potential impacts to the federally endangered gray and Indiana bats.

Following the establishment of sampling stations within Tumbling Creek Cave, and an initial September 1996 survey using those stations (McKenzie, in litt. 1996), we contracted Dr. David Ashley, of Missouri Western State College, St. Joseph, Missouri, to monitor population trends of the Tumbling Creek cavesnail. Ashley completed 16 separate monitoring trips between September 3, 1997, and August 31, 2001 (Ashley 2000, 2001a, 2001b, 2001c). Ashley (2000, 2001a, 2001b, 2001c) determined that population estimates of Antrobia culveri within the monitoring stations fluctuated both seasonally and annually, and ranged from a high of 1,166 individuals on September 3, 1997, to a low of 0 individuals on January 11, March 17, May 8, July 16, and August 31, 2001. Ashley statistically analyzed the data and concluded that a significant decrease in the numbers of cavesnails had occurred between September 9, 1996, and August 31, 2001 (Ashley 2001c).

Although the 2001 surveys failed to document the presence of any cavesnails within the established monitoring stations, 40 individuals were discovered upstream of the sampling stations in March 2001. During March 16-18, 2001, Ashley and others surveyed the entire human-accessible 457 m (1,500 ft) of Tumbling Creek, including a small tributary that has approximately 9 additional meters (30 ft) of accessible habitat. A total of 39 person-hours was expended in searching a total of 1,054 rocks in the 466 m (1,530 ft) of available habitat. A total of 39 cavesnails were located in a 14-m (45-ft) section of the stream upstream from the monitoring stations, and another cavesnail was found in the tributary (Ashley 2001a). Subsequent surveys in May, July, and August 2001 documented the presence of cavesnails only in this 14-m section upstream of the established sampling stations. The small tributary stream was not searched during those subsequent surveys. A more thorough search was not conducted in either the tributary or the area upstream from the sampling stations in order to minimize disturbance to cavesnails in those areas. Observations between March and August 2001 suggest that the numbers of Antrobia culveri have declined drastically from estimates obtained by Greenlee (1974); however, differing sampling methods make it impossible to directly compare Ashley's estimates with those of Greenlee.

In addition to Greenlee's 1974 survey and the standardized surveys conducted between 1996 and 2001, other attempts have been made to monitor the species' status and derive estimates of its abundance. A June 1991 survey conducted by Tom Aley, Paul McKenzie (Service, Columbia, Missouri), and Dennis Figg (MDC, Jefferson City, Missouri) located 42 individuals after a 9 person-hour search (McKenzie, pers. obs.). A June 1993 survey conducted by Monty Holder (a high school biology instructor) of Sedalia, Missouri, and three assistants located 21 individuals during 6 person-hours of search effort (Tom Aley, in litt. 1993), but the number of plots sampled is unknown. On August 29, 1995, Paul McKenzie and Cathy Aley searched for the species and attempted to estimate the number of cavesnails discovered per 0.3048 m 2 (1 ft 2 ) plot. This survey yielded 6 cavesnails in 22 plots or 0.27 cavesnails per plot (McKenzie, unpubl. data). This compares to an estimated 2.16 cavesnails per plot observed by Greenlee (1974) when equivalent plot sizes were calculated for analysis purposes. Although it is impossible to determine the exact number of plots sampled by Greenlee (1974), he did record the average number of snails per plot, and this can be compared to the same variable measured in 1995. A decrease from 2.16 cavesnails per plot to 0.27 cavesnails per plot would represent an approximate 88 percent decrease in the species' density over the 22-year period between 1974 and 1995.

On January 6, 1989, the Service published an Animal Notice of Review (54 FR 54554-54579) which included the Tumbling Creek cavesnail as a category 2 candidate species for possible future listing as threatened or endangered. Category 2 candidates were those taxa for which information contained in the Service's files indicated that listing may be appropriate but for which additional data were needed to support a listing proposal. On November 21, 1991, the Service published an Animal Candidate Notice of Review (56 FR 58804-58836), which elevated the Tumbling Creek cavesnail to category 1 status. Category 1 candidates were those taxa for which the Service had on file sufficient information on biological vulnerability and threats to support preparation of listing proposals. In the subsequent February 28, 1996, Candidate Notice of Review (61 FR 7596-7613), we indicated that the category 2 candidate species list was being discontinued, and that henceforth the term “candidate species” would be applied only to those taxa that would have earlier fit the definition of the former category 1 candidate taxa, that is, those species for which we had on hand sufficient information to support a listing proposal. The Tumbling Creek cavesnail has remained a candidate species until now.

In 1996, we initiated a 5-year set of standardized surveys designed to better assess and quantify the decline in the species' population that was apparent from the earlier data. In January 2001, Ashley (pers. comm. January 14, 2001) notified the Service that no cavesnails were observed within the established monitoring stations during the January 11 survey. He further reported that an analysis of 5 years of data collected between September 1996 and March 2001 indicated that population numbers of the species had exhibited an alarming decline (Ashley 2001b). Based on this information, the Service determined that it was necessary to more closely monitor the species by having surveys conducted once every two months.

Recognizing the need for prompt additional conservation actions for the species, on January 30, 2001, Region 3 of the Service recommended changing the listing priority number for the Tumbling Creek cavesnail from 7 to 1 based upon the mid-January monitoring that failed to locate any cavesnails (Service 2001). Region 3 also recommended pursuing an emergency listing of the species and simultaneously publishing a proposal for long-term listing as endangered under the Act as soon as funding became available. On October 30, 2001, we published an updated Candidate Species Notice of Review (66 FR 54808) that formally changed the listing priority number for Antrobia culveri from 7 to 1, reflecting our increased concern for the survival of the species.

On August 29, 2001, the U.S. Department of the Interior reached an agreement with several conservation organizations regarding a number of listing actions that had been delayed by court-ordered critical habitat designations and listing actions for other species. That agreement was subsequently approved by the U.S. District Court for the District of Columbia. Under the agreement, the Service and the organizations agreed to significantly extend the existing court-approved deadlines for the actions on the other species, thereby making funds available for a number of listing actions judged to be higher priority by the Service. Those higher priority listing actions include the emergency listing of the Tumbling Creek cavesnail.

After a thorough review and consideration of all information available, the Service has determined that the Tumbling Creek cavesnail warrants classification as an endangered species. We followed procedures found in section 4 of the Act (16 U.S.C. 1533) and regulations (50 CFR part 424) promulgated to implement the listing provisions of the Act. We may determine a species to be endangered or threatened due to one or more of the five factors described in section 4(a)(1) of the Act. These factors and their application to the Tumbling Creek cavesnail ( Antrobia culveri ) are as follows:

Antrobia culveri has exhibited a drastic decline in numbers since the first estimate was made by Greenlee (1974) (see Status and Distribution, above). Systematic sampling conducted at established stations between 1996 and 2001 revealed that a statistically significant decline in population has occurred over that period (McKenzie in litt. 1996; Ashley 2000, 2001a, 2001b, 2001c). Additionally, no cavesnails have been located at established monitoring stations during the last five surveys (Ashley 2001a, 2001b, 2001c).

We have also documented a dramatic reduction in the portion of the cave stream occupied by the cavesnail. Antrobia culveri was historically known from an estimated 229 m (750 ft) of Tumbling Creek (Greenlee 1974). The 229 m of occupied habitat in 1974 constituted 50 percent of the 457 m (1,500 ft) of human-accessible cave-stream habitat that is believed to be suitable for the cavesnail. The entire accessible 457 m (1,500 ft) of Tumbling Creek, including a small tributary that has approximately 9 additional meters (30 ft) of accessible suitable habitat, was surveyed in March 2001. Cavesnails were found solely in one small (14-m) (45-ft) section of the stream and in the small tributary (Ashley 2001a). Observations between March and August 2001 suggest that Antrobia culveri is now restricted to 23 m of available stream habitat or approximately 5 percent of the 457 m of accessible suitable habitat. These figures indicate that distribution of this species in Tumbling Creek Cave has decreased by 90 percent.

Species such as the Tumbling Creek cavesnail, which spend part or all of their life cycle in subterranean water systems, are highly vulnerable to changes in the quality and quantity of that water. In turn, the quality and quantity of the subsurface water is highly dependent upon conditions and human activities on the land surface from which water feeds into losing streams and sinkholes that drain into underground karst conduits. Surface water moves into the subsurface system by a number of mechanisms, including sinkholes, percolation through sandy or gravelly soils and stream bottoms, and seepage and flowage into crevices. As water moves from the surface to the subsurface system, it carries the chemicals and particulate matter from the surface. The land surface that feeds water into a particular cave stream is referred to as the “recharge area” for that cave stream. Because recharge areas may be large and may consist of all or parts of several surface watersheds, it is critically important to accurately determine the boundaries of the recharge area with reliable hydrogeological methods. Only when the recharge area is accurately delineated can water quality threats be successfully addressed (Aley and Aley 1991).

The recharge area that feeds water into Tumbling Creek Cave has been recently delineated by the cave owner, Mr. Thomas Aley of the OUL, who is also a recognized cave specialist and expert karst hydrogeologist (Aley and Aley 2001). Pending the results of additional recharge delineation studies currently being conducted by Aley on a tract of land recently purchased by him and Cathy Aley (Tom Aley, pers. comm., September 24, 2001), he estimated the recharge area to be approximately 2,349 hectares (5,804 acres or 9.07 square miles). Land ownership based on current data within the recharge area is: (1) Tom and Cathy Aley own approximately 1,550 acres, or 25 percent of the total; (2) employees of Ozark Underground Laboratory and other private individuals who manage their property to protect water quality and benefit the species own approximately 1,268 acres or 22 percent; (3) an estimated 1,300 acres or 23 percent is within Mark Twain National Forest; (4) the U.S. Army Corps of Engineers (CE) owns an estimated 100 acres or 2 percent; and (5) other private landowners whose land use practices and knowledge of the cavesnail are currently unknown to us own approximately 1,636 acres or 28 percent. Thus, within the delineated recharge area for Tumbling Creek Cave, roughly 4,168 acres or approximately 72 percent is either in public or private ownership by entities who can be expected to manage their land to benefit the species. This includes 920 acres recently purchased by Tom and Cathy Aley, or about 22 percent of the total conservation ownership. However, most of this recently purchased land was subject to recent land use practices (e.g., over-grazing and removal of riparian vegetation) that resulted in heavy soil erosion that probably continues to contribute to deteriorating water quality in Tumbling Creek Cave. Remediation and restoration of these lands are planned and will require considerable funds, effort, and time.

The Tumbling Creek cavesnail is likely threatened by habitat degradation through diminished water quality from upstream locations within the unprotected or improperly managed areas within the cave's delineated recharge zone. The dramatic decrease in the population and area occupied by this species is probably attributable to degraded water quality from these sources. In recent years, there has been a noticeable increase in water turbidity in Tumbling Creek; the increased turbidity has probably had an adverse effect on the water quality in the cave's stream (Tom and Cathy Aley, pers. comm., August 30, 2001). Increased silt loads within Tumbling Creek could adversely affect the cavesnail by hampering reproduction and recruitment by suffocating juvenile cavesnails (Ashley 2000). Tom and Cathy Aley have also observed that clay particles within deposited silt have settled between gravel and rocks and cemented them together and to the stream bottom (Tom and Cathy Aley, pers. comm., August 2001). Such cementing decreases habitat available to cavesnails, because they are generally restricted to the undersurface of gravel and rocks. This hypothesis is supported, in part, by the observations of Greenlee (1974), who reported that cavesnails occurred primarily on “3 inch gravel substrate” rather than on the larger rocks the species has been seen using during more recent surveys. Interestingly, Ashley's (2000) results revealed that some older individuals use silt-covered substrates. This is different from the observations made by Greenlee (1974) who noted that cavesnails were not observed in areas of the stream where fine silt was deposited. Ashley's observations may be because of a reduction in the amount of silt-free substrates preferred by cavesnails which could force the species to use less favorable habitats. Although silt has been a component of Tumbling Creek since Greenlee's initial survey in 1974, it has apparently increased significantly since that date (Tom and Cathy Aley, pers. comm., August 2001). Additional research is needed to determine the degree of silt deposition within Tumbling Creek and if the deposition of silt into the cave is adversely impacting the species, especially smaller and younger individuals (Ashley 2000).

Potential sources of silt within the cave's recharge area have been identified on the two tracts recently purchased by Tom and Cathy Aley, including an earthen dam that burst, and severely degraded and eroded pastureland due to overgrazing. In the latter case, soil erosion has been exacerbated in the last six years by the removal of nearly all vegetation within the riparian corridors of all semi-permanent and intermittent streams on one of those parcels. Harvey (1980) concluded that “accelerated erosion and sediment transport” was a problem within drainage basins that have “excessive slopes,” and identified “timber cutting and land clearing for raising livestock, extending urban sprawl, and highway building” as potential sources of “accelerated erosion.” In addition to these sources, the construction of fire lanes associated with controlled burning on Forest Service property within the recharge area may increase the threat of soil erosion with a resulting decrease in water quality in Tumbling Creek.

Other factors within the recharge area of Tumbling Creek Cave that could contribute to the deterioration of the water quality of Tumbling Creek include: (1) increase in ammonia and nitrate loads from livestock feedlots that could lead to reductions in dissolved oxygen levels, (2) chemicals used for highway maintenance or from accidental spills, and (3) contaminants from different types of trash or hazardous waste materials deposited into sinkholes, ravines, and depressions. Whether these factors are occurring on the parts of the recharge area that are outside of the current “conservation ownership” remains to be determined. Refer to Factor E for a discussion of these potential threats.

Because access to Tumbling Creek Cave is controlled by the cave owners, all collection of and research on Antrobia culveri is strictly controlled. Consequently, there is no evidence of overutilization of this species for commercial, recreational, scientific, or educational purposes. There is also no evidence that disturbance associated with conducting regular surveys is adversely affecting the species. Rocks that are examined are carefully replaced in the location from which they were removed, any specimens discovered are disturbed as little as possible and kept moist to reduce stress, and only a small percentage of the available habitat is sampled during each survey.

The direct effect of disease on the Tumbling Creek cavesnail is not known and such risks to the species have not been determined. Because the Tumbling Creek cavesnail is known from a single location, disease must be considered a potential threat to the survival of the species. Certain species of salamanders have been shown to be adversely impacted by the bacterium Acinetobacter that flourished due to increasing levels of nitrogen associated with the overstocking of livestock (Worthylake and Hovingh 1989). Similarly, Lefcort et al. (1997) and Kiesecker and Blaustein (1997) found that amphibians exposed to high levels of silt are susceptible to infection by different species of water mold of the genus Saprolegnia. Saprolegnia spp. are widespread in natural waters and commonly grow on dead organic material (Wise et al. 1995). Speer (1995) stated that some species of Saprolegnia are parasitic on aquatic invertebrates such as rotifers, nematodes, diatoms, and arthropods. High nitrogen and silt levels from overgrazing or other agricultural or urban runoff may increase the cavesnail's susceptibility to disease and act synergistically with other risk factors (e.g., competition from limpets, discussed below) to jeopardize the survival of the remaining individuals. Whether the Tumbling Creek cavesnail is being adversely affected by bacteria or water molds associated with increased loads of nitrogen or silt into Tumbling Creek is unknown but warrants further investigation.

During the December 6, 1997, survey, a few individuals of an unknown species of limpet ( Ferrissia sp.) were discovered for the first time on the same substrates used by Antrobia culveri within the established monitoring stations (Ashley, pers. comm., September 10, 2001). Limpets were not observed again until the January 11, 2001, survey, after which their numbers began to increase. By the August 31, 2001, survey, limpet numbers had increased explosively, and the presence of many small limpets, as well as larger limpets with visible, developing embryos, indicated that reproduction was taking place (Ashley, pers. comm., September 10, 2001; McKenzie pers. obs.). The reasons why these organisms have appeared and increased in numbers within Tumbling Creek are unknown; it is also unknown whether they compete with the cavesnails for food, breeding substrates, or other necessary resources. Other cave invertebrates (e.g., a troglobitic isopod, Caecidota antricola .; a troglobitic amphipod, Stygobromus sp.; and a troglophilic amphipod, Gammarus sp.) coexist with Antrobia culveri, often on the same rocks, but it is unknown if these species compete with the cavesnail in any way. Additional research is needed to determine if local environmental changes have provided a competitive advantage for one or more of these species over the Tumbling Creek cavesnail.

The primary cause of the decline of the Tumbling Creek cavesnail is unknown but is believed to be associated with factors within the 2,349-hectare (5,804-acre) delineated recharge area that have adversely affected the water quality of Tumbling Creek. Federal, State, and local laws have not been sufficient to prevent past and ongoing impacts to areas within the cave's delineated recharge area. Antrobia culveri is listed as critically imperiled globally (G1) by The Nature Conservancy, as well as critically imperiled in the State (S1) on the Missouri Species of Conservation Concern Checklist (Missouri Natural Heritage Program 2001). The designation as G1/S1 on this checklist, however, provides no legal authority, but is simply utilized for planning and communication purposes (Missouri Natural Heritage Program 2001). Nonetheless, the species currently receives some protection under the Wildlife Code of Missouri (Wildlife Code) (Missouri Department of Conservation 2001) as a “biological diversity element” (Missouri Natural Heritage Program 2001). “Biological diversity elements” are protected under the following general prohibitions of chapter 4 of the Wildlife Code (3CSR10-4.110): “(1) No bird, fish, amphibian, reptile, mammal or other form of wildlife, including their homes, dens, nests and eggs in Missouri shall be molested, pursued, taken, hunted, trapped, tagged, marked, enticed, poisoned, killed, transported, stored, served, bought, imported, exported or liberated to the wild in any manner, number, part, parcel or quantity, at any time, except as specifically permitted by these rules and any laws consistent with Article IV, sections 40-46 of the Constitution of Missouri. (2) Except as otherwise provided in this Code, wildlife may be taken only by holders of the prescribed permits and in accordance with prescribed methods. (3) No person, corporation, municipality, county, business or other public or private entity shall cause or allow any deleterious substance to be placed, run or drained into any of the waters of this State in quantities sufficient to injure, stupefy or kill fish or other wildlife which may inhabit such waters.”

Under the Section 6 Cooperative Agreement between MDC and the Service, if a species is listed as endangered under the ESA, the Conservation Commission of Missouri shall list the species as State endangered. The protection of all species in Missouri is outlined in Chapter 4 of the Wildlife Code and regulations pertaining to endangered species are listed in section 3CSR10-4.111. Under the Wildlife Code, citizens can possess (but not sell or purchase) up to five individuals of any species without a permit and when not specifically protected elsewhere in the code (3CSR10-9.110). However, when a species is listed as endangered, citizens cannot possess any individuals and can not import, transport, purchase, take or possess without a scientific collecting or special use permit. Although the term “refuge” is not defined under the Wildlife Code, there is also a provision that enables MDC's Director to establish refuges not to exceed 1 square mile for not more than 60 days to provide essential protection to endangered species. Furthermore, the Wildlife Code states that a species' “home” is protected. The term “home” is not defined in this statute and may provide limited or no protection for the cavesnail's habitat. For instance, the creek where the cavesnail resides and the cave's recharge area would probably not be considered a home and thus receive no protection under the Wildlife Code (Bob White, MDC, Protection Division Chief, pers. comm., October 2, 2001).

The Federal Cave Resources Protection Act of 1988 (18 U.S.C. 4301-4309; 102 Stat. 4546) was passed to “secure, protect, and preserve significant caves on Federal lands * * *” and to “foster increased cooperation and exchange of information between governmental authorities and those who utilize caves located on Federal lands for scientific, educational, or recreational purposes.” Although this statute and a final rule to implement the Federal Cave Resources Protection Act on Forest Service land (59 FR 31152; June 17, 1994) provides protection for caves located on property owned by the Forest Service, they do not provide protection for caves whose recharge areas are within Forest Service boundaries if the caves themselves are under private lands, as is the case with Tumbling Creek Cave.

The protection afforded Antrobia culveri from the above-mentioned statutes is limited, does not provide any protections to its habitat, and includes no provisions to protect areas within the delineated recharge area for Tumbling Creek Cave. Therefore, we conclude the most likely threats to the species cannot be addressed by existing regulatory mechanisms.

Several other potential factors, including point and non-point pollution, threats from residential and commercial development, and recent changes to the hydrological cycle within the 2,349-hectare (5,804-acre) delineated recharge area supporting Tumbling Creek Cave may have negative effects on the species. It is possible that the recent decline in cavesnail numbers is attributable to some yet to be identified point or non-point source pollution within the cave's recharge area. Because the Tumbling Creek cavesnail occupies a permanent, flowing stream, it will likely come in contact with any deleterious chemical or other material that enters the cave's recharge system. Silt deposition has been identified as a potential problem, especially to younger cohorts of the cavesnail's population, but additional research is needed to determine if other contaminants are potentially involved. (See Factor A above.)

Non-point source pollution may be a problem in a significant portion of the recharge area that feeds Tumbling Creek Cave. Potential sources of pollution include the drainage of barnyard and feedlot wastes and the discharge of treated sewage into sinkholes and losing streambeds within the cave's recharge area. The water quality of Tumbling Creek is also threatened due to accidental spills into sinkholes or losing stream valleys feeding Tumbling Creek Cave from State and county highways passing through the recharge area. Such sources of pollution have been identified as potential problems for ground water in the Springfield-Salem Plateaus of southern Missouri (including the watershed that encompasses Tumbling Creek and its identified recharge zone) (Harvey 1980). The decline in numbers of the Tumbling Creek cavesnail may be due to one or several sources of pollution that have resulted in a deterioration of water quality within the recharge area for Tumbling Creek as outlined in Factor A. In comparing ground-water quality of sites within the Ozark Plateaus (including SW Missouri) with other National Water-Quality Assessment Program (NAWQA) sites, Petersen et al. (1998) documented that: (1) nitrate concentrations in parts of the Springfield Plateau aquifer were higher than in most other NAWQA drinking-water aquifers, and (2) volatile organic compounds were detected more frequently in drinking-water aquifers within the Ozark Plateaus than in most other drinking-water aquifers. Tumbling Creek Cave is within the NAWQA study boundaries; consequently, the cavesnail could be threatened from these contaminants. Although no detailed water analyses have yet been performed on Tumbling Creek, an instrumentation package to measure water quality parameters will be installed in Tumbling Creek cave during the fall of 2001.

Aley (pers. comm., Jan. 19, 2001) postulated that the decline in cavesnail numbers may actually be because of too much gray bat guano that could deplete oxygen levels in Tumbling Creek, especially during periods of reduced flows as occurred during 1999-2001. What importance gray bat guano plays in the life history requirements of the Tumbling Creek cavesnail is yet to be tested experimentally. The instrumentation package mentioned above will provide data on dissolved oxygen levels once it is installed.

Tumbling Creek Cave is approximately 25 to 30 miles southeast of Branson, Missouri, which is one of the most rapidly expanding areas in the State due to tourism, outdoor recreation, and entertainment developments. If recent trends continue, it has been projected that the number of visitors attracted to this area would increase from an estimated level of 6 million in 1992 to11 million by the year 2015. The accompanying growth in entertainment- and recreation-related activities will place even greater demands on this area of the State (Mullen and Keith 1992). Tumbling Creek Cave is 2 to 3 miles northwest of Bull Shoals Lake which is also undergoing additional real estate development. Consequently, it is likely that sections of the recharge zone for Tumbling Creek Cave will be adversely affected by real estate development and related construction and land management activities.

Another potential threat to the species results from the close hydrologic association of Tumbling Creek with nearby Bull Shoals Lake. Occasional high water levels in this CE reservoir are believed to cause water to backup into the cave stream, threatening roosting bats and the cavesnail (Aley, pers. comm., July 16, 2000). The CE is considering raising the conservation pool of the reservoir by 10 feet, which will likely increase the frequency and duration of the backup events in Tumbling Creek Cave.

Climatic changes, especially recent periods of drought, may also be a contributing factor to the decline of the cavesnail. The National Oceanic and Atmospheric Administration's (NOAA) Palmer Drought Severity Index provides a widely recognized and accepted standard measurement of moisture conditions (NOAA 2001). The Index varies roughly from -6.0 (extreme drought) to +6.0 (extremely wet), with -0.49 to 0.49 indicating near normal conditions. Since the 1974 survey by Greenlee, there have been 4 periods in Southwest Missouri where the Index was below normal for 6 months or longer and exceeded an Index value of -2.0 (moderate drought) for some part of that period. These events occurred in 2-year cycles: 1980-1981; 1991-1992; 1995-1996; and 1999-2000. The 1980-1981 drought was the most prolonged and severe, with the Index reaching -5.0 (extreme drought). We further analyzed a 6-year period between 1995 and 2000, which is the approximate period that Ashley conducted his cavesnail monitoring. The Index was below normal for 6 months or more for 4 of these 6 years. The years, number of months the Index was below normal, and the averages for the negative indices are: 1995, 6 months, average Index -1.54; 1996, 7 months, average Index -1.2; 1999, 6 months, average Index -1.29; 2000, 10 months, average Index -1.65. Preliminary data on NOAA's website indicate that below-normal moisture (negative Palmer Index) occurred in this region during the early part of 2001 but precipitation levels are now near normal levels.

According to this climatic data, in 2 recent periods (1995-1996 and 1999-2000) precipitation within the recharge area for Tumbling Creek Cave was below normal for an extended period. The direct or indirect impacts of these droughts on the cavesnail are unknown. Reduced flows in the cave stream, especially when combined with other threats, could hamper essential life history requirements ( e.g., reproduction, food availability, water temperature); decrease the flushing of silt, guano, and harmful contaminants from the stream; and create an environment more favorable for competitors (e.g., limpets, isopods, and amphipods).

The small population size and endemism (i.e., restricted to a single site) of Antrobia culveri makes it vulnerable to extinction due to genetic drift, inbreeding depression, and random or chance changes to the environment (Smith 1990) that can significantly impact cavesnail habitat. Inbreeding depression can result in death, decreased fertility, smaller body size, loss of vigor, reduced fitness, and various chromosome abnormalities (Smith 1990). Despite any evolutionary adaptations for rarity, habitat loss and degradation increase a species' vulnerability to extinction (Noss and Cooperrider 1994). Numerous authors ( e.g., Noss and Cooperrider 1994; Thomas 1994) have indicated that the probability of extinction increases with decreasing habitat availability. Although changes in the environment may cause populations to fluctuate naturally, small and low-density populations are more likely to fluctuate below a minimum viable population ( i.e., the minimum or threshold number of individuals needed in a population to persist in a viable state for a given interval; Gilpin and Soule 1986; Shaffer 1981; Shaffer and Samson 1985). Current threats to the habitat of the Tumbling Creek cavesnail may exacerbate potential problems associated with its low population numbers and increase the chances of this species going extinct.

Under section 4(b)(7) of the Act and regulations at 50 CFR 424.20, we may emergency list a species if the threats to the species constitute an emergency posing a significant risk to its well-being. Such an emergency listing expires 240 days following publication in the Federal Register unless, during this 240-day period, we list the species following the normal listing procedures. Below, we discuss reasons why emergency listing the Tumbling Creek cavesnail as endangered is necessary. In accordance with the Act, if at any time after we publish this emergency rule, we determine that substantial evidence does not exist to warrant such a rule, we will withdraw it.

In making this determination, we have carefully assessed the best scientific and commercial information available regarding the past, present, and future threats faced by the Tumbling Creek cavesnail. Antrobia culveri is restricted to one cave and population monitoring conducted between 1996 and 2001 has indicated that a significant and precipitous decline in the population of the species has occurred. This decline has continued to the point that we are no longer finding any cavesnails in a part of the cave where they had always been found prior to 2001 by using the same monitoring methodology. From the discussion under Factor D of this section, it is clear that currently applicable Federal, State, and local laws, regulations and ordinances, individually and collectively, do not provide adequate protection for the Tumbling Creek cavesnail or its habitat or assure that the species will continue to survive.

We believe that the survival of the Tumbling Creek cavesnail now depends on protecting the delineated recharge area of Tumbling Creek Cave from further degradation and restoring and rehabilitating areas within the recharge area to improve the water quality in Tumbling Creek. The few remaining individuals are vulnerable to extinction from ongoing threats, as well as from random natural or human-caused events unless sufficient habitat is protected, water quality improves, and the current small population greatly increases in size. The recent rapid population decline makes it clear that this cavesnail is on the brink of extinction. By this emergency listing as an endangered species, we believe the additional protections, funding, and recognition that immediately become available to the species will greatly increase the likelihood that it can be saved from extinction and can ultimately be recovered.

Critical habitat is defined in section 3, paragraph 5(A), of the Act as: (i) The specific areas within the geographical area occupied by a 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 a determination that such areas are essential for the conservation of the species. “Conservation” 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 our implementing regulations (50 CFR 424.12) require that, to the maximum extent prudent and determinable, we designate critical habitat at the time the species is determined to be endangered or threatened. However, our budget for listing and critical habitat activities is currently insufficient to allow us to immediately complete all of the listing actions required by the Act. Listing Antrobia culveri without designation of critical habitat will allow us to concentrate our limited resources on other listing actions that must be addressed, while allowing us to invoke the protections needed for the conservation of this species without further delay. This is consistent with section 4(b)(6)(C)(i) of the Act, which states that final listing decisions may be issued without critical habitat designation when it is essential that such determinations be promptly published. If prudent and determinable, we will prepare a proposed critical habitat designation for A. culveri in the future at such time as 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 results in public awareness and conservation actions by Federal, Tribal, State, and local agencies, private organizations, and individuals. The Act provides for possible land acquisition and cooperation with the State and requires that recovery actions be carried out for all listed species. The protection required of Federal agencies and the prohibitions against certain activities involving listed species are discussed, in part, below.

Section 7(a) of the Act, as amended, 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. If a species is listed on an emergency basis, or is listed under a non-emergency listing proposal, 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 such a species or to destroy or adversely modify its critical habitat. If a Federal agency action may adversely affect a listed species or adversely modify its designated critical habitat, the responsible Federal agency must initiate formal consultation with the Service. Section 7(a)(4) of the Act requires Federal agencies to confer with us on any action that is likely to jeopardize the continued existence of a proposed species or result in destruction or adverse modification of proposed critical habitat. Federal agency actions that may affect the Tumbling Creek cavesnail and may require conference and/or consultation with the Service include, but are not limited to, those within the jurisdiction of the U.S. Forest Service, U.S. Army Corps of Engineers, Natural Resources Conservation Service, Environmental Protection Agency, and Federal Highway Administration.

The Act and its implementing regulations found at 50 CFR 17.21 set forth a series of general prohibitions and exceptions that apply to all endangered wildlife. These prohibitions, in part, make it illegal for any person subject to the jurisdiction of the United States to take (including harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect; or attempt any such conduct), import or export, ship in interstate or foreign 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 Service agents and those of State conservation agencies.

Permits may be issued to carry out otherwise prohibited activities involving endangered wildlife under certain circumstances. Regulations governing permits are codified at 50 CFR 17.22 and 17.23. For endangered species, such permits are available for scientific purposes, to enhance the propagation or survival of the species, and for incidental take in connection with otherwise lawful activities.

As published in the Federal Register on July 1, 1994 (59 FR 34272), it is the Service's policy to identify to the maximum extent practicable at the time a species is listed those activities that would or would not 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.

We believe that, based on the best available information, the following actions are not likely to result in a violation of section 9, provided these actions are carried out in accordance with any existing regulations and permit requirements:

(1) Possession of a Tumbling Creek cavesnail legally acquired prior to the effective date of this rule;

(2) Actions that may affect the Tumbling Creek cavesnail that are authorized, funded, or carried out by a Federal agency, when the action is conducted in accordance with an incidental take statement issued by the Service under section 7 of the Act;

(3) Actions that may affect the Tumbling Creek cavesnail that are not authorized, funded, or carried out by a Federal agency, when the action is conducted in accordance with an incidental take permit issued by the Service under section 10(a)(1)(B) of the Act. Applicants design a Habitat Conservation Plan (HCP) and apply for an incidental take permit. These HCPs are developed for species listed under section 4 of the Act and are designed to minimize and mitigate impacts to the species to the greatest extent practicable; and

(4) Actions that may affect the Tumbling Creek cavesnail that are conducted in accordance with the conditions of a section 10(a)(1)(A) permit for scientific research or to enhance the propagation or survival of the species.

We believe that the following actions could result in a violation of section 9; however, possible violations are not limited to these actions alone:

(1) Unauthorized possession, collecting, trapping, capturing, killing, harassing, sale, delivery, or movement, including interstate and foreign commerce, or harming, or attempting any of these actions, of Tumbling Creek cavesnails without a permit (research activities where cavesnails are collected will require a permit under section 10(a)(1)(A) of the Endangered Species Act);

(2) Discharges or dumping of toxic chemicals, silt, or other pollutants (point source and non-point source pollution) within the recharge area of Tumbling Creek Cave that alters or degrades the water quality of Tumbling Creek to the point that it results in death or injury to individuals of the species or results in degradation of cavesnail occupied habitat; and

(3) Release of exotic species (including, but not limited to, fish and crayfish) into Tumbling Creek that adversely affect the cavesnail.

Questions regarding whether specific activities will constitute a violation of section 9 should be directed to the Field Supervisor of the Columbia, Missouri Field Office (see ADDRESSES section).

Requests for copies of the regulations regarding listed species and inquiries regarding prohibitions and permits may be addressed to the U.S. Fish and Wildlife Service, Endangered Species Permits, Bishop Whipple Federal Building, 1 Federal Dr., Fort Snelling, MN 55111-4056 (612/713-5343, facsimile 612/713-5292).

The Service has determined that an Environmental Assessment, as defined under the authority of the National Environmental Policy Act of 1969, need not be prepared in connection with regulations adopted pursuant to section 4(a) of the Act, as amended. The Service published a notice outlining our reasons for this determination in the Federal Register on October 25, 1983 (48 FR 49244).

This rule does not contain any collections of information that require additional Office of Management and Budget (OMB) approval under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. An information collection related to the rule pertaining to permits for endangered and threatened species has OMB approval and is assigned clearance number 1018-0094. This rule does not alter that information collection requirement. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number. For additional information concerning permits and associated requirements for endangered wildlife, see 50 CFR 17.21 and 17.22.

A complete list of all references cited in this rulemaking is available upon request from the Field Supervisor, Columbia, Missouri Field Office (see ADDRESSES section).

The primary author of this proposed rule is Paul M. McKenzie, Ph.D., U.S. Fish and Wildlife Service, Columbia, Missouri Field Office (see ADDRESSES section).

The FMP divides managed species into two categories: actively managed and monitored. Harvest guidelines for actively managed species (Pacific sardine and Pacific mackerel) are based on formulas applied to current biomass estimates. Harvest guidelines for monitored species (jack mackerel, northern anchovy, and market squid), which are underutilized or under the jurisdiction of the State of California, are not based on current biomass estimates, although a constant allowable biological catch (ABC) for each species is based on the long-term yield of each species. If an ABC for a monitored species is reached, it would be designated an actively managed species; at that time, the Pacific Fishery Management Council (Council)would review the condition of the resource and recommend management action.

At a public meeting each year, the biomass for each actively managed species is presented at a public meeting held by the Council’s Coastal Pelagic Species Management Team (Team). At that time, the biomass, the harvest guideline, and the status of the fishery is reviewed. Following review and recommendations by the Council, and after hearing all public comments, NMFS publishes the annual harvest guideline in the Federal Register before the beginning of the fishing season.

On October 10, 2001, in accordance with the procedures of the FMP, the biomass report and harvest guideline for Pacific sardine were reviewed at a public meeting of the Team at the offices of the California Department of Fish and Game in Los Alamitos, California. A public meeting between the Team and the Council’s Coastal Pelagic Species Advisory Subpanel was held in the same location that afternoon. The Council reviewed the report at its meeting on November 1, 2001, and heard comments from its advisory bodies and the public. No significant comments on the biomass estimate were received; therefore, the Council recommended to NMFS that the biomass and harvest guideline be published as presented.

The sardine population was estimated using a modified version of the integrated stock assessment model called Catch at Age Analysis of Sardine-Two Area Model (CANSAR-TAM). CANSAR-TAM is a forward-casting, age-structured analysis using fishery dependent and fishery independent data to obtain annual estimates of sardine abundance, year-class strength, and age-specific fishing mortality for 1983 through 2001. The modification of CANSAR-TAM was developed to account for the expansion of the Pacific sardine stock northward to include waters off the northwest Pacific coast. Documentation of the 2002 estimate is described in Stock Assessment of Pacific Sardine with Management Recommendations for 2002 (see ADDRESSES ).

The formula in the FMP uses the following factors to determine the harvest guideline:

1. The biomass of age one sardine and above. For 2002, this estimate is 1,057,599 metric tons (mt).

2. The cutoff. This is the biomass level below which no commercial fishery is allowed. The FMP established this level at 150,000 mt.

3. The portion of the sardine biomass that is in U.S. waters. For 2002, this estimate is 87 percent, based on the average of larval distribution obtained from scientific cruises and the distribution of the resource obtained from logbooks of fish-spotters.

4. The harvest fraction. This is the percentage of the biomass above 150,000 mt that may be harvested. The fraction used varies (5-15 percent) with current ocean temperatures. A higher fraction is used for warmer ocean temperatures, which favor the production of Pacific sardine, and a lower fraction is used for cooler temperatures. For 2002, the fraction was 15 percent based on three seasons of sea surface temperature at Scripps Pier, California.

Based on the estimated biomass of 1,057,599 mt and the formula in the FMP, a harvest guideline of 118,442 mt was calculated for the fishery beginning January 1, 2002. The harvest guideline is allocated one-third for Subarea A, which is north of 35° 40′ N. lat. (Pt. Piedras Blancas, CA) to the Canadian border, and two-thirds for Subarea B, which is south of 35° 40′ N. lat. to the Mexican border. Any unused resource in either area will be reallocated between areas to help ensure that the optimum yield will be achieved. The northern allocation is 39,481 mt; the southern allocation is 78,961 mt.

This action is authorized by 50 CFR 660.509 and is exempt from review under Executive Order 12866.

The Assistant Administrator for Fisheries, NOAA (AA) finds for good cause under 5 U.S.C. 553 (b)(B) that providing prior notice and an opportunity for public comment on this action is unnecessary because establishing the annual harvest guideline is primarily a ministerial act, determined by applying formulas in the FMP. During the comment periods for Amendment 8 to the CPS FMP and its proposed rule, the public was given an opportunity to comment on these formulas. Some of the variables used in the formula (biomass estimate, proportion of biomass in U.S. waters, harvest fraction determination) are developed with input from the Council and its advisory committees. Final input on these items was provided in November, which did not allow sufficient time to publish a proposed rule in the Federal Register . Since the harvest guideline should be in place before the fishing year begins on January 1, 2002, it would be impracticable and contrary to the public interest to delay this process further.

Because this final rule merely announces the result of harvest guideline calculations and does not require any participants in the fishery to take action or to come into compliance, the AA finds for good cause under 5 U.S.C. 553 (d)(3) that delaying the effective date of this final rule for 30 days is unnecessary.

Because prior notice and opportunity for public comment are not required for this action by 5 U.S.C. 553, or any other law, the analytical requirements of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq ., are not applicable.