In an interim rule effective January 2, 2002, and published in the Federal Register on January 9, 2002 (67 FR 1067-1070, Docket No. 01-081-1), we amended the imported fire ant regulations contained in §§ 301.81 through 301.81-10 by adding all or portions of five counties in Arkansas, three counties in Georgia, eight counties in North Carolina, and four counties in Tennessee to the list of quarantined areas in § 301.81-3. As a result of that action, the interstate movement of regulated articles from those areas was restricted.

Comments on the interim rule were required to be received on or before March 11, 2002. We received one comment by that date, from an association of State plant health officials. The comment supported the changes to the quarantine made by the interim rule. It also requested that the Animal and Plant Health Inspection Service consider making various other changes to the imported fire ant regulations in a separate rulemaking. We are considering those recommendations.

Therefore, for the reasons given in the interim rule and in this document, we are adopting the interim rule as a final rule without change.

This action also affirms the information contained in the interim rule concerning Executive Order 12866 and the Regulatory Flexibility Act, Executive Orders 12372 and 12988, and the Paperwork Reduction Act.

Further, for this action, the Office of Management and Budget has waived the review process required by Executive Order 12866.

The regulations in 9 CFR part 94 (referred to below as the regulations) govern the importation of specified animals and animal products into the United States in order to prevent the introduction of various animal diseases, including foot-and-mouth disease (FMD). FMD is a highly communicable viral disease, not found in the United States since 1929, that affects all cloven-hoofed ruminants, especially cattle and swine. The disease is highly communicable and is characterized by fever and blisterlike lesions on the tongue and lips, in the mouth, on the teats, and between the hooves. It causes severe losses in production of meat, milk, and other dairy products. Although many affected animals survive the disease, it leaves them debilitated. Because of the highly communicable nature of FMD, it is necessary to protect livestock that are free of the disease from any animals, animal products, or other articles that might be contaminated with the FMD virus.

Section 94.1(a) of the regulations lists regions of the world that are declared free of rinderpest (another highly communicable serious disease) or free of both FMD and rinderpest. FMD or rinderpest exists in all regions of the world not listed. The provisions of § 94.1(b) of the regulations prohibit, except for very limited exceptions, the importation into the United States of any ruminant or swine or any fresh (chilled or frozen) meat of any ruminant or swine that originates in any region in which FMD or rinderpest exists, or that enters a port that is located in or otherwise transits a region in which FMD or rinderpest exists.

Among the articles that could harbor the FMD virus is farm equipment that has been used on a premises containing infected animals and that has not been cleaned free of soil or other particulate matter from that premises.

In the past, such equipment that was imported into the United States from a region in which FMD exists has not been allowed entry into the United States without being first cleaned of dirt or other potentially contaminated matter at the port of arrival.

Although such cleaning has been effective to date in ensuring that FMD-contaminated equipment does not come into contact with U.S. livestock, it presents logistical problems that we have determined make it necessary to review such a practice. Many U.S. ports do not have facilities that allow large mechanized equipment to be cleaned in a way that ensures that soil and other particulate matter has been removed. Additionally, some ports are not constructed to allow for secure disposal of waste water and other cleaning materials.

Because of the recent increase in outbreaks of FMD in different parts of the world, we now consider it necessary to prohibit the importation of all used farm equipment into the United States from regions in which FMD exists unless the equipment meets the following conditions: (1) It has first been steam-cleaned free of exposed soil and other particulate matter in the exporting region; and (2) it is accompanied by an original certificate signed by an authorized official of the national animal health service of the region of origin stating that such cleaning has been done. Once the equipment arrives at the port of arrival, it must be inspected by an inspector of the Animal and Plant Health Inspection Service (APHIS) to confirm that it has been cleaned free of exposed soil and other particulate matter, or that the amount of any exposed soil and other particulate matter is so minimal that it can be safely removed at the port of arrival. We are adding these requirements to the regulations at a new § 94.1(c) and are redesignating the existing § 94.1(c) as § 94.1(d).

We consider it necessary to require certification from the exporting region that such cleaning has been done, even though inspection will also be conducted in the United States, in order for APHIS to make the best use of its personnel resources. If used farm equipment arrives at a U.S. port without an original certificate signed by an authorized official of the national animal health service of the region of origin, APHIS inspectors will not inspect the equipment and will simply not allow it to be entered into the United States. If equipment arrives at a U.S. port with the required certification from the exporting region, but is found upon APHIS inspection to contain exposed soil or other particulate matter, it will also be refused entry, unless, in the judgment of the APHIS inspector, the amount of exposed soil is minimal enough to allow cleaning at the port of arrival, and there are adequate facilities and personnel at the port to conduct such cleaning without risk of spreading disease. Whether such cleaning can be carried out at the port of arrival will be determined by factors such as, but not limited to, the availability of space, cleaning equipment, and personnel, and the presence of adequate drainage and other means of ensuring that any material potentially contaminated with the FMD virus is safely disposed of.

We are adding to § 94.0 of the regulations a definition of farm equipment to mean “equipment used in the production of livestock or crops, including, but not limited to, mowers, harvesters, loaders, slaughter machinery, agricultural tractors, farm engines, farm trailers, farm carts, and farm wagons, but excluding automobiles and trucks.” We are excluding automobiles and trucks from the definition of farm equipment because those vehicles are constructed in such a way that APHIS inspectors at the port of arrival can adequately clean them if necessary. The other types of equipment used on farms are more likely to contain parts and crevices from which soil and other particulate matter are not easily removed.

Whether farm equipment is considered used will be determined at the time of inspection at the port of arrival, and will be based on its physical appearance, its description in the equipment's carrier manifest, and any accompanying trade documentation, including, but not limited to, Customs entries, container markings, certificates, and commercial invoices.

This rulemaking is necessary on an emergency basis to prevent the importation into the United States of dirty equipment that has been used on farms that may be affected with FMD. Because of the highly transmissible nature of the disease, such equipment poses an unacceptable risk of introducing the FMD virus into the United States. We are making this action effective retroactively to March 31, 2001, which is the date APHIS made effective a policy stating it had stopped issuing import permits for, and would prohibit the importation of, the materials covered by this interim rule. This effective date is necessary to ensure that articles contaminated with the FMD agent are not imported into the United States. Under these circumstances, the Administrator has determined that prior notice and opportunity for public comment are contrary to the public interest and that there is good cause under 5 U.S.C. 553 for making this rule effective less than 30 days after publication in the Federal Register .

We will consider comments we receive during the comment period for this interim rule (see DATES above). After the comment period closes, we will publish another document in the Federal Register . That document will include a discussion of any comments we receive and any amendments we are making to the rule as a result of the comments.

This rule has been reviewed under Executive Order 12866. The rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget.

This emergency situation makes timely compliance with section 604 of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) impracticable. We are currently assessing the potential economic effects of this action on small entities. Based on that assessment, we will either certify that the rule will not have a significant economic impact on a substantial number of small entities or publish a final regulatory flexibility analysis.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule: (1) Preempts all State and local laws and regulations that are inconsistent with this rule; (2) has retroactive effect to March 31, 2001; and (3) does not require administrative proceedings before parties may file suit in court challenging this rule.

In accordance with section 3507(j) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ), the information collection and recordkeeping requirements included in this interim rule have been submitted for emergency approval to the Office of Management and Budget (OMB). OMB has assigned control number 0579-0195 to the information collection and recordkeeping requirements.

We plan to request continuation of that approval for 3 years. Please send written comments on the 3-year approval request to the following addresses: (1) Office of Information and Regulatory Affairs, OMB, Attention: Desk Officer for APHIS, Washington, DC 20503; and (2) Docket No. 01-037-1, Regulatory Analysis and Development, PPD, APHIS, suite 3C03, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please state that your comments refer to Docket No. 01-037-1 and send your comments within 60 days of publication of this rule.

This interim rule establishes regulations prohibiting the importation into the United States of used farm equipment from regions affected with FMD unless the equipment is accompanied by an original certificate, signed by an authorized official of the national animal health services of the exporting region, stating that the equipment has been steam-cleaned prior to export to the United States to remove all visible dirt and other particulate matter. We are soliciting comments from the public (as well as affected agencies) concerning our information collection and recordkeeping requirements. These comments will help us:

(1) Evaluate whether the information collection is necessary for the proper performance of our agency's functions, including whether the information will have practical utility;

(2) Evaluate the accuracy of our estimate of the burden of the information collection, including the validity of the methodology and assumptions used;

(3) Enhance the quality, utility, and clarity of the information to be collected; and

(4) Minimize the burden of the information collection on those who are to respond (such as 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).

Estimate of burden: Public reporting burden for this collection of information is estimated to average 0.20 hours per response.

Respondents: Exporters of used farm equipment in FMD-affected regions; veterinary authorities in FMD-affected regions.

Estimated annual number of respondents: 1,000.

Estimated annual number of responses per respondent: 10.

Estimated annual number of responses: 10,000.

Estimated total annual burden on respondents: 2,000 hours.

Copies of this information collection can be obtained from Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 734-7477.

On March 15, 2002 (67 FR 11566), the NRC published in the Federal Register a direct final rule amending its regulations in part 72 by revising the NAC International Multi-Purpose Canister (NAC-MPC) cask system listing within the “List of approved spent fuel storage casks” to include Amendment 2 to Certificate of Compliance (CoC) No. 1025. This amendment allows for modification of the design of the cask system to accommodate a new type of fuel. The modifications include increased length of the fuel basket and canister, transfer cask, and vertical concrete cask. Changes also include a redesigned fuel basket to accommodate 26 fuel assemblies, with an alternate 24-fuel assembly configuration and increased transfer cask radial shielding. The CoC has been revised in its entirety to include a reference to the new type of fuel and a revised format. The Technical Specifications (TS) have also been revised in their entirety to include specifications for the new type of fuel, new operational limits, and to incorporate a revised format for the TS. In the direct final rule, NRC stated that if no significant adverse comments were received, the direct final rule would become final on May 29, 2002. The NRC did not receive any comments on the direct final rule. Therefore, this rule will become effective as scheduled.

On March 21, 2002, the FAA issued AD 2002-06-51, amendment 39-12688 (67 FR 14844, March 28, 2002), applicable to certain Bombardier Model CL-600-2C10 (Regional Jet Series 700 and 701) series airplanes, to require revising the Airplane Flight Manual (AFM) to provide procedures for addressing uncommanded transfer of fuel from wing fuel tanks to the center fuel tank. That action also requires revising the Minimum Equipment List (MEL); limiting operation of the airplane to flight within 60 minutes of a suitable alternative airport; and ensuring that normal mission fuel requirements are increased by 3,000 pounds. That action was prompted by reports of uncommanded fuel transfer between the wing fuel tanks and the center fuel tank. The actions required by that AD are intended to ensure that the flight crew has the procedures necessary to address such uncommanded fuel transfer, which could cause the center tank to overfill, and fuel to leak from the center tank vent system or to become inaccessible, and result in engine fuel starvation.

Since the issuance of that AD, Transport Canada Civil Aviation (TCCA), which is the airworthiness authority for Canada, has advised the FAA that vibration and misalignment of fuel lines in the center fuel tank could cause damage to the fuel line couplings, and result in leakage of fuel within the center tank. Extensive fuel leakage within the center tank could result in an increase in unusable fuel and consequent engine fuel starvation.

Bombardier has issued two alert service bulletins to provide increased reliability for the fuel system. The procedures included in these alert service bulletins are described as follows:

CRJ700 (Bombardier) Alert Service Bulletin A670BA-28-007, Revision B, dated March 18, 2002, specifies procedures for modifying the fuel distribution system for the center tank. Modification includes installing new brackets and attaching the ejectors with new P-clamps, replacing couplings (four in total) with new couplings, and relocating certain brackets.

CRJ700 (Bombardier) Alert Service Bulletin A670BA-28-005, Revision B, dated March 21, 2002, specifies procedures for inspection of the motive flow line and fuel feed line in the fuel distribution system for the center tank to detect discrepancies, and corrective actions if necessary. Discrepancies include misalignment, pre-loading, or damage to certain parts such as the fuel lines, couplings, boost pump canisters, check valves, ejectors, and P-clamps. Corrective actions include replacement of any part that exceeds the limit specified by the alert service bulletin, and proper alignment of parts.

TCCA issued Canadian airworthiness directive CF-2002-22, dated March 22, 2002, in order to ensure the continued airworthiness of these airplanes in Canada.

This airplane model is manufactured in Canada and is 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, TCCA has kept the FAA informed of the situation described above. The FAA has examined the findings of TCCA, 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 supersedes AD 2002-06-51 to continue to require revising the AFM to address uncommanded transfer of fuel from wing fuel tanks to center fuel tank; revising the MEL; limiting airplane operation; and increasing normal mission fuel requirements by 3,000 pounds. This AD adds requirements for modifying the fuel distribution system for the center tank; a one-time inspection of the motive flow line and fuel feed line in the fuel distribution system for discrepancies, and corrective actions if necessary. The actions are required to be accomplished per the alert service bulletins described previously, except as discussed below.

Operators should note that the applicability of the Canadian airworthiness directive specifies serial numbers 10005 through 10039. However, this AD expands the applicability to include airplanes having serial numbers 10005 and subsequent. The FAA considers that such an expansion is necessary until a modification is developed by the manufacturer and approved by the FAA to address the identified unsafe condition and ensure continued operational safety of the fleet.

Operators also should note that, although the Canadian airworthiness directive specifies that the actions may be accomplished per the previously referenced alert service bulletins, “or later revisions,” this AD requires modification and inspection actions to be accomplished per specific alert service bulletins. The FAA points out that where a specific service bulletin is referenced in an AD, the use of the phrase, “or later revisions,” violates Office of the Federal Register regulations regarding approval of materials that are incorporated by reference.

Operators should note that, although the Canadian airworthiness directive and the applicable alert service bulletin specify a “visual inspection,” this AD specifies a “detailed inspection.”

This is considered to be interim action. The manufacturer has advised that it currently is developing a modification that will positively address the unsafe condition addressed by this AD. Once this modification is developed, approved, and available, the FAA may consider additional rulemaking.

Paragraph (a) of this AD has been revised to clarify the reference to AD 2002-06-51 by adding “amendment 39-12688” following the AD number.

Paragraph (d) of this AD has been revised to clarify the operational requirements cited in paragraph (d) of AD 2002-06-51.

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 2002-NM-99-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.

On April 2, 2002, the Federal Aviation Administration (FAA) issued AD 2002-07-09, amendment 39-12703 (67 FR 17923, April 12, 2002), which applies to all Boeing Model 727, 727C, 727-100, 727-100C, 727-200, and 727-200F series airplanes. That AD currently requires repetitive inspections to find cracking of the lower skin panel at the lower row of fasteners in certain lap joints of the fuselage, and repair, if necessary. That AD was prompted by the FAA's determination that, in light of additional crack findings, certain modifications of the fuselage lap joints are necessary. The actions required by that AD are intended to find and fix fatigue cracking of the fuselage lap joints, which could result in sudden fracture and failure of the lower skin lap joints, and rapid decompression of the airplane.

The FAA notes that there is a typographical error in the STC number specified in paragraph (i) of the AD.

The FAA has determined that a correction to AD 2002-07-09 is necessary to correctly identify the STC number.

This document corrects the error and correctly adds the AD as an amendment to section 39.13 of the Federal Aviation Regulations (14 CFR 39.13).

The AD is reprinted in its entirety for the convenience of affected operators. The effective date of the AD remains May 17, 2002.

Since this action only corrects a typographical error, it has no adverse economic impact and imposes no additional burden on any person. Therefore, the FAA has determined that notice and public procedures are unnecessary.

The FAA issued a final rule AD 2002-06-04 on March 11, 2002 (67 FR 12858, March 20, 2002) for the specified Eurocopter France helicopters. The following correction is needed:

The effective date given in paragraph (f) of the AD was intended to be the same effective date of April 24, 2002, as stated in the “Effective Date” line. Therefore, the date in paragraph (f) needs correcting.

Since no other part of the regulatory information has been revised, the final rule is not being republished.

The FAA issued a final rule AD 2002-05-06, on March 5, 2002 (67 FR 11893, March 18, 2002). The following correction is needed:

The effective date given in paragraph (g) of the AD was intended to be the same effective date of April 22, 2002 as stated in the “Effective Date” line. Therefore, the date in paragraph (g) needs correcting.

Since no other part of the regulatory information has been revised, the final rule is not being republished.

The FAA published this direct final rule with a request for comments in the Federal Register on February 27, 2002 (67 FR 8859). The FAA uses the direct final rulemaking procedure for a non-controversial rule when FAA believes that there will be no adverse public comment. This direct final rule advised the public that adverse comments were not anticipated, and that unless written adverse comments or written notice of intent to submit such adverse comments, were received within the comment period, the regulation would become effective on March 21, 2002. No adverse comments were received. Thus, this action confirms the direct final rule will become effective on that date.

On February 21, 2002, the FAA proposed to amend Title 14 Code of Federal Regulations, part 71 (14 CFR part 71) by establishing Class E surface area airspace at St. George, UT, in order to provide a safer IFR environment at St. George Municipal Airport, St. George, UT (67 FR 7980). This amendment provides additional Class E2 Surface Area controlled airspace at St. George, UT, to contain aircraft conducting instrument flight operations at St. George Municipal Airport. Interested parties were invited to participate in the rulemaking proceeding by submitting written comments on the proposal. No comments were received.

This amendment to Title 14 Code of Federal Regulations, part 71 (14 CFR part 71) establishes Class E airspace at St. George, UT in order to provide adequate controlled airspace for IFR operations at St. George Municipal Airport, St. George, UT. This amendment establishes Class E2 Surface Area airspace at St. George, UT to enhance safety and efficiency of IFR flight operations in the St. George, UT terminal area. The FAA establishes Class E airspace where necessary to contain aircraft transitioning between the terminal and en route environments. This rule is designed to provide for the safe and efficient use of the navigable airspace and to promote safe flight operations under IFR at the St. George Municipal Airport and between the terminal and en route transition stages.

The area will be depicted on aeronautical charts for pilot reference. The coordinates for this airspace docket are based on North American Datum 83. Class E airspace areas designated as surface areas for an airport, are published in Paragraph 6002, of FAA Order 7400.9J dated August 31, 2001, and effective September 16, 2001, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document will be published subsequently in the Order.

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

On February 21, 2002, the FAA proposed to amend Title 14 Code of Federal Regulations, part 71 (14 CFR part 71) by revising Class E airspace at Hailey, ID, in order to provide a safer IFR environment at Friedman Memorial Airport, Hailey, ID (67 FR 7981). This amendment provides additional Class E2 Surface Area controlled airspace at Hailey, ID to contain aircraft conducting instrument flight operations at Friedman Memorial Airport. Interested parties were invited to participate in the rulemaking proceeding by submitting written comments on the proposal. No comments were received.

This amendment to Title 14 Code of Federal Regulations, part 71 (14 CFR part 71) modifies Class E airspace at Hailey, ID, in order to provide adequate controlled airspace for IFR operations at Friedman Memorial Airport, Hailey, ID. This amendment modifies Class E 700 and 1,200 foot airspace at Hailey, ID, to enhance safety and efficiency of IFR flight operations in the Hailey, ID, terminal area. The FAA establishes Class E airspace where necessary to contain aircraft transitioning between the terminal and en route environments. This rule is designed to provide for the safe and efficient use of the navigable airspace and to promote safe flight operations under IFR at the Friedman Memorial Airport and between the terminal and en route transition stages.

The area will be depicted on aeronautical charts for pilot reference. The coordinates for this airspace docket are based on North American Datum 83. Class E airspace areas extending upward from 700-feet or more above the surface of the earth, are published in Paragraph 6005, of FAA Order 7400.9J dated August 31, 2001, and effective September 16, 2001, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document will be published subsequently in the Order.

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

The harbor maintenance fee was created by the Water Resources Development Act of 1986 (Pub. L. 99-622; codified at 26 U.S.C. 4461 et seq. ) (the Act) and is implemented by § 24.24 of the Customs Regulations (19 CFR 24.24). Imposition of the fee is intended to require those who benefit from the maintenance of U.S. ports and harbors to share in the cost of that maintenance. Pursuant to the Act and as implemented by the regulations, the harbor maintenance fee became effective on April 1, 1987, and is assessed based on 0.125 percent of the value of commercial cargo loaded or unloaded at certain identified ports or, in the case of passengers, on the value of the actual charge paid for the transportation. In 1998, the U.S. Supreme Court held the fee unconstitutional as applied to exports ( United States Shoe Corporation v. United States, 118 S. Ct. 1290, No. 97-372 (March 31, 1998)). Until then, the fee had been assessed on port use associated with imports, exports, foreign trade zone admissions, passengers, and movements of cargo between domestic ports.

After the Supreme Court decision, by a notice published in the Federal Register (63 FR 24209) on May 1, 1998, Customs announced that, as of April 25, 1998, the harbor maintenance fee for cargo loaded on board a vessel for export would no longer be collected. On July 31, 1998, Customs published in the Federal Register (63 FR 40822) an amendment to § 24.24 of the Customs Regulations, removing the requirement that exporters loading cargo at ports subject to the harbor maintenance fee pay the fee. Thus, currently, application of the fee continues, as noted above, but only for imports, domestic shipments, foreign trade zone admissions, and passengers.

On August 28, 1998, the U.S. Court of International Trade (CIT) ordered an immediate refund of undisputed export fee payments to exporters who had filed complaints with the court ( United States Shoe Corporation v. United States, No. 94-11-00668, slip op. 98-126 (C.I.T. Aug. 28, 1998)). The court's refund procedure applied to export fee payments received by Customs within two years of the date of the exporter's complaint, and refunds under this procedure were duly paid by Customs. On February 28, 2000, the U.S. Court of Appeals for the Federal Circuit (CAFC) acknowledged that the Customs Regulations did not then impose a limitation on the period within which a refund request may be filed ( Swisher International, Inc. v. U.S., 205 F. 3d 1358 (No. 99-1277 C.A.F.C. February 28, 2000) (cert. denied).) With this decision, all parties who had paid export fees became eligible to file a refund request for those fees regardless of when the fees were paid. This opened the entire period the export fee was in effect (April 1, 1987—April 25, 1998) to recovery of refunds under the administrative procedure set forth in the regulations.

After publishing a notice of proposed rulemaking and considering the comments received, Customs, on July 2, 2001, published a final rule in the Federal Register (66 FR 34813) establishing a one year from time of payment time limit within which a refund request must be filed for overpayments of harbor maintenance fees that were paid on a quarterly basis. As Customs has not collected the fee on exports since April 25, 1998, this time limitation, when in effect, would have eliminated the opportunity for exporters to file any additional harbor maintenance fee refund requests. Thus, to ensure that all exporters had sufficient time and notice to file refund requests, the July 2, 2001, final rule provided that those who made quarterly payments on exports more than one year ago (in effect, all payers of these export fees) would have until December 31, 2001, to file refund requests. Customs notes that the December 31, 2001, filing deadline for refunds applied also to any other harbor maintenance fees paid on a quarterly basis that are more than a year old as of that date.

Before publication of the July 2, 2001, final rule, Customs published an interim regulation providing a simplified procedure for requesting refunds of export harbor maintenance fees. The interim regulation was published in the Federal Register (66 FR 16854) on March 28, 2001, and became effective on that date. A correction document to the interim regulation was published in the Federal Register (66 FR 21806) on April 27, 2001.

It is noted that the July 2, 2001, final rule setting the one year time limitation for refunds of quarterly harbor maintenance fee payments incorporated the simplified refund procedure for export fee payments set forth in the interim regulation. However, it modified the structure of the interim regulation and deleted language in the interim regulation regarding the application of interest to refunds because the issue of interest was and remains subject to litigation.

Today's document is a final rule that adopts, with modifications, the content of the interim regulation as corrected by the April 27, 2001, correction document. It retains the structure of the July 2, 2001, final rule and continues to not mention whether interest is applicable to the refunds. The primary additional modifications to the interim regulation (additional to those that were included in the July 2, 2001, final rule) are that: (1) Customs, after receiving a refund request, will provide exporters a list of all payments Customs was able to identify from a search of its records; (2) all exporters filing refund requests will have an additional 120 days from Customs issuance of payment and certification reports to file a request for a Revised Report/Certification to make a refund claim for additional payments; (3) refund requests covering export fee payments made prior to July 1, 1990, will become subject to a power of attorney/authorization letter requirement (exporters or their agents can submit the authorization after the refund request is filed); (4) an exception to the power of attorney/authorization letter requirement will be introduced for freight forwarders; and (5) any agent (including a freight forwarder) that signs a Report/Certification or Revised Report/Certification on an exporter's behalf will certify that it will use due diligence to forward the refund to the exporter and will return to Customs any refund not forwarded to the exporter within one year of its receipt. These and other changes are discussed in the “Discussion of Comments”, “Other Changes”, and “Conclusion” sections of this document.

For Export Fee Payments Made on and After July 1, 1990

The interim regulation's refund procedure, which became effective on March 28, 2001 (the substance of which was incorporated into the July 2, 2001, final rule), provides that Customs, upon receipt of a request, will search its records for payments made on and after July 1, 1990, and include all payments that can be confirmed in a “Harbor Maintenance Tax Payment Report and Certification” (Report/Certification) that is issued to the exporter. If the exporter agrees that the Report/Certification is accurate, the exporter will sign and return it to Customs, thereby agreeing that the amount determined to be owed in the Report/Certification is in full accord and satisfaction of its export harbor maintenance fee claims. Customs then will issue the refund.

If an exporter disputes any payment listed in the Report/Certification (that is, the Report/Certification does not include a payment the exporter believes was made or includes one but not in the correct amount), the exporter must submit documentary proof to Customs to support its claim. After reviewing the submission, if any additional or corrected payments can be confirmed, Customs will issue a Revised Report/Certification listing all undisputed payments from the initially issued Report/Certification and adding the additional confirmed payments (including corrections). If Customs cannot confirm the additional payments/corrections, they will be denied a refund. The denial will be final, and the original Report/Certification will constitute the total refund.

To receive a refund, the exporter must sign and return to Customs the Report/Certification or the Revised Report/Certification, as the case may be.

Regarding refund requests for payments made prior to July 1, 1990, the interim regulation (and the July 2, 2001, final rule) provides that proof of payment documentation for each payment must be submitted with the request. If the documentation relative to a payment is sufficient to confirm the payment, Customs will issue a refund. If the documentation relative to a payment is lacking or insufficient to confirm payment, the refund request for that payment will be denied. Upon denial, an exporter will have an additional 120 days to submit documentation or additional documentation proving payment. Customs will review the documentation and issue refunds for confirmed payments and deny refunds for payments that cannot be confirmed. Any denials will be final.

In the interim regulation, Customs explained that it is treating payments made prior to July 1, 1990, differently from payments made on or after that date because it possesses paper documentary proof of payment for payments made on or after July 1, 1990, but not before. Under the interim regulation's procedure, where Customs has paper documentation, it will not require exporters to submit proof of payment with their refund requests. However, Customs will require documentation for such payments where an exporter disputes the completeness or accuracy of a Report/Certification.

Customs received comments from nine commenters on the interim regulation. The comments raised various issues, some of which have already been addressed by Customs in its July 2, 2001, final rule.

Comment: One commenter indicated that exporters may be disinclined to accept Customs invitation to withdraw Freedom of Information Act (FOIA) requests. (Customs made the suggestion in the “Background” text of the interim regulation in order to unclog the refund process that had been inundated with FOIA requests. Customs did so after pointing out that FOIA requests would be of no benefit to exporters for two reasons: (1) In most cases, proof of payment documents would not be required under the refund procedure for export fee payments made on and after July 1, 1990, and (2) Customs does not possess, and therefore cannot provide, proof of payment documents (paper documents) for payments made prior to July 1, 1990.) This commenter explained that filers of FOIA requests will not withdraw them because the records received from a FOIA request can be used to assist exporters in identifying the quarters in which a payment was made, as required under the interim regulation. Thus, this commenter recommended that the regulation be modified to remove the requirement that the quarters of payment be identified in a refund request for payments made on and after July 1, 1990; Customs could then search the entire post-June 30, 1990, period for payments.

Customs response: Customs appreciates the commenter's concern regarding FOIA requests and has reconsidered the refund procedure. To accommodate exporters who have requested documentation and to further simplify the process, Customs is modifying the refund procedure in this document.

As set forth in the regulatory text in this document, Customs, when processing a refund request, will perform a search of its records (paper documents and electronic database) and produce for issuance to the exporter two reports: the Report/Certification (also provided for under the interim regulation) and the Harbor Maintenance Tax Payment Report (HMT Payment Report; not provided for under the interim regulation).

The Report/Certification lists all post-June 30, 1990, payments identified by Customs record search and any pre-July 1, 1990, payments supported by documentation submitted by the exporter with its refund request or afterward; it also sets forth the total amount of the refund owed the exporter. The HMT Payment Report lists all payments made by the exporter during the entire recovery period (April 1, 1987 through April 25, 1998), as identified by Customs record search. Customs believes that the HMT Payment Report should satisfy all exporters who filed FOIA requests, as it contains all payments that Customs can identify from all record sources.

Consequently, specifying quarters of payment in a refund request (or not doing so) will not determine which payments will be included in a Report/ Certification (although the information may be helpful to Customs in its search). Exporters who could not identify quarters will benefit from Customs issuance of the HMT Payment Report, as it will provide them information they may need to locate evidence of payments should that evidence be needed to obtain a refund.

Also, Customs notes that under the modified procedure, upon receipt of the HMT Payment Report and the Report/Certification, the exporter will have 120 days to submit a request for a Revised Report/Certification, with supporting documentation, to establish any payments not listed in the Report/Certification. This provides an exporter with a second opportunity to submit required documentation to establish pre-July 1, 1990, payments and, as under the interim regulation procedure, gives exporters the opportunity to support with documentation additional post-June 30, 1990, payments not listed in a Report/Certification (as well as corrections of payments listed).

Comment: Several commenters contended that Customs could use its database to provide information to exporters relative to export fee payments made prior to July 1, 1990. The exporters could then use the provided data to search for records to support payments.

Customs response: Customs favors this recommendation, which is reflected in the modified procedure set forth in this document. Under the modified procedure, Customs will use the database (along with other paper document sources Customs possesses for payments made on or after July 1, 1990) to provide each requesting exporter a HMT Payment Report that lists all payments made during the entire recovery period. This report will provide exporters data they can use to search for that supporting documentation, just as the commenter recommended.

Comment: One commenter recommended that Customs search its database for pre-July 1, 1990, payments and treat them the same as post-July 1, 1990, payments, meaning that Customs would include them in the Report/ Certification's refund calculation.

Customs response: Customs cannot agree to this recommendation. The modified procedure will provide the exporter the reports that list payments Customs identified in its record search, but exporters will be required to submit supporting documentation to obtain refunds for pre-July 1, 1990, payments. Customs records do not include paper documentation to support these payments, and Customs experience with older payments recorded in the database has shown that the database is unreliable. Customs therefore cannot rely exclusively on that record source to confirm export fee payments, and exporters will have to provide that documentation (if not with the refund request, as soon as possible thereafter) to receive refunds for pre-July 1, 1990, payments.

Comment: Two commenters objected to the interim regulation's requirement that only certain documents are acceptable as proof of payment for pre-July 1, 1990, payments. (The interim regulation provides that acceptable documentation may be either a copy of the Export Vessel Movement Summary Sheet or, where an Automated Summary Monthly Shipper's Export Declaration was filed, a letter containing certain information there specified.) These commenters contended that any documentation tending to support the payment should be acceptable, such as a cancelled check, a company payment ledger, or a Shipper's Export Declaration (SED).

Customs response: The interim regulation requires as proof of payment the documentation that, under the regulations, was required to be submitted with payment. In requiring that documentation to support a payment, Customs is demanding no more from exporters than the regulation always required for refunds and no more than the regulation still requires for refunds of other than export harbor maintenance fee payments. However, Customs appreciates the difficulty some exporters may have in locating these documents, particularly for older payments (the recovery period extends back to April of 1987). Therefore, Customs is modifying the regulation to provide that, in addition to the required documents, Customs will consider any documentation the exporter submits that tends to prove a payment, including, with respect to exporters whose only quarterly HMT payments were for exports, affidavits attesting to that fact.

Customs notes however that in reviewing documentation other than the required documentation, it will balance its obligation to issue refunds with its obligation to protect the revenue. Thus, while Customs will accommodate exporters by considering additional evidence of payment, it will only accept those documents as evidence of payment if the documentation clearly shows that the payments were made for export fees (as opposed to other harbor maintenance fees), in the amounts sought to be refunded, and by the party requesting the refund (or on whose behalf the refund is requested). The regulation is amended in this document accordingly.

Customs notes that the regulations did not require the CF 349 and the CF 350 until 1991. Thus, for a period of time after this 1991 regulation change, Customs also accepted with payment, and for proving payments for refund, the documentation that was required under the regulations prior to the 1991 change. Consequently, for issuing refunds now for payments made on and after July 1, 1990, Customs will accept as proof of payment, when required to be submitted, whichever type of document Customs accepted with the payment at the time it was made. That documentation was either the documentation required after the 1991 change or, at least for a time, the documentation required under the regulations prior to the 1991 change.

Comment: Two commenters objected to the interim regulation's statement, in the “Background” text of the document, regarding when a protest under 19 U.S.C. 1514 should be filed to challenge a denial of a refund request for a pre-July 1, 1990, payment. These commenters contended that the 90-day protest filing period should commence upon expiration of the 120-day refund request refiling period. (The interim regulation procedure provided that, for pre-July 1, 1990, payments, an exporter would have 120 days after a refund denial to submit additional documentation. The document pointed out, however, that if an exporter wanted to file a protest, it must do so within 90 days of the refund denial. This would mean that an exporter would have to file a protest prior to the end of the 120-day period.)

Customs response: Under 19 U.S.C. 1514(c)(3), a protest must be filed within 90 days of the date of a Customs decision described in 19 U.S.C. 1514(a)(3) concerning charges or exactions under the customs laws, which includes a decision to deny a refund of export harbor maintenance fees. (See Swisher International, Inc. v. United States, 205 F. 3d 1358 (No. 99-1277 C.A.F.C. February 28, 2000)(cert. denied), which held that denial of a harbor maintenance fee refund request is protestable.) Based on this statutory requirement, the interim regulation document indicated that a protest must be filed within 90 days of the Customs decision to deny a refund.

However, the modified refund procedure, as set forth in this document, renders the concern of these commenters moot. Under the modified procedure, and in contrast to the procedure set forth in the interim regulation, under no circumstance does the 120-day period for filing documentation run concurrently with the statutory 90-day protest period. Under the modified procedure, the 90-day protest period begins to run either upon expiration of the 120-day period or issuance of a Revised Report/Certification if issued after the period's expiration.

Comment: Several commenters objected to Customs expression of intent, in the “Background” text of the interim regulation, to require that refund requests for export fee payments made more than a year ago be filed by the anticipated 30-day delayed effective date of the then not yet published July 2, 2001, final rule. These commenters recommended that Customs allow one year or 18 months from the date of publication of that anticipated final rule.

Customs response: Regarding the effective date of the July 2, 2001, final rule by which refund requests for export fee payments must be filed, Customs reconsidered the matter after publication of the interim regulation (partly in response to comments discussed in the final rule). Thus, in the July 2, 2001, final rule, Customs set forth a 180-day delayed effective date that would allow exporters plenty of time to file these refund requests, through December 31, 2001. Customs believes that this was a satisfactory resolution of the matter as it provided ample time to file refund requests (considering the period of time exporters had to do so prior to issuance of the July 2, 2001, final rule).

Comment: Several commenters objected to the interim regulation explicitly precluding application of interest to refunds of export harbor maintenance fees. Some of these commenters stated that interest should apply to these refunds and others stated that the regulation should not explicitly preclude application of interest while the issue is still being litigated.

Customs response: Customs does not agree that interest should apply to refunds of export harbor maintenance fees. As Customs pointed out in its comment responses published in the July 2, 2001, final rule, the U.S. Court of Appeals for the Federal Circuit ruled in International Business Machines Corp. v. United States, 201 F.3d 1367 (Fed. Cir. 2000), that exporters are not entitled to interest on the refund of these fees. Customs, however, does agree that the regulation should not mention interest while the matter is still subject to litigation. Consequently, Customs removed the language regarding interest from the regulation published in the July 2, 2001, final rule, and today's final rule document continues the omission.

Customs also notes that under § 24.24(e)(4)(ii)(B) of the interim regulation (and under the July 2, 2001, final rule), claims for recovery of interest are not included among the claims waived by the exporter. This is made explicit in the amendment published in this document (see § 24.24(e)(4)(iv)(B)( 5 )).

Comment: Several commenters objected to the interim regulation's requirement that a power of attorney or letter of authorization be submitted when an exporter is represented by an agent. The power of attorney or letter constitutes the exporter's authorization of an agent or representative to file a refund request, sign a Report/Certification or Revised Report/Certification, and/or receive a refund on its behalf.

Customs response: Customs notes that it was the exporter who was liable for the export fee and, as such, is the proper party entitled to receive a refund. Generally, where an agent claims to represent an exporter, Customs believes it is appropriate to require as evidence of the representation a properly executed and current power of attorney or letter of authorization executed by the exporter. This ensures that the agent requestor is properly authorized to request and receive the refund, and it protects both the Government and the exporter against the possibility of issuing a refund to the wrong party, issuing duplicate refunds to both the exporter and its agent, or issuing refunds to more than one agent claiming to represent the same exporter.

Thus, the general rule is that Customs will not process a refund request submitted by an agent on behalf of an exporter (by witholding issuance of the HMT Payment Report and the Report/Certification until an authorizing document is filed) unless a power of attorney or authorization letter signed by the exporter is submitted.

However, in reviewing this matter, Customs has recognized the special circumstance of freight forwarders who made export fee payments on behalf of many exporters at a time, in some cases, hundreds. Customs believes that this special circumstance warrants an exception to the general rule that is practical for Customs as well as the exporters represented by these agents.

To accommodate these agents and yet to ensure, as much as possible, that Customs does not inadvertently issue double refunds to an exporter who also files a refund request on its own behalf, Customs will process refund requests filed by freight forwarders without power of attorneys or authorization letters unless any exporter covered in the refund request has also filed a separate refund request on its own behalf. In that instance, the freight forwarder's entire refund request will be removed from the chronological processing order and processed later.

The exception to the power of attorney/authorization letter requirement for freight forwarders is added to § 24.24(e)(4)(iv)(B)( 1 ) of this final rule. Minor conforming modifications are made in the amended regulation, as necessary.

Customs notes that while it always intended to process refund requests in the chronological order of receipt, the interim regulation did not make that explicit. This final rule amends the regulation to make it explicit (see § 24.24(e)(4)(iv)(B)( 1 )).

Where a power of attorney or authorization letter is submitted, whether or not required, it must be executed by an official of the exporting company who is authorized to legally bind the company.

Finally, Customs notes that under the interim regulation procedure, this requirement for a power of attorney or authorization letter only applied to refund requests for post-June 30, 1990, payments for which a Report/Certification would be issued. Refund requests covering payments made prior to July 1, 1990, did not require a power of attorney or authorization letter, as they were to be treated like a request for a refund of any other quarterly paid harbor maintenance fee (except that an additional 120-day period to establish payments would apply) and a Report/Certification would not be issued. However, as the modified procedure treats payments made prior to and on or after July 1, 1990, the same with respect to issuance of a HMT Payment Report and a Report/Certification that must be signed by the exporter or its representative to receive a refund, the power of attorney/authorization letter requirement is no longer limited to refund requests covering post-June 30, 1990, payments. The regulation is modified accordingly in this document (§ 24.24(e)(4)(iv)(B)( 1 )).

Comment: One commenter recommended that Customs clarify that already-filed refund requests (filed before publication of the interim regulation) that were accompanied by documentation to prove payments made on or after July 1, 1990, will result in a Customs records search that is not limited to only the quarters covered by the documentation submitted. This commenter stated that an exporter should receive refunds for all post-June 30, 1990, payments made but will not if Customs does not search the entire period or the exporter does not refile its refund request identifying all possible quarters during which payments were (or could have been) made.

Customs response: Given the modified procedure set forth in this document, this commenter's concern is moot. Exporters, all of whom have already filed refund requests, will receive the HMT Payment Report that identifies all payments made by the exporter, as revealed by Customs record search. All post-June 30, 1990, payments that Customs can identify will be included in the HMT Payment Report and the Report/Certification whether or not the exporter's request specified quarters of payment. All payments, no matter when made, will be included in the HMT Payment Report.

Comment: Some commenters contended that Customs should convene a public meeting to discuss the amended refund process.

Customs response: Customs does not agree with this recommendation. As stated in its comment responses published in the July 2, 2001, final rule document, Customs believes that a public meeting regarding this subject is unnecessary and that the particular administrative (notice and comment) procedures being followed are sufficient to resolve the matter at issue.

Comment: One commenter recommended that Customs adopt a procedure to sever disputed claims from undisputed claims in a refund request to allow immediate payment of claims that can be verified while the exporter pursues a dispute involving claims that cannot be verified.

Customs response: A form of severability (of undisputed claims from disputed claims) is available under the modified procedure. Under the modified procedure, an exporter may sign and return to Customs a Report/Certification to receive the refund set forth in that report and also file a request for a Revised Report/Certification to seek refunds for additional payments not identified in the Report/Certification. The request for a Revised Report/Certification may be filed either contemporaneously with the filing of the signed Report/Certification or sometime later but within the 120-day period. Customs notes, however, that corrections of payments included in a signed Report/Certification cannot be pursued later because the exporter's signature on the report constitutes a full accord and satisfaction agreement with respect to all payments covered in that report.

In addition, an exporter may file another request for a Revised Report/Certification at any time during the 120-day period. This feature of the procedure allows an exporter to seek a refund for any later discovered payments and gives an exporter another chance to prove (with additional documentation) a payment that was not included in a refund previously issued by Customs.

Finally, after expiration of the 120-day period, an exporter may file a protest covering any payments not refunded by Customs. This provides another opportunity to sever disputed from undisputed refund claims, though later in the process.

Comment: One commenter recommended that a time limit be imposed on Customs processing of refund requests to require that Customs process at least 500 claims per month.

Customs response: Customs disagrees that a monthly processing requirement is necessary. However, Customs agrees that the expeditious processing of claims should be given a high priority. Toward that end, the modified procedure provides that Customs will endeavor to issue a Revised Report/Certification within 60 days of receiving a request for a revised report with supporting documentation. Also, for exporters whose payments are confined to the post-June 30, 1990, period and who do not dispute the payments listed and the refund set forth in a Report/Certification, refunds will be issued soon after Customs receipt of a signed Report/Certification. The sooner the exporter signs and returns it to Customs, the sooner Customs will issue the refund. Customs believes that the timetable set up in the modified procedure adequately addresses this commenter's concern.

After further consideration of the interim regulation's refund procedure, Customs determined that other changes were warranted (additional to those discussed in the comment responses above). One change involves the exporter's waiver (release, waiver, and abandonment) of claims against the Government (its officers, agents, and assigns for costs, attorney fees, expenses, compensatory damages, and exemplary damages, excluding interest), and another change involves the exporter's full accord and satisfaction agreement. The interim regulation (as well as the July 2, 2001, final rule) provides that the waiver and the full accord and satisfaction agreement apply to all export fee payments made by the exporter, whether or not addressed in a report. In contrast, under the modified procedure set forth in this document, an exporter's signature on a Report/Certification or a Revised Report/Certification represents a waiver and a full accord and satisfaction agreement relative only to the payments approved for refund in the report.

Another change is the Government's waiver of claims (excluding fraud claims) against the exporter (its employees, etc.) which in this document, like the exporter's waiver, is limited to claims arising out of payments covered in a signed report. Under the interim regulation, the Government's waiver was broad, covering all export fee payments whether or not covered in a report.

Another change has to do with the certification made by an agent, including a freight forwarder, that signs a Report/Certification or Revised Report/Certification on an exporter's behalf. Customs, in determining that the freight forwarder exception to the power of attorney/authorization letter requirement is warranted (discussed in the “Comments” section), recognized that any agent should be accountable for the proper distribution of refunds issued by Customs that are intended for exporters covered in the agent's refund request. Thus, Customs is adding to the regulation (§ 24.24(e)(4)(iv)(B)( 5 )) a provision that requires any agent, when signing a Report/Certification or Revised Report/Certification and accepting refunds on behalf of exporters, to certify that it will use due diligence to forward the refund to the exporters it represents, and will return a refund to Customs, within one year of receipt, if it does not forward it to the exporter.

Another change in the regulation is to add language indicating that refund requests will be processed in the chronological order of receipt (see § 24.24(e)(4)(iv)(B)( 1 )) . Customs always intended to process refund requests in this way, but the regulation was silent in this regard.

Finally, a change concerning the address for submitting requests for refunds of harbor maintenance fees paid on a quarterly basis (found in § 24.24(e)(4)(i) of the interim regulation) is made in this document (in §§ 24.24(e)(4)(i) and (iv)(A)). The change reflects the correct zip code; however, as noted previously, this change was reflected in the July 2, 2001, final rule and was made in a notice of correction document published in the Federal Register on April 27, 2001.

After analysis of the comments and further review and consideration of the matter, Customs has determined to adopt as final the content of the interim amendments published in the Federal Register (66 FR 16854) on March 28, 2001, with the changes discussed above in this document and set forth in the amended regulatory text below.

In summary, these changes relate to: (1) That part of the procedure relative to Customs issuance of refunds after receiving a refund request, including the issuance of a HMT Payment Report; (2) the processing of refund requests in chronological order; (3) the requirement that a power of attorney or authorization letter be submitted to Customs prior to issuance of a HMT Payment Report and Report/Certification for any refund request (as opposed to only requests covering post-June 30, 1990, payments) submitted on the exporter's behalf by an agent other than a freight forwarder; (4) an exception to the power of attorney/ authorization letter requirement applicable to freight forwarders and it's effect on the chronological processing of refunds filed by freight forwarders; (5) a requirement that any agent (including a freight forwarder) that signs a Report/Certification or Revised Report/Certification on an exporter's behalf must certify that it will use due diligence to forward the refund to the exporter and will return to Customs any refund not forwarded to the exporter within one year of its receipt; (6) the exporter's waiver (release and abandonment) of claims and its agreement of full accord and satisfaction; (7) the Government's waiver of claims against the exporter; (8) the address for mailing refund requests for export harbor maintenance fees; and (9) the matter of interest on refunds of export harbor maintenance fees. Customs notes that the latter two changes were reflected in the July 2, 2001, final rule.

Customs emphasizes that the instant final rule's modification of the interim regulation's refund-filing procedure will not prejudice exporters who filed refund requests in accordance with that procedure. The modified procedure is simpler and more accommodating to exporters than the interim regulation's procedure, and all filers will benefit equally from its implementation. Customs notes that as all refund requests have been filed prior to publication of this document, any modification to the procedure will not affect any exporter's actual filing of the request. The modifications made in this document affect the part of the procedure that commences after Customs receives a refund request.

Finally, Customs notes that this document amends only § 24.24(e)(4)(iv). The remaining paragraphs of § 24.24(e)(4) remain as published in the July 2, 2001, final rule (which became effective after the interim regulation and thereby replaced the interim regulation).

Pursuant to 5 U.S.C. 553(d)(3), Customs has determined that a delayed effective date for this final rule is unnecessary. This document adopts, with some modifications, the content of an interim regulation previously published in the Federal Register (66 FR 34813) and made effective on March 28, 2001. The several changes made with publication of this document are to the benefit of the exporters who are required to follow the procedure set forth in the already effective interim regulation. For that reason, the effective date of this final rule document should not be delayed.

This document does not meet the criteria for a Asignificant regulatory action” as specified in E.O. 12866.

The collection of information contained in this final rule has previously been reviewed and approved by the Office of Management and Budget (OMB) under OMB control number 1515-0158. Additional information requested in the final rule relates to usual and customary business information/records. This rule does not include any substantive changes to the existing approved information collection. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.

Because no notice of proposed rulemaking was required for this rule, the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) do not apply. However, because this amendment to the regulations merely simplifies, to the benefit of exporters, a procedure for applying for and receiving refunds of export harbor maintenance fees that is already provided for under an existing regulation, it will not have a significant economic impact on a substantial number of small entities.

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

The final regulations that are the subject of these corrections are under section 1221 of the Internal Revenue Code.

As published, the final regulations contain errors that may prove to be misleading and are in need of clarification.

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. Due to the terrorist attacks on September 11, 2001 and the warnings given by national security and intelligence officials, there is an increased risk that further subversive or terrorist activity may be launched against the United States. A heightened level of security has been established around all cruise ships near the ports of Los Angeles and Long Beach. These security zones are needed to protect the United States and more specifically the people, waterways, and properties near San Pedro Bay.

In addition, the Coast Guard is currently working on an NPRM, for this temporary rule to become a final rule, which will soon be published. Therefore, the public will still have the opportunity to comment on this rule. This current temporary final rule's sole purpose is to continue a similar temporary final rule that began enforcement on November 1, 2001, recently following the attacks, and expires May 1, 2002. In this case, doing a NPRM will be repetitious in nature and since delay is inherent in the NPRM process, any delay in the effective date of this rule, is contrary to the public interest insofar as it may render individuals and facilities within and adjacent to cruise ships vulnerable to subversive activity, sabotage or terrorist attack. The measures contemplated by this rule are intended to prevent future terrorist attacks against individuals and facilities within or adjacent to cruise ships. Immediate action is required to accomplish these objectives and necessary to continue safeguarding these vessels and the surrounding area. Any delay in the effective date of this rule is impractical and contrary to the public interest.

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

On September 11, 2001, terrorists launched attacks on commercial and public structures—the World Trade Center in New York and the Pentagon in Arlington, Virginia—killing large numbers of people and damaging properties of national significance. There is an increased risk that further subversive or terrorist activity may be launched against the United States based on warnings given by national security and intelligence officials. The Federal Bureau of Investigation (FBI) issued warnings on October 11, 2001 and February 11, 2002 concerning the potential for additional terrorist attacks within the United States. In addition, the ongoing hostilities in Afghanistan have made it prudent for important facilities and vessels to be on a higher state of alert because Osama Bin Ladin and his Al Qaeda organization, and other similar organizations, have publicly declared an ongoing intention to conduct armed attacks on U.S. interests worldwide.

These heightened security concerns, together with the catastrophic impact that a terrorist attack against a cruise ship would have to the public interest, makes these security zones prudent on the navigable waterways of the United States. To mitigate the risk of terrorist actions, the Coast Guard has increased safety and security measures on the navigable waterways of San Pedro Bay by establishing security zones around cruise ships. Vessels operating near cruise ships present possible platforms from which individuals may gain unauthorized access to these vessels or launch terrorist attacks upon these vessels or adjacent population centers. As a result, the Coast Guard is taking measures to prevent vessels or persons from accessing the navigable waters close to cruise ships on San Pedro Bay.

On January 18, 2002, we published a temporary final rule for cruise ships entitled “Security Zones; Port of Los Angeles and Catalina Island” in the Federal Register (67 FR 2571) under § 165.T11-058. It has been in effect since 11:59 PST on November 1, 2001 and is set to expire 11:59 p.m. PDT on May 1, 2002. As of today, the need for security zones around cruise ships still exist. This new temporary final rule will begin 11:59 p.m. PDT on May 1, 2002, the exact time the previous cruise ship security zone was in effect, and is set to expire 11:59 p.m. PST December 1, 2002. This will allow the Coast Guard time to publish a notice of proposed rulemaking (NPRM) in the Federal Register , which will include a public comment period, and for a final rule to be published and put into effect without there being an interruption in the protection provided by cruise ship security zones.

This new rule differs slightly from temporary section 165.T11-058 in a few ways. First, this temporary rule extends only the security zones in San Pedro Bay. Second, the security zones will be in effect around cruise ships in the Port of Long Beach as well as the Port of Los Angeles. Third, while underway in San Pedro Bay, the security zone will be 200 yards ahead, and 100 yards on each side and astern of the cruise ship which is needed due to the cruise ship's speed of advance through the water. Fourth, while implicit in the prior temporary rule, the security zones here will be described as extending from the water's surface to the sea floor. This more specific description is intended to discourage unidentified scuba divers and swimmers from coming within close proximity of a cruise ship. Fifth, the security zone around cruise ships that are underway or anchored on San Pedro Bay was broadened from only the port of Los Angeles inside the Los Angeles “sea buoy” to include all waters on San Pedro Bay within three nautical miles of the Federal breakwaters. Lastly, to clarify to which types of passenger vessels the rule applies, we have defined “cruise ship” to coincide with the description in 33 CFR 120.100.

This regulation establishes a security zone in the waters of San Pedro Bay around all cruise ships that are anchored, moored, or underway within the Los Angeles or Long Beach port area. This security zone will take effect upon entry of any cruise ship into the waters from within three nautical miles outside the Federal breakwaters encompassing San Pedro Bay and will remain in effect until that vessel departs the three nautical mile limit. The following areas are security zones:

(1) All waters, extending from the surface to the sea floor, within a 100 yard radius around any cruise ship that is anchored at a designated anchorage either inside the Federal breakwaters bounding San Pedro Bay or outside at designated anchorages within three nautical miles of the Federal breakwaters;

(2) The shore area and all waters extending from the surface to the sea floor, within a 100 yard radius around any cruise ship that is moored, or in the process of mooring, at any berth within the Los Angeles or Long Beach port areas inside the Federal breakwaters bounding San Pedro Bay; and

(3) All waters, extending from the surface to the sea floor within 200 yards ahead, and 100 yards on each side and astern of a cruise ship that is underway on the waters inside the Federal breakwaters bounding San Pedro Bay or on the waters within three nautical miles seaward of the Federal breakwater.

These security zones are needed for national security reasons to protect cruise ships, the public, transiting vessels, adjacent waterfront facilities, and the ports from potential subversive acts, accidents, or other events of a similar nature. Entry into these zones will be prohibited unless specifically authorized by the Captain of the Port or his designated representative. Vessels already moored or anchored when these security zones take effect are not required to get underway to avoid either the moving or fixed zones unless specifically ordered to do so by the Captain of the Port or his designated representative.

As part of the Diplomatic Security and Antiterrorism Act of 1986 (Pub. L. 99-399), Congress amended the Ports and Waterways Safety Act (PWSA) to allow the Coast Guard to take actions, including the establishment of security and safety zones, to prevent or respond to acts of terrorism against individuals, vessels, or public or commercial structures. This authority, under section 7 of the PWSA (33 U.S.C. 1226), supplements the Coast Guard's authority to issue security zones under The Magnuson Act regulations promulgated by the President under 50 U.S.C. 191, including Subparts 6.01 and 6.04 of Part 6 of Title 33 of the Code of Federal Regulations.

Vessels or persons violating this section will be subject to the penalties set forth in 33 U.S.C. 1232 and 50 U.S.C. 192. 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 up to 6 years and a maximum fine of $250,000), and in rem liability against the offending vessel. Any person who violates this section, 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. Vessels or persons violating this section are also subject to the penalties set forth in 50 U.S.C. 192: Seizure and forfeiture of the vessel to the United States, a maximum criminal fine of $10,000, and imprisonment up to 10 years.

The Captain of the Port will enforce these zones and may enlist the aid and cooperation of any Federal, State, county, municipal, and private agency to assist in the enforcement of the regulation. This regulation is proposed under the authority of 33 U.S.C. 1226 in addition to the authority contained in 50 U.S.C. 191 and 33 U.S.C. 1231.

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) because these zones will encompass a small portion of the waterway for a limited period of time. Delays, if any, are expected to be less than 30 minutes in duration. Vessels and persons may be allowed to enter these zones on a case-by-case basis with permission of the Captain of the Port.

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.

For the same reasons stated in the Regulatory Evaluation section above, 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.

We expect this rule will affect the following entities, some of which may be small entities: The owners and operators of private and commercial vessels intending to transit or anchor in a small portion of the ports of Los Angeles or Long Beach near a cruise ship that are covered by these security zones. The impact to these entities would not, however, be significant since these security zones will encompass a small portion of the waterway for a limited period of time. Delays, if any, are expected to be less than thirty minutes in duration.

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. If this rule will affect your small business, organization, or government jurisdiction and you have questions concerning its provision or operations for compliance, please contact the person listed under FOR FURTHER INFORMATION CONTACT for assistance in understanding this rule.

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).

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 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 rule will 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.

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 create 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 (34)(g), of Commandant Instruction M16475.lD, this rule is categorically excluded from further environmental documentation because we are establishing security zones. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under ADDRESSES.

On September 21, 2001, the Coast Guard published a temporary final rule entitled “Protection of Naval Vessels” in the Federal Register (66 FR 48779). The temporary final rule continues until June 15, 2002.

On February 21, 2002, we published a notice of proposed rulemaking (NPRM) entitled “Protection of Naval Vessels” in the Federal Register (67 FR 7992). We received no letters commenting on the proposed rule. No public hearing was requested, and none was held.

These zones are necessary to provide for the safety and security of United States naval vessels in the navigable waters of the United States. The regulations are issued under the authority contained in 14 U.S.C. 91. Prior to issuing the temporary final rule on September 21, 2001, no regulation existed implementing 14 U.S.C. 91.

We determined that a continuing need existed for the protection of naval vessels. Therefore, we are establishing a final rule that will replace the temporary rule.

The temporary final rule continues until June 15, 2002. The permanent final rule becomes effective June 15, 2002.

We received no comments on the proposed rule. Therefore, we have made no changes and plan to implement the provisions of the proposed rule as written.

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).

Although this regulation restricts access to the regulated area, the effect of this regulation will not be significant because: (i) individual naval vessel protection zones are limited in size; (ii) the Coast Guard, senior naval officer present in command, or official patrol may authorize access to the naval vessel protection zone; (iii) the naval vessel protection zone for any given transiting naval vessel will only effect a given geographical location for a limited time; and (iv) when conditions permit, the Coast Guard, senior naval officer present in command, or the official patrol should give advance notice of all naval vessel movements on VHF-FM channel 16 so mariners can adjust their plans accordingly.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed 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 proposed rule will not have a significant economic impact on a substantial number of small entities.

This rule will affect the following entities, some of which may be small entities: the owners or operators of vessels intending to operate near or anchor in the vicinity of U.S. naval vessels in the navigable waters of the United States.

This regulation will not have a significant economic impact on a substantial number of small entities for the following reasons: (i) Individual naval vessel protection zones are limited in size; (ii) the official patrol may authorize access to the naval vessel protection zone; (iii) the naval vessel protection zone for any given transiting naval vessel will only affect a given geographic location for a limited time; and (iv) when conditions permit, the Coast Guard, senior naval officer present in command, or the official patrol should give advance notice of all naval vessel movements on VHF-FM channel 16 so mariners can adjust their plans accordingly.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), we want to assist small entities in understanding this rule so that they can better evaluate its effects on them and participate in the rulemaking process. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the address listed under ADDRESSES .

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).

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 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 rule will 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.

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 create 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 would 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 (34)(g), of Commandant Instruction M16475.lD, this rule is categorically excluded from further environmental documentation. A “Categorical Exclusion Determination” is available in the docket for inspection and copying where indicated under ADDRESSES.

The proposed rule was published in the July 17, 2001, Federal Register (66 FR 37202) for a 60-day public comment period. NARA notified Federal records officers of the availability of the proposed rule. A copy of the proposed rule was also posted on the NARA web site.

NARA received 14 responses to the proposed rule, 12 from Federal agencies and two from private sector commenters. Six agencies and the two non-Federal commenters concurred with both changes. Comments from six agencies on the proposed rule related mainly to the clarity of the requirements and the format of the electronic copies of schedules submitted to NARA. Comments on each of the sections of the regulation are summarized below, followed by NARA's response.

Comment: One agency recommended that NARA eliminate the requirement to submit a schedule for any deviation from GRS authorities.

NARA response: We did not adopt this comment. Application of the GRS is mandatory unless NARA has approved an alternate disposition. NARA has the statutory responsibility to approve all records disposition authorities, including those on agency-specific schedules and those contained in the GRS. See 44 U.S.C. 3303a.

Comments: Under the new rule, agencies need to notify NARA when they intend to apply a previously approved agency schedule instead of a newly-approved or newly-revised GRS. One agency suggested that it would be easier for agencies to notify NARA when they are not going to continue using the agency schedule rather than when they intend to continue to apply it. Another agency recommended that NARA add a time limit of 60-90 days for agencies to notify NARA that they intend to continue using their schedules. That agency also asked how NARA would determine which GRS items need be applied “without exception.”

NARA response: The GRS, as the later authority, would normally supersede the agency schedule, so agencies need to tell NARA when they do not choose to apply the GRS. The rule has been modified to require notification within 90 days from issuance of the GRS change. GRS items that must be used without exception will be those that have a retention period based on another statutory or regulatory requirement. For example, retention periods for such records as accountable officers accounts and contracts are based on the statute of limitations on claims. A shorter retention period than provided in the law would deny an agency the ability to defend itself against claims, and a longer retention period may put the Government in jeopardy of processing untimely claims. NARA will identify such items clearly on the GRS Transmittal and in the disposition instruction for the applicable item.

Comment: One agency commented that NARA needs to process schedules for exceptions to the GRS more quickly, including shortening the 45-day review period on pending schedules listed in Federal Register notices to 14 days.

NARA response: We did not adopt this comment. NARA is concerned about the time required to approve many of the schedules submitted by agencies, and has undertaken a review of the scheduling process. NARA will consider, as part of this review, whether the Federal Register notice period should be modified. Public notice on pending schedules is required by law (44 U.S.C. 3303a(a)), and the current review period provides reasonable accommodation. In the meantime, NARA appraisal archivists work with agencies to set priorities for schedule processing.

Comments: One agency asked for clarification of the requirement that agencies submit copies of schedules to NARA within 30 days as it relates to the provision in 36 CFR 1228.50(a)(4)(ii) that agencies submit a copy to NARA when posted. That agency also recommended that NARA provide links to printed schedules of all agencies. Another agency suggested that the regulation specify that if the agency both prints and posts an electronic copy of its schedule, it need only submit an electronic copy to NARA.

NARA response: The provisions of 36 CFR 1228.50(a)(4) apply to both subordinate paragraphs ((a)(4)(i) and (a)(4)(ii)). Therefore, agencies are required to submit printed directives, schedules, and schedule changes within 30 days of the date they were issued, and a printed or electronic copy of the materials on an Internet or Intranet web site within 30 days of the date they were posted. Agencies may email electronic copies of schedules to NARA at the email address now indicated in the rule. The NARA records management web site includes the Agency Records Disposition Online Resource (http://ardor.nara.gov/index.html) which contains agency schedules or links to agency schedules, and the GRS. NARA urges agencies to provide information on their schedules to add to this resource. NARA agrees that agencies may submit only electronic copies of schedules if they both post an electronic copy and print copies for distribution. This change has been made.

Comments: Three agencies raised questions about the format of the electronic copy of the records schedule that agencies would send to NARA. One agency asked whether the term meant the method of transmission, e.g., via email, instead of the format of the document itself. That agency also asked if the requirement to provide the Internet address for relevant schedules could be met if the address (URL) is on the electronic copy submitted to NARA. Another agency believed that the “format specified by NARA” referred to the requirement for transfer of permanent records in 36 CFR 1228.270, because it requested that HTML and PDF be acceptable as well as ASCII. A third agency commented that NARA should be able to accept all formats. Another agency recommended that the regulation specify that any revisions to schedules also be covered by the requirement to submit copies of schedules to NARA.

NARA response: The regulation relates to the format of the directives, schedules, and schedule changes, not the method of transmission for either the schedules or the transfer of permanent electronic text records to NARA. NARA will accept the schedules in all formats that it is able to read and disseminate, e.g., Word, WordPerfect, HTML, RTF (rich text format), and PDF. If the copy of a schedule posted on a publicly available web site is submitted to NARA and includes the URL, the requirement to provide the Internet address would be met. However, inclusion of the URL for schedules posted on an agency's internal Intranet is not required because an agency's Intranet is not available to either NARA or the public. The regulation clearly states that agencies are to submit “changes to all manuals as they are issued.” NARA believes that the requirement is sufficiently clear.

After publication of the proposed rule, the General Services Administration (GSA) updated its records management regulations. Cross-references to specific sections of GSA's records management regulations in title 41, Code of Federal Regulations, have been changed in this rule.

This rule is a significant regulatory action for the purposes of Executive Order 12866 and has been reviewed by the Office of Management and Budget. As required by the Regulatory Flexibility Act, I certify that this rule will not have a significant impact on a substantial number of small entities because it applies only to Federal agencies. This rule has no federalism or tribalism implications. This rule is not a major rule as defined in 5 U.S.C. Chapter 8, Congressional Review of Agency Rulemaking.

This supplemental information section is organized as follows:

In this action, EPA is approving into the Minnesota SIP a revision to the SIP that MPCA submitted on December 16, 1998 which updates the Minnesota performance test rule. The Minnesota performance test rule was originally approved into the SIP on May 6, 1982 (47 FR 19520). Specifically, EPA is approving into the SIP Minnesota Rules 7017.2001 through 2060, removing from the SIP Minn. R. 7017.2000, and amending in the SIP Minn. R. 7011.0010, 7011.0105, 7011.0510, 7011.0515, 7011.0610, 7011.0710, 7011.0805, 7011.1305, 7011.1405, and 7011.1410.

EPA is taking this action because the state's submittal, which revises the performance test rule SIP, is fully approvable. The revisions made by MPCA to the performance test rule since 1976 vastly improve the performance testing requirements found in the Minnesota SIP. The 1976 rule, which is currently enforceable by EPA in the SIP (Minn. R. 70 17.2000), lacks many of the requirements now specifically set forth in the revised state rules.

EPA reviewed the SIP revision request for completeness based on the completeness requirements contained in Title 40 of the Code of Federal Regulations, Part 51, Appendix V. The EPA determined that the submittal is complete, and notified the State of Minnesota in a March 23, 1999 letter from Richard C. Karl, EPA, to Karen Studders, MPCA. The state has adequately addressed EPA's concerns, as discussed below, and the performance test SIP revision satisfies the applicable requirements of the Act. A more detailed explanation of how the state's submittal meets these requirements is in EPA's June 19, 2001 Technical Support Document (TSD).

Minnesota promulgated the original performance test rules in 1976 as Air Pollution Control 21 (APC 21). APC 21 was submitted to EPA in 1980 as part of Minnesota's Total Suspended Particulate Matter control plan and was incorporated into the SIP on May 6, 1982 (47 FR 19520). The state recodified APC 21 to Minn. R. 7005.1860 in 1983, and yet again to Minn. R. 7017.2000 in 1993. The state made only minor changes to the performance test rule between 1976 and 1993. MPCA initiated major additions to the performance test rule in 1993 as described below.

The MPCA revised the performance test rule in 1993 for the following reasons: (1) The need to clarify and consolidate the state's performance test requirements; (2) the increase in the number of regulated pollutants and the increase in available test methods for performance testing; and (3) the need to use a definition of “PM10” that is consistent with the federal definition. On December 6, 1993, the state repealed the 1976 performance test rule, Minn. R. 7017.2000, and the 1993 performance test rule, Minn. R. 7017.2001-2060, became effective.

EPA reviewed and commented on the rule during its development and had identified several issues that required resolution before the rule could be approved into the SIP. EPA and MPCA staff participated in numerous discussions subsequent to the rulemaking to resolve these issues. EPA formally provided MPCA with its final comments by letter dated May 9, 1997. EPA's primary concerns with the 1993 version of the performance test rule were that certain provisions in the regulations could unintentionally impede enforcement, and that provisions addressing malfunction, startup and shutdown were less stringent than the federal New Source Performance Standards (NSPS).

MPCA initiated its latest revision to the performance test rule to address EPA's May 9, 1997 comments. As previously stated, in 1993 the state repealed the 1976 version of the performance test rule, which is currently in the Minnesota SIP.

In a June 25, 1997 letter to EPA, MPCA staff responded to EPA's May 9, 1997 comments with additional revisions to the rule. Due to filing errors, MPCA placed the performance test rule on public notice twice, from July 28 to August 27, 1997 and from April 20 to May 20, 1998 before rulemaking was completed on the final rule.

Because over a year had passed between MPCA's June 25, 1997 response to EPA's May 9, 1997 comments and the completion of formal rulemaking, MPCA re-responded to EPA's comments which it included in their December 16, 1998 SIP submittal.

In order to resolve those issues that EPA identified as impediments to SIP approval, MPCA made the following revisions to its performance test rule. MPCA revised language in the performance test rule to reference the use of credible evidence where a test does not meet the administrative and technical requirements of the rule, and incorporated NSPS language to make the revised rule's provisions regarding malfunction, startup and shutdown equally stringent to the federal requirements. MPCA also incorporated a number of relatively minor language changes to help clarify the intent of the rule. Additional changes to the performance test rule were based on MPCA's review and experience since the state adopted the rule in December 1993, and the streamlining of certain administrative procedures. EPA has reviewed both the 1997 and 1998 response documents submitted by MPCA and has found that the state has adequately addressed EPA's concerns.

The State has requested that EPA approve the following: (1) The removal of Minn. R. 7017.2000 from the SIP, since this rule was repealed by the state in 1993; (2) the inclusion of the revised performance test rule, Minn. R. 7019.2001-2060, into the SIP; and (3) the inclusion into the SIP of updates to small portions of the opacity rules and other related rules identified while amending the performance test rule. Listed below are some of the changes made by the state to strengthen the performance test rule since it was incorporated into the SIP in 1976.

Definitions (7017.2005). A detailed set of definitions for the terms used in the performance test provisions was added to enhance the clarity and enforceability of the requirements.

Federal Testing Requirements and Test Methods (7017.2010, 7017.2015, and 7017.2050). The amended rule requires compliance with current EPA test methods. Because the rule incorporates by reference federal test methods and any future amendments or versions of those methods, the SIP will automatically require compliance with the latest EPA requirements (including testing requirements set forth in NSPS and NESHAPS).

Pretest Requirements (7017.2030). Substantial pretest requirements have been added, including a requirement to submit a detailed test plan and to meet with MPCA personnel prior to testing.

Testing Procedures and Quality Assurance (7017.2045 7017.2060). Incorporates new language regarding testing procedures and quality assurance.

Operational Requirements and Limitations (7017.2025). Establishes enforceable operating limitations based on tested conditions to better ensure that the compliance shown during testing is actually maintained during day-to-day operations.

Reporting and Certification Requirements (7017.2035, 7017.2040). Prescribes detailed reporting requirements, including what information must be in the test report, and specific requirements for responsible persons to certify the sampling, analysis, and reporting of the test results.

Consequences for Failing a Test (7017.2025, subparts 4 and 5). Lays out specific retesting requirements and a standard requirement to shut down units failing a retest except in certain circumstances.

Credible Evidence (7017.2020, subpart 6). Ensures that no person can mistakenly assume that the performance test requirements in any way undermine the ability to use any credible evidence to establish a violation.

Changes to Opacity Averaging Times in Performance Standards (7011). Changes the averaging times of all opacity limit excursion levels to six-minute intervals, and proportionately lowers the excursion limit. This results in an opacity standard that is essentially equivalent and consistent with EPA Method 9 and therefore makes the excursion limits more enforceable.

EPA is approving into the Minnesota SIP revisions to the Minnesota performance test rule. The Minnesota performance test rule was originally approved into the SIP on May 6, 1982 (47 FR 19520). Specifically, EPA is approving into the SIP Minnesota Rules 7017.2001 through 2060, and amending the following rules currently in the SIP with amendments adopted by the state on July 13, 1998: Minn. R. 7011.0010, 7011.0105, 7011.0510, 7011.0515, 7011.0610, 7011.0710, 7011.0805, 7011.1305, 7011.1405, and 7011.1410. In addition, EPA is removing Minn. R. 7017.2000 from the SIP, since this rule was repealed by the state in 1993. As described above, MPCA has addressed the issues identified by EPA and the performance test rule revision is therefore fully approvable.

The EPA is publishing this action without prior proposal because we view this as a noncontroversial amendment and anticipate no adverse comments. However, in the proposed rules section of this Federal Register publication, we are publishing a separate document that will serve as the proposal to approve the state plan if relevant adverse comments are filed. This rule will be effective July 12, 2002 without further notice unless we receive relevant adverse comments by June 12, 2002. If we receive such comments, we will withdraw this action before the effective date by publishing a subsequent document that will withdraw the final action. All public comments received will then be addressed in a subsequent final rule based on the proposed action. The EPA will not institute a second comment period. Any parties interested in commenting on this action should do so at this time. If we do not receive any comments, this action will be effective July 12, 2002.

Nothing in this action should be construed as permitting or allowing or establishing a precedent for any future implementation plan. Each request for revision to the SIP shall be considered separately in light of specific technical, economic, and environmental factors and in relation to relevant statutory and regulatory requirements.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). This action merely approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). Because this rule approves pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4).

This rule also does not have tribal implications because it will 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, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action also does not have Federalism implications because it does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action merely approves a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it is not economically significant.

In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the Clean Air Act. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 12, 2002. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

The following table of contents describes the format for this SUPPLEMENTARY INFORMATION section:

EPA is taking final action to approve the changes Connecticut made to its regulations (R.C.S.A. Sections 22a-174-1, 22a-174-2a and 22a-174-33) regarding the state's title V permitting program. The Agency is granting full approval to Connecticut's title V permitting program because Connecticut has made all the necessary changes to its program required by EPA's interim approval and the additional program changes that the state made meet the requirements of title V and EPA's state operating permit program regulations at 40 CFR part 70 (part 70). Details of the state's regulatory changes can be found in EPA's two proposed rulemakings, 66 FR 42496 (August 13, 2001) and 67 FR 11636 (March 15, 2002).

EPA received comments from several groups on the proposed rulemakings. Responses to relevant comments are contained in the following section. In the final adoption, the state made several changes to its proposed rule in response to comments the state received. These changes do not effect the substance of the provisions EPA relied on when it proposed to grant full approval to Connecticut's program. The exact changes the state made can be found as part of EPA's public record. In addition, in EPA's proposal of March 15, 2002, the Agency explained several interpretations of the state's rules upon which we are relying to fully approve the program. The Connecticut Department of Environmental Protection (DEP) has submitted a letter confirming DEP's agreement with our interpretations. See letter from Carmine DiBattista to Donald Dahl, April 12, 2002.

Unlike the prior interim approval, this full approval has no expiration date. However, the state may revise its program as appropriate in the future by following the procedures of 40 CFR 70.4(i). EPA may also exercise its oversight authority under section 502(i) of the Act to require changes to a state's program consistent with the procedures of 40 CFR 70.10.

EPA received several comments on its proposals during the public comment periods. The state's rule changes touch upon three separate, though related, programs—the title V operating permit program, the new source review (NSR) preconstruction permit program, and mechanisms that may be used to limit a source's potential emissions. EPA received comments that raise issues about all three programs. EPA is not taking action here on the portions of the state's rule changes that concern NSR and the mechanisms that may limit potential emissions. In the Agency's Technical Support Document, EPA has categorized the comments into three areas: comments relating to the title V program, comments relating to new source review, and all other comments including several comments on section 22a-174-3b which establishes operational requirements for facilities that assure their emissions will remain at insignificant levels. The requirements of section 3b may ultimately play a role in a facility's potential to emit. But this section is not part of the title V program, and relates more to the requirements for staying out of the title V program. Comments concerning new source review or other programs, including section 3b, are not related to EPA's proposal and are beyond the scope of today's actions. EPA is now responding only to the comments that are relevant to fully approving Connecticut's title V program. Those comments and our responses are as follows:

1. Comment: The commenter states that Connecticut did not fully meet a state legislative mandate that requires the DEP to identify and explain differences between federal and state requirements.

Response: Under section 506(a) of the Clean Air Act, a state is free to establish “additional permitting requirements not inconsistent with [the] Act.” Therefore, EPA will not look behind a state's decision to include permitting requirements beyond the minima of the Act and part 70, provided the program satisfies those requirements. While state agencies may have an independent obligation under state law to explain their reasons for including requirements beyond those specified in part 70, that obligation does not apply to EPA's assessment of the program's adequacy under the Act and part 70.

2. Comment: The commenter states that the DEP should continue its work in clarifying terminology. Examples were given where clarity could be improved. Terms such as “minor” or “modification” will have different meanings depending on the context the term is used in.

Response: EPA agrees with the commenter that an unambiguous regulation is an important goal for Connecticut as well as the Agency. We also agree with the commenter that Connecticut has made major improvements in clarity to its title V regulations. As the program is implemented in the future, we will continue to work with Connecticut in addressing any areas of the state's rule that may be unclear to the public or the regulated community. EPA believes that the meaning of the terms “minor” and “modification” are reasonably clear when read in the context of each regulatory requirement.

3. Comment: The commenter requested the state to clarify the intent of the phrase “any other state located within fifty (50) miles of a Connecticut Title V source” contained within the definition of “Affected State or States” in Section 22a-174-1 of the state regulations. The current state rule is unclear as to whether “the within 50 mile test” applies from the Connecticut state border or from the location of the permitted source.

Response: Part 70 defines “affected state” as all states whose air quality may be affected and which are contiguous to the state in which the title V source exists in and any other state within 50 miles of the source. The state's definition in section 22a-174-1 differs from part 70 only in that Connecticut lists the contiguous states and removes the requirement that the source may affect the air quality in that contiguous state. Both Connecticut's rule and part 70 determine the 50 mile rule based on the distance between another state's border and the location of the title V facility. Connecticut's rule satisfies the part 70 requirements for identifying affected states.

4. Comment: The commenter asks the state whether the definition of “Minor Permit Modification” means either a permit modification under the new source review program or a permit modification under the title V permitting program.

Response: The term “minor permit modification” as it is used in Connecticut's air regulations can mean either a modification to a title V permit or a new source review permit. When the term is read in context, however, the state's regulations make a source's obligations reasonably clear when making a change that would require a minor permit modification to its title V permit. This is also true for a source that is required to obtain a minor permit modification under the new source review program.

5. Comment: The commenter asks the state whether the definition of “non-minor permit modification” means either a permit modification under the major new source review program or the title V permitting program.

Response: The term “non-minor permit modification” as it is used in Connecticut's air regulations can mean either a major modification to a title V permit or a major new source review permit. The state's permit process regulations consolidate provisions for title V and NSR permits where possible to avoid repetition of similar procedural requirements. When the term is read in context, however, the state's regulations make a source's obligations reasonably clear when making a change that would require a non-minor permit modification to its title V permit. This is also true for a source that is required to obtain a non-minor permit modification under the major new source review program.

6. Comment: The commenter asks the state why the phrase “who are legally” was removed from the definition of who is responsible as an “operator.” The commenter suggests that the state limit the definition by adding “legally” when describing who can be considered responsible as an operator. The commenter interprets the proposed definition of operator, without the term “legally responsible,” as possibly making all employees subject to permit requirements.

Response: The term “operator” in the state's regulations is used to define who is responsible for a source. For example, section 22a-174-33(c)(1) states that the title V provisions shall apply to the owner or operator of a title V source. Connecticut has agreed with the commenter and has added the phrase “who are legally responsible for the operation of a source” back into the definition of “operator.” This change does not affect EPA's ability to fully approve the state's program. It is the intent of part 70 to hold any operator or owner, including their agents, who are legally responsible for a source's operations liable for meeting the Act's requirements.

7. Comment: The commenter states that adding the phrase “portable emissions units” to the definition of “stationary sources” will lead to unnecessary permitting of de minimus sources. According to the comment, de minimus sources would include, among other things, snow making machines, rented engines, and spray painting equipment. The commenter suggests removing the reference to “portable emissions units.”

Response: The term “stationary source” is used extensively in the state's title V regulations. In order to clarify what process units are considered emission units at a stationary source, the state proposed to add to the term “stationary source” portable emission units that remain stationary at a source. The state's clarification is consistent with EPA guidance when dealing with emission units that are portable. Therefore, EPA disagrees with the commenter that the state definition of “stationary source” should remove the term “portable emission unit.” For example, under the title V program in Vermont, the state correctly included snow making machines as emission units in the title V permit for Okemo Mountain, Incorporated.

8. Comment: The commenter requests that the state incorporate-by-reference the federal definition of “volatile organic compound” in Section 22a-174-1 of its regulations. The comment states that this will minimize the need for the DEP to revise the definition every time EPA changes the definition.

Response: The term “VOC” is used in the state's title V regulations in the definition of “regulated air pollutant.” EPA agrees with the commenter that incorporating the federal definition of VOC will make it easier for the state to recognize future changes EPA makes to the federal definition. The state also agrees with the commenter and has changed the definition of VOC to simply incorporate EPA's definition found in “40 CFR 51.100(s), as amended from time to time.”

9. Comment: The commenter requests the state to clarify and modify the signatory responsibilities requirements found in section 22a-174-2a(a). This section of the state rule identifies who the responsible official is for purposes of certifying documents under the title V permit program. The state should clarify that people who sign documents in accordance with section 22a-174-2a(a)(1) be authorized in accordance with section 22a-174-2a(a)(2). The state should also use the existing language in section 22a-174-33(b) regarding responsible officials and authorization. The state should clarify that an authorization goes to a position rather than a specific person. Lastly, the requirement for state approval when signatory responsibility is delegated is overly burdensome.

Response: EPA identified as an interim approval issue the definition of a “responsible official” for documents submitted under the title V program. See 62 FR 13830-13833 (March 24, 1997). As discussed in EPA's August 13, 2001 proposal to fully approve Connecticut's program, the state's proposed rule fully addressed EPA's interim approval issue. To address comments the state received, Connecticut has made changes to its provisions for identifying a “responsible official.” The state changes clarify the procedures a company must follow when designating an individual as a responsible official. The state's final rule still satisfies the federal requirements for “responsible official.”

As discussed in response to comment number 1, above, EPA does not have authority to look behind a state's decision to include permitting requirements in addition to those specified in part 70. Therefore, whatever burden might be created by Connecticut's requirement that DEP approve delegations of signatory responsibility is not relevant to EPA's review and approval of this program.

10. Comment: The commenter noted that DEP provides for adjudicative hearings, as well as less formal legislative hearings, as an option for satisfying the requirement that there be an opportunity for a hearing on permits. The commenter asserts that EPA has interpreted the Act to require only the less formal legislative hearings. Additionally, the commenter requests the DEP to consider limiting the requirement to hold a public adjudicative hearing by adding a threshold that one must make a “material request” before a hearing would be granted.

Response: The provisions of 22a-174-2a(c)(6) and 22a-174-2a(c)(7) governing non-adjudicative hearings and meetings satisfy the federal requirement to provide an opportunity for a hearing for Title V operating permits and new source review permits. In both programs, however, a state may include procedural requirements, including adjudicative hearing procedures, in addition to the federal minimum where the state agency deems it appropriate. EPA has found it appropriate for states to require that a request for a hearing must raise a material issue; it would be plainly unreasonable to require a state to hold hearings on immaterial issues.

11. Comment: The commenter notes that “issue of a subject permit * * *” should be “issuance of a subject permit * * *” in section 22a-174-2a(c)(7).

Response: Connecticut has corrected this error. As stated in the response to the previous comment, section 22a-174-2a(c)(7), in conjunction with section 22a-174-2a(c)(6), satisfies the federal requirements when a public hearing is requested.

12. Comment: Section 22a-174-2a(e)(3)(B)(i) requires a source to include in its application for a minor permit modification any “modification in potential emissions.” Since the term “modification” is a defined term, the commenter requests the word “modification” be replaced by the word “increase.”

Response: The state agreed with the commenter and changed the word “modification” to “increase” when describing a change in emissions due to a project that requires a minor modification to the part 70 permit. EPA agrees that this change clarifies the state's proposed rule. The state's rule still satisfies the federal requirements regarding the content of a title V application for a minor permit modification.

13. Comment: Connecticut requires a 21 day waiting period before a source can make the change it proposes in its application for a minor permit modification. The commenter requests that the state remove the waiting period and make the process consistent with part 70.

Response: The provision of section 22a-174-2a(e)(3)(c) meets the federal requirement for minor permit amendments that allow a source to make the proposed change prior to receiving a permit modification. As stated earlier, a state may include procedural requirements in its title V program, including a waiting period for minor permit modifications, in addition to the federal minimum requirements when the state agency deems it appropriate.

14. Comment: The commenter requested that Connecticut incorporate a safe harbor provision in the procedures for a minor permit modification in section 22a-174-2a(e)(4) of the state's regulations. A safe harbor provision would protect a source from enforcement if the source acted in good faith when it implemented its minor permit modification, even if it was determined later that the modification did not qualify as a minor permit modification.

Response: EPA disagrees with this comment. The part 70 program does not allow a state to create a safe harbor provision for a source that violates program regulations even though the source is complying with its application and applied for the minor modification in good faith. The minor permit modification procedures in 40 CFR 70.7(e)(2) allow a facility to implement a change prior to the permit authority revising the permit to address the change. But this provision imposes strict liability on a facility that submits a change that it purports to be a minor permit modification, but ultimately turns out to require a significant permit modification. This strict liability is an important element of the structure of 70.7(e)(2), because it provides a significant disincentive to permitees that might be tempted to rush a change through the system with an unfounded claim that it is a minor modification. Therefore, Connecticut cannot, consistent with part 70, create the “safe harbor” the commenter recommends, and the state's rule is consistent with part 70.

15. Comment: The commenter requests that Connecticut add language to section 22a-174-2a(d)(4)(D) that would explicitly state that modifications qualifying as operational flexibility and off-permit changes would not be subject to non-minor permit modification requirements.

Response: The state has made changes to its proposed rule to address this comment. It is consistent with part 70 to exclude changes at a facility that qualify as changes under the off-permit or operational flexibility requirements from the requirements for significant permit modifications. Therefore, the state's changes to its rule that address this comment do not impact EPA's ability to approve this program.

16. Comment: The commenter requests that the approval of “equivalent monitoring, recordkeeping, or reporting” be added to administrative amendments found at 22a-174-2a(f)(2) of the state regulations.

Response: In 40 CFR 70.7(d), EPA lists the types of changes a state may allow sources to make as administrative amendments. Section 70.7(d)(1)(iii) states a change is eligible as an administrative amendment if the permit change “requires more frequent monitoring or reporting.” Since the request is to add “equivalent monitoring * * *,” EPA disagrees with the comment and supports Connecticut's position not to add “equivalent monitoring, recordkeeping, or reporting” to its list of permit changes eligible for administrative amendments. Making a determination that a substitute monitoring regime is “equivalent” to that provided in the permit involves a level of regulatory judgment that is not appropriate for the administrative amendment procedure. These procedures are designed for amendments that are largely ministerial or that are indisputably more protective of the environment, such as increased monitoring frequency.

17. Comment: Section 22a-174-2a(i)(1) requires permit renewal applications to include “any modifications in potential emissions resulting from the proposed modifications.” The commenter suggests clarifying language by replacing “any modification” with “any increase” since the term modification is a defined term.

Response: Connecticut essentially agreed to make this clarification in its regulations, and the final rule provides that a renewal application must describe any “increases or decreases in potential emissions resulting from any proposed modifications.” This revision is consistent with part 70.

18. Comment: The commenter states that section 22a-174-3a(m) of Connecticut regulations is not identical to part 63 with regard to case-by-case MACT determinations. For example, under Connecticut's definitions, an increase in HAP emissions at the entire source, not just process lines, is used to determine if the thresholds for a 112(g) modification are triggered.

Response: Case-by-case MACT determinations are commonly referred to as 112(g) modifications because they implement the requirements of section 112(g) of the CAA. Under part 63, the entire new or reconstructed process must be a major source by itself. A process is defined in 40 CFR part 63 as “any collection of structures and/or equipment, that processes assembles, applies, or otherwise uses material inputs to produce or store an intermediate or final product.” This means that a single facility may contain more than one process or production unit. Since the state's regulation determines applicability on a facility wide basis, the state's rule could potentially require more section 112(g) determinations than federal requirements. However a state may include requirements, including a more encompassing 112(g) program, in addition to the federal minimum for a part 70 program and other air pollution control programs where the state agency deems it appropriate. See sections 506(a) and 116 of the Act, 42 U.S.C. 7661e(a) and 7416.

19. Comment: The commenter states that Connecticut's rule does not exclude sources from the 112(g) program that use existing controls previously determined as BACT within 5 years of the modification (referred to as the “good controls exclusion”). This omission could make the Connecticut 112(g) program more stringent than the federal program. The commenter requests that the state make section 22a-174-3a(m)(8) consistent with the federal requirements regarding situations when compliance with a MACT standard is not required for a source that is operating under a 112(g) determination.

Response: The comment is correct in that Connecticut's rule is more stringent than the federal rule regarding this issue. However, a state may include requirements, including a more encompassing 112(g) program, that go beyond the federal minimum for a part 70 program and other air pollution control programs.

20. Comment: The commenter requests that the state expand its list of exempted activities from 112(g) determinations in section 22a-174-3a(m)(2) to be consistent with federal requirements. The expanded list would include adding exemptions for electric utility steam generating units and research and development activities.

Response: The exemption for electric steam generating units is no longer applicable. See 65 FR 79825 (December 20, 2000). In its final rule, the state did add an exemption for research and development (R&D). To comply with the exemption, the state rule requires R&D activities to meet the federal requirements for R&D at 40 CFR 63.40(f). Exempting R&D activities from 112(g) requirements is consistent with federal requirements under part 63 and does not impact EPA's ability to approve the title V program.

21. Comment: The commenter suggests that the state incorporate-by-reference the federal application requirements for a case-by-case MACT determination. The commenter states that Connecticut's rule does not contain administrative procedures nor an opportunity for public comment. The current proposed state regulations are also confusing when determining the required information in an application for a 112(g) modification.

Response: Connecticut is not required to incorporate the federal requirements for 112(g) applications. Instead, the state has the option to develop its own regulations for applications, as long as the state regulations are consistent with federal requirements. EPA has determined that section 22a-174-3a, including subsections (c) and (m), meet the federal requirements for a complete application, including adequate public notice, under the 112(g) program.

22. Comment: The commenter requests the state to clarify section 22a-174-3a(m)(7). This section determines when a permittee that has received a 112(g) determination is required to comply with the emission limit for the applicable MACT standard. The state rule is unclear about what happens when a source that installs case-by-case MACT controls that are different than the MACT standard later adopted by EPA.

Response: The state regulation requires a facility, even one with a case-by-case MACT determination, to comply with a MACT standard within 8 years after a MACT is promulgated or within 8 years of the permittee's first compliance date for the emission limitation under the MACT determination, whichever is earlier. If the first compliance date precedes the MACT promulgation, then the permittee would have less than 8 years from the promulgation. Since the federal requirement is for all sources with case-by case determinations to meet the MACT standard within eight years of the standard's promulgation, the state rule meets federal requirements.

23. Comment: The commenter is concerned that the state rule regarding alternative operating scenarios could be interpreted too broadly, requiring separate permit conditions for each level of production.

Response: It is not the intent of a title V permit program to require a source to list every production level as an alternative operating scenario. EPA has determined that Connecticut's definition of an alternative operating scenario is consistent with the Agency's policy and guidance on the issue.

It is true that the definition of “alternative operating scenario” in definitions section of Connecticut's operating permit program regulations is quite broad. See R.C.S.A. sec. 22a-174-33(a)(1). Read out of context, it is possible to conclude this definition implies that any variation in a facility's operations is relevant under this program, regardless of the bearing that variation has on the permit and the applicable requirements.

But it is important to understand this definition in the context in which it is used in the program regulations. Permit applicants must provide information “for each alternative operating scenario that the applicant has included in the title V permit application.” R.C.S.A. sec. 22a-174-33(g)(1)(E). The permit content requirements mandate that each permit include a “statement of all terms and conditions applicable to any allowable alternative operating scenario, including a requirement that each such alternative operating scenario shall meet all applicable requirements * * *.” R.C.S.A. sec. 22a-174-33(j)(1)(J). These provisions make it reasonably clear that an applicant must provide information about those operating scenarios that must be addressed in the permit and which require separate attention because of the different compliance scenarios or different applicable requirements that apply to those scenarios.

24. Comment: The commenter requests a determination as to how title V applicability in the state rules affects landfills and other sources subject to section 111(d) plans of the CAA.

Response: According to Section 22a-174-33(a)(10)(D) of the state's rule, any source subject to a 111(d) plan would be defined as a “Title V source.” However, not all “Title V sources” are required to obtain a title V permit. Section 22a-174-33(c)(2)(D) of the state's rule, exempts sources subject to a 111(d) plan, in addition to other types of sources, from obtaining a Title V permit if EPA exempts such a source. For example, if a closed landfill is not otherwise required to obtain a Title V permit, 40 CFR 62.14352(f) exempts the landfill from obtaining a Title V permit provided that the landfill meets certain criteria. Since EPA has exempted this limited class of landfills from having to obtain a Title V permit, Section 22a-174-33(c)(2)(D) is invoked and closed landfills in Connecticut meeting the requirements of 40 CFR 62.14352(f) are exempted from Title V permitting. Please note that if Connecticut submits a rule that would substitute for the federal rule for existing landfills, and EPA approves the state rule, the exemption from Title V permitting listed in 40 CFR 62.14532(f) would no longer apply. The exemption would have to exist in the EPA approved state rule.

25. Comment: The commenter believes that the references to a general permit in sections 22a-174-33(d)(9) and (10) are redundant and unnecessarily repeat the requirements of sections 22a-174-33(c)(4) and (5).

Response: Section 22a-174-33(d) of Connecticut's rules deals with regulations that limit a source's potential emissions. Subsection (d) does not contain provisions for a general permit for the title V permit program. In fact, the main reason Connecticut developed section 22a-174-33(d) is to allow a source to limit its potential emissions to avoid the title V permit program. Sections 22a-174-33(c)(4) and (5), on the other hand, address how title V general permits operate under Connecticut's program. Specifically, they spell out the consequences for failing to comply with a general permit and for failing to qualify for a general permit under which the facility claims it is operating. These provisions are not redundant with the general permit provisions designed to limit a source's potential to emit under sections 22a-174-33(d)(9) and (10).

26. Comment: The commenter believes that the state has gone beyond the federal requirement when determining the consequences when a source is found to be violating a general title V permit or a general permit limiting potential to emit. Connecticut's rule states that if a source violates either type of a general permit, the source would be considered to be operating without a title V permit.

Response: EPA disagrees with the comment and has determined the state regulation (sections 22a-174-33(c)(4) and (d)(10)) is consistent with federal requirements. The commenter is correct that the minimum federal requirement in EPA's part 70 regulations for liability provisions in a title V general permit program includes a provision deeming the source to be operating without a title V permit if the source is found not to qualify for a general permit. Connecticut added section 33(c)(5) to address EPA interim approval issue number 23 to meet this requirement. In addition, Connecticut provided that sources which fail to comply with their general permits will be deemed to be operating without a title V permit under section 33(c)(4). While not required by the part 70 regulations, this provision is certainly allowed under title V pursuant to section 506(a) of the Act. That section allows a state to establish “additional permitting requirements not inconsistent with [the] Act.” Connecticut's decision to provide vigorous enforcement mechanisms to ensure compliance with its general permit programs is certainly not inconsistent with the Clean Air Act.

The requirement in section 33(d)(10), while similar in structure to 33(c)(4), is not strictly speaking part of EPA's review of the operating permit program. This provision addresses a source's liability when it fails to comply with a general permit to limit its potential to emit. As noted in response to the prior comment, the purpose of 33(d) is to keep sources out of the title V program, not to address the requirements of title V or part 70.

27. Comment: The commenter requests the state to be consistent with the federal requirements regarding the timing of a title V application for a new major stationary source. The federal rule requires an application within 12 months of commencing operation. The state's proposed rule required an application within 12 months of applying for an NSR permit.

Response: The state addressed this comment by changing its proposed rule to be consistent with federal regulations. Section 22a-174-33(f)(4) requires a title V application within 12 months of commencing operation for a new major stationary source or a major modification to an existing title V source or within 90 days if notified by the commissioner, whichever date is earlier. This state rule addresses the application deadline requirements of 40 CFR 70.5(a)(1)(ii).

Section 22a-174-33(f)(4) does not address the requirement in 40 CFR 70.5(a)(1)(ii) that the title V permit must be modified prior to operating the modification when its existing title V permit prohibits such construction or change in operation. However, nothing in section 22a-174-33(f)(4) of the state rules excuses a source applying for a major modification from complying with its existing title V permit. Section 22a-174-2a(d)(5)(B) of the state rules clearly prohibits a source deviating from its existing permit unless the state first modifies the permit.

28. Comment: The commenter states the vagueness of section 22a-174-33(h) of Connecticut's rules may not allow an applicant a reasonable opportunity to correct application deficiencies before being held liable for an insufficient permit application.

Response: Connecticut has revised section 22a-174-33(h) to clarify the consequences if a source fails to meet the requirements for submitting a timely application either for the first time or when the state determines additional information is required in order to process an application. The state's final rule is still consistent with federal requirements and fully addresses EPA's interim approval issue. See 62 FR 13831, section III, no. 6.

29. Comment: The commenter requests that the state make its permit shield provisions in the state rules consistent with permit shield language in part 70, and that the state grant permit shield when issuing permits.

Response: Connecticut's permit shield provisions in section 33(k) are substantially identical to the federal shield provisions in section 70.6(f) of EPA's part 70 regulations. Both regulations require that a permit shield will only cover those applicable requirements that are included and are specifically identified in the permit. Therefore, the commenter's concern that the state's shield provisions are more stringent that federal requirements appears to be misplaced.

The commenter's concern that the state does not always provide for a permit shield when issuing permits is not relevant to this program review. The permit shield language is an optional element for a state title V program. It is solely within Connecticut's discretion to grant a permit shield. As long as the authority for granting a shield under section 22a-174-33(k) is consistent with federal requirements, it is up to the state to decide when to use that authority.

30. Comment: The commenter requests the state to relax the proposed rule regarding prompt reporting. The commenter is concerned that the state has eliminated the provision in section 33(p)(1) that commenced the period for measuring “prompt” reporting from the time at which the permit holder reasonably should have learned of the occurrence. The commenter is concerned that some deviations will be difficult to discover, and the deadline for reporting will have passed before the permit holder knows that the deviation must be reported.

Response: Part 70 is not specific about how a state should define “prompt” for reporting deviations, and leaves the state substantial latitude in structuring this requirement. As described in section IV., no. 8 of the proposal, EPA stated that sections 22a-174-33(o)(1) and (p)(1) of Connecticut's proposed rules are consistent with how EPA defines prompt reporting in the federal program. See 40 CFR 71.6(a)(iii)(B). Since Connecticut has not changed these proposed provisions, EPA has determined that the state's regulations governing prompt reporting meet the requirements of part 70. Any concern about the strict standard in section 33(p)(1) for reporting a deviation can be addressed as part of program implementation and with the reasonable application of enforcement discretion.

31. Comment: The commenter requests the state confirm that it has deferred title V permitting of chrome emitting sources for five years.

Response: Section 22a-174-33(c)(2)(D) essentially incorporates any decisions EPA has made under the NSPS and NESHAP programs, including the MACT standards program, to defer facilities from the requirement to have a title V permit. This section allows for such deferrals where the sole reason for bringing a source into the title V program is the applicability of a MACT standard and where EPA has promulgated a deferral of the title V permitting requirement for that MACT standard or certain sources under it. At the discretion of the permitting authority, EPA has deferred chrome sources from becoming subject to the title V permit program until December 9, 2004. A title V application will be due one year after becoming subject to the program, on December 9, 2005 unless EPA exempts or continues to defer title V applicability for chrome emitting sources.

32. Comment: The commenter asks why did the DEP define the term “principal executive officer” in the last sentence of section 22a-174-2a(a)(1)(E) of the state's rule because the term appears nowhere else in the section. This section of the state rule lists the positions of people who can sign as the responsible official for federal entities.

Response: DEP clarified this provision by including “principal executive officer” in the list of federal officials who can sign title V permitting documents as responsible officials. Thus, the definition for this term now makes sense in the context of the final regulation, and the provision is consistent with part 70, section 70.2.

33. Comment: The commenter believes that section 22a-174-33(f)(3) includes a typographical error and the phrase “may issue” does not belong in the last phrase of the section. This section of the state regulation contains the deadlines for applying for a title V permit when a source's potential emissions are minor, but when the source is subject to either 40 CFR parts 60 or 61.

Response: Connecticut agreed with the comment and deleted the phrase “may issue.” The deletion of the phrase “may issue” does not impact EPA's proposal that states section 22a-174-33(f)(3) has been adequately revised to address the interim approval issue. See section IV, no. 20 of EPA's proposal.

34. Comment: The commenter requests that the state identify the forms that a facility must use to comply with the “non-minor permit modification” application process in section 22a-174-2a(e)(5)(B) of the state rules.

Response: On page 199 of its November 14, 2001 Hearing Report, Connecticut stated that it is developing forms for sources to use. However, the state made it clear, and EPA concurs, that a source is still required to submit all information required by the regulations if it desires a non-minor permit modification, even if the state has not yet developed a form.

35. Comment: A commenter expressed concern that the permit modification process for “non-minor permit modifications” is open-ended. Connecticut's regulation section 22a-174-2a(d)(8) requires the Commissioner to take final action on a non-minor modification within 12 months, but also provides that the modification will not be “automatically be deemed sufficient or approved” if the Commissioner takes longer than 12 months. The commenter asks what the consequence is if DEP misses its deadline for modifying a permit.

Response: EPA agrees with DEP that default issuance of “non-minor” permit modifications, which basically correspond to significant modifications under part 70, cannot be allowed consistent with sections 70.7(e)(4)(ii), 70.7(a), and 70.7(h). Therefore, it would not be appropriate to allow a facility to make a “non-minor modification” in its permit based solely on the fact that DEP has failed to act on its application within 12 months. EPA's significant permit modification regulations do provide that the “permitting authority shall design and implement this review process to complete review on the majority of significant permit modifications within 9 months after receipt of a complete application.” 40 CFR 70.7(e)(4)(ii). This provision does not mandate that the state bind itself to acting on all applications within 9 months. Rather it requires that the state use its authority to act on most significant modifications within 9 months. Connecticut's rule for processing “non-minor modifications” is consistent with this provision. Connecticut's procedures for taking public comment, offering an opportunity for a hearing, addressing affected state comments, and allowing for EPA review give DEP ample opportunity to implement its program so that it acts on a majority of “non-minor modifications” within 9 months. See R.C.S.A. 22a-174-2a(b), (c), and (d).

36. Comment: A commenter agreed with Connecticut's incorporation of the federal definition for “emission unit” in section 22a-174-1

Response: EPA also agrees with the state's change in its definition for “emission unit.”

37. Comment: The definition of “federally enforceable” elicited several comments. First, commenters asked whether “permits to operate” issued under section 22a-174-3 of the state's regulations are considered federally enforceable. Second, the commenters supported the state's decision to provide that practically enforceable limits should also be considered sufficient to limit a source's potential to emit. Commenters also submitted concerns that relate to the new source review program and are not relevant to this action.

Response: In a July 25, 1997 letter to Christopher James at DEP, EPA confirmed that state operating permits issued pursuant to section 22a-174-3(f) and (g) may be federally enforceable if they are issued consistent with the requirements of those regulations approved into the state implementation plan. As discussed below, EPA agrees that emission limits to reduce a facility's potential to emit must be practically enforceable.

38. Comment: A commenter requested an explanation from Connecticut whether the change to the state's definition for “fugitive emissions” was intended to change the meaning of “fugitive emissions” as defined by EPA.

Response: Connecticut's hearing report makes it clear that it did “not intend to alter or expand the meaning of “fugitive emissions” by the proposed change.” DEP Hearing Report at 154 (November 14, 2001). Rather the state's change was made to shift the tense of the verb “which could not reasonably pass through a stack * * *” from past tense to the present tense “that cannot pass through a stack .* * *” Therefore, if emissions would reasonably be passed through a stack, this definition would exclude them from being treated as fugitive emissions. Connecticut's revised definition for “fugitive emissions” is consistent with 40 CFR 70.2.

39. Comment: The commenter requested an explanation of the state's intent concerning new language the state added to the definition of “maximum capacity.” The new language allows the state to accept a time frame different from 8760 hours per year when determining the maximum capacity of a piece of equipment.

Response: Connecticut responded that it intends to issue future guidance on determining “maximum capacity.” On January 25, 1995, EPA issued guidance titled “Options for Limiting the Potential to Emit (PTE) of a Stationary Source Under section 112 and Title V of the Clean Air Act (Act)” that recognized inherent physical limits in a source's operations that would restrict a source's capacity. These restrictions would prevent a source from operating the pollution emitting devices 8760 hours per year. In this guidance EPA indicated that states have the authority to make judgements on inherent physical operational restrictions. The language Connecticut added to the definition of “maximum capacity” gives the state the authority EPA recognized in the Agency's guidance. EPA is committed in working with Connecticut in developing state guidance on when the use of 8760 hours of operation is inappropriate when calculating a source's potential emissions.

40. Comment: The commenter requests the state to limit the counting of fugitive emissions “to the extent quantifiable” within the definition of “potential emissions.” In addition, the commenter states the definition of “potential emissions” arbitrarily prevents pollution control equipment from being considered as a physical limitation on potential emissions where that equipment is integral to the source's operation.

Response: The term “potential emissions” is used in section 22a-174-33(a)(10) for determining whether a source is required to obtain a title V permit. The state disagreed with the commenter and did not add the language “to the extent quantifiable” when determining if fugitive emissions are counted towards a source's title V applicability. The state rule is consistent with part 70, where the language “to the extent quantifiable” is absent when describing fugitive emissions within the definition of “major source.” The state also disagreed with the commenter that pollution control equipment is treated arbitrarily under its definition of potential emissions, and EPA sees no reason to disagree with that conclusion. DEP clarified that it will consider “inherent engineering, operational or technical capacity on an emissions unit that restricts the potential emission of such unit” when determining the maximum capacity of a unit. Nothing in this standard arbitrarily excludes consideration of pollution control equipment that is integral to the design of an emissions unit, although the applicant may have a high burden to demonstrate that the operation and performance of the control equipment is an inherent aspect of the source's operation.

41 Comment: Several industry commenters objected to aspects of the new definition of “practically enforceable” in section 1(87) of the state's rule. Following some slight adjustments DEP made to the proposed definition in its final rule, the remaining relevant comments all expressed concern about the requirement that a facility must have “CEM or equivalent” monitoring if it wishes to limit its emissions using an emission limit or operating restriction with a 12-month rolling average averaging period.

Response: Strictly viewed, this comment is probably not directly relevant to the action EPA is taking today to approve Connecticut's title V program. The term “practically enforceable,” as well as the corresponding term “federally enforceable,” are used in DEP's regulations primarily to define how a facility may take limits on its potential to emit to avoid the title V operating permit program or other applicable requirements that are triggered based on a facility's potential emissions. So these terms do not relate so much to the implementation of the operating permit program EPA is approving as they bear on how to stay out of that program.

Nevertheless, EPA is responding to comments about the definition of “practically enforceable” because the meaning of this term might be relevant to how permit terms in a title V permit are crafted. For example, a title V permit holder may wish to take a limit in its permit reducing its potential to emit so as to avoid an otherwise applicable requirement. In this context, title V sources and the state may want to assess the practical enforceability of that limit. Therefore, EPA is responding to the comments on this definition.

Connecticut's definition of practically enforceable is built on the same principles as EPA's guidance on the enforceability of limits on potential to emit (PTE). See e.g. Guidance on Enforceability Requirements for Limiting Potential to Emit through SIP and § 112 Rules and General Permits, from Kathie A. Stein, Jan. 25, 1995, and the materials summarized at p. 5 of this guidance. Both DEP and EPA are concerned that if a facility is relying on a PTE limit to avoid important applicable requirements or title V permitting, the agencies must be able to enforce those PTE limits readily on a short term basis. If we must wait for year before enforcing a PTE limit, the limit will have far less practical deterrent effect than a short term limit.

A limit based on a 12-month rolling averaging period strains at the boundary of this principle. It is not optimal for an agency to have to wait for a month to document compliance with a PTE limit. To be sure that we can determine compliance readily when the monthly compliance period is completed, the monitoring of such limits must be both accurate and timely.

A CEM meets this standard and provides a useful benchmark for the sort of monitoring that is necessary to make such limits practically enforceable. As DEP explained in its own response to comments, their rule does not mandate CEMs, but does require monitoring with similar characteristics—“qualitatively equal to that of CEM.” DEP Hearing Report at 182 (Nov. 14, 2001). DEP and EPA understand that two critical qualities of CEMs are that they are accurate in their measurement of emissions and they produce data virtually contemporaneously. In addition to making timely compliance determinations possible at the end of each month, such monitoring would allow an agency inspector to arrive mid-month and look at the monitoring records of a facility to determine if it is on track to meet its PTE limit at the end of a month. EPA believes Connecticut's requirement for “CEM or equivalent” monitoring for 12-month rolling average compliance periods is a reasonable step to making such longer term rolling PTE limits practically enforceable. During review of title V permits, EPA will monitor Connecticut's implementation of the “CEM or equivalent” requirement when a 12-month rolling average is used for the compliance period.

42. Comment: The commenter requested that Connecticut establish in the definition of “Research and Development Operation” a de minimis amount of commercial product activity in a laboratory. The commenter states that by adding a de minimis level to the definition, the definition would be consistent with EPA's proposed changes to part 70.

Response: Connecticut did revise the proposed amendments to section 33 with regards to how Research and Development Activities are treated. However, the state changes did not create a de minimis amount of product that could be sold commercially. Rather, the state's final rule essentially maintained the definition of “Research and Development” as the term was defined in the state's interim title V program which EPA had approved in 1997. If part 70 is amended as EPA proposed in 1996, EPA will work with Connecticut in making any state program changes that the revised federal rule would require or allow.

43. Comment: The commenter noted language appeared missing from the end of section 22a-174-33(j)(1)(F)(ii). “For all other regulated air pollutants such limits are no [???].”

Response: Connecticut noted in its hearing report that a software error had led to the deletion of phrase “less than one (1) ton per pollutant per year for each emission unit” from the commenter's copy. The official version of the regulation contained the missing language so there was no typographical error.

44. Comment: The commenter requested that in order to take advantage of fuel cells, hydrogen, argon, and helium should be exempted in the states definition of “air pollutant.”

Response: Connecticut did not add the requested exemptions to the definition of “air pollutant.” The state's definition of “air pollutant” is consistent with how that term is used in part 70.

45. Comment: One commenter inquired about EPA's assessment of section 22a-174-2a(f)(2)(F) in which EPA clarified that Connecticut's new source review program (NSR) does not include all the necessary elements of the title V program to allow NSR permits to be included in a title V permit using an administrative amendment. The commenter asked EPA to explain what provisions of Connecticut's new source review program do not meet all the requirements of sections 40 CFR 70.6, 70.7, and 70.8 and to specify the changes Connecticut would have to make in its NSR program to meet these requirements.

Response: EPA is not prepared here to catalogue exactly how Connecticut might enhance its NSR program to allow for administrative title V permit amendments. That question is not ripe as a formal matter, and it would not be prudent for EPA to spell out how DEP might revise its NSR program without first working with DEP to sort through the many choices DEP would have to make about the design of such NSR enhancements. It is sufficient for the purposes of the decision currently before EPA to say that the state's NSR program does not contain all the substantive and procedural elements of sections 70.6, 70.7, and 70.8—the most obvious example being that the state does not provide EPA an opportunity to object to NSR permits to block their issuance.

EPA is using the good cause exception under the Administrative Procedure Act (APA) to make the full approval of the state's program effective on May 31, 2002. In relevant part, the APA provides that publication of “a substantive rule shall be made not less than 30 days before its effective date, except— * * * (3) as otherwise provided by the agency for good cause found and published with the rule.” 5 U.S.C. 553(d)(3). Section 553(b)(3)(B) of the APA provides that good cause may be supported by an agency determination that a delay in the effective date is impracticable, unnecessary, or contrary to the public interest. EPA finds that it is necessary and in the public interest to make this action effective sooner than 30 days following publication. In this case, EPA believes that it is in the public interest for the program to take effect before June 1, 2002. In the absence of this full approval of Connecticut's amended program taking effect on May 31, 2002, the federal program under 40 CFR part 71 would automatically require some sources to pay operating permit fees to the federal government in addition to fees the sources already pay to Connecticut under state law. EPA believes it is in the public interest for sources to avoid having to pay federal fees for permits the sources would not receive, since a federal program would only continue for a short time after June 1, 2002. Furthermore, a delay in the effective date is unnecessary because Connecticut has been administering the title V permit program for more than five years. Through this action, EPA is approving a few revisions to the existing and currently operational program. The change from the interim approved program which substantially met the part 70 requirements, to the fully approved program is relatively minor, in particular if compared to the changes between a state-established and administered program and the federal program. Finally, the state regulations EPA is approving have been effective under state law since March 15, 2002. Therefore, the regulated community has had more than 30 days to anticipate compliance with the requirements EPA is approving today.

Today, EPA is fully approving Connecticut's title V program. Upon the effective date of this notice, the part 71 program will no longer be effective in Connecticut. However, a part 71 program could become effective at a future date if EPA makes a finding that Connecticut's title V program fails to meet the requirements of part 70. If such a finding is made, the Agency will use its authority and follow the procedures under section 502(i) of the CAA and 40 CFR 70.10.

In its program submission, Connecticut did not assert jurisdiction over Indian country. To date, no tribal government in Connecticut has applied to EPA for approval to administer a title V program in Indian country within the state. EPA regulations at 40 CFR part 49 govern how eligible Indian tribes may be approved by EPA to implement a title V program on Indian reservations and in non-reservation areas over which the tribe has jurisdiction. EPA's part 71 regulations govern the issuance of federal operating permits in Indian country. EPA's authority to issue permits in Indian country was challenged in Michigan v. EPA, (D.C. Cir. No. 99-1151). On October 30, 2001, the court issued its decision in the case, vacating a provision that would have allowed EPA to treat areas over which EPA determines there is a question regarding the area's status as if it is Indian country, and remanding to EPA for further proceedings. EPA will respond to the court's remand and explain EPA's approach for further implementation of part 71 in Indian country in a future action.

Under Executive Order 12866, “Regulatory Planning and Review” (58 FR 51735, October 4, 1993), this final approval is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) the Administrator certifies that this final approval will not have a significant economic impact on a substantial number of small entities because it merely approves state law as meeting federal requirements and imposes no additional requirements beyond those imposed by state law. This rule does not contain any unfunded mandates and does not significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4) because it approves pre-existing requirements under state law and does not impose any additional enforceable duties beyond that required by state law. This rule also does not have tribal implications because it will 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, as specified by Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000). This rule also does not have Federalism implications because it will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132, “Federalism” (64 FR 43255, August 10, 1999). This rule merely approves existing requirements under state law, and does not alter the relationship or the distribution of power and responsibilities between the state and the federal government established in the Clean Air Act. This final approval also is not subject to Executive Order 13045, “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997) or Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001), because it is not a significant regulatory action under Executive Order 12866. This action will not impose any collection of information subject to the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. , other than those previously approved and assigned OMB control number 2060-0243. For additional information concerning these requirements, see 40 CFR part 70. 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 OMB control number.

In reviewing state operating permit programs submitted pursuant to title V of the Clean Air Act, EPA will approve state programs provided that they meet the requirements of the Clean Air Act and EPA's regulations codified at 40 CFR part 70. In this context, in the absence of a prior existing requirement for the state to use voluntary consensus standards (VCS), EPA has no authority to disapprove a state operating permit program for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews an operating permit program, to use VCS in place of a state program that otherwise satisfies the provisions of the Clean Air Act. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply.

The Congressional Review Act, 5 U.S.C. 801 et seq. , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . A major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2). This rule will be effective on May 31, 2002.

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 12, 2002. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2)).

2. Appendix A to part 70 is amended by revising the entry for Connecticut to read as follows:

The Hazardous Materials Regulations (HMR; 49 CFR Parts 171-180) specify requirements for the safe transportation of hazardous materials in commerce by rail car, aircraft, vessel, and motor vehicle. In general, the HMR apply to each person who performs, or causes to be performed, functions related to the transportation of hazardous materials in commerce. The HMR prescribe requirements for classification, packaging, hazard communication, shipping papers, incident reporting, handling, loading, unloading, segregation, and movement of hazardous materials.

Each year, carriers report thousands of “incidents” involving the transportation of hazardous materials to the Research and Special Programs Administration (RSPA, we) in accordance with the HMR incident reporting requirements. An “incident” occurs when there is an unintentional release of hazardous material from a package (including a tank) or, as a direct result of hazardous materials, an “incident” requires immediate notification to the National Response Center (see §§ 171.15 and 171.16).

Many incidents result from noncompliance with the requirements in the HMR. They frequently stem from a shipper's lack of awareness of the HMR's requirements, rather than a deliberate violation. The safety of hazardous materials in transportation depends on persons engaged in day-to-day transportation-related activities making a concerted effort to comply with the HMR. We strongly urge all persons involved in the packaging and offering of hazardous materials to carefully examine all of their procedures to ensure compliance.

In this document, we discuss requirements that are applicable to persons who offer (or ship) hazardous materials. These are subdivided into the following seven areas: (1) Hazard identification, classification and communication; (2) general packaging requirements; (3) requirements for the use of packagings meeting United Nations (UN) performance standards; (4) additional packaging requirements for air shipments; (5) transportation security; (6) training of hazmat employees; and (7) obtaining Federal assistance.

Most of the guidance and information in this document applies to all modes of transportation. However, this document emphasizes the requirements for air transportation because of the number of reported incidents involving air transportation and the vulnerability of air transportation to potentially catastrophic accidents. This document provides general guidance only. Shippers should not rely on this document as a substitute for the HMR to determine compliance with regulatory requirements.

Reducing or eliminating the incidence of undeclared hazardous materials in transportation is one of our highest priorities. Undeclared hazardous materials shipments by aircraft are of particular concern because of the risks they pose. We believe a lack of awareness of regulatory requirements and the risks posed by hazardous materials is a contributing factor in undeclared hazardous materials entering the transportation system. As a shipper—that is, a person who offers hazardous materials for transportation—you must be aware of any hazardous characteristics of your products and must know whether a product is regulated as a hazardous material before offering it for transportation. In addition, you should know whether an item or article contains a hazardous material.

Currently, we have a number of non-regulatory initiatives to increase public awareness of the safety problem presented by undeclared shipments of hazardous materials. We are examining a number of alternatives to reduce or eliminate undeclared hazardous materials shipments, such as through better means of detection. Ultimately, however, primary responsibility for ensuring that hazardous materials are identified and declared in accordance with the applicable regulations rests with the shipper.

Because you as a shipper perform critical functions in preparing hazardous materials for transportation, you have the greatest opportunity to improve transportation safety. You may offer a hazardous material for transportation only when it is properly classed and described in accordance with parts 172 and 173 of the HMR, or international regulations such as the International Civil Aviation Organization's Technical Instructions for the Safe Transport of Dangerous Goods by Air (ICAO Technical Instructions), as permitted in Part 171 of the HMR. The § 172.101 Hazardous Material Table (HMT) lists the most commonly transported materials and articles by name, or by a generic alternative when no specific name is listed. Some hazardous materials are prohibited for transportation. Others, such as most explosives, self-reactive substances, and organic peroxides, require the approval of the Associate Administrator for Hazardous Materials Safety before they may be offered or transported. However, for most hazardous materials, you are responsible for determining the appropriate hazard class and shipping description. This information determines the appropriate packaging and hazard communication requirements such as package marking, labels, and shipping documentation, including emergency response information.

Selection and use of the appropriate packaging for a hazardous material are essential to ensuring that a hazardous material is not released during transportation. Only packagings authorized by the HMR may be used to package hazardous materials for transportation. You must ensure that a packaging will retain its contents during temperature variances, changes in atmospheric pressure, vibration, or other conditions that may be encountered during normal conditions of transport.

Section 173.24 of the HMR sets forth general requirements that apply to all packagings and packages used for hazardous materials. Section 173.24a contains additional requirements for non-bulk packagings. These sections of general applicability require you to ensure a packaging is compatible with its lading, properly closed, and meets any additional capability requirements. For example, § 173.24 requires plastic packaging and inner receptacles used for liquids to be capable of withstanding, without failure, the procedure for determining chemical compatibility and rate of permeation prescribed in Appendix B of Part 173. For Packing Group I materials, this procedure must be performed on each plastic packaging or receptacle. In addition, § 173.24a requires all non-bulk packagings to be capable of withstanding the vibration test procedure specified in § 178.608 without rupture or leakage. Section IV of this notice discusses additional packaging requirements in § 173.27 that apply to packages transported by aircraft.

Generally, the HMR specify performance levels for packagings based on the hazardous characteristics posed by the specific hazardous material to be packaged. In the HMR, we have implemented packaging standards based on United Nations Recommendations on the Transport of Dangerous Goods (UN Model Regulations). UN standard packagings (i.e., packagings which conform to both the UN Model Regulations and the HMR) are required for most hazardous materials.

Prior to using a UN standard packaging, you must determine that the packaging has been manufactured, assembled, and marked in accordance with Part 178 of the HMR or national or international regulations based on the UN Model Regulations (see § 173.24(d)(2)). For a UN standard packaging, you must assure that the packaging meets the applicable packing group, specific gravity, gross mass, and pressure requirements. Unless otherwise permitted, you must assemble, fill, close, and offer a package for transportation in the same manner as it was tested. Communication between you and the packaging manufacturer is essential to ensure these conditions are met, and that any specialized instructions relating to package preparation are followed. For liquids, you must know the vapor pressure and specific gravity of the material to be packaged (see § 173.24a(b)(4)). You will generally need to know the design details (e.g., size, shape, and type of material) for cushioning material used, if any, and the number and type (e.g., metal can, plastic bottle), style (e.g., friction lid, narrow mouth screw top, wide mouth jar), closure details (e.g., material, size, and liner or gasket design (if required)), and position of any inner receptacles as tested in that particular design type.

You should have a copy of the packaging manufacturer's notification to its customers (see 49 CFR 178.2(c)) and complete the assembly and closure of the package in the manner specified in the notification. Closure of the packaging in the same manner as tested and as specified in the manufacturer's notification is essential to ensuring that it conforms to the requirements of § 173.24 under conditions normally incident to transportation. We strongly recommend that you maintain copies of both the packaging design test report and the notification to customer to ensure that the packaging conforms to applicable requirements. You may also need this information if you reoffer a previously offered package of hazardous material.

For combination UN standard packagings, inner receptacles must conform to the general packaging requirements of §§ 173.24 and 173.24a, discussed in Section II above. Inner packagings must be adequately secured and cushioned within the outer packaging to prevent breakage or leakage and to control the movement of inner packagings within the outer packaging under conditions normally incident to transportation. Except as otherwise permitted under § 178.601 variations, you must close a package in accordance with closure instructions provided by the packaging manufacturer. Design tested components of a combination packaging may vary as permitted under § 178.601. When using a variation, you must ensure that an equivalent level of performance is maintained and you should document how such equivalence was determined. For example, under the selective testing variations in § 178.601(g)(1), Variation 1 allows inner packagings of a tested design to be replaced with inner packagings of equivalent or smaller size without further testing provided an equivalent level of performance is maintained. You must, however, be able to fully ascertain that the varied inner packagings are equally effective as the tested inner packagings they replace; otherwise, the packaging is considered a new packaging and subject to design qualification testing.

If you intend to reuse a packaging or receptacle you must ensure the packaging continues to conform to all applicable HMR requirements. This includes closure devices and cushioning materials. Before a packaging is reused, it must be inspected to assure it is free from incompatible residue, leaks, or other damage that reduces its structural integrity. Packagings that show any evidence of such damage must be reconditioned in accordance with § 173.28(c) prior to reuse. Non-bulk packagings made of paper, plastic film, or textile are not authorized for reuse.

Single or composite UN standard packagings intended to contain liquids are subject to the leakproofness test prescribed in § 178.604 and must be leakproofness tested before reuse. As prescribed in § 173.28(b)(2)(i), packagings must be tested with air using an internal air pressure (gauge) of at least 48 kPa (7.0 psi) for Packing Group I and 20 kPa (3.0 psi) for Packing Group II and Packing Group III. The packaging must be marked with the letter “L”, the name and address or symbol of the person conducting the test, and the last two digits of the year the test was conducted to indicate successful completion of the leakproofness test.

Metal and plastic drums and jerricans used as single packagings or as the outer packagings of composite packagings may be reused only when they are permanently marked (e.g., embossed) in millimeters with the nominal (for metal packagings) or minimum (for plastic packagings) thickness of the packaging material, as required by §§ 173.28 and 178.503(a)(9). Under § 173.28(b)(5), plastic inner receptacles of composite packagings must have a minimum thickness of 1.0 mm (0.039 inch) if reused. Metal or plastic packagings that do not conform to minimum thickness requirements may not be reused.

Packagings manufactured to a UN standard must be design-qualified. This means the design must be tested (design qualification tests) to meet a particular standard. Once a packaging has been tested, it is certified by marking it to identify which performance standard it meets, where and when it was manufactured, and by whom. Identical packagings may be manufactured until periodic retesting is due. Single and composite non-bulk packaging designs must be retested successfully at least once every 12 months. Combination packaging designs must be retested successfully at least once every 24 months.

The term “manufacturer” means the person certifying or taking responsibility for assuring that the packaging meets the standard to which it is marked. This may not necessarily be the person who produces the packaging or the person who tests the packaging. A person who certifies a packaging may be a self-certifying shipper, a box manufacturer, or a third party testing lab. The person certifying the packaging is responsible for the integrity of the packaging and for ensuring the packaging meets the performance requirements of the HMR.

Any person certifying a packaging, and each subsequent distributor of that packaging, must notify in writing each person to whom that packaging is transferred of all requirements of Part 178 not met at the time the packaging is transferred. Such notification must include the type and dimensions of any closures, including gaskets, needed to satisfy performance test requirements. This notification includes instructions on how to assemble and close each packaging so the user may be assured that the packaging will perform to the standard to which it is marked. A copy of the written notification must be retained by the packaging manufacturer for at least one year from the date it is issued, and copies of all written notifications must be made available for inspection by representatives of DOT.

If you offer hazardous materials for transportation by aircraft, you must ensure that all of the additional requirements applicable to air transport are met. Because of the risks posed by leaking hazmat packages in air transport, you must exercise exceptional diligence and attention to detail when preparing packagings. For example, because temperatures can range from −40 °C to 55 °C (−40 °F to 130 °F), sufficient ullage (outage) must be maintained in receptacles containing liquids to ensure the structural integrity of the package while transported. Reduced external pressure caused by altitude variances can result in package failure if inferior, untested, or improper packagings containing liquids are transported. Extreme care must be exercised when hazardous materials have been packaged by others and are consolidated or reshipped. You must verify that the package is eligible for air transport.

All packagings offered for air transport must conform to the requirements prescribed in § 173.27 of the HMR. These requirements are in addition to those in §§ 173.24 and 173.24a. For example, a Packing Group III material of Class 4, 5, or 8 offered for air transport must be packaged in packages meeting the Packing Group II performance level. In addition, § 173.27 prescribes pressure requirements for packagings; package closure requirements; the use of absorbent materials; inner receptacle quantity limits and pressure capabilities; and additional labeling for packages requiring transport aboard cargo-only aircraft.

Tables 1 and 2 of § 173.27 prescribe the maximum net capacity of inner packagings contained within a combination packaging that may be offered for transport aboard an aircraft. Columns 9A and 9B of the HMT specify individual package quantity limits or forbid transportation by passenger-carrying or cargo-only aircraft, respectively. Unless otherwise specified, the individual package quantity limitations in columns 9A and 9B of the HMT are “net”, that is, the quantity of hazardous materials in the completed package. When “gross” is specified, the individual package limitation is the gross mass (i.e., packaging and its contents) allowed per package. For articles or devices specifically listed by name, the net quantity limit applies to the entire article or device, less packaging and packaging materials.

You should not use a packaging for transportation by aircraft unless the packaging meets the pressure requirements and is closed in a manner that ensures that it will be capable of resisting pressure changes throughout transportation. All packagings intended to contain liquids must be capable of withstanding, without leakage, an internal gauge pressure of at least 75 kPa (11 psig) for liquids in Packing Group III of Class 3 or Division 6.1 or 95 kPa (14 psig) for all other liquids, or a pressure related to the vapor pressure of the liquid to be conveyed, whichever is greater (see § 173.27(c)). This requirement also applies to liquids excepted from specification packaging, such as limited quantities and consumer commodities. Although not currently required, we recommend that you perform pressure tests on sample receptacles to ensure conformance with the capability standard. Liquids contained in inner receptacles that do not meet the minimum pressure requirements in § 173.27(c) may be overpacked into receptacles that do meet the pressure requirements. A single packaging, or any packaging subject to hydrostatic pressure testing under § 178.605, must have a marked test pressure of not less than 250 kPa for liquids in Packing Group I, 80 kPa for liquids in Packing Group III of Class 3 or Division 6.1, and 100 kPa for other liquids.

Packaging failures in air transportation often involve loose closures. Stoppers, corks, or other such friction-type closures must be held securely, tightly and effectively in place by positive means (see § 173.27(d)). A screw-type closure on any packaging must be secured to prevent the closure from loosening due to vibration or substantial change in temperature. A secured closure should incorporate a secondary means of maintaining a seal, such as a shrink-wrap band or heat sealed liner. You must ensure that replacement closures or inner packagings other than those originally tested (e.g., caps or bottles from a different vendor) conform to the pressure requirements in § 173.27 (c)(1) and (c)(2).

Except as otherwise provided, liquids in Packing Group I or II of Class 3, 4, 5, 6, or 8, when in glass or earthenware inner packagings, must be packaged with absorbent material that will not react dangerously with the liquid as prescribed in § 173.27(e). In addition, where a package requiring absorbent material is not liquid-tight, a means of containing the liquid must be used. You may accomplish this by using a leakproof liner, plastic bag, or other equally efficient means of containment. It should be noted that, while not having official standing under the HMR, the majority of air carriers only accept hazardous materials packaged in conformance with the International Air Transport Association's Dangerous Goods Regulations (IATA DGR). Currently, the IATA DGR require all liquids in Class 3, 4, or 8, or in Division 5.1, 5.2, or 6.1, to be provided with a means of containing the liquid in the event of leakage when packed in an outer package that is not leak-tight. The addition of a liner or similar form of containment to a previously tested packaging design generally would not constitute a different packaging, requiring new design qualification testing, provided the liner does not compromise the integrity of the original tested design type (such as affecting the closure or necessitating a change in the manner of assembly of the package).

In the wrong hands, certain hazardous materials may pose significant security threats, particularly those that may be used as weapons of mass destruction. Persons who offer, transport, or store hazardous materials in transit should review their security measures and make any necessary adjustments to ensure the security of hazardous materials shipments. On February 14, 2002, we published a notice in the Federal Register (67 FR 6963) advising hazardous materials shippers and carriers of voluntary measures to enhance the security of hazardous materials shipments during transportation. The notice addresses personnel, facility, and en route security issues, and includes contact points for obtaining additional, more detailed information. These possible actions are not government regulations or mandates. However, we strongly suggest that shippers and carriers consider implementation of security measures that are appropriate to their industry and operations. There are certain cargo security regulations already in place, such as the Federal Aviation Administration's Indirect Air Carrier Security Program set forth under 14 CFR part 109.

We estimate that over 85 percent of all hazardous materials incidents are caused by human error. Insufficient function-specific training of hazmat employees has been identified as a major contributor in hazmat related incidents. Before any hazmat employee performs a function subject to the HMR, that person must be trained in the performance of that function. Effective training of hazmat employees reduces the potential for incidents and accidents. Training is essential for the protection of people, property, and the environment.

Training is a systematic program (consistent approach, testing, and documentation) that ensures a hazmat employee has knowledge of hazardous materials and the HMR, and can perform assigned hazmat functions properly. The terms “hazmat employee” and “hazmat employer” are defined in detail in § 171.8. Stated briefly, a hazmat employee is anyone who directly affects hazardous material transportation safety. A hazmat employer is anyone who uses employees in connection with transporting hazardous materials in commerce, causing hazardous materials to be transported, or manufacturing or offering packagings as authorized for use in transportation of hazardous materials. Each hazmat employee must be initially trained, and periodically retrained every three years in three areas: (1) General awareness/familiarization training designed to provide familiarity with requirements of the HMR and to enable the employee to recognize and identify hazardous materials; (2) function-specific training concerning requirements of the HMR which are specifically applicable to the functions the employee performs; and (3) safety training concerning emergency response information, measures to protect the employee from the hazards posed by materials, and methods and procedures for avoiding accidents.

You may obtain information on hazardous material incidents, most of which involve “spills” (the unintentional release of a hazardous material during transportation), from RSPA's database which is accessible from our website at http://hazmat.dot.gov. You can search this database to make sure that you are aware of incidents involving your shipments. To ensure that shippers are informed of incidents involving their shipments, RSPA has proposed to amend the HMR to require a carrier to notify the shipper of any incident required to be reported to RSPA. ( See RSPA's notice of proposed rulemaking published in the Federal Register on July 3, 2001; 66 FR 35155.)

Our Hazardous Materials Information Center (HMIC) may be reached toll-free at 800-467-4922. The HMIC provides informal guidance concerning requirements of the HMR. The HMIC is staffed with information specialists from 9 am until 5 pm, Eastern time, Monday through Friday, except Federal holidays. When the information line is not staffed, callers may leave a recorded message, which will be answered the next business day. This toll-free number may also be used to voluntarily report suspected violations of the HMR. Reported violations of hazardous materials regulations are forwarded to the Office of Hazardous Materials Enforcement or the appropriate DOT modal administration for appropriate action.

Modal-specific information may be obtained directly from DOT's modal administrations ( i.e., the Federal Aviation Administration, the Federal Motor Carrier Safety Administration, the Federal Railroad Administration, the U.S. Coast Guard, and the Transportation Security Administration) at their Washington, DC headquarters or field offices.

You may request an informal written interpretation, a regulatory clarification, a response to a question, or offer an opinion concerning hazardous materials transportation by submitting a written request to the RSPA Office of Hazardous Materials Standards (DHM-10), U.S. Department of Transportation, 400 Seventh Street, SW., Washington, DC 20590-0001.

We have a variety of training materials and compliance guides available in limited quantities to interested persons. Information on those publications and related materials is available through our website at http://hazmat.dot.gov/. In addition our website provides: (1) A complete copy of the HMR; (2) recently published rulemakings; (3) hyperlinks to government and private vendors who offer training, consulting and other contracted services; (4) our multi-modal training seminar schedule; (5) complementary on-line training modules; and (6) informal interpretations and guidance documents.

This rule is being published as an interim final rule and is being made effective on January 1, 2003. A notice of proposed rulemaking does not precede this rule.

In the fiscal year 2002 Department of Transportation Appropriations Act (Public Law 107-87; December 18, 2001), Congress directed that as a condition of processing applications of Mexico-domiciled motor carriers for authority to operate beyond the commercial zones and municipalities located along the U.S.-Mexico border, the FMCSA must issue an interim final rule to ensure that new entrant carriers are knowledgeable about Federal safety standards. The FMCSA is making the effective date of the rule January 1, 2003 in order to allow the agency sufficient time to put in place the necessary resources to conduct the safety audits prescribed by the rule. Additionally, the FMCSA will need the funds generated by its final fee structure under the Motor Carrier Replacement Information/Registration System to run the program. It expects to complete that rulemaking by the January 2003 effective date.

Because of Congress' direction, the FMCSA finds that there is good cause that notice and comment are contrary to the public interest under 5 U.S.C. 553(b)(3)(B).

On December 9, 1999, the President signed the Motor Carrier Safety Improvement Act of 1999 (Public Law 106-159). Section 210(a) of MCSIA, now codified as 49 U.S.C. 31144(f), requires the Secretary of Transportation to establish regulations specifying minimum requirements for applicant motor carriers seeking federal interstate operating authority, including a requirement that new entrants undergo a safety audit within the first 18 months of operations.

Although operating authority has generally been construed in the past to mean registration of for-hire carriers subject to the jurisdiction transferred from the Interstate Commerce Commission following enactment of the ICC Termination Act of 1995 (ICCTA) (Public Law 104-88) (referred to herein as authorized for-hire motor carriers), the FMCSA believes section 210 extends this concept to all carriers subject to Federal safety jurisdiction. In other words, all new entrants, regardless of whether they need to register with the FMCSA under 49 U.S.C. 13901, will be required to meet certain minimum safety standards in order to continue operating in interstate commerce during and after the 18-month period following their receipt of a USDOT number.

The FMCSA intends to improve the safety performance of new entrants by providing educational and technical assistance to new carriers as they begin their new business. The intent of the safety audit and 18-month monitoring period is to provide new carriers the opportunity to understand their safety obligations under the Federal Motor Carrier Safety Regulations (FMCSRs) and applicable Hazardous Materials Regulations (HMRs). The safety audit will consist of a review of the new entrant's safety data, a review of requested motor carrier documents, and an interview session with the motor carrier by an individual certified under FMCSA regulations to perform safety audits. The objective of the safety audit is both to educate the carrier on compliance with the FMCSRs and HMRs and to determine areas where the carrier might be deficient in terms of compliance. Areas covered include the qualification of drivers; driving a commercial motor vehicle; hours of service; vehicle inspection, repair, and maintenance; transporting and marking hazardous materials; controlled substances and alcohol use and testing; commercial driver's license standards; and financial responsibility. When presented with evidence that carriers cannot or will not exercise basic safety management controls, the FMCSA will require corrective action. If the necessary corrective action is not taken, a carrier will be denied the privilege of operating in interstate commerce.

However, the safety enforcement remedies addressed in the rule are not the exclusive enforcement tools available to the agency to ensure safe operations by new entrants. New entrant carriers are subject, like any other carrier operating in the United States, to all Federal Motor Carrier Safety Regulations and operating requirements. The agency can and will, where necessary, apply the full range of enforcement actions to new entrant carriers. These include, but are not limited to, compliance reviews, civil penalties, and revocation of new entrant registration for serious safety violations.

Currently, an applicant who wishes to begin commercial vehicle operations in interstate commerce is required to submit the Motor Carrier Identification Report, Form MCS-150, to FMCSA before commencing operations. Additionally, unless providing transportation exempt from ICCTA registration requirements, a for-hire motor carrier must also apply for the appropriate operating authority, make the necessary administrative filings as required by the ICCTA, and pay a fee.

This regulation establishes new minimum requirements for all applicant motor carriers domiciled in the United States and Canada seeking to operate in interstate commerce for the first time. Applicants will be provided educational and technical assistance material to assist them in complying with the FMCSRs and applicable HMRs, and will be required to certify that they are knowledgeable about, and will comply, with these regulations. This will help ensure they are knowledgeable about applicable Federal motor carrier safety standards before being granted “new entrant registration” that will continue for a minimum of 18 months. During the 18-month period, FMCSA will evaluate the new entrant's safety management practices through a safety audit and monitor its on-road performance prior to granting the new entrant permanent registration.

Section 210(b) of the MCSIA required the Secretary to consider establishing a proficiency examination as well as other requirements to ensure applicants understand applicable safety regulations before being granted operating authority. The FMCSA is not requiring a proficiency examination because it believes that the educational and technical assistance materials provided to the new entrants and the safety certifications on the required application forms will demonstrate the new entrants understand applicable safety regulations.

The new MCS-150A form requires the new entrant to certify that it has a system(s) in place to ensure compliance with applicable requirements covering driver qualifications, hours of service, controlled substance and alcohol testing, vehicle condition, accident monitoring, and hazardous materials transportation. The certification reminds the new entrant of its statutory and regulatory responsibilities, which if neglected or violated, may subject the applicant to civil penalties and/or lead to the revocation of the new entrant registration.

Motor carriers domiciled in Mexico seeking to operate in the United States will not be subject to this rule. The FMCSA adopted separate application and safety monitoring procedures for Mexico-domiciled carriers on March 19, 2002, (67 FR 12652, 67 FR 12702, and 67 FR 12758). The FMCSA believes it is necessary to maintain separate procedures for Mexico-domiciled carriers because of: (1) The differences between the Mexican and U. S. regulatory systems, which present unique circumstances in ensuring compliance with the FMCSRs and HMRs by Mexico-domiciled carriers; and (2) the unique requirements imposed on certain Mexico-domiciled carriers by the Department of Transportation Appropriations Act. These differences are discussed in detail in the preambles to the notices of proposed rulemakings for the Mexican carrier rules published on May 3, 2001 (66 FR 22238, 22371 and 22415).

Under the new requirements, an applicant may request an application package by contacting the FMCSA website ( www.fmcsa.dot.gov ); or by contacting the FMCSA's Washington, DC headquarters by mail, fax or telephone. Applicants are strongly encouraged to complete the applications on line. The application package will contain the following:

1. Educational and technical assistance material regarding the requirements of the FMCSRs and HMRs, if applicable.

2. The Form MCS-150, The Motor Carrier Identification Report.

3. The Form MCS-150A, Safety Certification for Applications for U.S. DOT Number. A copy of Form MCS-150A is available in the docket described above under ADDRESSES .

For-hire motor carriers are also required to complete the application forms OP-1 or OP-1(P), as appropriate, and must submit them to the FMCSA at the same time as the Forms MCS-150 and MCS-150A. The FMCSA is planning to update these forms in the future to implement the provisions of the ICC Termination Act of 1995 (ICCTA).

The educational and technical assistance package will consist of material designed to assist the applicant in complying with the FMCSRs and establishing good safety management practices. It will include information on driver qualifications; controlled substances and alcohol use testing; commercial drivers licenses; minimum levels of financial responsibility; accident reports; requirements applicable to the driving of motor vehicles; vehicle inspection, repair and maintenance; hours of service and records of duty status of drivers; and requirements applicable to the transportation of hazardous materials.

Following completion of the application forms, FMCSA will register the new entrant and assign a United States Department of Transportation (USDOT) number. For-hire motor carriers, unless providing transportation exempt from ICCTA registration requirements, are required to obtain operating authority prior to commencing operations. The new entrant registration begins with the issuance of the USDOT number and will continue for 18 months. During the 18-month new entrant registration period, the new entrant will be required to undergo a safety audit designed to evaluate the adequacy of its safety management practices and to offer guidance and assistance in enhancing those practices. The agency is treating the term “safety audit,” which is used in Sec. 211 of the MCSIA regarding the certification of an individual under FMCSA regulations to perform safety audits, as equivalent to the “safety review” mandated by Sec. 210 of MCSIA. The statutory purpose of a “safety review” and a “safety audit” appears to be very similar. In addition, the term “safety audit” avoids any possible confusion with the safety reviews previously conducted by the agency, which were discontinued on September 30, 1994.

The safety audit will generally occur at the new entrant's place of business, upon reasonable notice to the new entrant, which will include notice of what the audit will consist of and when it will take place. The safety audit will be an assessment of the adequacy of the new entrant's basic safety management controls. It will include, but not be limited to, a review of selected carrier records and operational practices, e.g., driver qualification records, driver records of duty status, and vehicle maintenance files. The safety audit is different than a compliance review in that it focuses on providing safety management and technical assistance and will not result in a safety fitness determination, i.e., a safety rating of satisfactory, conditional, or unsatisfactory. Safety ratings are assigned only after a compliance review. However, the safety audit could result in the new entrant having its new entrant registration revoked if it is found to have inadequate basic safety management controls and fails to take corrective action required by the FMCSA. Appendix A—Explanation of Safety Audit Evaluation Criteria will be used to determine the adequacy of the new entrant's basic safety management controls.

The FMCSA is interested in comments on the advisability of conducting some safety audits at alternate locations. This would enable the agency to provide educational and technical assistance to a number of new entrants at one time and also perform the audits of the systems and records the new entrants will be required to provide. The FMCSA also invites comments on whether it is appropriate for private contractors certified by the FMCSA to conduct safety audits.

Following completion of the safety audit, the auditor will review the findings with the new entrant. If the safety audit reveals that the carrier has basic safety management controls in place that are functioning adequately, the FMCSA will notify the new entrant in writing within 45 days that it has successfully met the safety audit requirements. However, the new entrant registration will remain in place and the carrier's performance will remain closely monitored by the FMCSA until the end of the 18-month period. If a safety audit has not been conducted on a new entrant, through no fault of the carrier, the new entrant designation will continue until such time as a safety audit is conducted. However, a new entrant who has not undergone a safety audit within the 18 months because it has refused to allow the FMCSA to conduct the safety audit may have its new entrant registration revoked ten days after receiving notice from the FMCSA.

The FMCSA anticipates that the safety management practices of the large majority of new entrants will prove to be adequate because of the combined effect of: (1) Providing educational material to the new entrant in the application process; (2) requiring the new entrant to certify that it understands and that it will comply with the FMCSRs; and (3) providing notice to the new entrant of the content of the safety audit. However, in those cases in which the safety audit reveals that the new entrant's safety management practices are inadequate, the FMCSA will notify the new entrant that it is required to take action to improve its practices. The new entrant will have 60 days to take the necessary remedial action, unless it transports passengers or carries hazardous materials, in which case it will have 45 days. These time periods are consistent with the period currently provided to motor carriers to improve proposed safety ratings following a compliance review. Failure by the carrier to make the necessary changes to remedy inadequate basic safety management controls will result in revocation of its new entrant registration and imposition of an out-of-service order (OOS) prohibiting operations in interstate commerce. The FMCSA is interested in comments on the resource cost to the economy of denying permanent registration.

If a new entrant provides the FMCSA with a written response demonstrating that corrective action likely to achieve compliance with the requirements of the FMCSRs and applicable HMRs has been taken, and the FMCSA determines the new entrant's basic safety management controls are adequate, the new entrant will be notified in writing that its safety management practices are acceptable and that its new entrant registration will remain in place until the end of the 18-month period.

The FMCSA believes that in most cases in which corrective action is needed, the remedial action will be taken in the required time frame. However, in those cases in which the new entrant does not take any remedial action, or takes action unlikely to improve its safety performance to an acceptable level, the FMCSA will initiate a proceeding to revoke the new entrant registration.

The FMCSA Division Administrators or State Directors will make the initial determination about the adequacy of a new entrant's basic safety management controls and whether necessary corrective action has been taken. The Field Administrator of the appropriate FMCSA Service Center will conduct administrative review of this decision.

A new entrant may request the FMCSA to conduct an administrative review if it believes the FMCSA has committed an error in determining that its basic safety management controls are inadequate. The new entrant's request must explain the error it believes the FMCSA committed in its determination and include a list of all factual and procedural issues in dispute. In addition, the new entrant must include any information or documents that support its argument. Following the administrative review, the FMCSA will notify the new entrant of its decision, which will constitute the final action of the agency.

A new entrant whose registration has been revoked is prohibited from operating a CMV in interstate commerce and may not reapply for new entrant registration sooner than 30 days after the date of revocation. A new entrant reapplicant will be required to demonstrate to the FMCSA's satisfaction that it has corrected the deficiencies that resulted in revocation and otherwise has in place safety management systems that will function effectively.

The rule provides that at the end of the 18-month period, if the new entrant has successfully met the requirements of the safety audit and is not currently under a notice from the FMCSA to remedy its safety management practices, its DOT registration will become permanent. Thereafter, it will be treated like any other motor carrier. If the carrier is under a notice to remedy its safety management practices, its new entrant designation will continue until FMCSA determines the new entrant has implemented actions necessary to achieve adequate safety management practices.

The FMCSA has determined that this action is a significant regulatory action within the meaning of Executive Order 12866, and is significant within the meaning of Department of Transportation regulatory policies and procedures (44 FR 11034, February 26, 1979). It has been reviewed by the Office of Management and Budget. The subject of requirements for new entrant motor carriers will likely generate considerable public interest within the meaning of Executive Order 12866. We have classified the rule as significant because of the high level of public and congressional interest in the new entrant safety assurance process. OMB has designated the rule as economically significant. A regulatory evaluation has been prepared and placed in the docket.

A series of analyses and reports have demonstrated that new motor carriers are less likely to comply with safety regulations, and are more likely to be involved in crashes, than established motor carriers. In response to this, Congress directed the FMCSA to develop a program to ensure the safety of new entrants.

The centerpiece of the new entrant program is the safety audit, which will be performed on all new entrants within 18 months of their registration. Individuals certified under the FMCSA regulations will perform these audits. The FMCSA anticipates a volume of approximately 40,000 new entrant safety audits each year. A copy of the complete regulatory evaluation is available in the docket described above under ADDRESSES.

In compliance with the Regulatory Flexibility Act (5 U.S.C. 601-612), the FMCSA has considered the effects of this regulatory action on small entities and determined that such entities would not be adversely affected by this rule. We therefore certify that it would not have a significant impact on a substantial number of small entities.

This action 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 does not concern an environmental risk to health or safety that would disproportionately affect children.

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 action has been analyzed in accordance with the principles and criteria contained in Executive Order 13132 dated August 4, 1999, and it has been determined that this action does not have a substantial direct effect or sufficient federalism implications on States that would limit the policymaking discretion of the States. Nothing in this document directly preempts any State law or regulation. It will not impose additional costs or burdens on the States. This action will not have a significant effect on the States' ability to execute traditional State governmental functions. To the extent that States incur costs for conducting these safety audits, they will be reimbursed with federal funds under the Motor Carrier Safety Assistance Program (MCSAP). Since the MCSAP is an “80/20” program, FMCSA would reimburse the States for 80% of the costs incurred in conducting safety audits.

Catalog of Federal Domestic Assistance Program Number 20.217, Motor Carrier Safety. The regulations implementing Executive Order 12372 regarding intergovernmental consultation on Federal programs and activities do not apply to this program.

Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct, sponsor, or require through regulations. An analysis of this interim final rule has been made by the FMCSA, and it has been determined that it will affect a currently-approved information collection covered by OMB Control No. 2126-0013 (Motor Carrier Identification Report). Information collection 2126-0013, with an annual burden of 68,250 hours, expires on May 31, 2004.

In addition to completing form MCS-150 (Motor Carrier Identification Report), this interim final rule will also require new entrants to complete a new supplemental form, entitled Safety Certification for Applications for U.S. DOT Number (MCS-150A). The completion of the supplemental form is the only portion of this interim final rule with PRA implications.

Although the rule also involves two other forms new entrants must complete—the BOC-3 and OP forms, there is no impact on burden hours for those information collections resulting from this rule. The BOC-3 form is covered by 2126-0015 (Designation of Agents, Motor Carriers, Brokers and Freight Forwarders), which expires on November 30, 2004. The OP series forms are covered by 2126-0016 (Revision of Licensing Application Forms of Application Procedures and Corresponding Regulations), which expires on March 31, 2005. However, this rule does not affect the burden hours involved with these two information collections.

The FMCSA estimates that approximately 40,000 new entrants annually will be required to complete this supplemental form (MCS-150A) and that the supplemental form takes approximately 9 minutes to complete. Therefore, we estimate the total annual burden of this interim final rule to be 6,000 burden hours (9 minutes × 40,000, divided by 60 minutes). The new total burden for information collection 2126-0013 would be 74,250 hours (the currently-approved 68,250 hours for completing the MCS-150, plus 6,000 hours for completing the MCS-150A).

We particularly request your comments on whether the collection of information is necessary for the FMCSA to meet its goal of reducing truck crashes, including (1) whether the information is useful to this goal; (2) the accuracy of the estimate of the burden of the information collection; (3) ways to enhance the quality, utility and clarity of the information collected; and (4) ways to minimize the burden of the collection of information on respondents, including the use of automated collection techniques or other forms of information technology.

You may submit comments on the information collection burden addressed by this interim final rule to the Office of Management and Budget (OMB). The OMB must receive your comments by June 27, 2002. You must mail or hand deliver your comments to: Attention: Desk Officer for the Department of Transportation, Docket Library, Office of Information and Regulatory Affairs, Office of Management and Budget, Room 10102, 725 17th Street, NW., Washington, DC 20503.

The Federal Motor Carrier Safety Administration (FMCSA) is a new administration within the Department of Transportation (DOT). We are striving to meet all of the statutory and executive branch requirements on rulemaking. The FMCSA is currently developing an agency order that will comply with all statutory and regulatory policies under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq. ). We expect the draft FMCSA Order to appear in the Federal Register for public comment in the near future. The framework of the FMCSA Order is consistent with and reflects the procedures for considering environmental impacts under DOT Order 5610.1C. The FMCSA analyzed this interim final rule under the NEPA and DOT Order 5610.1C. We believe it would be among the type of regulations that would be categorically excluded from any environmental assessment.

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 likely to have a significant adverse effect on the supply, distribution, or use of energy because it sets standards for new entrant motor carriers and has no direct relation to energy consumption. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

This rule does not impose an unfunded Federal mandate resulting in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year. (2 U.S.C. 1531 et seq. ) Any costs incurred by the States are reimbursable under the Motor Carrier Safety Assistance Program (MCSAP). To the extent that States incur costs for conducting these safety audits, they will be reimbursed with federal funds under MCSAP.