The proposed rule that is the subject of these corrections amends Department of Justice regulations by establishing procedures for certain lawful permanent residents (LPRs) to apply for relief from deportation or removal pursuant to former section 212(c) of the Immigration and Nationality Act and sets forth procedures for filing special motions to seek such relief before an Immigration Judge or the Board of Immigration Appeals for LPRs currently in proceedings or under final orders for deportation or removal.

As published, the proposed rule contains a typographical error that may cause confusion and therefore is in need of clarification. In proposed § 3.44(d), the rule describes the effect of a prior denial of section 212(c) relief on discretionary grounds. As currently published, the rule states that if an LPR had been previously denied relief, a new motion to seek relief would be granted. The actual effect of a previous denial of section 212(c) on discretionary grounds is that a new motion seeking relief would be denied.

An advance notice of proposed rulemaking (ANPR) was published on July 23, 1998 (63 FR 39522), notifying the public that the NRC was considering amending its event notification reporting requirements. Although the ANPR was primarily directed at potential changes to power reactor event notification requirements in §§ 50.72 and 50.73, the notice also requested public comments to identify areas where other event notification reporting requirements could be simplified and/or modified to be less burdensome and more risk informed. The issue of potential changes for other reporting requirements was included both in the agenda at a public meeting held on August 21, 1998, to discuss the ANPR, and for the public workshop on September 1, 1998, on Direction Setting Issue (DSI) 13, “The Role of Industry.” Pertinent suggestions were provided at those meetings as well as in written comments on the ANPR.

In SECY-99-022, “Rulemaking to Modify Reporting Requirements for Power Reactors” (January 20, 1999), the NRC staff presented recommendations that had been made in public comments for changes to reporting requirements beyond those to §§ 50.72 and 50.73, including the following:

• 10 CFR 72.75 contains the requirement for a 4-hour report and 30-day written follow-up report. Revise this requirement to 8 hours and 60 days similar to changes proposed for §§ 50.72 and 50.73.

• 10 CFR 73.71 and Appendix G (Reportable Safeguards Events) to part 73 contain requirements for 1-hour reports. Amend these requirements to 8 hours and 60 days similar to changes proposed for §§ 50.72 and 50.73.

The Commission subsequently issued a final rule revising the event reporting requirements in §§ 50.72, 50.73, and 72.216 (65 FR 63769; October 25, 2000), and directed the NRC staff to consider similar changes to the event notification requirements in parts 72 and 73 under a separate rulemaking. On March 27, 2001, the NRC staff submitted a rulemaking plan to the Commission, “10 CFR parts 72 and 73—Conforming Requirements of Event Notification” (SECY-01-0054), to revise the event notification reporting requirements in parts 72 and 73 to more closely align them with those of part 50 reactor facilities. On April 18, 2001, the Commission approved the recommendations in SECY-01-0054 to proceed with the development of a proposed rule to revise the event reporting requirements in parts 72 and 73.

This proposed rule would amend the NRC's regulations at 10 CFR part 72 to change several event notification requirements that apply to an Independent Spent Fuel Storage Installation (ISFSI) and a Monitored Retrievable Storage (MRS) installation. The proposed rule would also amend safeguards event notification requirements that apply to facilities subject to part 73, such as reactor facilities, fuel cycle facilities, ISFSIs, an MRS, licensees who possess or transport special nuclear material or spent fuel, a geological repository operations area, and the gaseous diffusion plants. With respect to both the event notification requirements and the safeguards event notification requirements, the changes are intended to align these requirements with recent changes to the power reactor event notification requirements in part 50 made in a final rule issued on October 25, 2000 (65 FR 63769). The NRC evaluated the issues and concerns of the part 50 event notification reporting requirements and considered this regulatory framework as a basis for concluding that similar changes to the event notification reporting requirements in parts 72 and 73 were also warranted. The event reporting requirements of parts 72 and 73 affect both material licensees and nuclear power plant licensees. Most of the facilities subject to the event notification reporting requirements in parts 72 and 73 (power reactors and ISFSIs) are either physically co-located with reactor facilities or are reactor facilities. Most part 72 licensees are also part 50 licensees. These licensees share the same management structure and share the same emergency preparedness organization. Conforming the reporting requirements of part 72 with the revised requirements of part 50 thus will reduce regulatory burden and potential confusion, would maintain safety, and would take advantage of the work already performed to relate risk to reporting requirements for these types of facilities.

With respect to the part 73 event notification requirements, the 30-day period for submitting written follow-up reports for safeguards events should also be extended to 60 days to be consistent with § 50.73. Changing the time limit from 30 days to 60 days does not imply that licensees should take longer than they previously did to develop and implement corrective actions. The NRC expects licensees to take corrective actions on a time scale commensurate with the safety significance of the issue. However, for those cases where it does take longer than thirty days to complete a root cause analysis, this change will result in fewer licensee event reports that require amendment by submittal of an amended report. The extension is based on simplicity for reporting, importance to risk, and having the required reporting time be consistent with the need for NRC action. Furthermore, the increased time for follow-up reporting would allow for the completion of required root cause analyses and engineering evaluations, and full identification of corrective actions after event discovery; preparation of more complete and accurate event reports; and fewer event report revisions and supplemental reports. However, the NRC believes the verbal safeguards event notification requirements should remain at 1 hour because the NRC may need to respond expeditiously to licensee safeguards notifications and notify other licensees and Federal agencies of the event, particularly in light of the heightened threat environment after the terrorist attacks of September 11, 2001.

Revising the parts 72 and 73 event notification reporting requirements to be consistent with those in part 50 would maintain safety and take advantage of the work already performed on the risk impacts of the event notification requirements for part 50 licensees. The revision of parts 72 and 73 would also reduce licensee burden through consolidation of some notifications and lengthening the reporting period for other notifications to correspond to the times required under part 50. The current event notification reporting requirements in part 50 require written notification within 60 days and verbal notification within 1 hour (emergency events), and within 1-hour, 4-hours and 8-hours for some non-emergency events. The need for a 4-hour versus an 8-hour non-emergency notification is based on the urgency of the situation and the NRC's need to take prompt action.

Additionally, the NRC would remove § 72.216, “Reports.” Section 72.216 does not contain separate requirements, but merely directs a part 72 general licensee to comply with the reporting requirements of §§ 72.74 and 72.75. However, the need for this section was obviated with the addition of § 72.13, “Applicability,” to the part 72 regulations in a final rule issued on August 21, 2000 (65 FR 50606). Section 72.13 contains direction on the part 72 regulations that apply to specific licensees, general licensees, or certificate holders. Section 72.13(c) currently requires a general licensee to comply with §§ 72.74 and 72.75. Therefore, § 72.216 is no longer needed and would be removed and reserved. In addition, § 72.9 would be revised as a conforming change because of the removal of § 72.216. Also, the reference to § 72.19 would be removed from § 72.9 because there is no § 72.19 in part 72.

The NRC believes that consideration of the proposed changes is consistent with two of NRC's strategic performance goals to reduce unnecessary regulatory burden on stakeholders and to increase public confidence in NRC's regulatory process to maintain safety.

This proposed rule would make several changes to the event notification reporting requirements in parts 72 and 73 that would align the event notification requirements for ISFSIs and MRS facilities and safeguards event notification requirements more closely with recent changes to §§ 50.72 and 50.73. These changes would reduce licensee burden through the consolidation of some notifications and lengthening of reporting periods for others. Additionally, some new requirements would be added to permit the NRC to more effectively carry out its responsibilities during emergencies and in responding to public, media, and other stakeholder inquiries. Finally, some changes would be made to improve organization, clarification, and readability through the use of plain language.

Paragraph (a) would remain unchanged.

Paragraph (b) would be revised to remove §§ 72.19 and 72.216 as a conforming change.

Paragraph (a) would remain unchanged.

Paragraph (b) would be split into two new paragraphs (b) and (c) for 4-hour and 8-hour notifications, respectively. In new paragraph (b), the existing 4-hour notification requirement remains unchanged for departing from a certificate condition or technical specification during an emergency (current paragraph (b)(4)); a new requirement would be added to notify the NRC when another Government agency is notified or a news release is planned to permit the NRC to promptly respond to public, media, and other stakeholder inquiries during events; and lastly, the current 4-hour notifications would be removed for events that require immediate action to avoid exposure or unplanned fires or explosions (current paragraphs (b)(1) and (b)(6)) because they are redundant with the requirements in paragraph (a) above.

In new paragraph (c), the existing 4-hour event notifications would be changed to 8-hour notifications for a defect in any spent fuel storage structure, system, or component important to safety  1 (current paragraph (b)(2)) a significant reduction in the effectiveness of any spent fuel storage confinement system in use (current paragraph (b)(3)), and an event that requires the transport of a radioactively contaminated person to an offsite medical facility for treatment (revision of paragraph (b)(5)). These changes reduce unnecessary licensee burden consistent with Part 50 event notification requirements.

Existing paragraph (c) for 24-hour reports would be redesignated as paragraph (d) and revised as follows: The current notification would be retained for events in which equipment important to safety fails to function (current paragraph (c)(2)). The requirement for notification of unplanned contamination events requiring controls restricting worker access for greater than 24 hours would be removed because such an event occurring at an ISFSI or MRS does not rise to a level of significance that would warrant notification. Facilities that store and manipulate spent fuel assemblies are by their very nature subject to identification of contamination outside of posted radiological contamination control areas (i.e., hot particles). The NRC considers the identification, control, and decontamination of these areas a routine radiation protection function, not an event requiring NRC notification—even if it takes the licensee more than 24 hours to clean up the contamination. Furthermore, although these 24-hour verbal reports are due within 24 hours of the discovery of the event, their significance requires that this notification requirement would be revised to permit these notifications to be delayed to the next working day (i.e., 8 a.m. Eastern time) when the end of the 24-hour period falls outside of normal NRC working hours (7:30 a.m.-5 p.m. Eastern time), a weekend, or a Federal holiday.

Current paragraph (d) would be split into three paragraphs and redesignated as new paragraphs (e), (f), and (g) (i.e., initial verbal notifications, follow-up verbal notifications, and written notifications) to provide greater clarity and consistency with part 50 event notification requirements.

In new paragraph (e), the current requirement would be retained to notify the NRC Operations Center by telephone of emergency and non-emergency conditions (current paragraph (d)(1)). A new requirement would be added to identify the Emergency Class or the 4-hour, 8-hour, or 24-hour notification to eliminate confusion and facilitate NRC response to the emergency. The current requirement would remain unchanged to provide supporting information (current paragraphs (d)(1)(i) through (v)).

In new paragraph (f), new requirements would be added for licensees to make follow-up notifications to immediately report degrading conditions, declaration of any Emergency Class, change of an Emergency Class, termination of the Emergency Class, the results of evaluations, the effectiveness of responses or protective measures, and information on unexpected ISFSI or MRS behavior. These added requirements would ensure that the information on a degrading condition or termination of the event is promptly communicated to the NRC. Consistent with current policy for reactor licensees, the NRC expects a part 72 licensee to make any follow-up notifications to the NRC as soon as possible, but no later than 1 hour from the time of identification. Additionally, a requirement would be added to maintain an open, continuous communication channel with the NRC Operations Center upon request by the NRC. This requirement would be consistent with the current part 50 event reporting requirements and would ensure that during an ongoing emergency, the communications between the licensee and the NRC are not interrupted by the inability to complete a phone call when telephone circuits could be temporarily overloaded.

In new paragraph (g), the current 30-day requirement would be revised to require that written reports be submitted within 60 days (current paragraph (d)(2)) reducing the occurrence of supplemental reports and licensee burden. The requirements for human performance events (current paragraphs (d)(2)(i) through (d)(7), except (d)(2)(ii)(I)) would be revised to be consistent with currently revised § 50.73(b)(2)(ii)(J). Additionally, in paragraph (g)(2)(xii) the requirement to specify the quantities and chemical and physical forms of the material involved in the event would be expanded to include reactor-related greater-than-class-C (GTCC) waste because the Commission recently added authority to part 72 for the storage of reactor-related GTCC waste (see 66 FR 51823; October 11, 2001). Furthermore, a new requirement would be added on legibility of reports (new paragraph (g)(8)) to be consistent with the current § 50.73(e).

New paragraph (h) would be added to indicate that the Commission may require a licensee to submit supplemental information if this information is necessary for the NRC to obtain a complete understanding of an unusually complex or significant event.

New paragraph (i) would be added to clarify that the requirements of § 72.75 apply: after a specific part 72 license has been issued to an applicant; after a part 72 general licensee has first placed spent fuel on the ISFSI storage pad (if the ISFSI is located inside the reactor facility's collocated protected area) or when the spent fuel is being transferred outside of the reactor facility's protected area to the ISFSI storage pad (if the ISFSI storage pad is located outside of the reactor facility's protected area); and to non-emergency events that occurred within 3 years of the date of discovery. This paragraph would reduce licensee confusion on when the provisions of this section become applicable. The 3-year limitation would eliminate notifications for events that are no longer significant and would be consistent with the current §§ 50.72 and 50.73.

This section would be removed and reserved because it is no longer needed.

In paragraph (a)(4), the period for submitting written follow-up notifications would be extended from 30 days to 60 days. Changing the time limit from 30 days to 60 days does not imply that licensees should take longer than they previously did to develop and implement corrective actions. The NRC expects licensees to take corrective actions on a time scale commensurate with the safety significance of the issue. However, for those cases where it does take longer than thirty days to complete a root cause analysis, this change will result in fewer licensee event reports that require amendment by submittal of an amended report. The revision to the requirements for submission of written followup safeguards reports will not affect the NRC's ability to promptly respond to safeguards events, because the written reports are not relied upon by NRC staff for prompt response to significant events, but instead the reports are used for such followup actions as considering the need for enforcement action, evaluating whether a generic communication may be necessary, and evaluating the adequacy of existing NRC regulations and guidance. The extension is based on simplicity for reporting, importance to risk, and the required reporting time consistent with the need for prompt NRC action. Additionally the increased time for follow-up reporting would allow for: the completion of the required root cause analyses and engineering evaluations, and fully identify corrective actions after event discovery; preparation of more complete and accurate event reports; and, fewer event report revisions and supplemental reports, thus reducing unnecessary licensee burden. This proposed change would also be consistent with the Commission's actions in the final rule revising § 50.73. In paragraph (d), the period for submitting written follow-up notifications also would be extended from 30 to 60 days.

As a conforming change to § 73.71(a)(4), paragraph I of Appendix G to part 73 would also be revised to require that the period for submitting written follow-up notifications be extended from 30 days to 60 days.

For the purpose of section 223 of the Atomic Energy Act (AEA), the Commission is proposing to amend 10 CFR parts 72 and 73 under one or more of sections 161b, 161i, or 161o of the AEA. Willful violations of the rule would be subject to criminal enforcement.

Under the “Policy Statement on Adequacy and Compatibility of Agreement State Programs” approved by the Commission on June 30, 1997, and published in the Federal Register on September 3, 1997 (62 FR 46517), this rule is classified as compatibility Category “NRC.” Compatibility is not required for Category “NRC” regulations. The NRC program elements in this category are those that relate directly to areas of regulation reserved to the NRC by the Atomic Energy Act of 1954, as amended (AEA), or the provisions of Title 10 of the Code of Federal Regulations. Although an Agreement State may not adopt program elements reserved to NRC, it may wish to inform its licensees of certain requirements via a mechanism that is consistent with the particular State's administrative procedure laws but does not confer regulatory authority on the State.

The Presidential Memorandum dated June 1, 1998, entitled “Plain Language in Government Writing,” directed that the Government's writing be in plain language. The NRC requests comments on this proposed rule specifically with respect to the clarity and effectiveness of the language used. Comments should be sent to the address listed under the heading ADDRESSES above.

The National Technology Transfer Act of 1995 (Pub. L. 104-113) requires that Federal agencies use technical standards that are developed or adopted by voluntary consensus standards bodies unless the use of such a standard is inconsistent with applicable law or otherwise impractical. In this proposed rule, the NRC would amend its regulations to change several event notification requirements for ISFSI and MRS facilities and safeguards event notification requirements to more closely align them with event notifications for reactor facilities. The changes would reduce licensee burden through the consolidation of some notifications and lengthening the reporting period for other notifications. Some new requirements would be added to permit the NRC to more effectively carry out its responsibilities during emergencies and in responding to public, media, and other stakeholder inquiries. This action does not constitute the establishment of a standard that establishes generally applicable requirements.

The NRC has determined that this proposed rule is the type of action described in categorical exclusion 10 CFR 51.22(c)(3)(iii). Therefore, neither an environmental impact statement nor an environmental assessment has been prepared for this proposed rule.

This proposed rule amends information collection requirements that are subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ) These information collection requirements have been submitted to the Office of Management and Budget (OMB) for approval. Existing requirements were approved by the OMB, approval numbers 3150-0002 and -0132.

The burden to the public for these information collections in 10 CFR parts 72 and 73 is estimated to average 24 hours per response for part 72 and 13 hours per response for part 73, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the information collection. The U.S. Nuclear Regulatory Commission is seeking public comment on the potential impact of the information collections contained in the proposed rule and on the following issues:

1. Is the proposed information collection necessary for the proper performance of the functions of the NRC, including whether the information will have practical utility?

2. Is the estimate of burden accurate?

3. Is there a way to enhance the quality, utility, and clarity of the information to be collected?

4. How can the burden of the information collection be minimized, including the use of automated collection techniques?

Send comments on any aspect of these proposed information collections, including suggestions for reducing the burden, to the Records Management Branch (T-6 E6), U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, or by Internet electronic mail at INFOCOLLECTS@NRC.GOV; and to the Desk Officer, Office of Information and Regulatory Affairs, NEOB-10202, (3150-0002 and -0132), Office of Management and Budget, Washington, DC 20503.

Comments to OMB on the information collections or on the above issues should be submitted by September 23, 2002. Comments received after this date will be considered if it is practical to do so, but assurance of consideration cannot be given to comments received after this date.

The NRC may not conduct or sponsor, and a person is not required to respond to, a request for information or an information collection requirement unless the requesting document displays a currently valid OMB control number.

The Commission has prepared a draft regulatory analysis on this proposed regulation. The analysis examines the costs and benefits of the alternatives considered by the Commission.

The Commission requests public comment on the draft regulatory analysis and is specifically requesting stakeholder input on: (1) The number of reports per year a typical licensee could be anticipated to make under these modified event reporting requirements, (2) the number of hours per report a typical licensee could be expected to expend in preparing and submitting these reports, and (3) the number of NRC staff hours that would be saved by extending the period for submitting written reports from 30 to 60 days.

The regulatory analysis is available for inspection in the NRC Public Document Room, 11555 Rockville Pike, Rockville, MD, and in the NRC's interactive rulemaking Web site as described under the ADDRESSES heading. Single copies of the regulatory analysis may be requested from Tony DiPalo, telephone (301) 415-6191, e-mail, ajd@nrc.gov of the Office of Nuclear Material Safety and Safeguards.

In accordance with the Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b)), the Commission certifies that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities. The majority of companies that own these plants do not fall within the scope of the definition of “small entities” set forth in the Regulatory Flexibility Act or the Small Business Size Standards set out in regulations issued by the Small Business Administration at 13 CFR part 121.

The Commission has determined that, as in the final rule 10 CFR parts 50 and 72, “Reporting Requirements for Nuclear Power Reactors and Independent Spent Fuel Storage Installations at Power Reactor Sites,” the backfit rule (10 CFR 50.109, 72.62) does not apply to information collection and reporting requirements such as those reporting requirements contained in this proposed rule. The proposed rule does not involve any provisions that would impose backfits as defined in the backfit rule. Thus, a backfit analysis is not required.

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; and 5 U.S.C. 553; the NRC is proposing to adopt the following amendments to 10 CFR parts 72 and 73.

The Bipartisan Campaign Reform Act of 2002, Public Law 107-155, 116 Stat. 81 (March 27, 2002), contains extensive detailed amendments to the Federal Election Campaign Act of 1971, as amended, 2 U.S.C. 431 et seq. This Notice of Proposed Rulemaking (“NPRM”) is part of a continuing series of rulemakings the Commission is publishing over the next several months in order to meet the rulemaking deadlines set out in BCRA.

This NPRM addresses the increase in contribution limits, the prohibition on contributions and donations by minors to certain political committees, and the prohibition on contributions, donations, and certain expenditures by foreign nationals. These changes to the Act addressed in this NPRM are only a few of many changes made to the Act by BCRA. Other rulemakings have addressed or will address: (1) Non-Federal funds or “soft money” (promulgated on June 22, 2002, 67 FR 49063 (July 29, 2002)); (2) coordinated and independent expenditures;  1 (3) the so-called “millionaires' amendment,” which increases contribution limits for congressional candidates facing self-financed candidates on a sliding scale, based on the amount of personal funds the opponent contributes to his or her campaign; (4) electioneering communications (for NPRM, see 67 FR 51131 (Aug. 7, 2002)); (5) other new and amended provisions, including inaugural committees, fraudulent solicitations, disclaimers, personal use of campaign funds, and civil penalties; (6) reporting; and (7) reorganization of “contribution” and “expenditure” definitions (for final rules, see 67 FR 50582, August 5, 2002). The reporting NPRM will contain the reporting rules proposed in several of the other NPRMs and will restructure 11 CFR part 104 to make the reporting rules more user-friendly. Section 402(c) of BCRA establishes a 270-day deadline for the Commission to promulgate these rules. Since BCRA was signed into law on March 27, 2002, the 270-day deadline is December 22, 2002.

The Act limits the amounts that individuals and entities are permitted to contribute, and who may contribute those amounts, to candidates, political committees, and political party committees for use in Federal elections. 2 U.S.C. 441a and 441e. BCRA amends the FECA by increasing some of the contribution limits in 2 U.S.C. 441a (but only for contributions made on or after January 1, 2003), and by prohibiting certain contributions by minors in new 2 U.S.C. 441k. BCRA also amends 2 U.S.C. 441e, which prohibits contributions, donations, and expenditures made by foreign nationals. The proposed rules would implement these amendments.

The Act limits the amount that individuals may contribute to candidates, political committees, and political parties for use in Federal elections. 2 U.S.C. 441a. The pre-BCRA provisions of the Act permit persons to contribute up to $1,000 to Federal candidates per election and up to $20,000 per year to political committees established and maintained by national political parties. 2 For contributions made on or after January 1, 2003, BCRA amends 2 U.S.C. 441a(a)(1)(A) to increase the amount persons can contribute to Federal candidates to $2,000 per election and amends 2 U.S.C. 441a(a)(1)(B) to increase the amount that may be contributed by individuals to committees maintained and controlled by national political parties to $25,000 per year.

Current 11 CFR 110.1(b)(1) and (c)(1), which contain the contribution limits in 2 U.S.C. 441a(a)(1)(A) and (B), would be amended to incorporate the new increased contribution limits. Proposed paragraph (b)(1) would establish the new base contribution limit of $2,000 that a person may contribute to a candidate for election to any Federal office. Under proposed paragraph (b)(1)(i), that limit of $2,000 would be increased if necessary each election cycle by the difference in the price index in accordance with proposed 11 CFR 110.17, which is discussed below. Once the limit is increased, proposed paragraph (b)(1)(ii) would establish the effective dates of the increase from the day after the last general election to the day of the next general election. Because the contribution limits could change every two years, depending upon the consumer price index, proposed paragraph (b)(1)(iii) states that the Commission would publish the new contribution limits in effect in the Federal Register every odd-numbered year and maintain that information on its Web Site. Proposed section 110.1(c)(1) would parallel proposed section 110.1(b)(1), except it would establish the base contribution limit that a person would be able to make to a political committee of a national political party at $25,000 per calendar year. Proposed paragraphs (c)(1)(i), (ii), and (iii) would mirror proposed paragraph (b)(1)(i), (ii), and (iii), applying the same indexing as necessary each election cycle with the same effective dates.

The limit for the calendar year when the change becomes effective would be affected as well. These new contribution limits would be effective January 1, 2003, and would apply to contributions made on or after that date. The Commission seeks comments on whether these increased contribution limits should apply to elections that occurred before the effective date of the increase in the contribution limits. For example, if the contribution limit were to be increased from $2,000 to $2,100, effective November 3, 2004, and contributor X makes a $2,000 contribution to candidate Y in October of 2004, could contributor X make a $100 contribution after November 3, 2004 designated for the general election, provided that candidate Y's principal campaign committee still has net debts outstanding?

BCRA also amends the provisions in the Act that establish the aggregate contributions that may be made by individuals. Under 2 U.S.C. 441a(a)(3), individuals have been permitted to make no more than $25,000 in aggregate contributions per calendar year. This section has been revised by BCRA to establish new bi-annual aggregate limits that permit individuals to make up to $95,000 in contributions, including up to $37,500 in contributions to candidates and their authorized committees and up to $57,500 in contributions to any other committees. 2 U.S.C. 441a(a)(3)(A) and (B). The $57,500 aggregate contribution limit contains a further restriction in that no more than $37,500 of this amount may be given to committees that are not the political committees of national political parties. 2 U.S.C. 441a(a)(3)(B).

Current 11 CFR 110.5(b) would be amended to incorporate the increased bi-annual aggregate contribution limits, which will be effective January 1, 2003. Proposed paragraph (b)(1)(i) would contain the new bi-annual aggregate limit for contributions to candidates and their authorized committees. Proposed paragraph (b)(1)(ii) would contain the new bi-annual aggregate limit for contributions to other political committees.

However, 2 U.S.C. 441a(i)(1)(C) and 441a-1(a)(1)(B) contain an important exception to the contribution limits that has implications for the bi-annual aggregate limits for individuals. Under these sections, the individual contribution limits to candidates for the U.S House of Representatives and U.S. Senate are increased if the candidate is opposing another candidate who makes expenditures from his or her personal funds above a certain threshold. Contributions made under these provisions do not apply to the individual contributor's bi-annual aggregate limits. 2 U.S.C. 441a(i)(1)(C) and 441a-1(a)(1)(B). Proposed paragraph 110.5(b)(1)(iii) would reflect this exception, which will be addressed in greater detail in a separate NPRM concerning the so-called “millionaires' amendment.”

Proposed paragraph (b)(2) of 11 CFR 110.5 would reference the increase, if necessary, in the bi-annual aggregate limits by the percent difference in the price index as described in proposed 11 CFR 110.17 ( see the discussion below). Proposed paragraph (b)(3) would provide that the time period in which the price indexing applies also applies to the aggregation of contributions for purposes of the application of the bi-annual aggregate limits. An example of how the time period would operate for both the increase and the aggregation would also be included in proposed paragraph (b)(3). Proposed paragraph (b)(4) would restate the Commission's intention to publish information regarding the adjusted limits in the Federal Register and on the Commission's web site.

Under pre-BCRA 2 U.S.C. 441a(h), the Republican and Democratic Senatorial campaign committees or the national committee of a political party or any combination of such committees were permitted to contribute $17,500 to a candidate for election or nomination to the U.S. Senate during the year of the election. BCRA amends this section of the Act to increase the amount that may be contributed by these committees to senatorial candidates to $35,000 on or after January 1, 2003. Current 11 CFR 110.2(e), which contains this limit, would be amended to increase the limit to $35,000.

Pre-BCRA 2 U.S.C. 441a(c) mandated yearly indexing to inflation of the expenditure limitations established by 2 U.S.C. 441a(b) (the limits on expenditures by candidates for the office of President of the United States who accept public funding) and 2 U.S.C. 441a(d) (the limits on expenditures by national party committees, State party committees, or their subordinate committees in connection with the general election campaign of candidates for Federal office).

BCRA amends 2 U.S.C. 441a(c) to extend the inflation indexing to: the limitations for contributions made by persons under 2 U.S.C. 441a(a)(1)(A) and 441a(a)(1)(B); the bi-annual aggregate contribution limits for individuals now found at 2 U.S.C. 441a(a)(3); and the limitation for contributions made to U.S. Senate candidates by certain party committees at 2 U.S.C. 441a(h). 2 U.S.C. 441a(c)(1)(B). The adjustments for inflation for 2 U.S.C. 441a(a)(1)(A), 441a(a)(1)(B), 441a(a)(3) and 441a(h) are to be made only in odd-numbered years and such increases will be in effect for the 2-year period beginning on the first day following the date of the general election in the year preceding and ending on the date of the next general election. 2 U.S.C. 441a(c)(1)(C).

BCRA, however, presents a conflict concerning the interaction of 2 U.S.C. 441a(a)(3), which establishes the bi-annual aggregate contribution limits for individuals, and 2 U.S.C. 441a(c)(1)(C), which mandates indexing to inflation of these bi-annual aggregate limits. Section 441a(a)(3) of the Act specifically provides that the bi-annual aggregate limits for contributions made by individuals should apply during the period that begins on January 1 of an odd-numbered year and ends on December 31 of the next even-numbered year. For example, the dollar aggregate limits operate from January 1, 2005 to December 31, 2006. However, the inflation indexing for this provision as applied by 2 U.S.C. 441a(c)(1)(C) would operate from the day after the general election to the date of the next general election, e.g. November 3, 2004 to November 7, 2006, after which date the next two year inflation indexing period would alter the bi-annual aggregate contribution limits again. Thus, these competing time limits seem to dictate different contributions limits for the period from November 3, 2004 to January 1, 2005 and could not be applied simultaneously. Therefore, the conflict between 2 U.S.C. 441a(a)(3) and 441a(c)(1)(C) must be resolved to determine the time period in which the bi-annual aggregate contribution limits apply.

It is one principle of legislative interpretation that where two provisions of a statute are in conflict, the conflicting provision which is last in time or last in order of arrangement prevails. See Inter-Continental Promotions v. MacDonald , 367 F.2d 293 (5th Cir. 1966). Following this principle, because 2 U.S.C. 441a(c)(1)(C) appears later than 2 U.S.C. 441a(a)(3) in order of arrangement, both in BCRA and as codified in the Act, 2 U.S.C. 441a(c)(1)(C) would determine the time period of the bi-annual contribution limits for 2 U.S.C. 441a(a)(3). Therefore, the proposed rules would set the time period for the bi-annual contribution limits from the day after the general election, i.e. the first Wednesday following the first Monday in November of an even numbered year, to the date of the next general election, i.e. the first Tuesday following the first Monday in November of the next even numbered year. See proposed 11 CFR 110.5(b) and 110.17 below. Under this approach, runoff elections following the general election would not postpone the increase in the annual contribution limits. The Commission seeks comment on whether this interpretation of the statutory language and the proposed time period for the bi-annual aggregate contribution limits is appropriate.

Another question for the interpretation of the BCRA amendments to 2 U.S.C. 441a(c) relates to a timing issue in the administrative application of the inflation indexing. The increased contribution limits of 2 U.S.C. 441a(a)(1)(A) and (B), 441a(a)(3), and 441a(h) apply to contributions made on or after January 1, 2003. However, under the interpretation outlined above, 2 U.S.C. 441a(c)(1)(C) requires that these same contribution limits be increased through indexing for inflation in odd-numbered years with the increase in effect starting with the day following the last general election in the previous year. This could imply that initial contribution limits authorized by BCRA to take legal effect on January 1, 2003, should also be increased by the difference in the price index. Comments are requested on this possible interpretation, which is not included in the proposed revisions to section 110.5 below.

A further change in 2 U.S.C. 441a(c) is the introduction of a rounding provision for all the amounts that are increased by the indexing to inflation in 2 U.S.C. 441a. If the final amount is not a multiple of $100, it is rounded to the nearest multiple of $100. 2 U.S.C. 441a(c)(1)(B)(iii).

The current regulation at 11 CFR 110.9(c) that describes the expenditure limits subject to inflation indexing does not include any of the inflation indexing discussed above. In order to address the price indexing for the new contributions and expenditures limitations in a comprehensive manner, the Commission proposes to add new section 110.17 to track the changes to 2 U.S.C. 441a(c). In this new section 110.17, proposed paragraph (a) would restate current section 110.9(c) for the price index increases that previously existed for the party committee and Presidential candidate spending limits established by 11 CFR 110.7 and 110.8.

However, proposed paragraph (a) would contain one important change from current 11 CFR 110.9(c). Section 110.9(c) had incorrectly stated that the expenditure limitations established by sections 110.7 and 110.8 would be increased by the annual percent difference of the price index, as certified to the Commission by the Secretary of Labor. Section 441a(c) of the Act does not use an annual percent difference of the price index to calculate the increases. Instead, it requires the use of the percent difference between the price index for the 12 months preceding the beginning of the calendar year in which the change is made and the base period. For party committee expenditures limitations and Presidential candidate expenditures limitations, the base period is calendar year 1974 with the change being in effect for that calendar year. Proposed paragraph (a) would correctly state the standard to be applied and would delete the term “annual” from the regulation.

Proposed paragraph (b) of new section 110.17 would track 2 U.S.C. 441a(c)(1)(B) and state that the following contributions limits would be indexed to inflation: Proposed 11 CFR 110.1(b)(1) (limits for individuals contributing to candidates and authorized political committees); proposed 110.1(c)(1) (limits for contributions made to national party committees); proposed 110.2(e) (limits for contributions made by party committees to Senatorial candidates); and proposed 110.5 (bi-annual aggregate contribution limits for individuals). Consequently, current paragraph 110.9(c) would be removed.

Proposed section 110.17(b)(1) would specify that these contribution limitations would be increased during odd numbered years and that the increased limit would be in effect for a two-year period. Proposed paragraph (b)(2) would establish that 2001 is the base year for the calculation of the price index difference. Proposed paragraph 110.17(c) would implement the new rounding provision found at 2 U.S.C. 441a(c)(B)(iii).

The Act at 2 U.S.C. 441a(c)(2)(A) and proposed paragraph 110.17(d) specifically identify the price index as the average over a calendar year of the Consumer Price Index (all items-United States city average) published by the Bureau of Labor Statistics. The Department of Labor computes the CPI using two population groups: All Urban Consumers (CPI-U) and Clerical Workers (CPI-W). The CPI-U represents approximately 87% of the total United States population while the CPI-W, a subset of the CPI-U, represents 32% of the total United States population. 3 While neither the Act nor BCRA have specified which population group is to be used, the Commission has historically used the more inclusive CPI-U since that would seem the best method to calculate changes in the affected limitation. The Commission invites comments on whether this or an alternative approach would be preferable.

Proposed paragraph 110.17(e) would state that the Commission would provide information concerning the amount of the adjusted contribution limitations through the Federal Register and the Commission's web site.

In order to alert the reader to these contribution limit increases, each section containing a contribution increase that is subject to the indexing also contains a new paragraph referring to these increases. These would be proposed paragraphs 110.1(b)(1)(i), (ii), and (iii); (c)(1)(i), (ii), and (iii); 110.2(e)(2); and 110.5(b)(2).

Senator McCain, a primary sponsor of BCRA, stated during the Senate debate that the prohibition on contributions by minors is intended to prevent evasion of FECA's contribution limits and “restores the integrity of the individual contribution limits by preventing parents from funneling contributions through their children, many of whom are simply too young to make such contributions knowingly.” 148 Cong. Rec. S2145-2146 (daily ed. March 20, 2002).

During the debate, BCRA's sponsors acknowledged that many individuals younger than 18 years old enthusiastically supported candidates and pointed out that they could continue to do so by volunteering on campaigns and expressing their views through speaking and writing. See 148 Cong. Rec. S2146 (daily ed. March 20, 2002).

BCRA prohibits minors (individuals 17 years old and younger) from making a contribution to a candidate or a contribution or donation to a political party committee. See 2 U.S.C. 441k. The Commission is proposing to place the regulations that address this prohibition in a new section 11 CFR 110.19.

Under current regulations, a child under 18 years of age may make contributions in accordance with the limits of the Act provided that the child voluntarily and willingly makes the decision to contribute, the funds, goods or services contributed are owned or controlled exclusively by the child, and the contribution is not made from the proceeds of a gift given to the child to make a contribution or is not in any way controlled by an individual other than the child. See current 11 CFR 110.1(i)(2). Consequently, the proposed rules would amend current 11 CFR 110.1(i)(2) to conform with BCRA. See below for discussion of the proposed conforming amendments.

Proposed paragraph (a) of new 11 CFR 110.19 would address contributions by minors to candidates. That paragraph would state that an individual who is 17 years old or younger must not make a contribution to a candidate for Federal office. Proposed paragraph (a) would further clarify that a contribution to a Federal candidate includes a contribution to a candidate's principal campaign committee, to any other authorized committee of that candidate, or to any entity directly or indirectly established, financed, maintained or controlled by one or more Federal candidates.

The Commission believes that prohibiting contributions by minors to entities directly or indirectly established, financed, maintained or controlled by a Federal candidate is within the scope of BCRA, but it seeks comment on this issue. The Commission also seeks comment on whether minors who are emancipated under State law should be exempt from the prohibition. A condition of emancipation under State law usually entails a showing that a minor manages his or her own financial affairs, which would lessen the likelihood that a parent would funnel contributions through the emancipated minor child. Finally, the Commission seeks comment on whether the regulations should make clear that the relevant time for determining whether a minor has made a prohibited contribution is the age of the minor at the time he or she makes a contribution, i.e., when the minor relinquishes control over the contribution. See 11 CFR 110.1(b)(6).

Proposed § 110.19(b) addresses contributions and donations made by minors to political party committees. Because BCRA specifically prohibits donations as well as contributions by minors to “a committee of a political party,” proposed paragraph (b) states that individuals 17 years old or younger may not make contributions or donations to a national, State, district or local committee of a political party. Thus, as proposed, the regulations would interpret BCRA as prohibiting minors from making any donations whatsoever to non-Federal accounts of State, district and local party committees. To the extent that a non-Federal account of a State or local party committee may contain Levin funds, i.e., funds raised under State law but limited under Federal law to $10,000 per contributor, to finance certain Federal election activity such as voter registration and get-out-the vote activities, prohibiting donations by minors to State, district and local party committees has a clear nexus to Federal elections. It should be noted that this interpretation may preempt certain State laws to the extent that States permit minors to donate to state and local political parties.

The Commission seeks comment, however, as to whether a narrower construction of the prohibition on donations by minors to state, district, and local political party committees may be warranted. For example, the prohibition on donations by minors in 2 U.S.C. 441k could be interpreted to apply only to donations used to conduct activities that have some effect on Federal elections. Consequently, under this interpretation, a minor may make a donation only if the recipient state, district, or local party committee can show through a reasonable accounting method or by establishing a separate account that the donation is used exclusively for purposes that have no effect upon any Federal election to the extent permitted by State law. It is important to note, however, that a number of State laws treat contributions by minors as contributions by their parent(s) or guardian(s). See for example, Kan. Stat. Ann. 25-4153(c) and Okla. Stat. t. 74, 257:10-1-2(a)(1) and (h)(2).

Proposed 11 CFR 110.19(c) addresses contributions to other political committees, such as separate segregated funds and non-connected committees. The proposed rule would prohibit an individual who is 17 years old or younger from making a contribution to any such political committee if the contribution is earmarked or otherwise directed to one or more Federal candidates or political committees or organizations covered in proposed paragraphs (a) and (b).

Proposed 11 CFR 110.19(d) would make clear that minors are not prohibited from volunteering their services to Federal candidates, political party committees or other political committees. The exclusion of volunteer services is based on the statement made by Senator McCain in the BCRA Senate debate, as noted above, that Congress intended that minors could continue to participate in campaigns by volunteering.

Proposed paragraph (e) would define an entity “directly or indirectly established, financed, maintained, or controlled” by a candidate for purposes of the prohibition on minors' contributions to candidates as one that meets the definition of “directly or indirectly establish, finance, maintain or control” at 11 CFR 300.2(c). For the definition, see Final Rules for “Excessive and Prohibited Contributions: Non-Federal Funds or Soft Money,” 67 FR 49063 (July 29, 2002).

As discussed above, beginning on November 6, 2002, BCRA prohibits individuals who are 17 years old or younger from making contributions to Federal candidates and contributions or donations to political party committees. However, BCRA also provides that this prohibition will not apply with respect to runoff elections, recounts or election contests resulting from elections held prior to November 6, 2002. See 2 U.S.C. 431 note. Consequently, the current regulation concerning contributions by minors at 11 CFR 110.1(i)(2) would be amended by adding new paragraph (i)(3) to clarify that the provisions of 11 CFR 110.1(i)(2) would continue to apply to contributions made by minors to authorized committees and political party committees in connection with runoff elections, recounts or election contests resulting from elections held prior to November 6, 2002. It would also clarify that contributions made by minors to authorized committees and political party committees for all other elections held after November 6, 2002 would be governed by proposed 11 CFR 110.19.

Because 2 U.S.C. 441k specifically prohibits contributions by minors to candidates and political party committees rather than to political committees in general, the proposed rules contemplate that minors could continue to make contributions to political committees other than authorized committees or political party committees in accordance with the requirements of 11 CFR 110.1(i)(2). Consequently, 11 CFR 110.1(i)(2) would be amended to reflect this interpretation. The Commission seeks comment on whether 2 U.S.C. 441k could be interpreted to also prohibit contributions by minors to these other political committees.

With BCRA's renewed focus on contribution limits, the Commission is considering updating and streamlining its rules for designating contributions for a particular election or attributing contributions to particular donors. Current 11 CFR 110.1 and 110.2 set forth the procedures for the redesignation or reattribution of excessive contributions. Section 110.1(b)(5) permits an excessive contribution to a candidate that is not designated in writing for a particular election to be designated for a different election, provided that a signed, written redesignation is obtained from the contributor within 60 days. See 11 CFR 110.1(b)(5)(i)(C) and 110.1(b)(5)(ii). Given the amount of resources the Commission and the regulated community have had to devote to authorized committees' failure to properly follow these procedures, the Commission seeks comment on several ways to address this problem. Although BCRA does not address the procedures for handling excessive contributions, the Commission seeks comment on the following possible changes to §§ sections 110.1, 110.2 and 102.9 as a matter of administrative convenience and to better effectuate donor intent.

One possible change to § 110.1(b)(5) would be to presume that when a contributor makes an undesignated, excessive contribution to a candidate's authorized committee before a primary election, the contributor intends to contribute the excessive amount to the general election, provided that the total amount contributed does not exceed the limitations on contributions for both elections. If this presumption were allowed, the authorized committee would be permitted to treat the excessive amount of the contribution as a contribution made with respect to the general election without needing to obtain written permission from the contributor, or even to notify the contributor that such action had been taken. This approach, which is included in the proposed rules as Alternative 1-A in § 110.1(b)(5)(ii)(B), would be designed to minimize the administrative burden on authorized committees when a contributor's intent could be reasonably inferred.

Alternatively, or in conjunction with the presumption approach, the committee could be required to inform the contributor as to how the contribution had been designated, and that the contributor may request a refund. This approach is included in the proposed rules as Alternative 1-B in § 110.1(b)(5)(ii)(B). As with the presumption approach, no confirmation from the contributor would be required. If the Commission were to adopt the notification approach, then 11 CFR 110.1(l) would need to be amended to specify the documentation required to be retained under such an approach.

The Commission seeks comment on how this notification approach compares to or fits with the presumption approach. Would the benefit of requiring notification of contributors outweigh the administrative burden to authorized committees of providing and retaining records of such notification? What methods of notification ( e.g. , mail, electronic mail or oral communication accompanied by a contemporaneous signed record of the conversation) should be permitted if this notification approach is adopted? Should notification be required within thirty days of the treasurer's receipt of the contribution? If a contributor requests a refund, should the treasurer be required to make the refund within thirty days of receipt of the request?

The Commission specifically seeks comment on the merits of applying the presumption or notification approach described above to an undesignated, excessive contribution received before a primary election. In addition, the Commission seeks comment on whether it should allow the presumption or notification approach for other types of redesignations, or for reattributions. See 11 CFR 110.1(b)(5)(i), 110.1(k) and 110.2(b)(5)(i). For example, should the Commission permit backward-looking presumptions, so that excessive general election contributions received after a primary election may be designated by an authorized committee to pay off primary debt? Alternatively, should it be presumed that a contributor intended to contribute an excessive amount beyond a current election cycle? Are backward-looking presumptions or presumptions beyond a current election cycle consistent with what contributors can be reasonably expected to have intended? More generally, if the Commission adopts the presumption or notification approach for certain contributions in § 110.1, should the Commission make conforming changes to the requirements for contributions by multicandidate political committees in § 110.2? Are there circumstances where the presumption or notification approach would be appropriate for the reattribution of a contribution to a different donor, such as when a contribution made by written instrument is imprinted with the names of more than one account holder? Alternatives 2-A and 2-B in proposed 11 CFR 110.1(k)(3)(ii)(B) sets forth how the presumption and notification approaches could be applied under those circumstances. If the Commission adopts the presumption or notification approach for certain types of redesignations or reattributions, conforming amendments will be required in §§ 110.1 and 110.2.

Whether or not the Commission decides to allow the presumption or notification approach for certain types of redesignations or reattributions, there will remain circumstances where redesignation or reattribution might not be appropriate without some form of authorization from the contributor. See, e.g., 11 CFR 110.1(b)(5)(i)(B). Under current §§ 110.1 and 110.2, authorization from the contributor can only be obtained through written authorization signed by the contributor. The Commission seeks comment on whether it should eliminate the signature requirement for all redesignations and reattributions under 11 CFR 110.1 and 110.2, and instead permit authorization from the contributor by email or through oral communications with the contributor when there is a contemporaneous signed record of the conversation, as is permitted under the Commission's best efforts regulations ( see 11 CFR 104.7(b)(2)). Eliminating the signature requirement or permitting committees to obtain authorization orally or by e-mail for redesignations and reattributions would require amendments to §§ 110.1 and 110.2.

In addition to concerns about balancing administrative burdens with adequate protection of contributors' intent, the Commission has concerns about some committees' illegal use of contributions received for the general election during the primary election, despite the existing requirement that authorized committees distinguish contributions received for the primary election and contributions received for the general election. See 11 CFR 102.9(e). In order to reduce the illegal use of funds during the primary election through the use of contributions intended for the general election, the Commission seeks comment on whether all committees should be required to segregate contributions for the primary election from contributions for the general election. This could be done by tightening the requirements currently set forth in 11 CFR 102.9(e) so that separate accounts for primary and general election contributions would be mandatory, not optional.

Recordkeeping also plays a crucial role in ensuring compliance with the Act's contribution limitations. The Commission seeks comment on whether the recordkeeping duties set forth in 11 CFR 102.9 should explicitly require political committees to retain certain records of all contributions over $50. Should political committees be required to keep copies of contribution checks, either as photocopies or as digital images? Should committees be required to keep records of contributions made by credit card or debit card, such as credit card slips, processing batch reports, or other records created by the committee or provided by the credit or debit card processor? Many committees keep such records now, so it is not anticipated that it would create a significant additional administrative burden if such a recordkeeping requirement were adopted. Finally, the Commission seeks comment on whether 11 CFR 102.9 should include an explicit requirement that political committees maintain copies of all written solicitations.

As indicated by the title of section 303 of BCRA, “Strengthening Foreign Money Ban,” Congress amended 2 U.S.C. 441e to further delineate and expand the ban on campaign contributions and donations by foreign nationals. BCRA expressly applies the ban to contributions and donations solicited or made directly or indirectly to candidates for State and local as well as Federal office. 2 U.S.C. 441e(a)(1)(A) and (a)(2). Furthermore, the prohibition is expressly applied to contributions and donations to committees of political parties and is extended to disbursements for electioneering communications as well as to expenditures and independent expenditures. 2 U.S.C. 441e(a)(1)(B) and (C).

Consequently, the Commission proposes to amend 11 CFR part 110 to implement the revised statutory provision. The proposed rules would remove and reserve 11 CFR 110.4(a), the current regulation that addresses foreign nationals. In its place, new § 110.20 would be created to describe the prohibitions on contributions, donations, expenditures, independent expenditures, and disbursements by foreign nationals. This new section would also incorporate the provision in 2 U.S.C. 441e(a)(2) which prohibits persons from soliciting, accepting, or receiving contributions and donations from foreign nationals.

BCRA bans foreign national contributions and donations made “directly or indirectly.” Former 2 U.S.C. 441e(a) banned foreign national contributions made directly “or through any other person.” It is unclear what Congress intended in changing the terminology. While both phrases would address contributions made through conduits, the term “indirectly” could have a broader scope because the general purpose of section 303 of BCRA is to strengthen the ban on contributions and donations by foreign nationals. Comments are solicited as to whether “indirectly” should be construed to have a broader meaning than “through any other person” and if so, whether the rules should explicitly reflect this interpretation by defining “indirectly.” Please note that the proposed rule does not define “indirectly.”

Given the above-cited statutory provisions, proposed paragraph 110.20(a) would explicitly state that foreign nationals shall not, directly or indirectly, make contributions or donations in connection with any election for Federal, State, or local office. Because BCRA retains the provision on express or implied promise, proposed paragraph (a) would also include that language. Additionally, proposed paragraph (a) would define “election” in accordance with 11 CFR 100.2 and proposed 11 CFR 110.20(j). While current § 100.2 addresses Federal elections, proposed paragraph (j) would define “election” generically so that it would include State and local elections.

Comment is also sought on whether “indirectly” should cover a foreign controlled U.S. corporation, including a U.S. subsidiary of a foreign corporation, when such corporation seeks to make (1) non-federal donations of corporate treasury funds, or (2) federal contributions through a political action committee. Specifically, the Commission seeks comment on whether BCRA's new statutory language prohibits foreign controlled U.S. corporations, including a U.S. subsidiary of a foreign corporation, from making corporate donations, or from making federal contributions from their PACs, or both.

In BCRA, Congress added the “donation” of funds by foreign nationals to its prior ban on “contributions” by foreign nationals. In 2000, the Commission included in its legislative recommendations to Congress a proposal that 2 U.S.C. 441e be amended to clarify that the statutory prohibition on foreign national contributions extends to State and local elections. The Commission noted that this could be accomplished by changing “contribution” to “donation.”

In BCRA, Congress chose to retain “contribution” and to add “donation” as a prohibited activity, while also explicitly listing “a Federal, State, or local election” as the elections in connection with which such contributions and donations must not be made. By means of this two-fold approach, Congress left no doubt as to its intention to prohibit foreign national support of candidates and their committees for all Federal, State, and local elections.

According to the section-by-section analysis of BCRA by Senator Feingold, the revision to 2 U.S.C. 441e “prohibits foreign nationals from making any contribution to a committee of a political party or any contribution in connection with federal, state or local elections, including any electioneering communications. This clarifies that the ban on contributions [by] foreign nationals applies to soft money donations.” (Statement of Sen. Feingold, 148 Cong. Rec. S1991-1997 (daily ed. Mar. 18, 20020)).

While final rules entitled “Prohibited and Excessive Contributions: Non-Federal Funds or Soft Money” define “donation” at 11 CFR 300.2(e) for purposes of 11 CFR part 300, the proposed rules do not define “donation” for purposes of this rulemaking. The Commission seeks comments on whether it should include a definition of “donation” and, if so, should the definition be limited to proposed 11 CFR 110.20 or 11 CFR part 110, or should it be included in 11 CFR part 100 and have general applicability to all of the Commission's regulations.

BCRA also expressly extends the prohibition on foreign national contributions and donations to those made to committees of political parties, with foreign nationals prohibited from making any donations to such committees. 2 U.S.C. 441e(a)(1)(B). The particular committees covered would include the national party committees, the national congressional campaign committees, as well as all State, district, local, and subordinate committees. In light of the addition of “donation” to the statutory language, it appears that the prohibition on foreign national funds would extend to all political party organizations, whether or not they are political committees under the Act. In addition, because many party committee activities affect Federal, State, and local elections, this interpretation is supported by, and would reinforce, the prohibition in 2 U.S.C. 441e(a)(1)(A) on foreign national contributions and donations in connection with a Federal, State, or local election. Consequently, proposed 11 CFR 110.20(b) would adopt this interpretation. Comments are requested on whether the proposed rules should adopt a different interpretation.

BCRA prohibits a foreign national from making “an expenditure, independent expenditure, or disbursement for an electioneering communication.”  4 2 U.S.C. 441e(a)(1)(C). This provision, read alone, could be construed so that “expenditure,” “independent expenditure,” and “disbursement” modify “for an electioneering communication,” therefore narrowing the scope of “expenditure” and “independent expenditure” to include only “electioneering communications.” BCRA, however, expressly exempts from the definition of “electioneering communication” “a communication which constitutes an expenditure or an independent expenditure under this Act. * * *” 2 U.S.C. 434(f)(3)(B)(ii). Thus, statutory construction would require that the phrase “for an electioneering communication” at 2 U.S.C. 441e(a)(1)(C) is read as modified only by the term “disbursement,” with the prohibitions against an expenditure” or an “independent expenditure” being general in scope, i.e. , not limited to electioneering communications.

Consequently, proposed 11 CFR 110.20(d) would prohibit expenditures, independent expenditures, and disbursements  5 by foreign nationals for activities in connection with Federal, State, or local elections. Proposed paragraph (e) would specifically prohibit disbursements for electioneering communications by foreign nationals.

BCRA expressly prohibits all expenditures and independent expenditures by foreign nationals, and also prohibits all disbursements by foreign nationals for electioneering communications. Section 431(9)(A)(1) of FECA defines “expenditure” as “any purchase, payment, * * * or anything of value made for the purpose of influencing any election for Federal office,” and 2 U.S.C. 431(17) defines “independent expenditure” as “an expenditure by a person expressly advocating the election or defeat of a clearly defined candidate which is made without cooperation or consultation with any candidate * * * .” Thus, the terms “expenditure” and “independent expenditure” apply only to activities related to Federal elections. In contrast, “disbursement,” a term used in both FECA and BCRA, but not defined in the statutes, is now defined in new 11 CFR 300.2(d) as “any purchase or payment made by (1) a political committee; or (2) any other person, including an organization that is not a political committee, that is subject to the Act.” This definition of “disbursement” covers all payments including “expenditures,” “independent expenditures,” and those made in connection with non-Federal elections.

However, BCRA does not contain an express prohibition against foreign national disbursements for activities other than electioneering communications. This omission leaves in question the status of disbursements by foreign nationals for activities in connection with State and local elections that are by definition not “expenditures” or “independent expenditures” because they are not made to influence Federal elections. How the Commission addressed a similar issue in the past, however, provides guidance on this question.

Former 2 U.S.C. 441e contained no express prohibition against expenditures by foreign nationals. In response to this statutory silence, the Commission in 1989 revised 11 CFR 110.4(a) to state that foreign nationals were prohibited from making expenditures as well as contributions. The Explanation and Justification for that amendment stated: “The FECA generally prohibits expenditures when it prohibits contributions by a specific category [of] persons, thereby ensuring that the person cannot accomplish indirectly what they are prohibited from doing directly.” 54 FR 8581 (Nov. 24, 1989). The Explanation and Justification continued: “Nothing in Section 441e's legislative history suggests that Congress intended to deviate from the FECA's general pattern of treating contributions and expenditures in parallel fashion.” Id.

As discussed above, BCRA adds “donations” to the activities prohibited to foreign nationals, this being one way in which the reach of the statute is extended to State and local elections to which the term “contributions” does not apply. As was the case earlier with the FECA, there is nothing in BCRA that would indicate an intent on the part of Congress to treat disbursements for State or local elections any differently than it now treats expenditures for Federal elections. Therefore, the Commission in the regulations proposes to treat “donations” and “disbursements” in the same parallel fashion as it has treated “contributions” and “expenditures” in the past.

Consequently, proposed 11 CFR 110.20(d) would also prohibit disbursements by foreign nationals whether or not they are made for electioneering communications. Comments are sought as to whether a definition of “disbursement” using language similar to that in 11 CFR 300.2(d) should be included in 11 CFR 110.20.

The FECA prohibits foreign nationals from making any contribution or donation to national party committees, including donations for the purchase or construction of an office building. See 2 U.S.C. 441e. In addition, new 11 CFR 300.35(a) explicitly provides that the prohibitions in BCRA against contributions and donations by foreign nationals do not permit party committees to spend funds contributed or donated by foreign nationals for the purchase or construction of State or local party committee office buildings. Final Rule and Explanation and Justification, 67 FR 49101, 49127 (July 29, 2002). The Explanation and Justification for 11 CFR 300.35 indicates that this prohibition on foreign national funding also extends to in-kind contributions or donations. Consistent with new 11 CFR 300.35(a), the Commission proposes to add paragraph (f) to 11 CFR 110.20 to explicitly state that foreign nationals are prohibited from making contributions or donations to committees of a political party for the construction or purchase of any office building.

BCRA prohibits any person from soliciting, accepting, or receiving from a foreign national a contribution or donation made in connection with a Federal, State, or local election, or made to a party committee. 2 U.S.C. 441e(a)(2). However, both the former and the current foreign national prohibitions in 2 U.S.C. 441e are silent as to the degree of knowledge, if any, that such person should be shown to have had regarding the foreign national status of the contributor or donor before the person will be deemed to have violated the statute. In contrast, other parts of FECA and BCRA expressly provide that knowledge is an element of the violation. 6

The Commission in recent years has addressed the issue of required knowledge in a number of complex enforcement matters arising under former 2 U.S.C. 441e(a). In these matters, the Commission has confronted the questions of whether the statute or the First Amendment requires a person to have had knowledge of the contributor or donor's foreign national status in order to have been in violation of the foreign-national prohibition, and, if so, what degree of knowledge was required. Should, for example, actual knowledge at the time of a solicitation or receipt have been a prerequisite for a violation, or should the person have been required to follow up on certain factors that would have raised the suspicions of an objective observer?

Whether the foreign national prohibition as amended by BCRA contains a knowledge requirement is an important issue that may affect the implementation of this prohibition. One alternative is to assume, given the silence in both FECA and BCRA on this question, that Congress intended this to be a strict liability statute. The fact that Congress has used “knowingly” in other provisions of FECA and BCRA but did not include this standard with regard to the solicitation, acceptance or receipt of foreign national contributions and donations could be construed as intent not to require knowledge in this regard. However, an exception to the plain meaning rule is that it is not applied when an injustice would result. Sutherland Statutory Construction 47:25. Based upon Commission enforcement experience with political committees, and, in particular, with the involvement of volunteers in the solicitation and receipt of contributions and donation, a knowledge requirement, and related standards for the levels of knowledge to be required, may produce a less harsh result than a strict liability standard. Proposed 11 CFR 110.20(g), discussed below, would include a knowledge requirement with three different degrees of knowledge. Comments are sought regarding the addition of a knowledge requirement and of standards to be applied in determining whether such knowledge existed in a particular situation.

Additionally, the foreign national prohibition raises issues concerning the liability of persons who knowingly assist foreign nationals in making contributions or donations. Recently the Commission has addressed situations in which the liability of someone who served as a conduit or intermediary for a foreign national contribution was in question because he or she had not technically solicited, accepted or received the contribution at issue. Section 441e of FECA does not explicitly address those who assist others to violate its prohibition on foreign national contributions and donations. However, the Commission has taken the position in enforcement matters that, because 2 U.S.C. 441e prohibits foreign nationals from making contributions directly or through another person, and because the statute also prohibits persons from soliciting, accepting or receiving such contributions or donations, even a U.S. citizen's use of money acquired from a foreign national is prohibited, if that money was acquired for the purpose of enabling the foreign national to make political contributions.

Accordingly, proposed 11 CFR 110.20(g)(1) would prohibit any person from knowingly soliciting, accepting or receiving a contribution or donation from a foreign national. Proposed 11 CFR 110.20(g)(2) would prohibit any person from knowingly acting as a conduit or intermediary for receipt of a contribution or donation from a foreign national. Proposed 11 CFR 110.20(g)(3) would prohibit any person from knowingly providing substantial assistance with regard to the making of a contribution or donation by a foreign national.

Proposed paragraph (g)(4) would set forth the standards to be applied in determining whether the knowledge required by proposed paragraphs (g)(1), (2), and (3) exists in particular situations. Proposed paragraph (g)(4)(i) through (iii) would provide three alternative ways, any one of which would establish that a person has knowingly solicited, accepted or received a contribution or donation from a foreign national, or that a person knowingly acted as a conduit or intermediary for a foreign national to make a contribution or donation.

The first knowledge standard at proposed paragraph (g)(4)(i) would be that of actual knowledge. The second standard at proposed paragraph (g)(4)(ii) would require awareness on the part of the person soliciting, accepting or receiving a contribution or donation of certain facts that would lead a reasonable person to conclude that there is a substantial probability that the contribution or donation has come from a foreign source. This second standard would be in effect a “reason to know” standard, and is different from a “should have known” standard. Restatement (Second) of Agency, sec. 9, cmts. d and e (1958). The third standard at proposed paragraph (g)(4)(iii) would address situations in which the person soliciting, accepting or receiving a contribution is or becomes aware of facts that should have led any reasonable person to inquire about the status of the contributor or donor; however, the solicitor or recipient failed to so inquire. This third alternative would be in effect a willful blindness standard covering situations in which a known fact may not equal a substantial probability of illegality but at least should prompt an inquiry. Proposed paragraph (g)(5) would set out several categories of facts that are intended to be illustrative of the types of information that should lead a recipient to question the origins of a contribution or donation under proposed paragraph (g)(4)(ii) or (iii).

Comments are requested as to whether the standards or levels of knowledge at proposed paragraph (g)(4) are appropriate and whether there are other potential facts that should be added to those at proposed paragraph (g)(5). Further, comments are requested as to whether the regulation should expressly require that recipient candidates and committees actively seek information about the nationality of contributors and donors whenever one of the factors listed is at issue.

Current Commission regulations provide that political committee treasurers shall examine all contributions received for evidence of illegality. See 11 CFR 103.3(b). Contributions that “present genuine questions” as to whether they were made by corporations, labor organizations, foreign nationals, or other prohibited sources may, within 10 days of receipt, either be deposited or returned to the contributor. Id. If any such contribution is deposited, the treasurer has an affirmative duty to investigate the contribution and use best efforts to determine the legality of the contribution. 11 CFR 103.3(b)(1). If, despite such due diligence, the treasurer is unable to determine the legality of the contribution within 30 days, the treasurer is required to refund the contribution to the contributor. Id .

If a treasurer of a political committee later discovers that a contribution is illegal based on new information that was not available at the time the contribution was received and deposited, the treasurer must refund the contribution to the contributor within 30 days of the date in which the illegality is discovered. 11 CFR 103.3(b)(2). This provision applies “to contributions from foreign nationals or Federal contractors when there is no evidence of illegality on the face of the contributions themselves.” Explanation and Justification, 52 FR 760, 768-69 (Jan. 9, 1987).

In light of BCRA's new statutory provisions regarding the foreign-national ban, the Commission seeks comment on when political committees and their treasurers have an affirmative duty to investigate contributions and donations to confirm that they do not come from foreign sources. Specifically, the Commission seeks comment on whether such an affirmative duty is limited to circumstances when contributions and donations “present genuine questions” as to whether they are lawful, as outlined in 11 CFR 103.3. Are there additional circumstances when such an affirmative duty arises? Are the circumstances limited to when there is “evidence of illegality on the face of the contributions themselves” (Explanation and Justification, 52 FR at 768-69) or when the political committee otherwise has specific, credible information at the time of the contribution indicating that the contribution may be from a foreign source? See proposed 11 CFR 110.20(g)(5) (identifying specific factual circumstances). Should the Commission consider creating any safe harbors within which political committees are deemed to have satisfied whatever affirmative duty exists to investigate contributions or donations to confirm that they do not come from foreign sources? One possible safe harbor could be for political committees who acquire proof of U.S. citizenship (such as copies of U.S. passports) for donors who reside outside the United States or who list a foreign address or who make a contribution or donation through a foreign bank. If a political committee later discovers that a contribution or donation is illegal based on new information that was not available at the time the contribution or donation was received and deposited, is the political committee immunized from liability under section 303 of BCRA, provided that the political committee refunds the contribution or donation within 30 days of the date in which the illegality is discovered pursuant to 11 CFR 103.3(b)(2)? Comments are sought on all of these issues.

In addition, comments are sought as to whether the Commission should incorporate into proposed § 110.20(g) the definition of “solicit” in 11 CFR 300.2(m), 7 whether it should leave the term undefined, or whether it should give the term a more expansive or a narrower reading in this context.

Proposed 11 CFR 110.20(h) would retain the current prohibition at 11 CFR 110.4(a)(3) on participation by foreign nationals in the decision-making process of any person, including entities such as corporations, labor organizations or political committees, related to Federal and non-Federal election-related activities. Foreign nationals would thus continue to be prohibited from taking part in decisions about contributions to any candidates or committees and about expenditures made in support of, or in opposition to, such candidates or committees. Foreign nationals would also continue to be prohibited from involvement in the direct management of a political committee, including a separate segregated fund and a non-connected committee.

Proposed new 11 CFR 110.20(i) would retain the definition of “foreign national” currently found at 11 CFR 110.4(a)(4). Proposed 11 CFR 110.20(i)(1) and (2) would include the current exemptions for certain foreign principals as provided in 22 U.S.C. 611(b) and for permanent resident aliens as defined in 8 U.S.C. 1101(a)(20). At proposed 11 CFR 110.20(i)(3), however, the definition of “foreign national” would be narrowed by the exclusion of U.S. nationals as they are in turn defined in 8 U.S.C. 1101(a)(22). 8

Proposed new 11 CFR 110.20(j) would define “election” for purposes of this section. Although “election” is defined at 11 CFR 100.2, the definition at that section is stated expressly in terms of Federal elections. New 11 CFR 110.20(j) would extend the overall definition to include elections at all political levels.

Section 308 of BCRA amends section 510 of Title 36, United States Code, to prohibit Presidential inaugural committees from accepting donations from foreign nationals as defined in 2 U.S.C. 441e(b). 36 U.S.C. 510(c). Although section 308 does not amend Title 2, United States Code, its prohibition on donations by foreign nationals to Presidential inaugural committees, including its reference to the definition of “foreign national” in the Act, fits naturally within 11 CFR 110.20. Therefore, proposed new 11 CFR 110.20(c) has been created for this purpose.

Section 308 does not include a prohibition against the making of donations to Presidential inaugural committees by foreign nationals. Comments are sought as to whether the regulations should include a prohibition in this regard.

Current 11 CFR 110.9, entitled “Miscellaneous provisions,” includes four paragraphs that address: (a) Violations of the contribution limitations; (b) fraudulent misrepresentations; (c) price index increase; and (d) voting age population. Because this rulemaking and other BCRA rulemaking projects  9 would amend and move the provisions on fraudulent misrepresentation, the price index increase, and voting age population, only paragraph (a) of § 110.9, addressing violations of the contribution limitations, would remain. Therefore, the proposed rules would amend § 110.9 so that it contains only the provisions of paragraph (a) and the title of § 110.9 would be amended to “Violations of limitations” to reflect that change.

The proposed rules would also add the word “knowingly” in two places pertaining to the acceptance of contributions in violation of the limitations and prohibitions set forth in 11 CFR part 110. This revision would better reflect the knowledge requirement in 2 U.S.C. 441a(f) and 441f.

The Commission certifies that the attached proposed rules, if promulgated, will not have a significant economic impact on a substantial number of small entities. The basis of this certification is that the national, State, and local party committees of the two major political parties are not small entities under 5 U.S.C. 601 because they are not small businesses, small organizations, or small governmental jurisdictions.

Minors and most of foreign nationals are individuals, and therefore, not small entities. Furthermore, the proposed rules, which are based on statutory language, clarify and describe in further detail the already existing ban on contributions by foreign nationals. Additionally, to the extent that there may be foreign nationals that may fall within the definition of “small entities,” their numbers are not substantial, particularly the number that would make a donation, expenditure, independent expenditure, or disbursement in connection with a Federal, State, or local election.

In addition, the small entities to which the rules would apply would not be unduly burdened by the proposed increased contribution levels, which would give such small entities more latitude in the amount they contribute. The increase in contribution limits for individuals and national party committees would not create a burden for them even if they were small entities.

For reasons set out in the preamble, it is proposed to amend subchapter A of chapter I of title 11 of the Code of Federal Regulations as follows:

On September 19, 1989, the FAA published Notice of Proposed Rulemaking No. 89-25 (54 FR 38610) to propose an amendment to 14 CFR part 25, and invited public comment on the issue of engine cowling retention. Section 25.1193, Cowling and nacelle skin, addresses the design of engine cowlings, but does not address the single failure of a latch or hinge, or an improperly fastened latch. Several in- flight incidents of engine cowling separation resulted in damage to airplanes and property on the ground, and highlighted the need to re-evaluate the design and maintenance requirements applicable to engine cowlings. Notice No. 89-25 proposes to specify standards for failsafe criteria in the design of engine cowling retention systems, which would enable the systems to withstand the loss of a single latch and easily detect unlocked or improperly closed latches. The comment period for Notice No. 89-25 closed March 19, 1990.

Fifteen commenters responded to the NPRM. In general, most commenters are in favor of the proposed requirement for direct visual inspection of cowling retention systems, and are not in favor of the proposed cockpit visual warning system. A few commenters suggest additional enhancements to the proposal.

Four commenters favor direct visual inspection of the cowling but oppose the cockpit visual warning system. One of these commenters states that the direct visual inspection makes redundant the proposed addition of a cockpit visual warning system. Another opposes the cockpit visual warning system stating that the system would not be justified economically or functionally. Others state that the cockpit visual warning system would be impractical, introduce the potential for false signal indications, add complexity, and increase potential for failures detrimental to safety.

One commenter states that the real problem is inadequate preflight inspections. Another commenter notes concern about the clarity of terms, and the low probability of a double failure condition of an engine fire and an unlatched latch. An additional commenter considers the fundamental problem to be the lack of preload and resulting wear, plus any accidental damage done while opening or closing the latch. In response to commenters' interest in direct visual inspections, the FAA continues to require pilots to determine that an aircraft is in a condition safe for flight and encourage an on-going focus on appropriate preflight inspections to uphold safety standards.

Commenters also express concern about harmonization of any engine cowling requirements. The withdrawal of Notice No. 89-25 will allow the FAA to consider harmonization concerns and address the issues more completely in future regulatory actions in consideration of recommendations developed within ARAC.

The International Civil Aviation Organization (ICAO) established the International Standards and Recommended Practices to promote international cooperation towards the highest possible degree of uniformity in regulations and standards. The FAA and the Joint Aviation Authorities (JAA) of Europe came together to standardize their respective codes of regulation and identified a number of significant regulatory differences. Both consider harmonization a high priority. The FAA tasked ARAC with the harmonization effort. In 1999, the FAA and JAA agreed on a Fast Track Harmonization Program to expedite the standardization process. ICAO Resolution A29-3, Global Rule Harmonization, urges States to take positive action to promote global harmonization of national rules for application of ICAO standards. The FAA actively supports ICAO initiatives and programs to achieve a safe and efficient aviation system worldwide.

The FAA is involved in eliminating unnecessary differences and harmonizing where practical similar requirements with the JAA and Transport Canada. The FAA finds that including the issues of Notice No. 89-25 within harmonization efforts assigned to ARAC will contribute to a more complete analysis of the issues and will better serve the public interest. We will propose future changes to the Code of Federal Regulations to achieve harmonization through an NPRM with an opportunity for public comment. Therefore, the FAA withdraws Notice No. 89-25, (54 FR 38610) published September 19, 1989.

On May 12, 1987, the FAA published Notice of Proposed Rulemaking No. 87-3 (52 FR 17890) to propose an amendment to part 25 of title 14, Code of Federal Regulations, and invited public comment on the subject of a low fuel quantity alerting system. Notice No. 87-3 proposes to amend airworthiness standards for transport category airplanes by requiring a means to alert the flight crew to potentially unsafe low fuel quantities. The alerting system would be required to be independent of the normal fuel quantity measurement system, and the alert would have to occur with no less fuel remaining than that required to operate for 30 minutes at normal cruising conditions. The comment period closed September 9, 1987.

Ten comments were received in response to the NPRM. In general, most commenters were in favor of the NPRM for the low fuel quantity alerting system, with a few commenters suggesting additional enhancements to the proposal.

Of the commenters that express support for the proposal, one urges a similar rule change to parts 23, 121, and 135 of title 14 of the Code of Federal Regulations. Of the commenters who feel additional technology is warranted, one recommends a review and application to existing aircraft, another recommends an annual calibration check of the system, and another offers some design considerations. Several commenters find the cost estimation to be underestimated in the NPRM.

Two commenters support the proposal and state that the phrase “30 minutes at normal cruising conditions” needs clarification. Another two commenters object to the same phrase, but oppose the proposal, because it only applies to one configuration and one altitude. Both of these commenters assert that the proposal should only apply to air carriers whose aircraft weigh over 75,000 pounds.

The FAA acknowledges these contributions to the rulemaking process, and affirms its commitment to aviation safety by continuing to clarify, update, and harmonize its regulations. We will address any remaining concerns in future regulatory actions as we pursue global harmonization of aviation regulations.

The International Civil Aviation Organization (ICAO) established the International Standards and Recommended Practices to promote international cooperation towards the highest possible degree of uniformity in regulations and standards. Thirty-two States and authorities joined in the goal of standardization.

The FAA and the Joint Aviation Authorities (JAA) of Europe came together to standardize their respective codes of regulation and identified a number of significant regulatory differences. Both consider harmonization of the two codes a high priority. In 1999, the FAA and JAA agreed on a Fast Track Harmonization Program to expedite the standardization process. ICAO Resolution A29-3, Global Rule Harmonization, urges States to take positive action to promote global harmonization of national rules for application of ICAO standards. The FAA actively supports ICAO initiatives and programs to achieve a safe and efficient aviation system worldwide.

The FAA is involved in eliminating unnecessary differences and harmonizing, where practical, similar requirements with Europe and Transport Canada. We find that including the issues of Notice No. 87-3 within harmonization efforts assigned to ARAC will contribute to a more complete and current analysis of the issues that will better serve the public interest. In addition, future regulatory action will allow the public to benefit from the inclusion of technological advances relevant to the issues. To achieve harmonization goals and address technological issues, we will propose future changes to the Code of Federal Regulations through an NPRM with opportunity for public comment. Therefore, the FAA withdraws Notice No. 87-3 (52 FR 17890), published May 12, 1987.

Interested persons are invited to participate in the making of the proposed rule by submitting such written data, views, or arguments as they may desire. Communications should identify the Rules Docket number and be submitted in triplicate to the address specified above. All communications received on or before the closing date for comments, specified above, will be considered before taking action on the proposed rule. The proposals contained in this document may be changed in light of the comments received.

Comments are specifically invited on the overall regulatory, economic, environmental, and energy aspects of the proposed 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 summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their mailed comments submitted in response to this proposal must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. 99-SW-80-AD.” The postcard will be date stamped and returned to the commenter.

A proposal to amend 14 CFR part 39 to add an AD for certain BHTC helicopters was published as a Notice of Proposed Rulemaking (NPRM) in the Federal Register on April 19, 2000 (65 FR 20927). That NPRM proposed inspecting the tailboom skins for a crack; replacing any cracked tailboom with an airworthy modified tailboom; modifying the tailboom within the next 300 hours time-in-service (TIS); and inspecting the modified tailboom for a crack at intervals not to exceed 1200 hours TIS. That NPRM was prompted by several reports of cracked tailbooms found during mandatory inspections. That condition, if not corrected, could result in separation of the tailboom from the helicopter and subsequent loss of control of the helicopter.

Since issuing that NPRM, the FAA has received comments from two commenters, the manufacturer and an operator, requesting changes to the proposed actions. We have considered all these comments.

Both commenters state that the proposed compliance time for modifying the tailboom within 300 hours TIS should be increased to 600 hours TIS or no later than December 31, 2000, whichever occurs first, to coincide with the compliance times in the applicable ASB. The commenters state that changing the compliance time would give the manufacturer time to deliver the required secondary parts to modify the tailboom and eliminate considerable replanning by operators of their maintenance programs. Also, the commenters state that the repetitive inspections required before modifying the tailboom will ensure safety until the modification is done.

The FAA agrees with the comments, however, the December 31, 2000, date has passed. Further, since publication of the NPRM, the manufacturer has revised their ASB and changed the compliance time to March 31, 2002. That date has also passed. Because of these delays, we have reevaluated the need for modifying the tailboom within 300 hours time-in-service (TIS). We now believe that a compliance time of 600 hours TIS is sufficient to meet our safety objectives.

One commenter states that the compliance time should change because a redesigned tailboom, part number (P/N) 206-033-004-181, is now manufactured with the required skin doubler hot-bonded in place. The FAA agrees and will add a statement in the proposal that installing an airworthy, redesigned tailboom, P/N 206-033-004-181, is terminating action for the requirements of the AD.

Another commenter states that the AD should inform operators that modifying the tailboom in accordance with earlier versions of the referenced ASB is acceptable (the proposal referenced Revision D of BHTC ASB 206L-99-115). The FAA agrees because changes to the original ASB are minor and do not change or compromise the previous engineering approval. Therefore, the proposal will include a note stating that modifying the tailboom in accordance with earlier versions of the referenced ASB is acceptable.

Finally, a commenter advised us that the phone and fax numbers listed for obtaining service information is incorrect; we have corrected those numbers in this proposal.

Since these changes expand the scope of the originally proposed rule and the previous NPRM has been published for more than 2 years, the FAA has determined that it is necessary to reopen the comment period to provide additional opportunity for public comment.

The FAA estimates that this proposed AD would affect 1546 helicopters of U.S. registry. The FAA also estimates that this proposed AD would require 52 work hours to accomplish the proposed actions, an average labor rate of $60 per work hour, and $22,954 for parts. Based on these figures, the total cost impact of the proposed AD on U.S. operators is estimated to be $40,310,404, assuming all the tailbooms are replaced.

The regulations proposed herein would 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 proposal would not have federalism implications under Executive Order 13132.

For the reasons discussed above, I certify that this proposed regulation (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) if promulgated, will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A copy of the draft regulatory evaluation prepared for this action is contained in the Rules Docket. A copy of it may be obtained by contacting the Rules Docket at the location provided under the caption ADDRESSES .

Accordingly, pursuant to the authority delegated to me by the Administrator, the Federal Aviation Administration proposes to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) as follows:

The FAA invites comments on this proposed rule. You may submit whatever written data, views, or arguments you choose. You need to include the rule's docket number and submit your comments to the address specified under the caption ADDRESSES . We will consider all comments received on or before the closing date. We may amend this proposed rule in light of comments received. Factual information that supports your ideas and suggestions is extremely helpful in evaluating the effectiveness of this proposed AD action and determining whether we need to take additional rulemaking action.

The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this proposed rule that might suggest a need to modify the rule. You may view all comments we receive before and after the closing date of the rule in the Rules Docket. We will file a report in the Rules Docket that summarizes each contact we have with the public that concerns the substantive parts of this proposed AD.

If you want FAA to acknowledge the receipt of your mailed comments, you must include a self-addressed, stamped postcard. On the postcard, write “Comments to Docket No. 2002-CE-21-AD.” We will date stamp and mail the postcard back to you.

The Civil Aviation Authority (CAA), which is the airworthiness authority for the United Kingdom, recently notified FAA that an unsafe condition may exist on all Pilatus Britten-Norman BN-2, BN-2A, BN-2B, BN-2T, and BN2A MK. III series airplanes. The CAA reports two occurrences of extensive cracks being found on the bottom corner of the engine mount bracket between the attachment flange and the main bracket. The cracks were found during regular scheduled maintenance.

The manufacturer has determined that this condition is a result of the reinforcing doubler being too close to the flange.

This condition, if not detected and corrected, could result in failure of the engine mount. Such failure could result in the engine separating from the airplane and lead to loss of control of the airplane.

Pilatus Britten-Norman has issued Service Bulletin SB 275, Issue 1, dated November 30, 2001.

The service bulletin includes procedures for inspecting the engine mount bracket for cracks and specifies replacing any cracked bracket.

The CAA classified this service bulletin as mandatory and issued CAA AD Number 005-11-2001, not dated, in order to ensure the continued airworthiness of these airplanes in the United Kingdom.

These airplane models are manufactured in the United Kingdom and are type certificated for operation in the United States under the provisions of section 21.29 of the Federal Aviation Regulations (14 CFR 21.29) and the applicable bilateral airworthiness agreement.

Pursuant to this bilateral airworthiness agreement, the CAA has kept FAA informed of the situation described above.

The CAA AD and the service information allows continued flight if cracks are found in the engine mount bracket that do not exceed certain limits. The applicable service bulletin specifies replacement of the engine mount bracket only if cracks are found exceeding this limit, as does CAA AD 005-11-2001. This proposed AD, if adopted, would not allow continued flight if any crack is found. FAA policy is to disallow airplane operation when known cracks exist in primary structure, unless the ability to sustain ultimate load with these cracks is proven. The engine mount bracket is considered primary structure, and the FAA has not received any analysis to prove that ultimate load can be sustained with cracks in this area.

The FAA has determined that long-term continued operational safety would be better assured by design changes that remove the source of the problem rather than by performing repetitive inspections. With this in mind, we will continue to work with Pilatus Britten-Norman in collecting information to determine whether a future design change may be necessary.

The FAA has examined the findings of the CAA; reviewed all available information, including the service information referenced above; and determined that:

This proposed AD would require you to repetitively inspect the bottom corner of the engine mount bracket for cracks, replace any cracked bracket, return the removed bracket(s) to Pilatus Britten-Norman, and report the return to FAA.

We estimate that this proposed AD affects 126 airplanes in the U.S. registry.

We estimate the following costs to accomplish the proposed inspection for BN-2, BN-2A, and BN-2B, and BN2A MK. III series airplanes:

We estimate the following costs to accomplish the proposed inspection for BN-2T series airplanes:

We estimate the following costs to accomplish any necessary replacements for BN-2, BN-2A, BN-2B, and BN-2T series airplanes that would be required based on the results of the proposed inspection. We have no way of determining the number of airplanes that may need such replacement:

We estimate the following costs to accomplish any necessary replacements for BN2A MK. III series airplanes that would be required based on the results of the proposed inspection. We have no way of determining the number of airplanes that may need such replacement:

The compliance time of this proposed AD is “within the next 500 hours time-in-service (TIS) or within the next 24 calendar months after the effective date of this AD, whichever occurs first.”

We have established the compliance time of this proposed AD in both hours TIS and calendar time. The unsafe condition is dependent upon repetitive airplane operation. However, the recommended maintenance program specifies other actions in this area at intervals not to exceed 2 years. Therefore, the compliance time will ensure that high-time airplanes are inspected within a certain amount of hours TIS and the lower time airplanes would be inspected at the next maintenance event in the affected area. We have determined that this compliance time:

The regulations proposed herein would 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 proposed rule would not have federalism implications under Executive Order 13132.

For the reasons discussed above, I certify that this proposed action (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) if promulgated, will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A copy of the draft regulatory evaluation prepared for this action has been placed in the Rules Docket. A copy of it may be obtained by contacting the Rules Docket at the location provided under the caption ADDRESSES .

Accordingly, under the authority delegated to me by the Administrator, the Federal Aviation Administration proposes to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) as follows:

On July 26, 2002, the National Association of State Utility Consumer Advocates (NASUCA) filed a motion for an extension of time to file comments in response to the Commission's Notice of Inquiry (NOI) issued July 17, 2002, in the above-docketed proceeding. In its motion, the NASUCA states that because the issues presented in the NOI are of such significant importance to the natural gas industry and because of the press of other business, additional time is needed for the preparation of responsive comments. The motion further states that the Process Gas Consumers Group, the Interstate Natural Gas Association of America, the Natural Gas Supply Association and the American Gas Industry support the motion for additional time.

Upon consideration, notice is hereby given that an extension of time for filing comments on the NOI is granted to and including September 25, 2002. Reply comments shall be filed on or before October 25, 2002.

A notice of proposed rulemaking and notice of public hearing that appeared in the Federal Register on Friday, May 31, 2002, announced that a public hearing was scheduled for September 4, 2002 at 10 a.m., in the auditorium of the Internal Revenue New Carrollton Building, at 5000 Ellin Road, Lanham, MD 20706. The subject of the public hearing is proposed regulations under section 167 of the Internal Revenue Code. The deadline for submitting outlines and requests to speak at the hearing for these proposed regulations expired on August 13, 2002.

The notice of proposed rulemaking and notice of public hearing, instructed those interested in testifying at the public hearing to submit a request to speak and an outline of the topics to be addressed. As of August 19, 2002, no one has requested to speak. Therefore, the public hearing scheduled for September 4, 2002, is cancelled.

The Bureau of Alcohol, Tobacco and Firearms (ATF) published Notice No. 946 in the Federal Register on June 27, 2002, announcing the proposed plain language revision of 27 CFR Part 7, Labeling and Advertising of Malt Beverages. Please see Notice No. 946 at 67 FR 43496 for a discussion of the proposed revisions and for the proposed rule language.

As the proposed revision only adopts the plain language style, there is no change in the intent of the regulations from the existing part 7. There are no changes to the authority, scope, or effect of the regulations. The authority for the regulations in part 7 remains 27 U.S.C. 205.

We issued the original requirements in part 7 after an opportunity for notice and comment during the rulemaking process. Since we are proposing to make only stylistic changes and minor technical amendments, we are limiting comments on the proposed rule to the plain language issue.

We request comments from all interested persons. We will carefully consider all comments we receive on or before September 25, 2002. We will give the same consideration to comments we receive after that date if it is practical to do so, but we can give assurance of consideration only to comments we receive on or before September 25, 2002.

Because we only propose to amend these regulations to conform to the plain language style, we are limiting comments to the effects of this change in the regulations' language. Accordingly, comments should be limited to the following questions:

• Does this language have the same effect as the old regulations?

• Does the plain language format effect the operation of the regulations?

• Is this new style helpful or useful?

We will not consider in this rulemaking any comments that go beyond this scope.

We will not recognize any material in comments as confidential, and your comments may be disclosed to the public. You should not include any material that you consider to be confidential or inappropriate for public disclosure. We may disclose the name of any person submitting a comment.

By Mail: You may send written comments by U.S. mail to the address shown above in the ADDRESSES section of this notice.

By Fax: You may submit comments by facsimile transmission to (202) 927-8602. Facsimile comments must reference Notice No. 946 and must:

• Be legible when printed on 8 1/2 ″ x 11″ paper;

• Contain a written signature; and

• Be five pages or less in length (to ensure access to our equipment).

We will not acknowledge receipt of FAX transmittals. We will treat facsimile comments as originals.

By E-Mail: You may submit comments of any length by electronic mail to nprm@atfhq.atf.treas.gov. Electronic mail comments must include:

• A reference to Notice No. 946;

• Your e-mail address; and

• Your name and post office address.

We will not acknowledge receipt of e-mail comments. We will treat e-mail comments as originals.

By On-line Form: You may also submit comments electronically using the comment form provided with the online copy of Notice No. 946 on the ATF Internet web site at http://www.atf.treas.gov/alcohol/rules/index.htm. We will treat comments submitted via the web site as originals.

We will summarize and discuss pertinent comments in the preamble to any subsequent notices or the final rule published as a result of the comments. We will not acknowledge receipt of comments or reply to individual comments.

You may view copies of the comments on Notice No. 946 by appointment at the ATF Reference Library, Room 6480, 650 Massachusetts Avenue, NW., Washington, DC 20226, telephone (202) 927-7890. You may request copies of the comments (at 20 cents per page) by writing to the ATF Reference Librarian at the address shown above.

For the convenience of the public, ATF will post comments received in response to Notice No. 946 on the ATF web site. All comments posted on our web site will show the name of the commenter, but will have street addresses, telephone numbers, and e-mail addresses removed. We may also omit voluminous attachments or material that we do not consider suitable for posting. In all cases, the full comment will be available in the ATF library as noted above. To access online copies of the comments on this rulemaking, visit http://www.atf.treas.gov/ , select “Regulations,” and then “Notices of proposed rulemaking (Alcohol).” Then click on the “View Comments” button for Notice No. 946.

The principal author of Notice No. 946 is William H. Foster, and the author of this notice is Michael D. Hoover, Bureau of Alcohol, Tobacco and Firearms.

This notice is issued under the authority contained in 27 U.S.C. 205.

You may submit comments in response to this notice by (1) hard copy, or (2) FAX transmission (facsimile), or (3) electronically through the OSHA Webpage. Please note that you cannot attach materials, such as studies or journal articles, to electronic comments. If you have additional materials, you must submit three copies of the materials to the OSHA Docket Office at the address above. The additional materials must clearly identify your electronic comments by name, date, subject and docket number so we can attach them to your comments. Because of security-related problems there may be a significant delay in the receipt of comments by regular mail. Contact the OSHA Docket Office at (202)-693-2350 for information about security procedures concerning the delivery of materials by express delivery, hand delivery and messenger service.

All comments and submissions will be available for inspection and copying at the OSHA Docket Office at the above address. Comment and submissions posted on OSHA's Web site are available at http://www.osha.gov. OSHA cautions you about submitting personal information such as social security numbers and birth dates. Contact the OSHA Docket Office at (202)-693-2350 for information about materials not available through the OSHA Webpage and for assistance in using the Webpage to locate docket submissions.

Properties and Uses. Chromium exists in several oxidation states. Its most important natural source is as the mineral chromite (FeOCr 2 O 3 ). Common forms of chromium compounds are trivalent chromium (CrIII), and hexavalent chromium (CrVI). CrVI can be produced when CrIII is heated in the presence of mineral bases and oxygen. Such a change (from CrIII to CrVI) also occurs as a by-product of welding or cutting operations on stainless steel. In addition, a portion of CrIII used in refractory bricks can convert to CrVI during normal furnace operations.

CrVI compounds are characterized by high melting points, very high boiling points, varying solubilities, a wide array of colors, corrosion resistance and resistance to acid. These properties make chromium ideal for use in such widely diversified products as corrosion-resistant materials, pigments, coatings, metal plating, and chemicals.

Health risks associated with occupational exposure to CrVI. Epidemiologic studies of workers exposed to CrVI have consistently shown a positive correlation between exposure to CrVI and excess lung cancer. See, e.g., Machle and Gregorius (1948, Ex. 7-2); U.S. Public Health Service/Gafafer (1953, Ex. 7-3); Baetjer (1950, Ex. 7-6); Hayes et al (1979, Ex.7-15); Braver (1985, Ex. 7-17); Mancuso (1975, Ex. 18-3; 1997 Exs. 23, 24); and Gibb et al (2000, Ex. 25). The International Agency for Research on Cancer (IARC) (Ex. 18-1) and the U.S. Environmental Protection Agency (EPA) (Ex. 19-1) have classified CrVI as a human carcinogen based on excess lung cancers found in workers involved in chromate production, chromate pigment production, and chromium plating. The American Conference for Governmental Hygienists (ACGIH) classifies water-insoluble and water-soluble Cr IV compounds, zinc chromate, and strontium chromate as class A1 (confirmed human) carcinogens. (2002, ACGIH, TLVs® and BEIs®, Threshold Limit Values for Chemical Substances and Physical Agents and Biological Exposure Indices).

Occupational exposure to CrVI has also been associated with non-cancer health effects of the skin, such as dermatoses and chrome holes; and problems of the respiratory system including nasal septum irritation and perforation.

Occupational health regulation of CrVI exposure. In 1971, OSHA adopted and made applicable to general industry a national consensus standard (ANSI Z37.7-1971) for chromic acid and chromates (compounds that contain chromium in its hexavalent state). 29 U.S.C. 655(a). The general industry standard sets a permissible exposure limit (“PEL”) for hexavalent chromium compounds at 100 micrograms per cubic meter (μg/m 3 ) as a ceiling concentration measured as chromic acid (CrO 3 ), 29 CFR 1910.1000, Table Z-1 and Z-2. In 1971, OSHA also adopted, as its hexavalent chromium standard for construction work, an established federal standard that had been promulgated under the Construction Safety Act, 40 U.S.C. 333. That standard sets a PEL of 100 μg/m 3 (measured as CrO 3 ) as an 8-hour time-weighted average (8-hour TWA) for chromic acid and chromates, 29 CFR.1926.55.

In 1993, the Oil, Chemical and Atomic Workers Union (OCAW) and Public Citizen Health Research Group petitioned OSHA to issue an Emergency Temporary Standard (ETS) to immediately lower the PEL in all workplaces to 0.5 μg/m 3 , measured as an 8-hour TWA. OSHA denied the petition because it failed to satisfy the stringent criteria for an ETS. However, OSHA opened a rulemaking docket and began to collect information that would be relevant to a CrVI rule.

The information available to date indicates that occupational exposures to CrVI presents a number of complex and difficult issues (e.g., data gaps on current usage of and exposure to CrVI, differences in opinion on the interpretation of health effects data). In this notice, OSHA is seeking information to help the agency resolve some of these issues. OSHA believes that affording interested members of the public the opportunity to be heard on these issues would benefit the agency's decisional process.

OSHA requests data, comments, and information on a variety of topics relevant to the agency's review of occupational exposure to CrVI. The topics include: Adverse health effects associated with occupational exposure to CrVI; methods, costs, and effectiveness of control strategies that can reduce exposure to CrVI; and medical management of exposed employees.

The questions below highlight the areas of concern to OSHA. When answering specific numbered questions below, please key your responses to the number of the question, explain the reasons supporting your views, and identify and provide relevant information on which you rely, including, but not limited to, data, studies and articles. The public is also welcome to comment on other issues raised by this notice.

As discussed above, OSHA is aware of a number of studies reporting an association between adverse health effects and exposure to CrVI. In this notice, OSHA is seeking information associated with, and analysis of, the most recent and important studies that the agency can use to evaluate health effects.

(1) What studies (including positive and negative studies) should OSHA consider useful in assessing the potential carcinogenic, mutagenic, and non-carcinogenic health risks of CrVI exposure? Explain your scientific rationale for recommending these studies including potential strengths and weaknesses such as size of the population (or sample) studied, characterization of exposure, and confounding factors.

(2) Are there any recent studies that examine the dermal effects of CrVI exposure?

(3) Are there any studies showing adverse health effects resulting from routes of occupational CrVI exposure other than dermal contact and inhalation? What are those adverse health effects?

(4) Are there any important studies related to the dose response behavior of CrVI, including cellular, mechanistic, and dosimetric considerations? For instance, are any health effects of CrVI dependent on the time period over which exposure occurs rather than dependent on the total cumulative dose received or are there data that suggest CrVI exhibits a threshold effect?

(5) Do short-term peak exposures play a role in causing adverse CrVI health effects? If so, what studies are available that examine these types of effects. How should short-term peak exposures be addressed when evaluating CrVI health effects data? In answering, please consider both animal and human studies.

(6) How should OSHA address animal and epidemiological studies that rely on different analytical methods than are currently available to assess exposure when evaluating the health effects data contained in those studies?

(7) Animal studies are designed to test individual CrVI compounds (e.g., lead chromate, strontium chromate, potassium chromate). Epidemiological studies are designed to evaluate CrVI exposures in individual workplaces or by types of industries (e.g., chromate production, welding, pigment manufacture). Can or should the results from these individually tested compounds or work settings/industries be grouped together to assess the overall toxicity of CrVI or should each compound or industry be analyzed separately? Do different CrVI compounds have specific properties (e.g, solubility) that should be taken into consideration when evaluating animal or human studies?

OSHA is aware of the following risk assessments on human studies of lung cancer among workers exposed to CrVI via inhalation: The 1984 risk assessment prepared by the U.S. EPA (Ex. 19-1); the 1986 risk assessment prepared by Gibb et al. (Ex. 7-102); and the 1995 risk assessment by K.S. Crump Division (Ex. 13-5). These risk assessments relied heavily on the epidemiologic studies conducted by Mancuso (1975, Ex. 18-3) and Hayes et al. (Ex. 1979, Ex. 7-15). Since these risk assessments, Gibb et al. (2000, Ex. 25) has updated the investigation of the cohort originally studied by Hayes et al. (Ex. 7-15). This study notes limitations in the Mancuso data. OSHA is seeking the best available data to use in assessments of occupational risks of CrVI-related adverse health effects to CrVI-exposed workers. OSHA is especially interested in studies of occupational exposure that quantify exposure data and control for important confounding variables, have good statistical power, and are well conducted.

(8) Do the EPA (Ex. 19-1), the Gibb et al (Ex. 7-102) and the K.S. Crump (Ex. 13-5) risk assessments adequately characterize the lung cancer risks of CrVI? Please provide your rationale including information on studies selected and risk assessment methodology.

(9) What approaches (i.e., methods, models, data used) should OSHA use for estimating risk of CrVI exposure?

(10) Are there biological endpoints, besides lung cancer, that could or should be used to estimate the occupational risk to CrVI-exposed workers?

(11) What mathematical models are appropriate to quantify the risk of cancer or other adverse health effects associated with exposure to CrVI? What are the strengths and weaknesses of those models?

(12) Animal studies can add value to a risk assessment in areas such as dose-response. What, if any, animal studies are appropriate for use in a CrVI risk assessment? Which animal species, tumor incidences, route(s) of administration, and dose level(s) would be most appropriate.

(13) When extrapolating from animal studies, what additional corrections, if any, should be made to account for the route of exposure used in the study (e.g., topical application, injection, inhalation)?

(14) What other factors should OSHA take into consideration when analyzing risks associated with exposure to CrVI at the current permissible exposure level and in determining safe levels of exposure to CrVI?

In June 1998, OSHA revised and validated its analytical method “ID-215” to evaluate airborne occupational exposures of CrVI (Ex. 29). The method, ID-215, is very sensitive, with a qualitative detection limit of 0.001 ug/m 3 for a 960 liter air sample. The quantitative detection limit is 0.003 ug/m 3 for a 960 liter air sample.

Method ID-215 is an improvement over prior analytical methods for airborne CrVI. Prior methods may have been subject to greater interference from other heavy metals. In addition, reducing agents such as Fe(II) could convert CrVI to CrIII and thus reduce the amount of CrVI reported as measured.

(15) Are there methods other than ID-215 for measuring exposure levels in the range of 0.02 to 10 ug/m 3 that would be as accurate as, or more accurate than, OSHA's ID-215?

(16) Are there methods for conducting wipe samples?

(17) Are there methods for conducting field-tests?

(18) Are there methods to determine the presence or absence of CrVI in buildings for which no blueprints are in existence?

In 1994, OSHA contractor Meridian Research, Inc. delivered to the agency a report, Selected Chapters of an Economic Impact Analysis for a Revised OSHA Standard for Chromium VI: Introduction, Industry Profiles, Exposure Profiles, Technological Feasibility (for 6 Industries) and Environmental Impacts. (Ex. 26 ). This report was based, in part, on earlier analyses conducted by Centaur (Ex. 27). The purpose of the Meridian report was to “evaluate the impact a revision of the Occupational Safety and Health Administration (OSHA) standard for CrVI may have in the principal industries that would be affected by the new standard” and to “[identify] the potentially affected industries, [discuss] the structure of these industries, [determine] the size of the population at risk, [identify] current levels of exposure, and [describe] some of the economic impacts potentially associated with a reduction in CrVI exposures.”

Meridian identified many industries with potential CrVI exposure for which Meridian was unable to provide full information. For example, OSHA lacks information on number of employees exposed, number of sites, nature and level of exposures, controls and how CrVI is used in processes for industries such as woodworking, refractory brick production, portland cement uses and leather tanning. Moreover, in the years since the Meridian report, market forces, technological changes and environmental factors have, in varying degrees, altered the magnitude, frequency, and duration of employee exposures in the industries that have traditionally handled CrVI. Because of these trends, some industries have abandoned or dramatically reduced usage of CrVI.

For these reasons, OSHA has worked to obtain additional information on affected industries and workers by utilizing the following sources: (1) Inspection reports collected and summarized within OSHA's computerized Integrated Management Information System; (2) occupational health studies; and (3) data related to site visits conducted by the National Institute for Occupational Safety and Health (NIOSH) under an inter-agency agreement between NIOSH and OSHA. OSHA sought information on patterns of employee exposure, specific routes of exposure, type and cost of engineering controls in particular industries, and types and costs of personal protective equipment. OSHA has worked closely with NIOSH on this update. NIOSH has completed its field surveillance program and has delivered reports on roughly one-half of the sites. It has also summarized exposure data for the remaining sites. (Ex. 28). OSHA requests that the public review the industrial and exposure data reported by Meridian and NIOSH and provide comment on the representativeness of these data. OSHA further requests that the public comment on technological and economic forces that, especially within the last five to ten years, have altered worker exposure to CrVI.

(19) Are the industrial profiles described by Meridian and NIOSH reasonably reflective of current conditions, or have workplace and process conditions and worker activities changed to such an extent that the profiles would need revision? Are there industries or processes with CrVI exposures that are not covered in these reports?

(20) Are the exposure profiles reported by Meridian and NIOSH reasonably representative of affected industry processes or have there been changes in the statistical distribution of worker exposures in those profiles? OSHA requests exposure data that will enable the Agency to expand its current profile of the exposed worker population. For cases where commenters are able to provide exposure data, OSHA requests that, if possible, exposure data be personal samples with clear descriptions of the length of the sample. If this is not possible, the exposure data should clearly indicate the form and length of the exposure. In addition, exposure data that provide information concerning the controls in place are more valuable than exposure data without such information

(21) What are the job categories in which employees are potentially exposed to CrVI in your company or industry? For each job category, provide a brief description of the operation.

(22) How many employees are exposed, or have the potential for exposure, to CrVI in each job category in your company or industry?

(23) What are the frequency, duration and levels of exposures to CrVI at each job category in your company or industry? Include the analytical method and type of samples used for determining exposure levels. For cases where commenters are able to provide exposure data, OSHA requests that, if possible, exposure data be personal samples with clear descriptions of the length of the sample. If this is not possible, the exposure data should clearly indicate the form and length of the exposure.

(24) What engineering controls and types of protective equipment are either in use or available for each job category?

(25) What sampling and analytical methods are currently available to measure CrVI in your workplace? Provide details on the accuracy and precision of the sampling method, the range and limits of detection, the method of validation of sampling and analysis, and chemical interference.

(26) Describe any programs you have implemented for initial monitoring of exposure to CrVI. Do you conduct initial sampling or do you rely on objective data to estimate CrVI exposures? Describe any other programs you have implemented for assessing an employee's initial exposure to CrVI.

(27) Describe any follow-up or subsequent exposure assessments that you conduct. How often do you conduct any such follow-up or subsequent exposure assessments?

(28) Have there been technological changes within your industry that have influenced the magnitude, frequency, or duration of exposure to CrVI and the means by which employers attempt to control exposures? The Agency requests that commenters describe in detail any technological changes within industries that have altered methods of control. Provide direct links between control technologies and data on exposure levels associated with the application of controls.

(29) Have you installed engineering controls or adopted work practices with the purpose of reducing exposure to CrVI? If so, have these controls or work practices resulted in a reduction of CrVI exposure? Please give specific examples where the introduction of controls and work practices have reduced exposure to CrVI.

(30) Has there been a trend to eliminate CrVI from production processes, products and services? If so, OSHA requests that interested parties comment on the success of substitution efforts. In particular, OSHA requests that commenters estimate the percentage reduction in CrVI, and the extent to which CrVI is still necessary in their processes within product lines or production activities. OSHA also requests that commenters describe any technical, economic or other barriers or hindrances to substitution.

(31) The Agency seeks comment on potential impacts of reducing occupational exposures to CrVI, in terms of costs of controls, reduction in illness, cost savings related to accident avoidance, effects on revenue and profit, changes in worker productivity, or any other impact measure that commenters wish to identify. In describing and estimating impacts, please provide explicit examples of costs that could be incurred (e.g., dollar estimates of controls) or benefits that could be achieved (e.g., dollar estimates of medical savings from reduced cases of chromium-related illness).

(32) OSHA requests that commenters provide information on changes in market conditions that could result from reducing employees' exposures to CrVI. Include in your response any changes in market structure or concentration, or effects on domestic or international shipments of chromium-related products or services, that would result from reducing occupational exposures to CrVI.

(33) Are respirators provided to employees in your company or industry to protect against excessive airborne exposure CrVI? Why are they necessary and how are these respirators selected? Identify the type, model number, and manufacturer of such respirators by task.

(34) What other types of protective equipment, such as gloves, aprons, or other clothing, are provided to employees? How is this protective equipment selected?

(35) Under what conditions (e.g., exposure level, type of operations, duration of exposure) are protective equipment and respirators used?

(36) Are there processes or areas where it is infeasible to use respirators or other protective equipment to protect against exposure to CrVI? Describe those situations and explain why it is difficult to use protective equipment. How are employees protected in those situations?

(37) What job categories are included in your training program for reducing risks associated with CrVI exposure? How do you determine which job categories receive training?

(38) Describe the training employees receive, including the length and frequency of the training course, the topics covered, and the availability of training aids such as audio-visual aids and written operating instructions. Also describe any other factors that affect the cost of training and provide any estimate of the cost of training.

(39) How do you determine the effectiveness of the training? Are decreased absenteeism, decreased medical/insurance costs, decreased accident rates/severity, and increased productivity factors in your determination? Are there any other factors in your determination? How are language barriers to training addressed?

(40) Are there ways in which CrVI-related training could be improved?

OSHA is interested in medical programs that employers use or could use in the identification of signs and symptoms of illnesses associated with occupational exposures to CrVI. OSHA is especially interested in those programs focusing on prevention or treatment of CrVI-related injuries or illnesses for employees who have occupational exposure to CrVI.

(41) What medical or clinical examinations have potential usefulness in identifying workers with adverse health effects resulting from occupational CrVI exposure? Include specific tests or procedures used in any such examination and other useful information, such as the types of laboratories used for biological tests, the frequency of examinations and follow-up tests, and the contents of the examinations?

(42) What CrVI-related illnesses or conditions have you observed? What programs do you have in place to detect and refer employees for medical management?

(43) Do you have any information to suggest that the use of an employee medical management program designed to prevent adverse CrVI-related health effects such as “chrome holes” (ulcerations of the skin caused by CrVI) or nasal septum perforations reduces the incidence or prevalence of other CrVI-related effects, such as lung or other cancers?

(44) Are there any studies that suggest that elevated biological indicators (such as CrVI in blood or urine) are associated with an elevated risk of lung cancer or other adverse health effects such as asthma? What are normal levels of chromium in blood or urine in non-occupational exposed populations? Are these indicators affected by diet?

(45) Is there any information that suggests that biological indicators other than CrVI in blood or urine could be appropriate for evaluating risk of adverse health effects associated with CrVI exposures among workers?

(46) Are there any studies that suggest that chromium with other valences, other than in the CrVI valence, can be taken up by the red blood cells?

(47) When you evaluate an employee's chromium-blood levels, do you use whole blood or packed red blood cells? What is the significance of using one over the other?

(48) How do you determine eligibility in your medical screening program?

(49) Provide any information relating reduction in adverse health outcomes to the implementation of medical surveillance programs.

(50) Are your healthcare costs less after medical screening is initiated?

(51) Do you ever remove employees because of illness or injury related to CrVI exposure? If so, describe the circumstances of the removal and potential return. For how long are these employees removed? Are workers ever permanently removed?

(52) Please describe any special medical screening and treatment you conduct for chrome holes, dermatoses, and nasal septal perforations.

The National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321, et seq. ), the Council on Environmental Quality (CEQ) regulations (49 CFR. Part 1500, 43 F.R. 55978, November 29, 1978), and the Department of Labor (DOL) NEPA Compliance Regulations (29 CFR. Part 11); (45 F.R. 51187 et seq. , August 1, 1980) require that OSHA give appropriate consideration to environmental issues and impacts of proposed actions significantly affecting the quality of the human environment. OSHA is currently collecting written information and data on possible environmental impacts that could occur outside of the workplace (e.g., exposure to the community through contaminated air/water, contaminated waste sites, etc.) if the agency were to issue guidance or revise the existing standard for occupational exposure to CrVI. Such information should include both negative and positive environmental effects that could be expected to result from guidance or a revised standard. Specifically, OSHA requests comments and information on the following:

(53) How might reducing occupational exposures to CrVI exposure affect the environment?

(54) What is the potential direct or indirect impact of reducing employee exposure to CrVI exposure on water and air pollution, energy usage, solid waste disposal, and land use?

(55) How would any available CrVI substitutes alter ambient air quality, water quality, solid waste disposal, and land use?

(56) Are there situations in which reducing CrVI exposures to employees would be inconsistent with meeting environmental regulations?

Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), OSHA is required to assess the impact of proposed and final rules on small entities. OSHA requests that members of the small business community, or other parties familiar with regulation of small business, address any special circumstances facing small firms in controlling occupational exposure to CrVI.

(57) How many and what kinds of small businesses or other small entities in your industry could be affected by reducing exposures to CrVI? Describe any such effects.

(58) Are there special issues that make control of CrVI exposures more difficult or more costly in small firms?

(59) Are there any reasons that the benefits of reducing occupational exposure to CrVI might be less in small firms than in larger firms? With regard to potential impacts on small firms, please describe specific concerns that should be addressed. Please describe alternatives that might serve to minimize these impacts while meeting the requirements of the OSH Act.

(60) Are there any federal regulations that might duplicate, overlap or conflict with guidance or a revised standard concerning CrVI? If so, identify which ones and explain how they would duplicate, overlap or conflict.

(61) Are there any federal programs in areas such as defense or energy that might be impacted by guidance or a revised standard concerning CrVI? If so, identify which ones and explain how they would be impacted.

This document was prepared under the direction of John L. Henshaw, Assistant Secretary of Labor for Occupational Safety and Health, U.S. Department of Labor, 200 Constitution Avenue, NW., Washington, DC 20210. It is issued pursuant to sections 4, 6, and 8 of the Occupational Safety and Health Act of 1970 (29 U.S.C. 653, 655, 657), Secretary's Order 3-2000, and 29 CFR Part 1911.

Since revised evaluation criteria for respiratory conditions were established in 1996, the evaluation of most respiratory conditions has been based primarily on the results of specific pulmonary function tests (PFT's). Conditions evaluated on that basis include chronic bronchitis (diagnostic code 6600), pulmonary emphysema (diagnostic code 6603), chronic obstructive pulmonary disease (diagnostic code 6604), interstitial lung disease (diagnostic codes 6825-6833), and restrictive lung disease (diagnostic codes 6840-6845). In some cases, the rating schedule provides alternative evaluation criteria that may be used instead of PFT's. These include measures of the maximum exercise capacity; the presence of pulmonary hypertension (documented by echocardiogram or cardiac catheterization), cor pulmonale, or right ventricular hypertrophy; episode(s) of respiratory failure; and a requirement for outpatient oxygen therapy. Alternative criteria were established in order to provide more than one route to reach a particular level of evaluation and, at the same time, avoid requiring that veterans undergo additional invasive, risky, costly, or time-consuming tests when one or more objective and reliable tests or findings suitable for evaluation purposes are already of record.

Applying the PFT results can be difficult in some cases. We therefore propose to add provisions that would clarify the use of PFT's in evaluating respiratory conditions to 38 CFR 4.96 as paragraph (d), titled “Special provisions for the application of evaluation criteria for diagnostic codes 6600, 6603, 6604, 6825-6833, and 6840-6845.” We developed these provisions after consultation with the Pulmonary/Critical Care Advisory Committee of the Veterans Health Administration.

Chronic bronchitis (diagnostic code 6600) is an example of a respiratory condition that is evaluated primarily on the basis of PFT's but also has alternative evaluation criteria. The criteria for a 100-percent evaluation are FEV-1 (Forced Expiratory Volume in one second) less than 40 percent of predicted value, the ratio of FEV-1 to FVC (Forced Vital Capacity) less than 40 percent, DLCO (SB) (Diffusion Capacity of the Lung for Carbon Monoxide by the Single Breath Method) less than 40-percent predicted, maximum exercise capacity less than 15 ml/kg/min oxygen consumption (with cardiac or respiratory limitation), cor pulmonale (right heart failure), right ventricular hypertrophy, pulmonary hypertension (shown by echocardiogram or cardiac catheterization), episode(s) of acute respiratory failure, or a requirement for outpatient oxygen therapy. The criteria for a 60-percent evaluation are FEV-1 of 40- to 55-percent predicted, FEV-1/FVC of 40 to 55 percent, DLCO (SB) of 40- to 55-percent predicted, or maximum oxygen consumption of 15 to 20 ml/kg/min (with cardiorespiratory limit). The criteria for a 30-percent evaluation are FEV-1 of 56- to 70-percent predicted, FEV-1/FVC of 56 to 70 percent, or DLCO (SB) 56- to 65-percent predicted. The criteria for a 10-percent evaluation are FEV-1 of 71- to 80-percent predicted, FEV-1/FVC of 71 to 80 percent, or DLCO (SB) 66- to 80-percent predicted.

For the first provision, we propose to state when pulmonary function testing is not needed for disability evaluation purposes. The first instance would be when there is a maximum exercise capacity of record that is 20 ml/kg/min or less (which would result in a 60- or 100-percent evaluation). Although this test is not routinely done, and not all facilities have the necessary equipment to conduct the test, if available, it is a reliable and precise way to assess respiratory disability, so it may be used to evaluate when it is available and is reported at levels that would warrant a 60- or 100-percent evaluation. If not of record, however, evaluation will be based on alternative criteria. The second instance would be when pulmonary hypertension (documented by an echocardiogram or cardiac catheterization), cor pulmonale, or right ventricular hypertrophy has been diagnosed. Any of these would result in a 100-percent evaluation. The third instance would be when there is a history of one or more episodes of acute respiratory failure, and the fourth instance would be when there is a requirement for outpatient oxygen therapy, because either of these also establishes entitlement to a 100-percent evaluation.

Routine pulmonary function testing may or may not include a measurement of DLCO (SB) (Diffusion Capacity of the Lung for Carbon Monoxide by the Single Breath Method). The DLCO (SB) is not useful or valid in assessing every respiratory condition (for example, it is not valid in cases where the lung volume is decreased), so it is up to the examiner to assess whether it would provide useful information in a particular case. We therefore propose to add a second provision that would state that if the DLCO (SB) is not of record, evaluation will be based on alternative criteria as long as the examiner states why the DLCO (SB) would not be useful or valid in a particular case.

The third provision directs that when the PFT's are not consistent with the clinical findings, evaluation will be based on the PFT's unless the examiner states why they are not a valid indication of respiratory functional impairment in a particular case. The rationale for this is that PFT's are reliable, objective tests, and the respiratory system evaluation criteria have been revised in part to remove subjective assessment criteria, such as self-reported symptoms, in order to ensure consistent ratings. The PFT-based criteria are similar to the method of assessing impairment due to respiratory disease used by the American Thoracic Society and the American Medical Association Guides to the Evaluation of Permanent Impairment, 5th ed. (2001).

The fourth provision states that post-bronchodilator studies are required when PFT's are done for disability evaluation purposes except when the results of pre-bronchodilator pulmonary function tests are normal or when an examiner determines that post-bronchodilator studies should not be done and states why (for example, because the patient is allergic to the bronchodilator). The American Lung Association/American Thoracic Society Component Committee on Disability Criteria recommends testing for pulmonary function after optimum therapy.

The fifth provision also applies to post-bronchodilator studies and states that when evaluating based on PFT's, the post-bronchodilator results (rather than pre-bronchodilator results) will be used in applying the evaluation criteria in the rating schedule unless the post-bronchodilator results were poorer than the pre-bronchodilator results. In those cases, the pre-bronchodilator values will be used. The American Lung Association/American Thoracic Society Component Committee on Disability Criteria recommends testing for pulmonary function after optimum therapy. The best possible pulmonary function (which is ordinarily post-bronchodilator functioning) is the basis of standards for pulmonary function testing. If the bronchodilator has a contrary effect, the best pulmonary function would be the pre-bronchodilator functioning.

The sixth provision addresses cases in which there is a disparity between the results of different PFT's (FEV-1, FVC, etc.), so that the level of evaluation would differ depending on which test result is used to evaluate. In such cases, the test result that the examiner states most accurately reflects the level of disability would be used to evaluate.

The seventh provision states that a decreased FEV-1/FVC ratio will be considered normal if the FEV-1 is greater than 100 percent. In that case, both the FVC and the FEV-1 would be high (better than normal), so a decreased ratio would not indicate pathology.

In 38 CFR 4.104 (Schedule of ratings—cardiovascular system), diagnostic codes 7000 (valvular heart disease), 7001 (endocarditis), 7002 (pericarditis), 7003 (pericardial adhesions), 7004 (syphilitic heart disease), 7005 (arteriosclerotic heart disease), 7006 (myocardial infarction), 7007 (hypertensive heart disease), 7011 (ventricular arrhythmias (sustained)), 7015 (atrioventricular block), 7016 (heart valve replacement), 7017 (coronary bypass surgery), 7018 (implantable cardiac pacemakers), 7019 (cardiac transplantation), and 7020 (cardiomyopathy) have almost identical evaluation criteria. As in the case of respiratory conditions, there are alternative criteria for evaluation at some levels, and some criteria are based on the results of special tests. For example, the evaluation criteria for diagnostic code 7000, valvular heart disease, are, in part, as follows: for a 100-percent evaluation, chronic congestive heart failure, workload of 3 METs (metabolic equivalents) or less results in dyspnea, fatigue, angina, dizziness, or syncope, or left ventricular dysfunction with an ejection fraction of less than 30 percent; for a 60-percent evaluation, more than one episode of acute congestive heart failure in the past year, workload of greater than 3 METs but not greater than 5 METs results in dyspnea, fatigue, angina, dizziness, or syncope, or left ventricular dysfunction with an ejection fraction of 30 to 50 percent; for a 30—percent evaluation, workload of greater than 5 METs but not greater than 7 METs results in dyspnea, fatigue, angina, dizziness, or syncope, or evidence of cardiac hypertrophy or dilatation on electro-cardiogram, echocardiogram, or X-ray; and for a 10-percent evaluation, workload of greater than 7 METs but not greater than 10 METs results in dyspnea, fatigue, angina, dizziness, or syncope, or continuous medication required.

There are many tests that can assess cardiac function, as the presence of alternative criteria at various levels indicates. Which ones are done in a clinical situation for a particular patient, however, depends on many criteria, such as the type of heart disease, the clinical status of the patient, the clinician's preference, the local availability of certain tests, etc. The alternative criteria we provide at a particular level of evaluation are meant to closely approximate one another in the degree of cardiac disability they represent. For example, a National Institutes of Health publication titled “Heart Failure: Evaluation and Care of Patients With Left-Ventricular Systolic Dysfunction” ( http://text.nlm.nih.gov/ahcpr/lvd/www/lvdctxt.html ) states that the majority of patients with heart failure have moderate-to-severe left-ventricular systolic dysfunction and ejection fractions of less than 35-40 percent. Therefore, if congestive heart failure is present, the condition can be evaluated on that basis, with no need for a ventricular ejection fraction study to be conducted for rating purposes. The rating schedule requires that a diagnosis of cardiac enlargement or hypertrophy be supported by either X-ray, EKG, or echocardiogram, but it does not require that all 3 tests be done in every case simply for rating purposes. Our intent in providing alternative criteria was to avoid the need for a veteran to undergo additional tests that might be invasive, risky, costly, or time-consuming, if one or more objective and reliable tests or findings suitable for evaluation purposes are already of record. Although it was not our intent to require that a veteran undergo every test listed in the criteria, some individuals have interpreted the regulation as requiring that every veteran undergoing evaluation for one of these heart conditions have X-rays, an echocardiogram, a ventricular ejection fraction test (which can be done either by means of echocardiography or radionuclide ventriculography (MUGA scan)), and METs measurement (by exercise stress testing), in order to be certain that a higher evaluation based on one of the alternative criteria is not warranted. This regulation is proposed in order to clarify the application of these criteria.

We propose to add a new § 4.100, to be titled “Application of the evaluation criteria for diagnostic codes 7000-7007, 7011, and 7015-7020,” to VA's Schedule for Rating Disabilities. This section would contain three provisions guiding the evaluation of specified cardiovascular conditions. The first provision would require the evaluator to ascertain in all cases whether or not cardiac hypertrophy or dilatation (documented by electrocardiogram, echocardiogram, or X-ray) is present and whether or not there is a need for continuous medication. Either of these would establish entitlement to a minimum evaluation level, and it is therefore essential to know whether either is present.

A second provision would indicate that even if the requirement for a 10% (based on the need for continuous medication) or 30% (based on the presence of cardiac hypertrophy or dilatation) evaluation is met, METs testing is always required except in the following cases: (1) When there is a medical contraindication, (2) when the left ventricular ejection fraction has been measured and is 50% or less, (3) when chronic congestive heart failure is present or there has been more than one episode of congestive heart failure within the past year, or (4) when a 100% evaluation can be assigned on another basis (such as during the three-month period following myocardial infarction). The rationale for this provision is that cardiac disability may warrant a higher evaluation on some other basis, such as the METs level, than the minimum evaluations assigned for continuous medication, or cardiac enlargement or hypertrophy. For example, even if a veteran with disability due to arteriosclerotic heart disease with angina requires continuous medication warranting a 10-percent evaluation, the METs level might warrant a higher evaluation.

The left ventricular ejection fraction (LVEF) is an objective measure of left ventricular function, that is, of the heart's ability to pump blood throughout the body. Decreased left ventricular function is a good indicator of the level of severity, prognosis, response to treatment, etc., of many heart problems. It has no value for rating purposes, however, unless it is decreased, because serious cardiac disability may be present even though the left ventricular function is normal. Whether an LVEF study is needed must be determined in a clinical setting. For rating purposes, the LVEF test is not necessary if there is a clinical diagnosis of either chronic congestive heart failure or a history of more than one episode of congestive heart failure within the past year because congestive heart failure of this degree establishes eligibility for a total (100-percent) evaluation. The LVEF test is also not usually necessary if METs testing, another very good indicator of the overall cardiovascular functional capacity, is available. We therefore propose that a third provision state that if LVEF testing is not of record, evaluation will be based on alternative criteria unless the examiner states that the LVEF test is needed in a particular case because the available medical information does not sufficiently reflect the severity of the veteran's cardiovascular disability.

These provisions will clarify the method of evaluation of these heart conditions.

Before the cardiovascular system was revised in 1997, the evaluation criteria for hypertensive heart disease (diagnostic code 7007 in § 4.104 of 38 CFR), a condition that means the heart is enlarged or hypertrophied due to hypertension, were based in part on blood pressure readings. Hypertension itself was also evaluated primarily on the basis of blood pressure readings. Separately evaluating hypertension and hypertensive heart disease at that time was therefore prohibited because it would have meant evaluating two different conditions based on the same findings (or evaluating the same disability under two diagnoses), a process prohibited by 38 CFR 4.14, Avoidance of pyramiding. Since 1997, hypertensive heart disease has been evaluated on the same basis as most other types of heart disease, namely, the results of exercise testing expressed in METs, the presence of congestive heart failure, the ventricular ejection fraction, etc. It is no longer evaluated on the basis of blood pressure readings. Therefore, hypertension and hypertensive heart disease may now be separately evaluated because each has separate and independent evaluation criteria that do not overlap. There is therefore no conflict with § 4.14. The rating schedule changes left some confused about whether or not separate evaluations for hypertension and hypertensive heart disease are now appropriate. To eliminate the confusion, we propose to add a new note (3) under diagnostic code 7101, hypertensive vascular disease, in § 4.104, stating that hypertension will be separately evaluated from hypertensive heart disease and other types of heart disease.

The Unfunded Mandates Reform Act requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before developing any rule that may result in an expenditure by State, local, or tribal governments, in the aggregate, or by the private sector of $100 million or more in any given year. This rule would have no consequential effect on State, local, or tribal governments.

This regulatory amendment has been reviewed by the Office of Management and Budget under the provisions of Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993.

This document contains no provisions constituting a collection of information under the Paperwork Reduction Act (44 U.S.C. 3501-3520).

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

The Catalog of Federal Domestic Assistance program numbers are 64.104 and 64.109.

For the reasons set out in the preamble, 38 CFR part 4 (subpart B) is proposed to be amended as set forth below:

Some mailers elect to use the simplified form of address for their mass mailings. Simplified address is an alternate-addressing format that allows mailers to prepare mailpieces without using individual names and addresses within very specific requirements. Instead of using individual addresses, the mailpieces are simply addressed as “Postal Customer” (or a similar designation as permitted). Eligibility to use the simplified address format is determined by the type of route selected for distribution, and in some instances by the type of mailer, as follows:

• Rural Routes, Highway Contract Routes, and Post Office Boxes. Any mailer may use simplified address format for the distribution of mail to rural routes, highway contract routes, and Post Office boxes at offices without city carrier service. Distribution of such mail is made to each boxholder on a rural route or highway contract route, each family on a rural route or highway contract route (at any Post Office), or all Post Office boxholders at a Post Office without city carrier service.

• City Routes and Post Office Boxes. Only certain authorized governmental entities may use the simplified address format for the distribution of mail to city routes or to Post Office boxes at Post Offices with city carrier service. Authorized governmental entities include U.S. Congress and Federal Government agencies or state, county, or municipal governments, and the governments of the District of Columbia, the Commonwealth of Puerto Rico, and any U.S. territory or possession listed in Domestic Mail Manual (DMM) G010. Distribution of such mail must be made to each stop or possible delivery on city carrier routes, or to each Post Office box at Post Offices with city carrier service.

Under this proposal, Domestic Mail Manual (DMM) A040 would be revised to clarify the preparation requirements for letters and flats that use the simplified address format. Additionally, all congressional mailings using the simplified address format would use PS Tag 11, Congressional Mail, “Postmaster—Open and Distribute” on all containers to ensure appropriate handling through downstream postal processes. This tag, which would help identify congressional mail as it moves through the mailstream, would be firmly attached to the mailing container.

These proposed clarifications are a result of recommendations and suggestions from mailers and Postal Service personnel. The proposal would ensure that customer expectations for accurate processing and timely delivery are met. This would be achieved by clarifying and reinforcing procedures that would increase the identification of containers used in preparation of this type of mail. The Postal Service and mailers who use this mail format believe that clarifying and reinforcing the preparation and container labeling requirements would enable more accurate processing of the mail. It would also help maintain the integrity of mail using the simplified address format and prevent potential service breakdowns that may occur when such mail is inadvertently separated from the container identifying its destination as a result of inadequate preparation and container labeling. These discrepancies can cause unnecessary delays during postal handling and may increase postal processing costs.

Although exempt from the notice and comment requirements of the Administrative Procedure Act (5 U.S.C. 553(b), (c)) regarding proposed rulemaking by 39 U.S.C. 410(a), the Postal Service invites comments on the following proposed revisions to the DMM, incorporated by reference in the Code of Federal Regulations (See CFR part 111).

This proposal addresses the approval of the local MBUAPCD Rule 427. In the Rules and Regulations section of this Federal Register , we are approving this local rule in a direct final action without prior proposal because we believe this SIP revision is not controversial. If we receive adverse comments, however, we will publish a timely withdrawal of the direct final rule and address the comments in subsequent action based on this proposed rule. We do not plan to open a second comment period, so anyone interested in commenting should do so at this time. If we do not receive adverse comments, no further activity is planned. For further information, please see the direct final action.