Historic Preservation, Advisory Council
Forest Service
National Agricultural Statistics Service
Engineers Corps
Committee for Purchase From People Who Are Blind or Severely Disabled
Census Bureau
International Trade Administration
National Institute of Standards and Technology
National Oceanic and Atmospheric Administration
Air Force Department
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Federal Energy Regulatory Commission
Presidential Documents
Trade Representative, Office of United States
Fiscal Service
Centers for Disease Control and Prevention
Children and Families Administration
Food and Drug Administration
Health Resources and Services Administration
Indian Health Service
Substance Abuse and Mental Health Services Administration
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International Boundary and Water Commission, United States and Mexico
Trade Representative, Office of United States
Fiscal Service
National Agricultural Statistics Service
Federal Highway Administration
Surface Transportation Board
Fiscal Service
Internal Revenue Service
Public Debt Bureau
Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws.
To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http://listserv.access.gpo.gov and select Online mailing list archives, FEDREGTOC-L, Join or leave the list (or change settings); then follow the instructions.
Nuclear Regulatory Commission.
Final rule.
The Nuclear Regulatory Commission (NRC) is amending its regulations to reflect organizational changes resulting from the creation of the Office of Nuclear Security and Incident Response, to correct a minor error, and to change the example of the derivative classification stamp.
July 11, 2003.
J. Keith Everly, Information Security Section, Division of Nuclear Security, Office of Nuclear Security and Incident Response, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, telephone (301) 415-7048.
The events of September 11, 2001, highlighted the need to examine the way NRC was organized to carry out its safeguards, security, and incident response function. After a review of its organizational structure, the NRC, effective on April 7, 2002, added a new Office of Nuclear Security and Incident Response (NSIR) to its organization. As part of the creation of this new office, NRC's Information Security Section, which was part of the Division of Facilities and Security, Office of Administration, was moved to the Division of Nuclear Security, NSIR. This section receives all communications and reports concerning the regulations in 10 CFR part 95, “Facility Security Clearance and Safeguarding of National Security Information and Restricted Data.” Therefore, the regulations in this part were changed to reflect the transfer of the Information Security Section to NSIR. Accordingly, in relevant sections of part 95, the organization identification of “Facilities and Security, Office of Administration” has been changed to “Nuclear Security, Office of Nuclear Security and Incident Response.”
In addition, the final rule corrects the first sentence of 10 CFR 95.1 by removing the words “security facility approval” and adding in their place the words “facility security clearance.”
This final rule also amends the example of the derivative classification stamp in paragraph (c)(1)(iii) of 10 CFR 95.37, “Classification and preparation of documents,” for derivative classification of classified National Security Information regarding the Originating Agency's Determination Required (OADR) declassification instruction. In accordance with Executive Order 12958, “Classified National Security Information,” as implemented in 32 CFR part 2001, OADR is no longer used on newly generated documents as of October 16, 1995. Additionally, documents generated under previous executive orders do not have to be remarked. The derivative classification stamp includes instructions for declassification.
Because these amendments deal solely with NRC organization, procedure, or practice, the notice and comment provisions of the Administrative Procedure Act do not apply under 5 U.S.C. 553 (b)(A). In addition, good cause exists pursuant to 5 U.S.C. 553(d) to dispense with the usual 30-day delay in the effective date, because these amendments are of a minor nature, dealing with the organization and procedures of the NRC. Therefore, these amendments are effective upon publication in the
The NRC has determined that this final rule is the type of action described in categorical exclusion 10 CFR 51.22 (c)(2). Therefore, neither an environmental impact statement nor an environmental assessment has been prepared for this final rule.
This final rule does not contain new or amended information collection requirements subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
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.
A regulatory analysis has not been prepared for this final rule because this rule is administrative in that it amends the regulations to reflect organizational changes. These are considered minor non-substantive amendments and will not have a significant impact on NRC licensees or the public.
The NRC has determined that the backfit rule does not apply to this final rule because this rule does not involve any provisions that would impose a backfit as defined in 10 CFR Chapter 1. Therefore a backfit analysis is not required for this rule.
Classified information, Criminal penalties, Reporting and record keeping requirements, Security measures.
Secs. 145, 161, 193, 68 Stat. 942, 948, as amended (42 U.S.C. 2165, 2201); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 5841); E.O. 10865, as amended, 3 CFR 1959-1963 COMP., p. 398 (50 U.S.C. 401,
(c) * * *
(1) * * *
(iii) An example of the marking stamp is as follows:
For the Nuclear Regulatory Commission.
Drug Enforcement Administration (DEA), Justice.
Interim final rule with request for comment.
DEA is amending its regulations to define the term “reverse distributor” and to establish a new category of registration for persons handling controlled substances. The amendments establish the regulatory standards under which reverse distributors may handle unwanted, unusable, or outdated controlled substances acquired from another DEA registrant. These standards ensure the proper documentation and recordkeeping necessary to prevent diversion of such controlled substances to illegal purposes. Since this amendment mostly codifies DEA's existing practices, it will have no significant impact on existing reverse distributors.
Effective Date: August 11, 2003.
Comments should be submitted to the Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537, Attention: DEA
Patricia M. Good, Chief, Liaison and Policy Section, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537. Telephone (202) 307-7297.
As is more fully discussed in this preamble, this interim final rule mostly codifies existing practices that reverse distributors follow under memoranda of understanding (MOUs) with the Drug Enforcement Administration. This approach is consistent with the comments received (also discussed more fully later in this preamble) that stated that reverse distributors would be significantly and adversely impacted if, as was proposed, they were classified as manufacturers. In recognizing this activity as a separate registration category of distributors, DEA believes the entire controlled substances industry will benefit. Existing reverse distributors operating under MOUs will become fully recognized registrants under DEA rules. Thousands of other registrants who need to dispose of unneeded or outdated inventories will be able to turn to a fully registered group of distributors. Furthermore, by essentially codifying existing practices these benefits will be achieved with minimal need for change or for disruption to the affected industry.
The overall goal of the Controlled Substances Act (CSA) and of DEA's regulations in Title 21, Code of Federal Regulations (CFR), parts 1300-1316 is to provide a closed distribution system so that a controlled substance is at all times under the legal control of a person registered, or specifically exempted from registration, by the Drug Enforcement Administration until it reaches the ultimate user or is destroyed. DEA achieves this goal by registering manufacturers, distributors, and dispensers of controlled substances. Thus, any movement of controlled substances between these registered persons is covered by DEA regulations,
When a controlled substance has become outdated or otherwise unusable, the registered person who possesses the substance must dispose of it. However, over the past decade, environmental concerns and regulatory changes have caused drug manufacturers and government agencies (including DEA and State authorities) to become increasingly reluctant to be involved in the disposal process. Thus, many disposal options are no longer available.
Nonetheless, disposal of controlled substances can occur in several ways:
1. The distributor or dispenser can return the controlled substances to the pharmaceutical manufacturers who, as a service to their customers, accept returns of outdated/damaged controlled substances. Distributors, dispensers, and manufacturers are all registered with DEA.
2. The distributor, dispenser, or manufacturer can itself dispose of the controlled substances under the procedures outlined in 21 CFR 1307.21. Under 21 CFR 1307.21, any person may request permission to dispose of controlled substances without the benefit of a DEA or State witness. In many cases, blanket permission for disposal of controlled substances is granted to registrants who have an ongoing need to dispose of unwanted controlled substances. The disposal must be authorized by DEA in writing, and DEA may require that a set schedule be established. Other registrants are granted disposal authority on a case-by-case basis. DEA normally requires that the registrant provide two designated responsible individuals to accompany the drugs to the disposal site and witness the destruction. This achieves DEA's goal of assuring the controlled substances are rendered nonrecoverable. Disposal under the authority of 21 CFR 1307.21 maintains the closed distribution system because the controlled substances remain under the legal control of a registered person at all times.
3. The distributor, dispenser, or manufacturer can distribute the controlled substances to a reverse distributor to take control of the controlled substances for the purpose of returning them to the manufacturer or, if necessary, disposing of them.
For many years, DEA opposed granting DEA registrations to firms solely or primarily engaged in the disposal (whether the transportation portion, actual disposal, or both) of controlled substances because they were not considered an essential link in the closed distribution system that the Controlled Substances Act established to control the flow of drugs from the manufacturer to the ultimate user. In recent years, however, increasingly stringent requirements imposed by the U.S. Environmental Protection Agency (EPA) resulted in fewer and fewer approved disposal facilities. As a result, a new type of business has developed that collects controlled substances from registrants and either returns them to the manufacturer or arranges for their disposal. The businesses performing this middleman service refer to themselves as “reverse distributors” or “returns processors.”
This interim final rule deals only with the distribution of controlled substances to reverse distributors. The first two categories—direct returns of controlled substances by distributors or dispensers to manufacturers, and disposals by the distributor, manufacturer or dispenser—are already covered by the existing rules. Only the third category,
On August 23, 1995, DEA issued a Notice of Proposed Rulemaking (NPRM) (60 FR 43732) that proposed regulatory standards governing disposers of controlled substances. DEA proposed to accomplish this by amending its regulations to define the term “Disposer” to account for this middleman function in the regulations and establish a new category of manufacturer registration under which persons performing this function would be registered. DEA also proposed amending the regulations to exempt disposers from the quota requirements; to identify the records and reports required of disposers; and to establish order form procedures for disposers. Finally, DEA proposed amendments to a number of gender-specific sections to make them gender neutral.
DEA originally based its decision to define the persons performing the reverse distribution function as disposers on the definition of “manufacturer.” In 21 CFR 1300.01(b)(27), DEA defines manufacture in part as “the producing, preparation, propagation, compounding, or processing of a drug or other substance . . . .” The section further defines a manufacturer as “a person who manufactures a drug or other substance . . .” In the proposed rule, DEA stated that by its nature, a disposer processes a drug or other substance. Therefore, DEA proposed to place disposers within the definition of manufacturer, under a new disposer subcategory. Commenters to the proposed rule objected to being categorized as disposers and manufacturers for the reasons explained below under “Comments.” Therefore, in this interim final rule, DEA is establishing a definition for “reverse distributor” and is establishing a new category of registration as reverse distributors.
DEA is using an interim final rule because it will give interested persons an additional opportunity for comment even though the substance of this interim final rule is consistent with the purpose of the August 1995 NPRM, the comments submitted in response to that NPRM, and with current DEA and industry practice.
Currently DEA registers persons performing reverse distributor functions as distributors. Since reverse distributors are not specifically identified in the current regulations, DEA enters into a Memorandum of Understanding (MOU) with the person performing the reverse distribution function. The Memorandum of Understanding (MOU) specifies conditions which the reverse distributor must follow in addition to the regulations that apply to distributors. These registrations must be renewed annually and operations under them are limited to products in schedules listed on the registration. DEA has not experienced any difficulties in treating reverse distributors as distributors for purposes of registration and other requirements. Any reverse distributor that was registered under the terms of a MOU will be reregistered as a reverse distributor under the terms of this interim final rule in the next renewal cycle and will be specifically identified in DEA's records as a reverse distributor. Persons currently conducting reverse distribution operations must notify DEA by no later than the time of renewal of their registration so that they may be properly identified as reverse distributors in DEA's records.
The requirements for a reverse distributor in this interim final rule are similar to those currently imposed on
•
•
•
•
After publication of the August 1995 NPRM, DEA completed a rulemaking project in 1997 (62 FR 13938, March 24, 1997) that reorganized and clarified the regulations that would have been affected by that NPRM. The 1997 rulemaking also addressed the gender-specific and other editorial changes that were contained in the 1995 NPRM. Therefore, proposed changes to 21 CFR 1301.26 (now 21 CFR 1301.24), Exemption of law enforcement officers; 21 CFR 1301.32 (now 21 CFR 1301.13), Application forms; contents; signature; and 21 CFR 1304.34 (now 21 CFR 1304.33(a)), Reports generally, are not included in this interim final rule. For the proposed changes that relate to reverse distributors, this interim final rule amends the appropriate CFR sections as changed in 1997. Throughout the preamble, citations to both previous section number and current section number are provided, where relevant.
Eight comments were received regarding the proposed rule. Commenters included reverse distributors and disposers currently operating under Memoranda of Understanding (
Most commenters opposed the proposal to classify the activities they engage in as either disposal or manufacturing and stated that doing so would subject them to unnecessary and burdensome regulations.
One commenter stated that since reverse distributors neither process nor package/repackage controlled substances within the meaning of the statutory definition of “manufacturer,” it is beyond DEA's statutory authority to regulate these companies as manufacturers. Another commenter stated that the primary goal of disposers is not to render a controlled substance unusable, but, rather, it is to sort, inventory and perform other activities necessary to distribute products back to the original manufacturer and only secondarily, arrange for the actual destruction of controlled substances.
Four commenters stated that the proposed definition of disposer implies that a disposer is manipulating the product and, therefore, that waste is being accepted. This would, in turn, require disposers to comply with the more burdensome guidelines of the Food and Drug Administration (FDA) and EPA.
In response to these comments, DEA has decided to establish a definition for reverse distributor and is establishing a new category of registration as reverse distributors. In this interim final rule, DEA is adding the definition for “reverse distributors” to 21 CFR 1300.01(b). Reverse distributors are defined as “a person who receives controlled substances acquired from another DEA registrant for the purpose of returning unwanted, unusable, or outdated controlled substances to the manufacturer or the manufacturer's agent, or, where necessary, processing such substances or arranging for processing such substances for disposal.” When reverse distributors return unwanted, unusable, or outdated controlled substances acquired from legitimate medical, scientific, research or other industrial channels to a manufacturer or a manufacturer's agent, they must follow the same DEA requirements as distributors follow. When reverse distributors process controlled substances or arrange for processing controlled substances for disposal, they must follow the same procedures that distributors would follow in complying with 21 CFR 1307.21, “Procedure for disposing of controlled substances.”
One commenter stated that classifying dentists and other small disposers as manufacturers would be burdensome because they would now have to register and pay burdensome registration fees. This could result in dentists removing themselves from regulatory control by refusing to handle controlled substances, which could adversely affect their patients. This commenter recommended that the proposed rule either exempt dentists and other small disposers by quantity, or state that they are not members of the “disposer” subcategory.
Another commenter stated that previous contacts with DEA indicated that the rulemaking is intended to regulate disposers that dispose of or offer controlled substances for disposal over which they have legal control. This commenter requested that DEA clarify that it should not be subject to the proposed rule provided that it is acting as an agent of DEA through a contract; or that it disposes of controlled substances for manufacturers provided that the manufacturer's representatives bring the controlled substances to a disposal facility and witness the destruction, thus maintaining legal responsibility for the controlled substances.
In this interim final rule, DEA is not changing the procedures for disposing of controlled substances under 21 CFR 1307.21. Those procedures are designed to ensure that controlled substances are under the control of a DEA registrant until they are destroyed or rendered unusable. If a disposal company never takes legal control of a controlled substance and the actual destruction is witnessed by two representatives of a DEA registrant, the disposal company itself is not required to obtain a DEA registration. On the other hand, if a disposal company receives controlled substances from a DEA registrant and then disposes of them later, the disposal company becomes part of the chain of responsible parties and must therefore be registered by DEA as a reverse distributor.
Under the interim final rule, DEA registrants who need to periodically dispose of controlled substances, such as practitioners, would continue to follow their current procedures for disposal of controlled substances.
Commenters recommended creating a separate category for reverse distributors, as a subcategory of distributors, who would be subject to the existing registration and other requirements for distributors. Commenters stated that reverse distributors should, therefore, not be subject to the security, inventory, recordkeeping, and reporting requirements of the proposed rule that apply to manufacturers.
Since DEA has decided to create a completely separate category for reverse distributors, persons who fall under this category will be required to comply with the same security, reporting, and other requirements that apply to distributors rather than the requirements that apply to manufacturers.
DEA received one comment on the language in proposed 21 CFR 1301.71(b)(14) which requires the applicant or registrant to document the adequacy of its system for monitoring the receipt, manufacture, distribution, and disposal of controlled substances. The commenter stated that all of the “waste to energy” facilities that it operates have demonstrated that the implementation of supervised monitoring of the receipt and disposal process, by the disposer, has proven effective and that it would be physically impossible for them to construct the vaults or other security barriers that the regulations require for storage at manufacturer's locations (under 21 CFR 1301.72). Instead, this commenter recommended that disposers be required to develop a set of Standard Operating Procedures, to be approved by DEA, for the receipt and disposal of controlled substances.
With respect to the issue of physical security, it should be noted that the commenter does not take possession of the controlled substances that are to be destroyed. Instead, the commenter maintains incineration facilities at which DEA registrants carry out witnessed destruction of their controlled substances. As a result, the commenter is not subject to DEA's requirements and does not have to establish or maintain physical security as required under 21 CFR 1301.72 of the regulations.
One commenter commented on proposed 21 CFR 1301.71(b)(15), which would require DEA to consider the applicability of the security requirements contained in all Federal, State, and local laws and regulations governing the management of waste, as they would apply to applicants and registrants. The commenter stated that this requirement would be inappropriate because it would exceed DEA's statutory authority. While DEA inspectors should be concerned with compliance with DEA statutes and regulations during audits, the inspectors should not be empowered to look for violations of other Federal, State, and local laws governing the management of waste. Enforcement of those laws should be left to the other Federal agencies and individual jurisdictions. Therefore, the commenter requested DEA clarification on this issue.
With respect to this comment, the items listed in 21 CFR 1301.71(b)(1) through new (b)(15) are factors that the Administrator may consider in evaluating whether the security controls provided by a DEA registrant are adequate to guard against theft and diversion of controlled substances and appropriate to the registrant's business. Not all of the factors may be relevant for evaluation of a particular registrant's operation. DEA is adding a new factor regarding the applicability of other Federal, State, or local laws, not as an enforcement issue for those specific laws, but only as guidance to the registrant that DEA may consider how the registrant is complying with such laws in making an evaluation of the adequacy of the registrant's security system. DEA has the statutory authority under 21 U.S.C. 823 to consider an applicant's compliance with applicable State and local laws before granting a registration.
A commenter that provides disposal facilities at which registrants may conduct witnessed destructions recommended that additional language be added to the end of proposed 21 CFR 1304.20 (current 21 CFR 1304.11) to require that the information required under 21 CFR 1304.15(a), (c), and (d) be provided by the manufacturer or its agent when tendering the substances for disposal.
The commenter's suggested change is not necessary because in witnessed destructions the registrant conducting the destruction must accurately document the controlled substances being destroyed on DEA Form 41. Further, a disposal facility of the type operated by the commenter does not take possession of the controlled substances being destroyed and, thus, is not subject to the registration, inventory, and recordkeeping requirements under the law.
Several commenters made recommendations to change the language of proposed 21 CFR 1304.30(a) (current 21 CFR 1304.22) to make the specific requirements clear.
A commenter also expressed concern about proposed paragraph (b) and stated that the disposer should not be expected to recount and itemize the individual dosage units and containers for each substance being delivered for disposal. This would put their employees at possible risk for exposure to these substances, increase opportunities for diversion, and significantly slow down the disposal operation. Instead, the commenter recommended that sufficient controls be placed on the manufacturer and its representatives prior to disposal so that the disposer can focus on rapid and effective disposal procedures.
The comments primarily address problems that could have arisen if the reverse distribution function was included under manufacturing, as proposed. These concerns are mostly addressed by treating reverse distribution as a separate category of registration. The concerns expressed by disposers are, as previously discussed, not relevant as long as legal control of the controlled substances remains with a person who is registered with DEA.
Recordkeeping requirements for reverse distributors are set forth in new paragraph (e) of 21 CFR 1304.22. These requirements are tailored to the reverse distributor role and address recordkeeping for controlled substances in both bulk and finished form. These requirements are consistent with existing practice.
A commenter stated that DEA would require two responsible individuals to accompany the drugs to the disposal site and actually witness the destruction. The commenter stated that this would significantly increase the costs of controlled substances destruction for all registrants and that the rule should, therefore, require a regulatory flexibility analysis.
The requirement to have two responsible individuals accompany the drugs to the disposal site is also consistent with existing practice. DEA Form 41, Registrants Inventory of Drugs Surrendered, must be completed by a registrant's representative and witnessed by a second representative of the registrant, to document the disposal of controlled substances. This form must be sent to DEA.
A commenter stated that ARCOS reporting becomes difficult and costly when a disposer receives a quantity of a controlled substance listed in Schedule I and II and a narcotic controlled substance listed in Schedule III which is contained in a compound, mixture or preparation which is not assigned an NDC number. The commenter stated that this reporting “will become more difficult as more returns are accepted from Pharmacies, Home Infusion Pharmacies, Provider Pharmacies to Long Term Care Facilities, Hospitals, and dispensers.”
The commenter recommended adding a new paragraph (e) to current 21 CFR 1304.33 (formerly 21 CFR 1304.39) that would provide for the following exception: “Exceptions. Any controlled substance listed in Schedule I and II and on each narcotic controlled substance listed in Schedule III which material, compounded, mixture or preparation containing a quantity of a substance from a registered dispenser, practitioner, researchers, and analytical registrants,
While the commenter addressed the reporting requirements in proposed 21 CFR 1304.39(b) and (c), the commenter's real concern appears to be related to inventory requirements currently in 21 CFR 1304.11. This interim final rule will allow reverse distributors to follow the inventory requirements that currently apply to dispensers and researchers. This would mean that in the circumstances described in 21 CFR 1304.11(e)(3)(ii), it would not be necessary to make an exact count or measure of the contents in all cases,
Notwithstanding this change, a reverse distributor is required to know what it has on hand from the moment it is received. It is the reverse distributor's responsibility to have the proper documentation and accountability for any controlled substances in his or her possession. The best way for reverse distributors to accomplish this is by doing the following: (1) Require customers to provide a list of the controlled substances to be sent in advance of the shipment; (2) Complete a form or invoice indicating the amount that the customer will be sending, keep a copy of this document, and send 2 copies to the customer; and (3) Require the customer to keep one copy of the document and put the other copy in the package with the shipment. This procedure would maintain a paper trail and provide the data on inventory from the moment the shipment is received by the reverse distributor. Reverse distributors who follow this procedure should not have difficulty preparing the ARCOS reports that are required by current 21 CFR 1304.33 for controlled substances listed in Schedules I and II, and for narcotic controlled substances listed in Schedules III, IV, and V.
With respect to the issue of non-NDC material, such as compounded prescription products or infusion products, DEA's ARCOS Unit has established a listing of generic codes that can be used to identify products that do not have an NDC number assigned. If a product being handled does not have a generic code, please contact the ARCOS Unit of the Administration for assistance.
Reverse distributors are encouraged to make use of electronic identification and tracking systems, such as bar codes, to aid in meeting the inventory and reporting requirements. Also, reverse distributors may use electronic versions of DEA Form 41 if the electronic version is an exact reproduction of the form. If the electronic version is not identical to the paper version, it is not the official form, and may not be used.
DEA invites manufacturers, reverse distributors, and other distributors to work with the Administration to establish standard operating procedures so there is a standard recordkeeping system for transferring, receiving, and inventorying partial containers. With a standardized system there would be fewer inconsistencies among the records of each registrant when controlled substances are transferred from one to another.
A commenter stated that in the preamble, DEA stated that “Order Forms must be completed for all Schedule I and III items received and transferred.” The commenter stated that this is incorrect and that the correct statement should be: “Order Forms must be completed for all Schedule I and II items received and transferred.”
DEA agrees that there was a typographical error in the preamble and is clarifying that order forms (DEA Form 222) required by part 1305 are for Schedule I and II controlled substances received and transferred.
Under the interim final rule, reverse distributors may only receive controlled substances from DEA registrants. Non-registrants, such as long term care facilities, do not have direct authority to handle controlled substances. Further, the substances in their possession are no longer part of the closed system of distribution and are no longer subject to DEA's system of corresponding accountability. In cases where long term care facilities must dispose of controlled substances, they should follow the guidelines within their State for disposing of the drugs and maintain appropriate documentation of the disposal. Likewise, a former registrant, such as a pharmacy, whose registration has expired or has been surrendered, would need to coordinate with the local DEA office to develop a procedure to
As discussed previously, the goal of the NPRM was to give codified status to reverse distributors. While DEA initially proposed doing this by registering reverse distributors in the manufacturer category, comments on the NPRM made it clear that this approach would adversely affect the existing industry (
In summary, the registration and other requirements for reverse distributors under this interim final rule are the same as those currently imposed on distributors and the same as currently imposed on reverse distributors under MOUs; Registration requirements under existing 21 CFR 1301.13; Security requirements under existing 21 CFR 1301.71 and 1301.72; Inventory requirements under existing 21 CFR 1304.11; Recordkeeping requirements under existing 21 CFR 1304.22; Reporting requirements under existing 21 CFR 1304.33 (ARCOS reports); Order form requirements under existing 21 CFR 1305.08 (Persons entitled to fill order forms). In some cases these rules have been modified to apply specifically to reverse distributors. In addition, DEA is amending 21 CFR 1307.11 and 1307.12 to clarify that registrants can transfer (“distribute”) controlled substances to a reverse distributor, even if the registrant is not registered as a distributor. As a result of DEA's decision to classify reverse distributors as a new category of registration, instead of as a manufacturer, proposed 21 CFR 1303.12 on quotas is not applicable.
The closed system of distribution established under the CSA for controlled substances relies on certain fundamental principles, including registration, security, and accountability (
Because of the length of time since the NPRM was published and the evolving nature of this industry, DEA is using an interim final rule to give an additional opportunity for comment. DEA will consider comments on the appropriateness and the practical application of these rules to current industry practice and will be flexible where possible in developing final rules.
As has been previously noted in this rulemaking, persons wishing to conduct reverse distributor activities must register with DEA to do so. To apply for registration, persons must complete a DEA Form 225, Application for Registration. To renew a DEA registration, persons must complete a DEA Form 225a, Application for Registration Renewal. As DEA has not yet issued updated forms specifically referencing the reverse distributor business activity, persons wishing to register as reverse distributors must choose the distributor business activity on the form and then must attach a written statement signed by the person signing the registration or registration renewal application acknowledging that the applicant is conducting or wishes to conduct reverse distributor activities.
The Deputy Assistant Administrator hereby certifies that this interim final rulemaking has been drafted in accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)), and by approving it certifies that this regulation will not have a significant economic impact upon a substantial number of small entities. Therefore, no regulatory flexibility analysis is required.
The Deputy Assistant Administrator further certifies that this rulemaking has been drafted in accordance with the principles of Executive Order 12866 Section 1(b). DEA has determined that this rule is a significant regulatory action. Therefore, this action has been reviewed by the Office of Management and Budget.
The Deputy Assistant Administrator further certifies that this regulation meets the applicable standards set forth in Sections 3(a) and 3(b)(2) of Executive Order 12988.
This rulemaking does not preempt or modify any provision of State law; nor does it impose enforcement responsibilities on any State; nor does it diminish the power of any State to enforce its own laws. Accordingly, this rulemaking does not have federalism implications warranting the application of Executive Order 13132.
This rule will not result in the expenditure by State, local and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more in any one year, and will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.
This rule is not a major rule as defined by Section 804 of the Small Business Regulatory Enforcement Fairness Act of 1996. This rule will not result in an annual effect on the economy of $100,000,000 or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-
Definitions, Drug traffic control.
Administrative practice and procedure, Drug traffic control, Security measures.
Drug traffic control, Reporting requirements.
Drug traffic control, Reporting requirements.
Drug traffic control.
21 U.S.C. 802, 871(b), 951, 958(f).
(b) * * *
(41) The term
(i) Returning unwanted, unusable, or outdated controlled substances to the manufacturer or the manufacturer's agent; or
(ii) Where necessary, processing such substances or arranging for processing such substances for disposal.
21 U.S.C. 821, 822, 823, 824, 871(b), 875, 877.
(c) At the time a manufacturer, distributor, reverse distributor, researcher, analytical lab, importer, exporter or narcotic treatment program is first registered, that business activity shall be assigned to one of twelve groups, which shall correspond to the months of the year. The expiration date of the registrations of all registrants within any group will be the last date of the month designated for that group. In assigning any of these business activities to a group, the Administration may select a group the expiration date of which is less than one year from the date such business activity was registered. If the business activity is assigned to a group which has an expiration date less than three months from the date of which the business activity is registered, the registration shall not expire until one year from that expiration date; in all other cases, the registration shall expire on the expiration date following the date on which the business activity is registered.
(e) * * *
(1) * * *
(b) * * *
(13) The availability of local police protection or of the registrant's or applicant's security personnel;
(14) The adequacy of the registrant's or applicant's system for monitoring the receipt, manufacture, distribution, and disposition of controlled substances in its operations; and
(15) The applicability of the security requirements contained in all Federal, State, and local laws and regulations governing the management of waste.
(b) * * *
(7) Such other secure storage areas as may be approved by the Administrator after considering the factors listed in § 1301.71(b);
21 U.S.C. 821, 827, 871(b), 958(e), 965, unless otherwise noted.
(e) * * *
(2)
(3)
(b)
(e)
(1) For each controlled substance in bulk form the following:
(i) The name of the controlled substance.
(ii) The total quantity of the controlled substance to the nearest metric unit weight consistent with unit size.
(iii) The quantity received from other persons, including the date and quantity of each receipt and the name, address, and registration number of the other person from whom the controlled substance was received.
(iv) The quantity returned to the original manufacturer of the controlled substance or the manufacturer's agent, including the date of and quantity of each distribution and the name, address and registration number of the manufacturer or manufacturer's agent to whom the controlled substance was distributed.
(v) The quantity disposed of including the date and manner of disposal and the signatures of two responsible employees of the registrant who witnessed the disposal.
(2) For each controlled substance in finished form the following:
(i) The name of the substance.
(ii) Each finished form (
(iii) The number of commercial containers of each such finished form received from other persons, including the date of and number of containers in each receipt and the name, address, and registration number of the person from whom the containers were received.
(iv) The number of commercial containers of each such finished form distributed back to the original manufacturer of the substance or the manufacturer's agent, including the date of and number of containers in each distribution and the name, address, and registration number of the manufacturer or manufacturer's agent to whom the containers were distributed.
(v) The number of units or volume of finished forms and/or commercial containers disposed of including the date and manner of disposal, the quantity of the substance in finished form disposed, and the signatures of two responsible employees of the registrant who witnessed the disposal.
(c)
21 U.S.C. 821, 828, 871(b), unless otherwise noted.
(b) A person who has obtained any controlled substance in Schedule I or II by order form may return such substance, or portion thereof, to the person from whom he/she obtained the substance, to the manufacturer of the substance, or to a registered reverse distributor pursuant to the order form of the latter person;
21 U.S.C. 821, 822(d), 871(b), unless otherwise noted.
(a) A practitioner who is registered to dispense a controlled substance may distribute (without being registered to distribute) a quantity of such substance to—
(1) Another practitioner for the purpose of general dispensing by the practitioner to patients, provided that—
(i) The practitioner to whom the controlled substance is to be distributed is registered under the Act to dispense that controlled substance;
(ii) The distribution is recorded by the distributing practitioner in accordance with § 1304.22(c) of this chapter and by the receiving practitioner in accordance with § 1304.22(c) of this chapter;
(iii) If the substance is listed in Schedule I or II, an order form is used as required in part 1305 of this chapter; and
(iv) The total number of dosage units of all controlled substances distributed by the practitioner pursuant to this section and § 1301.25 of this chapter during each calendar year in which the practitioner is registered to dispense does not exceed 5 percent of the total number of dosage units of all controlled substances distributed and dispensed by the practitioner during the same calendar year.
(2) A reverse distributor who is registered to receive such controlled substances.
(b) If, during any calendar year in which the practitioner is registered to dispense, the practitioner has reason to believe that the total number of dosage units of all controlled substances which will be distributed by him pursuant to paragraph (a)(1) of this section and § 1301.25 of this chapter will exceed 5 percent of this total number of dosage units of all controlled substances distributed and dispensed by him during that calendar year, the practitioner shall obtain a registration to distribute controlled substances.
(a) Any person lawfully in possession of a controlled substance listed in any schedule may distribute (without being registered to distribute) that substance to the person from whom he/she obtained it or to the manufacturer of the substance, or, if designated, to the manufacturer's registered agent for accepting returns, provided that a written record is maintained which indicates the date of the transaction, the name, form and quantity of the substance, the name, address, and registration number, if any, of the person making the distribution, and the name, address, and registration number, if known, of the supplier or manufacturer. In the case of returning a controlled substance in Schedule I or II, an order form shall be used in the manner prescribed in part 1305 of this chapter and be maintained as the written record of the transaction. Any person not required to register pursuant to sections 302(c) or 1007(b)(1) of the Act (21 U.S.C. 822(c) or 957(b)(1)) shall be exempt from maintaining the records required by this section.
Internal Revenue Service (IRS), Treasury.
Final regulations.
This document contains final regulations that provide guidance on deferred compensation plans of state and local governments and tax-exempt entities. The regulations reflect the changes made to section 457 by the Tax Reform Act of 1986, the Small Business Job Protection Act of 1996, the Taxpayer Relief Act of 1997, the Economic Growth and Tax Relief Reconciliation Act of 2001, the Job Creation and Worker Assistance Act of 2002, and other legislation. The regulations also make various technical changes and clarifications to the existing final regulations on many discrete issues. These regulations provide the public with guidance necessary to comply with the law and will affect plan sponsors, administrators, participants, and beneficiaries.
Cheryl Press, (202) 622-6060 (not a toll-free number).
The collection of information contained in these final regulations has been reviewed and approved by the Office of Management and Budget in accordance with the Paperwork Reduction Act (44 U.S.C. 3507) under control number 1545-1580. Responses to this collection of information are mandatory.
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number assigned by the Office of Management and Budget.
The estimated burden per respondent varies from .033 hour to 2 hours per trust established depending upon individual respondents' circumstances, with an estimated average of one hour for each trust established, and from 20 hours to 50 hours per application for approval as a custodian with an estimated average of 35 hours for each application submitted to qualify as a custodian.
Comments concerning the accuracy of this burden estimate and suggestions for reducing this burden should be sent to the Internal Revenue Service, Attn: IRS Reports Clearance Officer, W:CAR:MP:T:T:SP Washington, DC 20224, and to the Office of Management and Budget, Attn: Desk Officer for the Department of the Treasury, Office of Information and Regulatory Affairs, Washington, DC 20503.
Books or records relating to this collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.
Section 131 of the Revenue Act of 1978 (92 Stat. 2779) added section 457 to the Internal Revenue Code of 1954. On September 27, 1982, final regulations (TD 7836, 1982-2 C.B. 91) under section 457 (the 1982 regulations) were published in the
Section 1107 of the Tax Reform Act of 1986 (100 Stat. 2494) extended section 457 to tax-exempt organizations. Section 6064 of the Technical and Miscellaneous Act of 1988 (102 Stat. 3700) codified certain exceptions for certain plans. Notice 88-68, 1988-1 C.B. 556, addressed the treatment of nonelective deferred compensation of nonemployees, and provided an exception under which section 457 does not to apply to certain church plans.
Section 1404 of the Small Business Job Protection Act of 1996 (110 Stat. 1755) added section 457(g) which requires that section 457(b) plans maintained by state and local government employers hold all plan assets and income in trust, or in custodial accounts or annuity contracts (described in section 401(f) of the Internal Revenue Code), for the exclusive benefit of participants and beneficiaries.
Section 1071 of the Taxpayer Relief Act of 1997 (111 Stat. 788) permits certain accrued benefits to be cashed out.
Sections 615, 631, 632, 634, 635, 641, 647, and 649 of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) (115 Stat. 38) included increases in elective deferral limits, repeal of the rules coordinating the section 457 plan limit with contributions to certain other types of plans, catch-up contributions for individuals age 50 or over, extension of qualified domestic relation order rules to section 457 plans, rollovers among various qualified plans, section 403(b) contracts and individual retirement arrangements (IRAs), and transfers to purchase service credits under governmental pension plans.
Section 411(o)(8) and (p)(5) of the Job Creation and Worker Assistance Act of 2002 (116 Stat. 21) clarified certain provisions in EGTRRA concerning section 457 plans, including the use of certain compensation reduction
On May 8, 2002, a notice of proposed rulemaking (REG-105885-99) was published in the
Following publication of the proposed regulations, comments were received and a public hearing was held on August 28, 2002. After consideration of the comments received, the proposed regulations are adopted by this Treasury decision, subject to a number of changes that are generally summarized below.
The proposed regulations addressed the income tax treatment of excess deferrals and the effect of excess deferrals on plan eligibility under section 457(b). The proposed regulations provided that an eligible governmental plan may self-correct and distribute excess deferrals and continue to satisfy the eligibility requirements of section 457(b) (including the distribution rules and the funding rules) by reason of a distribution of excess deferrals. However, the proposed regulations provided that if an excess deferral arose under an eligible plan of a tax-exempt employer, the plan was no longer an eligible plan.
Commentators objected to the less favorable treatment for eligible plans of tax-exempt employers.
After consideration of the comments received, the regulations extend self-correction for excess deferrals to eligible plans of tax-exempt employers. If there is an excess deferral under such plan, the plan may distribute to a participant any excess deferrals (and any income allocable to such amount) not later than the first April 15 following the close of the taxable year of the excess deferrals, comparable to the rules for qualified plans under section 402(g). In such a case, the plan will continue to be treated as an eligible plan. However, in accordance with section 457(c), any excess deferral is included in the gross income of a participant for the taxable year of the excess deferral. If an excess deferral is not corrected by distribution, the plan is an ineligible plan under which benefits are taxable in accordance with ineligible plan rules.
The income tax treatment and payroll tax reporting of distributions of excess deferrals from eligible section 457(b) governmental plans are similar to the treatment and reporting of distribution of excess deferrals from tax-qualified plans. Such amounts should be reported on Form 1099 and taxed in the year of distribution to the extent of distributed earnings on the excess deferrals. For eligible section 457(b) tax-exempt plans, the excess deferrals are subject to income tax in the year of distribution to the extent of distributed earnings on the excess deferrals and such earnings should be reported on Form W-2 for the year of distribution. See also Notice 2003-20, 2003-19 I.R.B. 894, for information regarding the withholding and reporting requirements applicable to eligible plans generally.
The proposed regulations included several rules that aggregate multiple plans for purposes of meeting the eligibility requirements of section 457(b). These regulations retain all of these rules. For example, the regulations provide that in any case in which multiple plans are used to avoid or evade the eligibility requirements under the regulations, the Commissioner may apply the eligibility requirements as if the plans were a single plan. Also, an eligible employer is required to have no more than one normal retirement age for each participant under all of the eligible plans it sponsors. In addition, all deferrals under all eligible plans under which an individual participates by virtue of his or her relationship with a single employer are treated as though deferred under a single plan for purposes of determining excess deferrals. Finally, annual deferrals under all eligible plans are combined for purposes of determining the maximum deferral limits.
Few comments were received with respect to the aggregation rules under the proposed regulations. However, one commentator requested that, where it is determined that multiple eligible plans maintained by a single employer, which have been aggregated pursuant to the proposed regulations, contain excess deferrals, the employer have the ability to disaggregate those plans solely for the purpose of either (1) distributing the excess deferrals under the self-correcting mechanism or (2) limiting the characterization of such plans as “ineligible” to the one(s) that actually contain the excess deferrals. Taking into account the ability for all eligible plans to self-correct by distribution, these regulations retain without material revision the aggregation rules that were in the proposed regulations.
The proposed regulations would have allowed an eligible plan to permit participants to elect to defer compensation, including accumulated sick and vacation pay and back pay, only if an agreement providing for the deferral is entered into before the beginning of the month in which the amounts would otherwise be paid or made available and the participant is an employee in that month. Comments requested that terminating participants be allowed to elect deferral for accumulated sick and vacation pay and back pay even if the participant is not employed at the time of the deferral.
The final regulations retain the rule under which the deferral election must be made during employment and before the beginning of the month when the compensation would have been payable. However, the regulations include a special rule that allows an election for sick pay, vacation pay, or back pay that is not yet payable (subject of course to the maximum deferral limitations of section 457 in the year of deferral). Under the special rule, an employee who is retiring or otherwise having a severance from employment during a month may nevertheless elect to defer, for example, his or her unused vacation pay after the beginning of the month, provided that the vacation pay would otherwise have been payable before the employee has a severance from employment and the election is made before the date on which the vacation pay would otherwise have been payable.
The proposed regulations added examples that would illustrate when an unforeseeable emergency occurred. In particular, one example provided that the need to pay for the funeral expenses of a family member may constitute an unforeseeable emergency. Several commentators requested clarification in the final regulations of the definition of family member. The regulations have been modified to define a family member as a spouse or dependent as defined in section 152(a).
The regulations include certain rules regarding plan terminations, plan-to-plan transfers, and rollovers. These topics have been affected by the statutory changes that impose a trust requirement on eligible governmental plans. The direct rollovers that were permitted by EGTRRA beginning in
The regulations allow a plan to have provisions permitting plan termination whereupon amounts can be distributed without violating the distribution requirements of section 457. Under the regulations, an eligible plan is terminated only if all amounts deferred under the plan are paid to participants as soon as administratively practicable. If the amounts deferred under the plan are not distributed, the plan is treated as a frozen plan and must continue to comply with all of the applicable statutory requirements necessary for plan eligibility.
The proposed regulations would have allowed plan-to-plan transfers between eligible governmental plans under new circumstances, as well as the purchase of permissive service credits by transfer from an eligible governmental plan to a governmental defined benefit plan, but only if the transfers were made by plans within the same State. Commentators objected to the requirement under the new transfer rules that the transfers be to plans within the same State.
Upon consideration of the comments received, the regulations allow transfers among eligible governmental plans in three situations. In each case, the transferor plan must provide for transfers, the receiving plan must provide for the receipt of transfers, and the participant or beneficiary whose amounts deferred are being transferred must be entitled to an amount deferred immediately after the transfer that is at least equal to the amount deferred with respect to that participant or beneficiary immediately before the transfer. Transfers are permitted among eligible governmental plans in the following three cases:
• A person-by-person transfer is permitted for any beneficiary and for any participant who has had a severance from employment with the transferring employer and is performing services for the entity maintaining the receiving plan (whether or not the other plan is within the same State).
• No severance from employment is required if the entire plan's assets for all participants and beneficiaries are transferred to another eligible governmental plan within the same State.
• No severance from employment is required for a transfer from one eligible governmental plan of an employer to another eligible governmental plan of the same employer.
The final regulations also allow a plan-to-plan transfer from an eligible governmental plan to a governmental defined benefit plan for permissive service credit, without regard to whether the defined benefit plan is maintained by a governmental entity that is in the same State. In addition, language that was in an example which implied that section 415(n) (which addresses the application of maximum benefit limitations with respect to certain contributions) might apply to such a transfer has been eliminated because Treasury and the IRS have concluded that section 415(n) does not apply to such a transfer in any case in which the actuarial value of the benefit increase that results from the transfer does not exceed the amount transferred.
The regulations retain the rule from the 1982 regulations allowing a plan-to-plan transfer after a participant has had a severance from employment.
The proposed regulations specified the treatment of amounts rolled into or out of an eligible governmental plan and stated that amounts rolled into the plan are treated as amounts deferred under the plan for purposes of the regulations. Some commentators requested that consideration be given to allowing eligible governmental plans to have the same flexibility that they claimed was permitted for qualified plans with respect to the timing of distributions of rolled-in assets. Specifically, these commentators requested the ability for an eligible governmental plan to allow a participant to receive a distribution of rolled-in assets even though the participant may not yet be eligible for a distribution of other assets held under the plan.
Commentators pointed out that, since section 402(c)(10) allows an eligible governmental plan to accept a rollover contribution only if the rolled-in assets from other plan types are separately accounted for (in order to apply the section 72(t) early withdrawal income tax for distributions from these assets), this ability should not cause administrative problems for plan sponsors. Commentators also asserted that the flexibility to design an eligible governmental plan to permit such distributions would be beneficial to its participants.
These regulations do not permit an eligible governmental plan to distribute rolled-in assets to a participant who is not yet eligible for a distribution until future guidance of general applicability is published that addresses this issue. Treasury and the IRS intend to issue, in the near future, guidance of general applicability resolving this issue in coordination with the applicable rules for qualified plans and section 403(b) contracts.
Commentators also requested clarification on the order of accounts for partial distributions to participants who have rolled-in assets that are subject to the early withdrawal income tax. They requested that consideration be given in final regulations to clarifying that the participant may be treated as receiving a partial distribution first from other plan assets to minimize the early withdrawal income tax that would otherwise apply. These regulations clarify that, if a rollover is received by an eligible governmental plan from an IRA, qualified plan, or section 403(b) contract, then distributions from the eligible governmental plan are subject to the early withdrawal income tax in accordance with the plan's method of accounting,
The proposed regulations had requested comments on the issue of separate accounting for rolled-in amounts and asked if there are any special characteristics that would be lost if multiple types of separate accounts were not maintained. Commentators asked for the regulations to permit maintenance of a single rollover account for all amounts that are rolled into the eligible governmental plan. These regulations require separate accounting only to the extent mandated by section
The proposed regulations included guidance regarding ineligible plans under section 457(f). Section 457(f) generally provides that, in the case of an agreement or arrangement for the deferral of compensation, the deferred compensation is included in gross income when deferred or, if later, when the rights to payment of the deferred compensation cease to be subject to a substantial risk of forfeiture. Section 457(f) was in section 457 when it was added to the Code in 1978 for governmental employees, and extended to employees of tax-exempt organizations (other than churches or certain church-controlled organizations) in 1986, because unfunded amounts held by a tax-exempt entity compound tax free like an eligible plan, a qualified plan, or a section 403(b) contract. Section 457(f) was viewed as essential in order to provide an incentive for employers that are not subject to income taxes to adopt an eligible plan, a qualified plan, or a section 403(b) contract.
Section 457(f) does not apply to an eligible plan, a qualified plan, a section 403(b) contract, a section 403(c) contract, a transfer of property described in section 83, a trust to which section 402(b) applies, or a qualified governmental excess benefit arrangement described in section 415(m). The proposed regulations stated that section 457(f) applies if the date on which there is no substantial risk of forfeiture with respect to the compensation deferred precedes the date on which there is a transfer of property to which section 83 applies. The proposed regulations included several examples, including an example illustrating that section 457(f) does not fail to apply merely because benefits are subsequently paid by a transfer of property. Comments were requested on the coordination of sections 457(f) and 83 under the proposed regulations.
In response, a number of commentators objected to the proposed coordination of sections 457(f) and 83, including arguing that the proposed regulation would place tax-exempt organizations at a competitive disadvantage when it comes to attracting and retaining executive talent because it would effectively eliminate the use of discounted mutual fund options as a tax effective component of total compensation. Some commentators also asserted that the proposed regulations were ambiguous as to their applicability to steeply discounted mutual fund options, and recommended that, if the provision is not removed, at a minimum future guidance should be more specific.
The final regulations retain the interpretation of the coordination of sections 457(f) and 83 that was in the proposed regulations, and also clarify the application of the rule by adding an example involving an option grant. The regulations also include a clarification that, when benefits are paid or made available under an ineligible plan, the amount included in gross income is equal to the amount paid or made available, but only to the extent that the amount exceeds the amount the participant included in gross income when he or she obtained a vested right to the benefit.
In 2000, the IRS issued Announcement 2000-1 (2000-1 C.B. 294), which provided interim guidance on certain broad-based, nonelective plans of a state or local government that were in existence before 1999. Comments were requested on arrangements, such as those maintained by certain state or local governmental educational institutions, under which supplemental compensation is payable as an incentive to terminate employment, or as an incentive to retain retirement-eligible employees, to ensure an appropriate workforce during periods in which a temporary surplus or deficit in workforce is anticipated. Treasury and the IRS continue to be interested in receiving comments on this issue, which should be sent to the following address: Internal Revenue Service, Attn: CC:DOM:CORP:R (Section 457 Plans), Room 5201, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Written comments may be hand delivered Monday through Friday between 8 a.m. and 4 p.m. to: Internal Revenue Service, Courier's Desk, Attn: CC:PA:RU (Section 457 Plans), 1111 Constitution Avenue, NW., Washington, DC 20224. Alternatively, written comments may be submitted electronically via the Internet by selecting the “Tax Regs” option on the IRS Home Page, or by submitting them directly to the IRS Internet site at:
The proposed regulations included a general effective date under which the regulations would have applied to taxable years beginning after December 31, 2001. This is the general effective date for the changes made in section 457 by EGTRRA. Commentators did not express concern about this effective date and some commentators also stated that eligible governmental plans have adopted plan amendments to address the changes that have been allowed by EGTRRA, so that it would be appropriate to have the final regulations effective date coincide with the effective date for EGTRRA.
These regulations are generally applicable to taxable years beginning after December 31, 2001, subject to certain specific transition rules. Under one of these transition rules, for taxable years beginning after December 31, 2001, and before January 1, 2004, a plan will not fail to be an eligible plan if it
Further, there is a special delayed effective date for the rule under which an eligible governmental plan cannot distribute rollover account benefits to a participant who is not yet eligible for a distribution. Thus, this rule is not applicable until years beginning after December 31, 2003, since this issue is expected to be resolved before that date.
The regulations also retain the rule in the proposed regulations under which the regulations do not apply with respect to an option that lacked a readily ascertainable fair market value (within the meaning of section 83(e)(3)) at grant that was granted on or before May 8, 2002. Thus, the status of such an option under section 457(f) would be determined without regard to these regulations.
It has been determined that this Treasury decision is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It has also been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations. It is hereby certified that the collection of information in these regulations will not have a significant economic impact on a substantial number of small entities. The collection of information in the regulations is in section 1.457-8(a)(3)(ii)(B) and consists of the requirement that a custodian of a custodial account may be a person other than a bank only if the person demonstrates to the satisfaction of the Commissioner that the manner in which the person will administer the custodial account will be consistent with the requirement of section 457(g)(1) and (3) of the Code. This certification is based on the fact that the cost of submitting this information is small, even for small entities. Therefore, a Regulatory Flexibility Analysis under the Regulatory Flexibility Act (5 U.S.C. chapter 6) is not required. Pursuant to section 7805(f) of the Code, the notice of proposed rulemaking preceding these regulations was submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.
Income taxes, Reporting and recordkeeping requirements.
Reporting and recordkeeping requirements.
26 U.S.C. 7805 * * *.
Section 457 provides rules for nonqualified deferred compensation plans established by eligible employers as defined under § 1.457-2(d). Eligible employers can establish either deferred compensation plans that are eligible plans and that meet the requirements of section 457(b) and §§ 1.457-3 through 1.457-10, or deferred compensation plans or arrangements that do not meet the requirements of section 457(b) and §§ 1.457-3 through 1.457-10 and that are subject to tax treatment under section 457(f) and § 1.457-11.
This section sets forth the definitions that are used under §§ 1.457-1 through 1.457-11.
(a)
(b)
(2) If the amount of compensation deferred under the plan during a taxable year is not subject to a substantial risk of forfeiture, the amount taken into account as an annual deferral is not adjusted to reflect gain or loss allocable to the compensation deferred. If, however, the amount of compensation deferred under the plan during the taxable year is subject to a substantial risk of forfeiture, the amount of compensation deferred that is taken into account as an annual deferral in the taxable year in which the substantial risk of forfeiture lapses must be adjusted to reflect gain or loss allocable to the compensation deferred until the substantial risk of forfeiture lapses.
(3) If the eligible plan is a defined benefit plan within the meaning of section 414(j), the annual deferral for a taxable year is the present value of the increase during the taxable year of the participant's accrued benefit that is not subject to a substantial risk of forfeiture (disregarding any such increase attributable to prior annual deferrals). For this purpose, present value must be determined using actuarial assumptions and methods that are reasonable (both individually and in the aggregate), as determined by the Commissioner.
(4) For purposes solely of applying § 1.457-4 to determine the maximum amount of the annual deferral for a participant for a taxable year under an eligible plan, the maximum amount is reduced by the amount of any deferral for the participant under a plan described at paragraph (k)(4)(i) of this
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(1) Any nonelective deferred compensation under which all individuals (other than those who have not satisfied any applicable initial service requirement) with the same relationship with the eligible employer are covered under the same plan with no individual variations or options under the plan as described in section 457(e)(12), but only to the extent the compensation is attributable to services performed as an independent contractor;
(2) An agreement or arrangement described in § 1.457-11(b);
(3) Any plan satisfying the conditions in section 1107(c)(4) of the Tax Reform Act of 1986 (100 Stat. 2494) (TRA ’86) (relating to certain plans for State judges); and
(4) Any of the following plans or arrangements (to which specific transitional statutory exclusions apply)—
(i) A plan or arrangement of a tax-exempt entity in existence prior to January 1, 1987, if the conditions of section 1107(c)(3)(B) of the TRA ’86, as amended by section 1011(e)(6) of Technical and Miscellaneous Revenue Act of 1988 (102 Stat. 3700) (TAMRA), are satisfied (see § 1.457-2(b)(4) for a special rule regarding such plan);
(ii) A collectively bargained nonelective deferred a compensation plan in effect on December 31, 1987, if the conditions of section 6064(d)(2) of TAMRA are satisfied;
(iii) Amounts described in section 6064(d)(3) of TAMRA (relating to certain nonelective deferred compensation arrangements in effect before 1989); and
(iv) Any plan satisfying the conditions in section 1107(c)(4) or (5) of TRA ’86 (relating to certain plans for certain individuals with respect to which the Service issued guidance before 1977).
(l)
(m)
(n)
(a)
(b)
(a)
(b)
(c)
(A) The applicable annual dollar amount specified in section 457(e)(15): $11,000 for 2002; $12,000 for 2003; $13,000 for 2004; $14,000 for 2005; and $15,000 for 2006 and thereafter. After 2006, the $15,000 amount is adjusted for cost-of-living in the manner described in paragraph (c)(4) of this section; or
(B) 100 percent of the participant's includible compensation for the taxable year.
(ii) The amount of annual deferrals permitted by the 100 percent of includible compensation limitation under paragraph (c)(1)(i)(B) of this section is determined under section 457(e)(5) and § 1.457-2(g).
(iii) For purposes of determining the plan ceiling under this paragraph (c), the annual deferral amount does not include any rollover amounts received by the eligible plan under § 1.457-10(e).
(iv) The provisions of this paragraph (c)(1) are illustrated by the following examples:
(i)
(ii)
(i)
(ii)
(i)
(ii)
(2)
(ii)
(A) The plan ceiling under paragraph (c)(1) of this section and the age 50 catch-up described in this paragraph (c)(2) (and disregarding the special section 457 catch-up described in paragraph (c)(3) of this section) or
(B) The plan ceiling under paragraph (c)(1) of this section and the special section 457 catch-up described in paragraph (c)(3) of this section (and disregarding the age 50 catch-up described in this paragraph (c)(2)).
(iii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(3)
(A) Twice the dollar amount in effect under paragraph (c)(1)(i)(A) of this section; or
(B) The underutilized limitation determined under paragraph (c)(3)(ii) of this section.
(ii)
(A) The plan ceiling established under paragraph (c)(1) of this section for the taxable year; plus
(B) The plan ceiling established under paragraph (c)(1) of this section (or under section 457(b)(2) for any year before the applicability date of this section) for any prior taxable year or years, less the amount of annual deferrals under the plan for such prior taxable year or years (disregarding any annual deferrals under the plan permitted under the age 50 catch-up under paragraph (c)(2) of this section).
(iii)
(iv)
(B)
(C)
(D)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(v)
(B)
(vi)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(4)
(d)
(2)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(e)
(2)
(3)
(4)
(5)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i) Facts. Assume the same facts as in
(ii)
(a)
(b)
(c)
(d)
(i)
(ii)
(i)
(ii)
(iii) If the underutilized amount under Plans W, X, and Y for 2006 were in each case zero (because E had always contributed the maximum amount or E was a new participant) or an amount not in excess of $5,000, the maximum exclusion under this section would be $20,000 for Participant E for 2006 ($15,000 plus the $5,000 age 50 catch-up amount), which Participant E could contribute to any of the plans.
(a)
(b)
(2)
(ii)
(A) No amount will be paid to the participant before a date at least 12 months after the day on which the contract expires under which services are performed for the eligible employer (or, in the case of more than one contract, all such contracts expire); and
(B) No amount payable to the participant on that date will be paid to the participant if, after the expiration of the contract (or contracts) and before that date, the participant performs services for the eligible employer as an independent contractor or an employee.
(c)
(2)
(ii)
(iii)
(d)
(e)
(2)
(f)
(2)
(3)
(i)
(ii)
(a)
(b)
(2)
(3)
(4)
(i)
(ii)
(i)
(ii)
(c)
(2)
(A) A distribution in the event of an unforeseeable emergency to the extent the distribution is permitted under § 1.457-6(c).
(B) A distribution from an account for which the total amount deferred is not in excess of the dollar limit under section 411(a)(11)(A) to the extent the
(ii)
(B)
(iii)
(iv)
(3)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(a)
(2)
(ii) Amounts deferred under an eligible governmental plan must be transferred to a trust within a period that is not longer than is reasonable for the proper administration of the participant accounts (if any). For purposes of this requirement, the plan may provide for amounts deferred for a participant under the plan to be transferred to the trust within a specified period after the date the amounts would otherwise have been paid to the participant. For example, the plan could provide for amounts deferred under the plan at the election of the participant to be contributed to the trust within 15 business days following the month in which these amounts would otherwise have been paid to the participant.
(3)
(ii)
(B)
(iii)
(4)
(b)
(2)
(a)
(b)
(a)
(2)
(ii)
(3)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(b)
(2)
(i) The transferor plan provides for transfers;
(ii) The receiving plan provides for the receipt of transfers;
(iii) The participant or beneficiary whose amounts deferred are being transferred will have an amount deferred immediately after the transfer at least equal to the amount deferred with respect to that participant or beneficiary immediately before the transfer; and
(iv) In the case of a transfer for a participant, the participant has had a severance from employment with the transferring employer and is performing services for the entity maintaining the receiving plan.
(3)
(i) The transfer is from an eligible governmental plan to another eligible governmental plan within the same State;
(ii) All of the assets held by the transferor plan are transferred;
(iii) The transferor plan provides for transfers;
(iv) The receiving plan provides for the receipt of transfers;
(v) The participant or beneficiary whose amounts deferred are being transferred will have an amount deferred immediately after the transfer at least equal to the amount deferred with respect to that participant or beneficiary immediately before the transfer; and
(vi) The participants or beneficiaries whose deferred amounts are being transferred are not eligible for additional annual deferrals in the receiving plan unless they are performing services for the entity maintaining the receiving plan.
(4)
(i) The transfer is from an eligible governmental plan to another eligible governmental plan of the same employer (and, for this purpose, the employer is not treated as the same employer if the participant's compensation is paid by a different entity);
(ii) The transferor plan provides for transfers;
(iii) The receiving plan provides for the receipt of transfers;
(iv) The participant or beneficiary whose amounts deferred are being transferred will have an amount deferred immediately after the transfer at least equal to the amount deferred with respect to that participant or beneficiary immediately before the transfer; and
(v) The participant or beneficiary whose deferred amounts are being transferred is not eligible for additional annual deferrals in the receiving plan unless the participant or beneficiary is performing services for the entity maintaining the receiving plan.
(5)
(i) The transferor plan provides for transfers;
(ii) The receiving plan provides for the receipt of transfers;
(iii) The participant or beneficiary whose amounts deferred are being transferred will have an amount deferred immediately after the transfer at least equal to the amount deferred with respect to that participant or beneficiary immediately before the transfer; and
(iv) In the case of a transfer for a participant, the participant has had a severance from employment with the transferring employer and is performing services for the entity maintaining the receiving plan.
(6)
(i) The transferred amount is subject to the restrictions of § 1.457-6 (relating to when distributions are permitted to be made to a participant under an eligible plan) in the receiving plan in the same manner as if the transferred amount had been originally been deferred under the receiving plan if the participant is performing services for the entity maintaining the receiving plan, and
(ii) In the case of a transfer between eligible plans of tax-exempt entities, except as otherwise determined by the Commissioner, the transferred amount is subject to § 1.457-7(c)(2) (relating to when amounts are considered to be made available under an eligible plan of a tax-exempt entity) in the same manner as if the elections made by the participant or beneficiary under the transferor plan had been made under the receiving plan.
(7)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii) Conclusion. If State C's (transferor) eligible governmental plan provides for such transfer and the eligible governmental plan of City U permits the acceptance of such a transfer (and the other requirements of paragraph (b)(1) of this section are satisfied), then the requirements of paragraph (b)(4) of this section are satisfied and, thus, State C may transfer the total amounts deferred under its eligible governmental plan to the eligible governmental plan maintained by City U.
(8)
(ii)
(A) For the purchase of permissive past service credit (as defined in section 415(n)(3)(A)) under the receiving defined benefit governmental plan; or
(B) A repayment to which section 415 does not apply by reason of section 415(k)(3).
(iii)
(i)
(ii)
(c)
(2)
(i)
(ii)
(i)
(ii)
(d)
(e)
(2)
(3)
(i)
(ii)
(f)
(a)
(1) Compensation deferred under the agreement or arrangement is includible in the gross income of the participant or beneficiary for the first taxable year in which there is no substantial risk of forfeiture (within the meaning of section 457(f)(3)(B)) of the rights to such compensation;
(2) If the compensation deferred is subject to a substantial risk of forfeiture, the amount includible in gross income for the first taxable year in which there is no substantial risk of forfeiture includes earnings thereon to the date on which there is no substantial risk of forfeiture;
(3) Earnings credited on the compensation deferred under the agreement or arrangement that are not includible in gross income under paragraph (a)(2) of this section are includible in the gross income of the participant or beneficiary only when paid or made available to the participant or beneficiary, provided that the interest of the participant or beneficiary in any assets (including amounts deferred under the plan) of the entity sponsoring the agreement or arrangement is not senior to the entity's general creditors; and
(4) Amounts paid or made available to a participant or beneficiary under the agreement or arrangement are includible in the gross income of the participant or beneficiary under section 72, relating to annuities.
(b)
(1) A plan described in section 401(a) which includes a trust exempt from tax under section 501(a);
(2) An annuity plan or contract described in section 403;
(3) That portion of any plan which consists of a transfer of property described in section 83;
(4) That portion of any plan which consists of a trust to which section 402(b) applies; or
(5) A qualified governmental excess benefit arrangement described in section 415(m).
(c)
(d)
(2)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(i)
(ii)
(a)
(b)
(c)
(d)
(e)
26 U.S.C. 7805.
(b) * * *
Departmental Offices, Treasury.
Final rule.
The Department of the Treasury (Treasury) is issuing this rule in final form as part of its implementation of Title I of the Terrorism Risk Insurance Act of 2002 (Act). That Act established a temporary Terrorism Risk Insurance Program (Program) under which the Federal Government will share the risk of insured loss from certified acts of terrorism with commercial property and casualty insurers until the Program sunsets on December 31, 2005. Treasury published an interim final rule with a request for comment on February 28, 2003. That rule set forth the purpose and scope of the Program and key definitions that Treasury will use in implementing the Program. It was the first in a series of regulations that Treasury will be issuing to implement the Program. This final rule generally adopts the interim final rule, but makes revisions in the definition of “affiliate” and certain other changes described in the preamble.
This final rule is effective July 11, 2003.
Mario Ugoletti, Deputy Director, Office of Financial Institutions Policy (202) 622-2730, or Martha Ellett or Cynthia Reese, Attorney-Advisors, Office of the Assistant General Counsel (Banking & Finance), (202) 622-0480 ( not toll-free numbers).
On November 26, 2002, President Bush signed into law the Terrorism Risk Insurance Act of 2002 (Public Law 107-297, 116 Stat. 2322). The Act was effective immediately. Title I of the Act establishes a temporary federal program of shared public and private compensation for insured commercial property and casualty losses resulting from an act of terrorism as defined in the Act and certified by the Secretary of the Treasury, in concurrence with the Secretary of State and the Attorney General. The Act authorizes Treasury to administer and implement the Terrorism Risk Insurance Program, including the issuance of regulations and procedures. The Program will sunset on December 31, 2005.
The Act's purposes are to address market disruptions, ensure the continued widespread availability and affordability of commercial property and casualty insurance for terrorism risk and to allow for a transition period for the private markets to stabilize and build capacity while preserving State insurance regulation and consumer protections. The amount of Federal payment for an insured loss resulting from an act of terrorism is to be determined based upon the insurance company deductibles and excess loss sharing with the Federal Government, as specified by the Act. Thus, the Program provides a Federal reinsurance backstop for a temporary period of time. The Act also provides Treasury with authority to recoup Federal payments made under the Program through policyholder surcharges, up to a maximum annual limit.
Each entity that meets the definition of “insurer” (well over 2000 firms) must participate in the Program. From the date of enactment of the Act through the last day of Program Year 2 (December 31, 2004), insurers under the Program must “make available” terrorism risk insurance in their commercial property and casualty insurance policies and the coverage must not differ materially from the terms, amounts and other coverage limitations applicable to commercial property and casualty losses arising from events other than acts of terrorism. The Act permits Treasury to extend the “make available” requirement into Program Year 3, based on an analysis of factors referenced in the study required by section 108(d)(1) of the Act, and not later than September 1, 2004. An insurer's deductible increases each year of the Program, thereby reducing the Federal government's involvement prior to sunset of the Program. An insurer's deductible is based on “direct earned premiums” over a statutory Transition Period and the three Program Years. Once an insurer has met its deductible, the Federal payments cover 90 percent of insured losses above the deductible, subject to an aggregate annual cap of $100 billion. The Act prohibits duplicative payments for insured losses that have been covered under any other Federal program.
As conditions for federal payment under the Program, insurers must provide clear and conspicuous disclosure to the policyholders of the premium charged for insured losses covered by the Program, and must submit a claim and certain certifications to Treasury. Treasury will be prescribing claims procedures at a later date.
The Act also contains specific provisions designed to manage litigation arising from or relating to a certified act of terrorism. Section 107 creates an exclusive federal cause of action, provides for claims consolidation in federal court and contains a prohibition on Federal payments for punitive damages under the Program. This section also provides the United States with the right of subrogation with respect to any payment or claim paid by the United States under the Program.
The interim final rule established Subpart A of a new Part 50 in Title 31 of the Code of Federal Regulations. Subpart A of new Part 50 contains certain general provisions and definitions of Program terms. The definitions contained in the interim final rule provide the foundation for participation by insurers under the Federal reinsurance Program created by the Act.
Some of the definitions in the interim final rule were taken virtually verbatim from the Act because they do not need further clarification. For other definitions, the interim final rule generally incorporated previously issued interim guidance provided by Treasury as it pertains to Program terms, for example, the terms “insurer,” “affiliate,” “property and casualty insurance” and “direct earned premium.” Such interim guidance was published at 67 FR 76206 (December 11, 2002), 67 FR 78864 (December 26, 2002) and 68 FR 4544 (January 29, 2003). In several areas, the interim final rule made clarifying modifications to, or supplemented, the previously issued interim guidance.
In implementing the Program, Treasury has been guided by several goals. First, we strive to implement the Act in a transparent and effective manner that treats comparably those insurers required to participate in the Program and that provides necessary information to policyholders in a useful and efficient manner. Second, Treasury seeks to rely as much as possible on the State insurance regulatory structure. In that regard, Treasury is closely coordinating with the National Association of Insurance Commissioners (NAIC) in implementing definitional and other aspects of the Program. Third, to the extent possible within statutory constraints, Treasury seeks to allow insurers to participate in the Program in a manner consistent with their normal course of business. Finally, given the temporary and transitional nature of the Program, Treasury is guided by the Act's goal for insurers to develop their own capacity, resources and mechanisms for terrorism risk insurance coverage when the Program expires.
Treasury received over 40 comments on the interim final rule. Comments were submitted by insurance companies, industry trade associations, the NAIC, two cities, and by two members of Congress. After review and careful consideration of these comments, as well as additional research and consultation with the NAIC, Treasury is now promulgating a final rule concerning TRIA definitions. In general, the final rule reflects the interim final rule. However, revisions and clarifications were made in several areas, based on comments received. For example, revisions were made to the rebuttable presumptions to controlling influence determinations under the definition of “affiliate,” and clarifications were made to the definitions of “direct earned premium” and “commercial property and casualty insurance.” The final rule, including changes and clarifications, is discussed in the summary below.
The interim final rule incorporated the statutory definition of “act of terrorism” found in section 102(1) of the Act. In that regard, the interim final rule provides that an “act of terrorism” for
Section 102(1)(B) limits the Secretary's ability to certify an act if committed as part of a course of war declared by Congress, (except for workers'compensation coverage), or if property and casualty insurance losses resulting from the act, in the aggregate, do not exceed a $5,000,000
With regard to the second statutory limitation on an act of terrorism certification, one commenter asked whether the $5,000,000 threshold loss has to be suffered by one insured policyholder. The Act, as reflected in the interim final rule, provides that the
Section 106(a)(2) of the Act provides that the Act's definition is the exclusive definition of the term “act of terrorism” for purposes of compensation for insured losses under the Act. In addition, section 102(1)(C) of the Act provides that the Secretary's determination or certification with regard to whether an act is an act of terrorism for purposes of the Program is final and is not subject to judicial review.
One commenter urged Treasury to establish a time frame within which the Secretary would be required to make a determination or certification that an “act of terrorism” had occurred in order to better assist insurers in responding to inquiries and claims from their policyholders. Treasury understands the desire for certainty of those in the industry who would advocate a definite time frame, and intends to make its determination as promptly as possible after obtaining and evaluating the facts surrounding a possible act of terrorism. However, there is no way to predict future events and ascertain a time frame that would be appropriate for all potential situations. Facts could be immediately available and, after consultation, present a clear basis for a quick determination by the Secretary; conversely, a determination could require more time to gather information and conduct an analysis of the act. Given this inherent uncertainty and the significance of an act of terrorism determination to all aspects of the Program, Treasury does not believe that it would be in the public interest to establish in advance a regulatory time frame that may later prove to be inappropriate or unattainable.
Approximately one-third of the comments submitted to Treasury on the interim final rule raised questions or concerns with regard to the definition of “affiliate”, which includes the definition of “control” in section 50.5(c). Most of these comments raised questions with either procedural or substantive aspects of the rebuttable presumptions of controlling influence in this section. After careful consideration of the comments and further consultation with the NAIC, Treasury has made several revisions in the final rule to address these comments. The regulatory definitions and changes to the interim final rule are set forth below.
Section 102(6) of the Act defines an “insurer” to include “any affiliate thereof.” The definitions of “affiliate” and “control” are intertwined in the Act. Section 102(2) defines “affiliate” to mean “with respect to any insurer, an entity that controls, is controlled by, or is under common control with the insurer.” Pursuant to Section 102(3) of the Act, “control” exists if
• an entity directly or indirectly or acting through 1 or more other persons owns, controls, or has power to vote 25 percent or more of any class of voting securities of the other entity; or
• an entity controls in any manner the election of a majority of the directors or trustees of the other entity; or
• the Secretary determines, after notice and opportunity for hearing, that the entity directly or indirectly exercises a controlling influence over the management or policies of the other entity.
Section 50.5(c) of the interim final rule generally incorporates and combines the related statutory definitions of “affiliate” and “control.” In addition, the interim final rule provides that an affiliate must itself meet the definition of “insurer” to participate in the Program. (See part E of this preamble for further discussion of “insurer” definition.) The definitions of affiliate and control are integral to Treasury's implementation of the Program. As discussed further in parts C and F of this preamble, affiliated insurers are treated collectively as one entity by Treasury for purposes of calculating direct earned premiums and an insurer deductible under the Program. Three comments objected to this consolidated treatment as not equitable. However, as noted in the preamble to the interim final rule, this consolidated treatment is in accord with the Act's legislative history and the clear intent of Congress. The Conference Report states that the terms “affiliate” and “control” were meant “to ensure that affiliated insurers are treated as a consolidated entity for calculating direct earned premiums.” H.R. Conf. Rep. No. 107-779 (2002).
Therefore, for example, if an insurance company meets the definition of an “insurer” under section 102(6) as implemented by Treasury, and three out
In addition, if an entity is under common control with an insurer, and that entity also meets the definition of “insurer” under Section 102(6) of the Act as implemented by Treasury, then the two insurers are “affiliates” and Treasury will treat them collectively as one “insurer” for the Program purposes of consolidating direct earned premiums and calculating the insurer deductible. If their parent company does not meet the definition of “insurer” under the Act, then it is not included in the Program.
The statutory definition of “control” in section 102(3) contains three categories. Section 102(3)(A) and (B) establish conclusive control under certain circumstances for purposes of the Program. The conclusive control provisions of the Act are contained in the definition of “affiliate” in the interim final rule at section 50.5(c)(2)(i) and (ii). If a relationship between or among insurers does not fit within the conclusive control provisions, control may still exist for purposes of the Program if Treasury determines, pursuant to section 102(3)(C), that an entity directly or indirectly exercises a controlling influence over the management or policies of another entity. Section 102(3)(C) is contained in the interim final rule at section 50.5(c)(2)(iii). In making a determination of whether controlling influence exists among insurers, section 102(3)(C) of the Act requires Treasury to provide notice and an opportunity for a hearing.
The Act's definition of control in section 102(3)(A), (B) and (C) is almost identical to the definition of “control” contained in the Bank Holding Company Act (BHCA) at 12 U.S.C. 1841(a)(2) and in the Savings and Loan Holding Company Act (SLHCA) at 12 U.S.C. 1467a, except that the Act does not contain a presumption of no control for holding less than 5 percent of any class of voting securities, nor does the Act provide any of the other explicit statutory exemptions that are provided in the BHCA and SLHCA. The Act's definition of control is also similar to the definition of control in the NAIC's Model Insurance Company Holding Company Act (Model Act) except that the Model Act contains a presumption of control if an entity owns 10 percent of the voting securities of an insurance company instead of the 25 percent conclusive control threshold that is contained in the Act (and in the BHCA and the SLHCA).
Under Section 102(3)(A) of the Act, “an entity has ‘control’ over another entity if the entity directly or indirectly or acting through 1 or more persons owns, controls or has the power to vote 25 percent or more of any class of voting securities of the other entity.” The interim final rule incorporates this statutory definition, but uses the word “insurer” instead of “entity” to clarify that the definition of control does not include entities that are not insurers.
One commenter asked for clarification that an affiliate itself must be an insurer to be treated as part of a consolidated entity with a related insurer. In view of the congressional intent that affiliated insurers be treated as a consolidated entity for purposes of calculating direct earned premiums, there is no reason to include non-insurer entities in the definition of “affiliate” because these entities do not have “direct earned premiums” as defined in the Act. Viewing a group of affiliates with both insurer and non-insurer entities, the direct earned premiums for the group should be no different whether or not the non-insurers are included in the group. For this reason, Treasury has decided to interpret the Act as generally excluding non-insurers from the definitions of affiliate and control at this time. Treasury could revisit this issue if it finds evidence that other corporate structures or arrangements are being used to thwart the goals and purposes of the Program.
Five insurance industry commenters took the position that ownership of 25 percent or more of the voting securities of an insurer should not automatically result in control. These commenters asserted that Treasury could and should by regulation change this statutory limit. One commenter referenced the NAIC Model Act language in support of creating a regulatory presumption. As noted above, unlike section 102(3)(A), the NAIC Model Act contains a 10 percent statutory presumption not a threshold of conclusive control. Several of these commenters stated that a 25 percent or more conclusive control limit could adversely affect the availability and affordability of coverage, and in particular, would have an adverse effect on their own companies if they were required to aggregate direct earned premiums. These commenters suggested various alternatives for Treasury to use instead of the 25 percent statutory limit. These included substituting other regulatory factors for the 25 percent limit and accepting a state determinations of “no control” based on state law even where there is ownership of more than 25 percent.
Consistent with the statutory language in section 102(3)(A) and with other statutes containing similar language, Treasury interprets the 25 percent or more direct or indirect ownership of any class of voting securities to be an objective standard establishing conclusive control. Under the plain language of the statute, the 25 percent voting securities threshold is not a presumption, and is not subject to rebuttal. We also note that in addressing the rebuttable presumptions in the interim final rule in connection with section 102(3)(C), several commenters characterized the ownership of 25 percent or more of any class of voting securities threshold in section 102(3)(A), as well as the control provision in section 102(3)(B), as objective standards. For these reasons, Treasury has not made any change in the final rule to the 25 percent threshold in section 50.5(c)(2)(ii) of the interim final rule.
The interim final rule provides that an insurer controls another insurer for purposes of the Program if the insurer controls in any manner the election of a majority of the directors or trustees of the other insurer. In general, this regulatory provision incorporates the statutory language in section 102(3)(B). For the reasons stated above in connection with section 102(3)(A), Treasury interprets the section 102(3)(B) as another objective standard that establishes conclusive control for purposes of the Act. This standard is not a presumption and is not subject to rebuttal.
In addition to the conclusive control provisions in section 102(3)(A) and (B), the Act defines control to exist if, “the Secretary determines, after notice and opportunity for hearing, that the entity directly or indirectly exercises a controlling influence over the management or policies of the other entity.” Section 102(3)(C). In the interim
Section 50.5(c)(4) of the interim final rule provided an insurer with an opportunity for an informal hearing to rebut a controlling influence presumption through written submissions and, in addition in Treasury's discretion, by an informal oral presentation. Treasury subsequently issued a notice on March 25, 2003 (68 FR 15039, March 27, 2003, “Interim Guidance IV”) providing further guidance on the procedure for rebutting a presumption of controlling influence.
In establishing several rebuttable presumptions in Section 50.5(c)(3) of the interim final rule, Treasury had two key goals. One was to provide additional transparency about the factors that Treasury considers indicative of controlling influence to provide greater certainty to insurers prior to a final determination of control and thereby facilitate the calculation of insurer deductibles prior to presentment of a claim.
The second was to enhance administrative efficiency given available time and other resources in this temporary Program.
With regard to the second goal, we point out that, in the Act, Congress established a temporary backstop program with the expectation that Treasury would not build a large bureaucratic program structure, but instead would leverage off of the state insurance regulatory structure, where possible and appropriate. Unlike state insurance commissioners, or state or federal bank examiners, Treasury does not conduct regular on-site examinations of Program participants, nor does it routinely review acquisitions, mergers or other transactions of such insurers. Thus, Treasury does not have ready access to detailed information on the control relationships of insurers that is generally available to regulators that implement the control provisions of the BHCA, the SLHCA, or state insurance law.
At this point, it is unclear to Treasury how many insurers fall outside section 102(3)(A) and (B) but may come within the controlling influence category. Rejecting the imposition of significant new regulatory reporting requirements on the property and casualty insurance industry, Treasury decided to utilize regulatory presumptions to accomplish these two goals and to implement the controlling influence provisions.
Treasury received 6 comments, from insurers and from a large insurance industry trade group, taking exception to the rebuttable presumptions as presented in the interim final rule. These commenters objected on procedural and substantive grounds. In addition, one commenter supported, in principle, the rebuttable presumption process.
Most of these commenters objected to the reliance on a state law determination of control in the first rebuttable presumption in the interim final rule. They contended that exclusive reliance on a state law determination, for purposes of a rebuttable presumption, was inappropriate given the varying state standards and the differences between the Act's definition of “control”, and the definition of “control” in the NAIC Model Law used by most states. Several commenters suggested that Treasury utilize specific guidelines or standards (such as the existence of a management agreement) instead of rebuttable presumptions.
After consideration of these comments and the stated administrative goals, Treasury has decided to retain the use of rebuttable presumptions, with modifications. Use of the rebuttable presumptions provides increased certainty and transparency to insurers and others of the factors that Treasury considers indicative of a controlling influence. Rebuttable presumptions have been and are used successfully by other agencies in implementing nearly identical statutory definitions of “control.” Rebuttable presumptions also aid efficient implementation of the controlling influence determination process, given that Treasury does not have ready access to relevant information about the financial, managerial, policymaking and corporate structures of insurers. Moreover, a rebuttable presumption is not a final determination of controlling influence by Treasury. Under the final rule, insurers subject to rebuttable presumptions, and others that do not fall within the conclusive control provisions and wish to have a final determination of controlling influence, all have an opportunity for a hearing. Based upon the comments, and further consultation with NAIC, Treasury is revising the rebuttable presumptions to provide more detail and transparency concerning factors that Treasury will consider indicative of controlling influence and is using these factors in the rebuttable presumptions. For example, in response to several comments, no rebuttable presumption relies exclusively on a state law determination of control in the absence of the existence of at least one of the listed control factors. The final rule also adds the existence of at least one of the control factors to the other two presumptions (which are based on the provision of 25 percent corporate capital/ policyholder surplus, or the provision of 25 percent underwriting capacity to another insurer).
In the final rule, if an insurer does not come within the conclusive control provisions of section 102(3)(A) or (B) (section 50.5(c)(2)(i) or (ii) of the final rule), but at least two of the following control factors exists, then Treasury will presume controlling influence exists prior to a final determination unless and until rebutted by the insurer:
• The insurer is one of the two largest shareholders of any class of voting stock;
• The insurer holds more than 35 percent of the combined debt securities and equity of the other insurer;
• The insurer is party to an agreement pursuant to which the insurer possesses a material economic stake in another insurer resulting from a profit-sharing arrangement, use of common names, facilities or personnel, or the provision of essential services to another insurer;
• The insurer is party to an agreement that enables the insurer to influence a material aspect of the management or policies of another insurer;
• The insurer would have the ability, other than through the holding of revocable proxies, to direct the votes of more than 25 percent of the other insurer's voting stock in the future upon the occurrence of an event;
• The insurer has the power to direct the disposition of more than 25 percent of a class of voting stock in a manner other than a widely dispersed or public offering;
• The insurer and/or the insurer's representative or nominee constitute more than one member of the other insurer's board of directors;
• The insurer or its nominee or an officer of the insurer serves as the chairman of the board, chairman of the
In addition, if a State has determined that an insurer controls another insurer, and at least one of the factors listed above exists, then Treasury will presume controlling influence exists unless and until rebutted by the insurer.
Further, if an insurer provides 25 percent or more of another insurer's capital in the case of a stock insurer, policyholder surplus (in the case of a mutual insurer) or corporate capital (in the case of other entities that qualify as insurers), and at least one of the factors listed above exists, then Treasury will presume a controlling influence exists unless and until rebutted by the insurer.
Finally, if an insurer, at anytime during the Program Year, supplies 25 percent or more of the underwriting capacity for that year to an insurer that is a syndicate consisting of a group including incorporated and individual unincorporated underwriters, and at least one of the factors in the above list exists, then Treasury will presume a controlling influence unless and until rebutted by the insurer.
A few of the commenters objected to the second and third rebuttable presumptions in the interim final rule as inconsistent with the conclusive control provisions in section 102(3)(A) and (B). As a general matter, Treasury is directed by the Act to treat insurers comparably under the Program. Treasury views the provision by an insurer of 25 percent of an insurer's corporate capital (or policyholder surplus), or supplying of 25 percent of an insurer's underwriting capacity for the Program Year, to indicate the functional equivalent of ownership of 25 percent of voting securities. As the administrator of the Program, Treasury also seeks to prevent loopholes in the regulations and elsewhere that may create opportunities to avoid or greatly minimize an insurer deductible merely on the basis of an insurer's unusual corporate structure or arrangement where, in effect, the insurer exercises a controlling influence over another insurer in the same or similar manner as the more traditional corporate structures of other insurers. The controlling influence determination authority in section 102(3)(C) aids Treasury's efforts to treat insurers comparably and helps preserve the goals and effectiveness of the Program. As described below, the final rule provides insurers with an opportunity for a hearing and a final determination on controlling influence.
Section 102(3)(C) of the Act authorizes Treasury to make a determination that an insurer directly or indirectly exercises a controlling influence over the management or policies of another insurer, after notice and opportunity for hearing. The statutory language providing an opportunity for hearing does not require a formal hearing on the record. In the interim final rule, Treasury provided an opportunity for an informal hearing to any insurer that (1) does not come within the conclusive control provisions of section 102(3)(A) or (B) and (2) wanted to rebut a presumption of controlling influence. The informal hearing procedure requires an insurer to provide Treasury with relevant facts and circumstances concerning the relationship and in support of the insurer's contention that no controlling influence exists. The procedure also allows a supplementary oral presentation by the insurer, if deemed necessary by Treasury. Based on the information provided by the insurer, including any oral presentation, the factors listed in the regulation and other relevant facts and circumstances, Treasury would then make a final determination of whether a controlling influence exists.
A few commenters contended that Section 554 of the Administrative Procedure Act (“APA”), 5 U.S.C. § 554, requires Treasury to hold a formal hearing for insurers challenging determinations of entity control under section 102(3) of the Act. We do not agree. The APA's formal hearing requirements apply when a hearing on the record is required by statute. “While the exact phrase ‘on the record’ is not an absolute prerequisite to the application of formal hearing procedures, the Supreme Court has made clear that these provisions do not apply, unless Congress has clearly indicated that the ‘hearing’ required by the statute must be trial-type hearing on the record.”
In response to the comments received, the final rule revises the interim final rule to provide greater transparency in the controlling influence determination process. The final rule includes regulatory notice of specific factors that Treasury considers indicative of a controlling influence, and the rebuttable presumptions in the interim final rule are revised to avoid reliance on state law determinations without other indicia of control. The final rule affords insurers an opportunity to request an informal hearing in which an insurer may submit all relevant information on the issue of controlling influence, whether to rebut a presumption or to otherwise obtain a final controlling influence determination from Treasury. As in the interim final rule, the final rule allows an oral presentation, where deemed necessary by Treasury to supplement the written submission. Treasury will base its final determination on the factors set forth in the final rule, on information provided to Treasury by the insurer and on other relevant facts and circumstances. Although the final rule sets no deadline for an insurer to request a hearing, Treasury encourages insurers that do not come within the conclusive control provisions but that are in a relationship or arrangement in which the control factors apply or exist to request a hearing as soon as possible if they wish to rebut the regulatory presumptions of controlling influence and obtain a final determination from Treasury of whether the relationship involves a controlling influence (and therefore control).
Separately from the issuance of the interim final rule, Treasury solicited comment on a pro rata allocation method for control determinations under section 102(3)(C) of the Act, in situations in which multiple insurers each provide 25 percent or more of the capital of a stock insurer, policyholder surplus of a mutual insurer or corporate capital of other entities that meet the definition of insurer under the Act and in the interim final rule. The pro rata approach under consideration by Treasury would allocate premium on a pro rata basis in situations where there are multiple 25 percent owners. This approach is still under consideration by Treasury and may be proposed in connection with claims procedures.
Treasury anticipates proposing within claims procedures at a later date that the controlling insurer will be the insurer that will be required to file any claim with Treasury for Federal payment under the Program and that this insurer
Treasury also solicited comment on various means to ensure the prompt distribution of the federal payment as appropriate to ensure that the purposes of the Program are not thwarted or evaded, and that the ultimate risk bearing entities are treated in an equitable manner, within the Act's requirements. Treasury will propose means of distribution of the federal payment in connection with the claims procedures at a later date.
The Act requires that “commercial property and casualty insurance” that falls within the scope of “insured loss” and that is written by an “insurer,” is part of the Program, and thus eligible for Federal payments and also subject to other provisions of the Act. Losses arising from a certified act of terrorism that do not meet these requirements are not eligible for Federal payments under the Program. For those losses that are eligible, the amount of Federal payment that an insurer may receive is subject to the insurer's “insurer deductible,” which is determined by a calculation based on the insurer's “direct earned premium”.
In the interim final rule, Treasury initially looked to the Act's definition to ascertain the scope of commercial property and casualty insurance for purposes of the Program. Section 102(12) of the Act expressly includes several lines of insurance: excess insurance, workers' compensation insurance and surety insurance. It also expressly excludes several additional lines of insurance: (i) Federal crop insurance issued or reinsured under the Federal Crop Insurance Act or any other type of crop or livestock insurance that is privately issued or reinsured; (ii) private mortgage insurance as defined in the Homeowners Protection Act or title insurance; (iii) financial guaranty insurance issued by monoline financial guaranty insurance corporations; (iv) insurance for medical malpractice; (v) health or life insurance including group life insurance; (vi) flood insurance provided under the National Flood Insurance Act of 1968; and (vii) reinsurance or retrocessional reinsurance.
In addition to these specific statutory inclusions and exclusions, Treasury needed to develop a uniform regulatory definition of commercial property and casualty insurance for purposes of the Program. Insurance is generally regulated by State law in the United States. After consulting with the NAIC and others, Treasury found no uniform or consistent definition of “commercial property and casualty insurance” among the States that could provide guidance or be used for purposes of the Program. In some States, a line of insurance may be considered as commercial; and, in other States, the same line of insurance may be considered as a personal line.
The closest reference point that Treasury found for a uniform definition was the NAIC's Annual Statement's Exhibit of Premiums and Losses (“Statutory Page 14”). Therefore, the interim final rule incorporated the interim guidance issued at 67 FR 76206 that designated those commercial lines reported on specified lines of Statutory Page 14 as commercial property and casualty lines of coverage to be included in the Program (subject to the Act's specific inclusions and exclusions). The lines so specified were: Line 1 (Fire); Line 2.1 (Allied Lines); Line 3 (Farmowners Multiple Peril); Line 5.1 (Commercial Multiple Peril—non-liability portion); Line 5.2 (Commercial Multiple Peril—liability portion); Line 8 (Ocean Marine); Line 9 (Inland Marine); Line 16 (Workers' Compensation); Line 17 (Other Liability); Line 18 (Products Liability); Line 19.3 (Commercial Auto No Fault—personal injury protection); Line 19.4 (Other Commercial Auto Liability); Line 21.2 (Commercial Auto Physical Damage); Line 22 (Aircraft—all perils); Line 24 (Surety); Line 26 (Burglary and Theft); and Line 27 (Boiler and Machinery). In making this determination Treasury considered the Act's definition of “commercial property and casualty insurance” and how it relates to the lines of coverage listed on Statutory Page 14, the Program structure, and what would be necessary to effectively administer the Program. In developing the interim final rule, Treasury consulted with the NAIC and others regarding State law and premium reports filed with insurance regulators in the respective States and with the NAIC.
Section 102(4) of the Act defines “direct earned premium” to mean direct earned premium (DEP) for property and casualty insurance issued by any “insurer” for losses within the scope of “insured loss.” The interim final rule also clarified that premium information on the specified lines of Statutory Page 14 should be included in calculating an insurer's DEP
Many policies have combined risk coverage (hybrid policies). Under some hybrid policies, some of the risks or lines are covered by the definition of commercial property and casualty insurance under the Program and some are not covered. To address these situations, the interim final rule allows (but does not require) an insurer to allocate a portion of the premium (
Instead of issuing a new reporting requirement or mandating a specific allocation formula for hybrid policies, Treasury has suggested several methods that insurers may use in adjusting and calculating their DEP under the Program:
(1) For policies with predominant personal line coverages, but where the premiums might also cover a portion for coverage of commercial risks, Treasury indicated that a policy would be considered personal, and not included in DEP, if the commercial portion was incidental (less than 25 percent of the total premium). If the commercial coverage portion represented more than 25 percent of the total premium, then the company should allocate the appropriate portion of the premium as commercial to be included in DEP.
(2) For policies written by insurers required to participate in the Program, but for which the premiums are not reported on Statutory Page 14 (
Several commenters were uncertain about whether the interim final rule's list of commercial lines as reported on the specified lines of Statutory Page 14 was exclusive or merely illustrative. Their uncertainty appears to arise from use of the word “includes” in section 50.5(l) of the interim final rule that property and casualty insurance (“includes commercial lines within the following lines of insurance.”) These commenters suggested that Treasury clarify whether it intended for the list to be exclusive, or identify those lines of business that are excluded.
As previously noted, Treasury consulted with the NAIC and others concerning the definition of commercial property and casualty insurance. Finding no uniform or consistent definition of the term, Treasury determined that the NAIC's Statutory Page 14, provided the best available point of reference—not only for identifying the lines of coverage for the Program, but also for guidance in determining an insurer's DEP for those lines of coverage. Treasury intended that the list of specified lines on Statutory Page 14 would be exclusive, and premiums reported on other lines would not be part of the Program. The final rule revises the previous language to clarify this.
In its comment on the interim final rule, the NAIC suggested Treasury should add the following language from the Act: “* * * or any other type of crop or livestock insurance that is privately issued or reinsured” to section 50.5(l)(2)(i) of the interim final rule. The NAIC commented that such an addition would prevent any uncertainty concerning the treatment of crop or livestock coverage that is not part of the Program.
In developing the interim final rule, Treasury understood based on available information that privately issued or reinsured crop or livestock insurance was reported under Multiple Peril Crop insurance on Line 2.2 of Statutory Page 14. It is now Treasury's understanding, based on additional information from the NAIC, that privately issued or reinsured crop or livestock insurance is generally reported as Allied Lines insurance on Line 2.1 of Statutory Page 14. Therefore, in the final rule, Treasury has added the specific statutory language and the appropriate reporting lines of Statutory Page 14 to section 50.5(l)(2)(i) of the final rule.
The Act and interim final rule exclude Federal flood insurance which is a line of single peril natural disaster insurance. Similarly, the interim final rule excluded earthquake insurance reported on Statutory Page 14. Treasury received no comments on the interim final rule regarding the treatment of any single peril natural disaster insurance. However, in light of information subsequently received in response to Treasury's proposed rule concerning state residual market insurance entities, Treasury is considering issuing a proposed rule specifically requesting comment on the inclusion or exclusion in the Program definition of commercial property and casualty insurance of other single peril natural disaster insurance, such as stand alone, single peril wind insurance, if reported on included lines of Statutory Page 14.
One commenter asserted that Treasury's determination that commercial coverage is incidental if its applicable premium is less than 25 percent of a hybrid personal/commercial lines policy premium would have adverse effects, suggesting that this could cause insurers to force incidental coverages off such personal policies, such as Homeowners insurance. Others commented that the incidental rule should only be used as a threshold calculation, or that insurers should be allowed to allocate personal/commercial hybrid policy premiums according to their normal business methods and procedures. One commenter contended that Homeowners policies should not be included in the Program regardless of the percentage of commercial premium, and that allocation of commercial/personal premium would not be appropriate for Farmowners or Farm Properties policies since they are both considered by some states to be commercial lines.
As discussed above, Treasury has suggested methods for the allocation of commercial portions of premiums in hybrid policies in an attempt to aid insurers by simplifying the adjustment and calculation of an insurer's DEP. If the appropriate premium was included in the DEP and the other required conditions for Federal payment are met, commercial portions of hybrid policies are covered by the Program. The 25 percent incidental provision was included in the interim final rule by Treasury to provide a threshold, so that those insurers that did not want to calculate an actual allocation of premiums on small incidental amounts of coverage, and did not intend to perfect their right to recover Federal payment on claims paid on such incidental commercial coverage, could then exclude those premiums from their DEP calculation if they wished to do so. In order to clarify this in the final rule, and to make it clear that an insurer can chose to allocate premiums below that amount, Treasury has modified the language in section 50.5(d)(1)(i-iv) of the interim final rule.
Four commenters asked for clarification with regard to whether coverage for one to four family rental units is personal or commercial insurance. One pointed out that such coverage is generally written under a Dwelling Properties insurance policy (which is considered to be a personal line). However, in other situations, under four family rental units are written as a commercial coverage. Treasury's designation in section 50.5(l)(1) of the interim final rule of the specific lines of commercial coverage from Statutory Page 14 was made, in part, to provide greater clarity for insurers in cases where various States may not treat certain types of coverage consistently as commercial coverage. In general, it is our understanding that premium income for one to four family rental unit insurance coverage generated from policies insuring property owned for business purposes (e.g. to generate income for the property owner) is reported on Lines 1 (Fire) 2.1 (Allied Lines) and 17 (Other Liability) of Statutory Page 14. Based on section 50.5(l)(1) of the final rule, such insurance coverage would be considered commercial property and casualty insurance coverage that is included in the Program. Treasury also addressed the issue of personal lines in the context of adjustments to DEP in section 50.5(d)(1) of the interim final rule and through adjustments to that section in the final rule. To the extent that one to four family rental units have a personal coverage component, the suggested methods of adjusting and calculating the appropriate DEP may be used by an insurer.
Another commenter stated that farm residences should be considered commercial. For purposes of the Program, Treasury does not agree, but considers any owner occupied residence to be basically a personal coverage. Therefore, where a farm residence is covered in a hybrid farm policy, the suggested methods of adjusting and
One commenter suggested that Treasury consider extending the commercial/personal allocation to other hybrid contracts containing premiums for excluded lines of coverage such as Medical Malpractice in combination with Hospital General Liability coverage. Such insurance lines are not within the scope of the definition of commercial property and casualty insurance of the Act and are not included in the Program. Therefore, premiums in hybrid policies applicable to those exceptions do not need to be included in an insurer's DEP. Any allocation of premium for such exclusions should be calculated by insurers either using methods suggested by Treasury, or other similar methods in accordance with the insurer's normal business methods and procedures.
Another commenter suggested that Treasury should exclude premiums reported on the specified lines on Statutory Page 14, but earned from retroactive insurance programs such as certain Novations, Adverse Development Cover, or Loss Portfolio Transfer Programs. Retroactive insurance is insurance covering only events that occurred prior to the inception date of the policy, but there appears to be no differentiation in the Statutory Page 14 reporting to indicate that such premiums relate to risks from prior years. Treasury takes the position that such retroactive premiums are not within the time period of the definition of “insured losses” if they are associated with losses that occurred prior to enactment and the effective date of the Act (November 26, 2002). Such premium income may be removed in an insurer's calculation of its DEP. Treasury has modified the language in the final rule (section 50.5(d)(1)(i-iv) of the interim final rule) to clarify the nature of the allocation provisions with regard to hybrid policies and other policies with coverage of losses outside the scope of insured losses under the Program.
Treasury did not include Line 23 (Fidelity) of Statutory Page 14 in its list of specified lines considered to be commercial “property and casualty insurance” covered under the Act in its initial interim guidance or in its interim final rule. Comments were received from five different commenters, two in support of Treasury's position, and three in opposition.
One of the commenters advocating the inclusion of fidelity insurance argued that it can also have a distinct property component as in cases where coverage is provided for the destruction of money and securities, such as those held in bank or corporate vaults. The commenter pointed out that it had losses associated with fidelity policies arising from the September 11 terrorist attacks totaling some $20 million due to the destruction of cash on the premises of its insured. Another commenter emphasized that fidelity has always been considered by state regulators, insurers, and policyholders to be a commercial property and casualty line.
Those opposed to the inclusion of fidelity insurance contend that it is a line of insurance that by itself faces low exposure to terrorism losses. One commenter had indicated previously that it had provided terrorism coverage for all of its fidelity policies prior to the Act, but needed to confirm whether fidelity insurance was covered under the Program in order to know how much reinsurance coverage would be needed to cover its deductible exposure. Commenters also pointed out that if Treasury were to reverse itself and now include fidelity insurance as a covered line, problems associated with the timing of the disclosure requirements and other issues would need to be addressed.
After considering the comments, Treasury has determined that fidelity insurance is not covered under the Act, and thus has not inserted Line 23 (Fidelity) in the specified lines on Statutory Page 14 that make up commercial property and casualty insurance covered under the Act. In making the overall determination of what lines of coverage are included and excluded in the definition of property and casualty insurance, Treasury relied on specific guidance provided by Congress in section 102(12) of the Act. Section 102(12)(A) expressly includes excess insurance, workers' compensation insurance, and surety insurance. Traditional surety insurance and fidelity insurance share a similar characteristic in that they guarantee against losses associated with the performance of third parties. Treasury maintains the position that if Congress had intended fidelity insurance to be covered, it would have specifically included it as it did surety insurance. Treasury relied on a similar rationale for excluding group accident coverage, a line of coverage that shares some of the same risk characteristics as workers' compensation coverage, from the list of specified lines on Statutory Page 14 that make up commercial property and casualty insurance covered under the Act.
Through the comment process, Treasury has been made aware that the traditional fidelity insurance coverage has been expanded in recent years by some insurers to include coverage to non-employee “insiders,” as well as to property coverage for loss of firm assets, including cash, due to crime. Although Treasury is making no change to the interim final rule definition with regard to fidelity in the final rule, Treasury will continue to evaluate this wrap-around or hybrid-type coverage which could include other types of coverage that are generally covered by the Act, but not reported as such. In this regard, Treasury will evaluate whether and how the designation of included and excluded lines has affected the availability of coverage for terrorism insurance risk, and whether any further change in the Program might be warranted.
On behalf of county or town mutual insurers that do not report on Statutory Page 14, one commenter suggested that Treasury's suggestion that they convert direct premium or other types of payments such as assessments or contributions into DEP, would lead to inconsistencies in the Program because states have varying reporting requirements. The result would be that DEPs would vary significantly from state to state, which would be “bad from a public policy perspective, but leaves insurers on uncertain ground despite their best good faith efforts at compliance.” Treasury has consulted with the NAIC on this issue and we understand that the NAIC plans to develop a recommended conversion method that States in turn could recommend to county or town mutual insurers.
Another commenter requested that Treasury give insurers assurance that “fronted” premiums received by an insurer would not be included in DEP and thus raise its deductible, if the insurer assuming the risk (captive or otherwise) is also an insurer under the Program. The commenter explained that “fronting” is a credit enhancement procedure that is sometimes employed by business customers and their insurers to expand available insurance capacity, and is recognized by state regulators. However, fronting arrangements are not addressed in the Act, and the Act does not appear to provide any basis to exclude “fronted” premiums from DEP. If one insurer “fronts” for another by receiving premiums but passes the risk to another,
Treasury incorporated the statutory definition of “insured loss” found in section 102(5) of the Act in section 50.5(e)(1) of the interim final rule. Section 50.5(e)(2) of the interim final rule clarified the meaning of insured loss as it relates to section 102(5)(B) of that Act as follows:
(i) A loss that occurs to an air carrier (as defined in 49 U.S.C. 40102), to a United States flag vessel, or a vessel based principally in the United States, on which United States income tax is paid and whose insurance coverage is subject to regulation in the United States, is not an insured loss under section 102(5)(B) of the Act unless it is incurred by the air carrier or vessel outside the United States.
(ii) An insured loss to an air carrier or vessel outside the United States under section 102(5)(B) of the Act does not include losses covered by third party insurance contracts that are separate from the insurance coverage provided to the air carrier or vessel.
One commenter took exception to Treasury's clarification that such extraterritorial insured third party losses to United States air carriers and vessels are not insured losses, and cited legislative history of the Act to indicate an intent on the part of Congress to provide extraterritorial coverage to United States air carriers and vessels without limitation.
After reviewing the comments including the legislative history cited by the commenter, Treasury has determined not to change the position it took in the interim final rule. Therefore, for purposes of the Program, an insured loss is “any” loss, including a third party liability loss, if it occurs within the geographic boundaries of the United States; but, if the loss occurs outside of the geographic boundaries of the United States (extraterritorial) to a United States air carrier or vessel, then only that portion of the loss “to” that air carrier or vessel is an insured loss eligible for the backstop. To further clarify, “to” in this context means insured losses that are incurred by United States air carriers and vessels (
Treasury's position is consistent with how third party liability losses are generally treated under the Program (including how such losses are treated for foreign air carriers and foreign flag vessels) in that such losses would be considered insured losses if they are incurred within the geographic scope of the United States. The extension of coverage provided to United States air carriers and vessels under the Act is related directly to those entities and their potential insurance exposures, which are fully covered under the interim final rule. Treasury does not believe that granting broader third party indemnification on an extraterritorial basis and creating greater exposure for United States taxpayers is consistent with congressional intent for the Program.
The interim final rule incorporated the statutory definition of “insurer” as generally reflected in previously issued interim guidance that was published at 67 FR 78864. In accordance with section 103(a)(3) of the Act, each entity that meets the definition of “insurer” under the Act as implemented by Treasury must participate in the Program. To participate in the Program, an entity, including an “affiliate” of an insurer (see further discussion in part B of this preamble), must itself meet all of the requirements of section 102(6)(A) and (B) and, as the Treasury may prescribe, (C). This means that to be an insurer, an entity must: (1) Fall within one of the categories in section 102(6)(A) described below; (2) receive direct earned premiums as required by section 102(6)(B); and (3) meet any additional criteria established by Treasury pursuant to section 102(6)(C).
The categories of insurers in Section 102(6)(A) that were directly addressed in the interim final rule include:
(i) Licensed or admitted to engage in the business of providing primary or excess insurance in any State (“State” includes the District of Columbia and territories of the United States);
(ii) Not so licensed or admitted, but is an eligible surplus line carrier listed on the Quarterly Listing of Alien Insurers of the National Association of Insurance Commissioners;
(iii) Approved for the purpose of offering property and casualty insurance by a Federal agency in connection with maritime, energy or aviation activity; and
(iv) A State residual market insurance entity or State workers' compensation fund.
The interim final rule provides that an entity that falls within two categories will be considered by Treasury to fall within the first category that it meets under section 102(6)(A)(i)-(iv). All entities that are licensed or admitted by a State's insurance regulatory authority, such as captive insurers, risk retention groups, and farm and county mutuals, fall under section 102(6)(A)(i).
The interim final rule also specified that the scope of insurance coverage (insured losses) under the Program for federally approved insurers under section 102(6)(A)(iii) is only to the extent of federal approval of the commercial property and casualty insurance coverage approved by the Federal agency in connection with maritime, energy or aviation activity. Therefore, insured losses under other insurance coverage that may be offered by a federally approved insurer under section 102(6)(A)(iii) would not be covered by the Program.
In addition to falling within a category in section 102(6)(A), an “insurer” must meet the requirements in section 102(6)(B) unless statutorily excepted. Therefore, an “insurer” must receive “direct earned premiums” (as defined) on any type of commercial property and casualty insurance (as defined). In addition, an “insurer” must meet any additional criteria prescribed by Treasury under section 102(6)(C). The interim final rule did not prescribe additional criteria under section 102(6)(C). However, under a separate notice of proposed rulemaking published at 68 FR 9814 Treasury solicited public comment on whether the Secretary should prescribe other criteria for certain insurers pursuant to the authority provided by section 102(6)(C) and, if so, what criteria Treasury should prescribe.
Treasury received six comments that addressed the treatment of captive insurers under the Program. The majority of these objected to Treasury's mandatory inclusion of captive insurers as a State licensed or approved insurer under Section 102(6)(A)(i). These commenters suggested that captives should be allowed to opt-in to the Program as opposed to being mandatory participants. In support of this position, commenters offered the following points: many captive insurers were created to operate outside of the traditional insurance marketplace, and thus they should not be treated as other insurance companies; some types of commercial coverage provided by
Treasury received one comment letter in support of treating State licensed or admitted captive insurers as mandatory participants under the Program. Treasury also received a comment letter from the NAIC that described a split view on the part of State regulators over mandatory participation requirements for state-licensed or admitted captive insurers. Although the NAIC's comments included some of the points noted above, the NAIC also acknowledged that allowing opt-in treatment for captive insurers could allow for adverse selection and could set a bad precedent as other entities would seek similar treatment. In addition, the NAIC noted that “when pressed for a decision regarding whether a complete inclusion is better than a complete exclusion for captives, regulators generally agree that inclusion is preferable.”
Treasury disagrees with the suggestion in some comments that captive insurers should be provided with opt-in treatment. Requiring mandatory participation for State licensed or admitted captive insurers is in accord with the plain language of section 102(6)(A)(i) where no distinction is made regarding types of State licensed or admitted insurers. This treatment also furthers other statutory objectives such as ensuring that policyholders have widespread access to the terrorism risk insurance benefits of the Program, and spreading potential costs of the Program associated with any federal loss-sharing payments. For example, the cost spreading provisions in connection with recoupment as required by section 103(e)(7) and in connection with surcharges as required by section 103(e)(8) are to be applied to all commercial property and casualty policyholders.
As it relates to the overall administration of the Program, allowing for opt-in treatment would create the potential for adverse selection within the Program as those captive insurers that perceived themselves to have higher risk to terrorism would likely opt-in to the Program while others with lower perceived risks would likely opt-out of the Program. A major consequence of this type of action would be the potential policyholder recoupment base would be reduced, which in turn would increase the potential recoupment costs on the policyholders of other mandatory participants in the Program.
Treasury does not support the view set forth by some of the commenters that limited risk exposure to terrorism of the coverage provided by some captive insurers is a reason to provide for an opt-in option. This same type of argument could be made by any number of insurers and policyholders that feel they have limited risk exposure to terrorism. Because the recoupment base applies to all commercial property and casualty policyholders, potentially limited risk exposure to terrorism is not a valid reason to limit participation under the Program.
Treasury also finds little or no support for assertions that the potential recoupment provisions of the Act would have an adverse effect on U.S. domestic captive jurisdictions. It should be noted that any such recoupment would only be imposed in the case of a terrorist event that triggers Federal payments under the Program, and that any potential recoupment is limited to a maximum 3 percent of premium surcharge in any given year. Although it is possible that certain state-licensed or admitted captive insurers would find these potential costs unattractive and search out other jurisdications, other state-licensed or admitted captive insurers would recognize the benefits of Program participation. Therefore, the ultimate effect on any particular captive insurance jurisdiction is difficult to quantify.
In addition to the general comments on providing captive insurers opt-in treatment under the Program, two members of Congress offered the view that, in the case of captives, the Act must be read in the context of section 103(f). This section authorizes (but does not require) Treasury to apply the provisions of the Act to “other” classes or types of captive insurers. These commenters believe that the use of the word “other” in section 103(f) is a grammatical error in the Act and, for that reason, they contend that Treasury's interim final rule does not reflect the intent of Congress to create a process through which captive insurers could be integrated into the Program on an opt-in basis.
As previously noted, Section 102(6)(A)(i) of the Act mandates participation by insurers that are “licensed or admitted” by a State to engage in the business of providing property and casualty insurance. Following this state-licensed or admitted category in the definition of “insurer”, is a category for “any other entity described in Section 103(f), to the extent provided in the rules of the Secretary issued under section 103(f).” (emphasis added). Section 103(f) of the Act gives discretionary authority to the Secretary to add to the Program, “other classes or types of captive insurers * * *” (emphasis added). A key principle of statutory construction is that words in a statute must be read to have meaning unless the reading of those words produces an absurd result. The bar for interpreting words in a statute to be a legislative error is extremely high. If the words in a statute can be construed as having a rational meaning, then the rules of statutory construction preclude an interpretation that they were enacted by Congress in error.
In this case, the word “other” in these two provisions can be easily construed as referring to captives other than those that are State-licensed or admitted. Adopting the interpretation of legislative error suggested by the two commenters would require the conclusion that Congress erred in two places in the Act. In addition, we found nothing in the Act's language or legislative history that would support treating state-licensed or admitted captives differently from other state-licensed or admitted insurers for purposes of the Program. For these reasons, the definition of “insurer” in the final rule, as in the interim final rule, includes those entities, including any captives, that are state-licensed or admitted. Therefore, if a captive is not state licensed or admitted, then it is not in the Program, unless subsequently brought in by any rules issued under section 103(f).
Treasury received comments requesting clarification on how insurance pooling arrangements, such as joint underwriting associations, are treated under the Act. These commenters found the interim final rule and previously issued interim guidance to be unclear with regard to (a) whether such entities are insurers under the Act, and (b) if they are insurers, the category of insurer under which they would belong (
The issue of Treasury's treatment of federally approved insurers is, for the most part, separable from the fundamental question of whether joint underwriting associations are State licensed or admitted insurers. With regard to joint underwriting associations operating in the United States, if such entities are considered to be State licensed or approved insurers, then they must participate in the Program as insurers in this category under the Act. The federally approved issue is not reached in this situation.
Treasury acknowledges that certain joint underwriting associations and other entities may not fit neatly within what is traditionally thought of as the “State licensed or admitted” market. To provide more clarity in the category of “State licensed or admitted,” the final rule provides that, with regard to joint underwriting associations and other pooling arrangements, such entities must meet all three of the following criteria to be an insurer under the Program:
• An entity must have gone through a process to be licensed or admitted to engage in the business of providing primary or excess insurance that is administered by the State's insurance regulator. If such a process differs from what a State's insurance regulator generally applies to insurance companies, such a process should be similar in scope and content;
• An entity must generally be subject to State insurance regulation (including financial reporting requirements) applicable to insurance companies within the State; and
• An entity must be managed independently from other insurers that are participating in the Program.
If a joint underwriting association, pooling arrangement or other entity is still uncertain of its status as State licensed or admitted insurers under the Program, such entities are encouraged to provide Treasury with an explanation of their particular circumstances and how the criteria listed above apply or do not apply. After reviewing this information, Treasury will directly contact such entities regarding their status under the Program. These Treasury decisions also will be made available to the public.
Treasury received fifteen comments regarding Treasury's treatment of federally approved insurers in the interim final rule. Under the interim final rule, the scope of insurance coverage (“insured losses”) for federally approved insurers is only to the extent of federal approval of the commercial property and casualty insurance coverage approved by the Federal Agency in connection with maritime, energy or aviation activity. Most of these commenters contended that Treasury's interpretation regarding the scope of insurance coverage under the Program for federally approved insurers was too narrow and that such an interpretation was counter to the intent of Congress.
The maritime shipping industry and their mutually owned insurance companies (International Group of Protection and Indemnity Clubs) raised particular concerns that Treasury's interpretation regarding federally approved insurers would unduly limit access to the Program for the United States and world shipping fleets. As it relates to the maritime industry, the United States Maritime Administration (MARAD) has in place various mechanisms to approve underwriters providing insurance coverage for vessels built or operated with subsidy or covered by vessel obligation guarantees issued pursuant to Title XI of the Merchant Marine Act, 1936, as amended. (46 U.S.C. 1271-1279). Commenters noted that vessels built with Title XI subsidies or guarantees make up a small portion of the United States flag fleet. Therefore, to the extent that the portion of United States flag fleet not subject to MARAD insurance approval was relying solely on federally approved insurers for their insurance coverage, such vessels would currently have limited access to federal payments under the Program. Commenters also noted that a similar situation exists to the extent that foreign flag vessels are currently relying on federally approved insurers for their insurance coverage.
MARAD has set forth eligibility criteria for underwriters of marine hull insurance at 46 CFR 249.4 and 249.5. Broadly speaking, to be eligible under the MARAD program an insurer must be: licensed to do business in the United States; an underwriter at Lloyd's; a member company of the Institute of London Underwriters; or specifically approved by MARAD. There is a fair degree of overlap between MARAD's eligibility criteria for Marine Hull insurers and the definition of “insurer” under the Act. Under sections 102(6)(A)(i-iv), the Act includes entities that are State licensed or admitted and entities that are listed on the Quarterly Listing of Alien Insurers of the NAIC as “insurers” under the Act. These insurers participate in the Program for all coverages that fall within the definition of “commercial property and casualty” within the scope of the definition of “insured loss” under the Act. Thus, insurers that fall within the first three of MARAD's eligibility criteria are for the most part already eligible insurers under the Act (although there may be some uncertainty regarding the Institute of London Underwriters as it is our understanding that this group has merged with another organization to form the International Underwriting Association). For insurers that MARAD specifically approves as Marine Hull underwriters, based on the most recently available lists (NAIC's Quarterly Listing of Alien Insurers—April 1, 2003, and MARAD Approval List—May 16, 2003), 13 out of the 18 MARAD approved insurers were listed on the NAIC's Quarterly Listing of Alien Insurers, and 1 of the 5 insurers that were not currently on the NAIC's Quarterly Listing of Alien Insurers was on the list in recent years. Thus, as it relates to Marine Hull underwriters, Treasury's interpretation with regard to federally approved insurers does not appear to have caused major disruptions in insurance coverage. Treasury also notes that we did not receive any comments directly from Marine Hull underwriters objecting to the treatment of federally approved insurers.
MARAD, as part of its general insurance information and requirements, also accepts the International Group of Protection and Indemnity Clubs (International Group) as providers of liability coverage. The International Group is made up of 13 independent Protection and Indemnity Clubs. Each club is independently owned by its ship-owner members. The International Group allows for the individual clubs to share claims, purchase reinsurance as a group, and coordinate on maritime public policy issues. Unlike the case with MARAD-approved hull insurance underwriters, of the 13 members of the International Group only two qualify as eligible insurers under the Act in a category separate from the federally approved insurer category. Hence, the bulk of the comments Treasury received from the maritime community focused on the treatment of the International Group under the interim final rule.
Treasury also received similar comments from the offshore oil and gas drilling industry objecting to the interim final rule's interpretation regarding the participation of federally approved insurers under the Act. The Department of Interior's Minerals Management Service approves insurance coverage as one method covered offshore facilities can use for demonstrating oil spill
Treasury also received comments regarding the treatment of federally approved insurers under the Department of Labor's authority to authorize workers' compensation coverage under the Longshore and Harbor Worker's Act (33 U.S.C. 901) and its extensions. The Department of Labor authorizes both insurance carriers (20 CFR 703.101) and self-insurers (20 CFR 703.301) for the purpose of meeting the requirements of the Longshore and Harbor Worker's Act. Insurers that are authorized under 20 CFR 703.101 clearly meet the criteria of section 50.5(f)(1)(C) of being “approved or accepted for the purpose of offering property and casualty insurance by a Federal agency in connection with maritime, energy, or aviation activity.” In this regard a key element is that such insurers are “offering” insurance coverage.
In contrast, the Department of Labor and other Federal agencies may approve self insurance as an acceptable means of meeting the financial requirements or responsibilities of their respective programs. In this regard, self insurance is just another means of establishing financial responsibility and is not a substitute for the requirement that insurance is being “offered.” Thus, self insurance arrangements approved by Federal agencies are not included under section 50.5(f)(1)(C). However, Treasury may consider self insurance arrangements for inclusion in the Program through Treasury's general authority to consider such arrangements under section 102(6)(A)(v) of the Act, which is also described in section 50.5(f)(1)(E) of the interim final rule. Treasury has not yet taken any action regarding the inclusion of self insurance arrangements under the Act.
In addition to the general concerns noted above regarding the treatment of federally approved insurers, airline insurance pools and other commenters (
After consideration of these comments by the maritime industry and their mutually owned insurance companies and others, Treasury has decided not to make any changes to the interim final rule's treatment of federally approved insurers for the following reasons.
First, the interim final rule's treatment of federally approved insurers is in accord with the statutory language of the Act in section 102(6)(A)(iii) (“approved for the purpose of offering property and casualty insurance by a Federal agency in connection with maritime, energy or aviation activity”). While some commenters pointed to congressional intent supporting a broader interpretation, no express language in the Act's legislative history supports this view. Moreover, Treasury's treatment of federally approved insurers in the interim final rule is consistent with the underlying reason for the Federal government providing Federal agencies with the authority to approve insurers. In general, the Federal government provides agencies with approval authority to address important national interests or to protect the Federal government's interests. For example, the Federal government requires that airlines maintain a minimum amount of liability insurance coverage. In contrast, the Federal government has no similar overall liability requirements for ocean going vessels, but such vessels are required to demonstrate financial responsibility for oil spills. As an example of protecting the Federal government's interest, MARAD approves insurance coverage for vessels that were built with a government subsidy or guarantee. MARAD could have been granted broader insurance approval authority than just federally subsidized vessels if there were a clear national interest in ensuring that all ocean going vessels in U.S. waters had adequate overall liability insurance coverage.
Second, Treasury's treatment of federally approved insurers is consistent with Treasury's consideration of a pre-existing nexus (for example, the nexus of State-licensing or NAIC approval for listing on the Quarterly Listing of Alien Insurers) to be very important to the effective and efficient administration of the Program. Some commenters criticized Treasury for not more fully explaining the importance of this consideration.
The following three key factors highlight the importance of a pre-existing regulatory nexus or structure for the administration of the Program.
However, such ongoing data is useful and important, especially as it relates to foreign insurers that are providing coverage on global risk policies. Global risk polices (
Treasury has considered carefully the concerns raised by commenters regarding the interim final rule's treatment of federally approved insurers. At this time, Treasury has decided that no changes to the rule are warranted. It appears that many of the insurers that have been approved by a Federal agency also qualify to participate in the Program based on other criteria. Treasury also notes that obtaining a listing on the NAIC's Quarterly Listing of Alien Insurers is an option that insurers can employ if they are not satisfied with the treatment of federally approved insurers under the interim final rule. Obtaining such a listing would satisfy the concerns we noted above, while at the same time imposing limited burden on insurers. It is our understanding that perhaps the major obstacle to obtaining a listing is setting up the necessary trust fund.
Treasury will continue to evaluate this issue as the Program matures. While Treasury does not plan on making any changes to the treatment of federally approved insurers at this time, Treasury would be open to considering alternatives if the three key factors listed above “ ongoing data reporting requirements, ability to impose surcharges or take enforcement actions, and comparability among federally approved insurers—could be addressed.
Under a separate notice of proposed rulemaking published at 68 FR 9814 Treasury solicited public comment on whether the Secretary should prescribe other criteria for certain insurers pursuant to the authority provided by section 102(6)(C) and, if so, what criteria Treasury should prescribe. Specifically, Treasury solicited comment on whether criteria should be developed to prevent newly formed insurance companies from participating in the Program if such companies were established for the purpose of evading the Act's deductible requirements.
A few commenters raised concerns that developing such criteria could limit the development of new structures to provide terrorism risk insurance coverage. One commenter acknowledged the concerns raised by Treasury and supported the interim final rule's treatment of the deductible requirements for newly formed insurance companies in section 50.5(g)(2) as an appropriate safeguard. Another commenter suggested a set of general criteria that Treasury could look to as it considers this issue. As Treasury noted in the preamble to interim final rule, we are seeking to balance the goals of encouraging new sources of capital in the market for terrorism risk insurance while also maintaining the integrity of the Program. Treasury is not proposing any additional criteria at this time, but we will continue to monitor developments in the market for terrorism risk insurance and the market's response to the Act.
Treasury also solicited comments on whether additional criteria should be proposed for federally approved insurers. Some commenters suggested that additional financial criteria could be applied if necessary, while one commenter suggested that the Act does not give Treasury the authority to regulate insurance. Given that the final rule retains the interim final rule's treatment of federally approved insurers, the scope of potential problems related to the financial integrity of such insurers is somewhat limited. Thus, Treasury is not proposing any additional criteria at this time, but we will continue to study and monitor this issue.
The interim final rule incorporated the statutory definition of “insurer deductible” found in section 102(7) of the Act and set forth a procedure specifying how newly formed insurance companies would calculate their deductible under the Program. In particular, the interim final rule specified that for an insurer that came into existence after November 26, 2002, the insurer deductible will be based on data for direct earned premiums for the current Program Year. If the insurer has not had a full year of operations during the applicable Program Year, the direct earned premiums for the current Program Year will be annualized to determine the insurer deductible.
The two commenters who addressed this issue both indicated support for Treasury's determination that premiums for new insurers would be annualized in the calculation of their insurer deductible, and the language of the interim final rule is incorporated without change into the final rule.
The Act established a Program to provide for loss sharing payments by the Federal Government for insured losses resulting from certified acts of terrorism. The Act became effective immediately upon the date of enactment (November 26, 2002). Preemptions of terrorism risk exclusions in policies, mandatory participation provisions, disclosure and other requirements and conditions for federal payment contained in the Act applied immediately to those entities that come within the Act's definition of “insurer.” Treasury has issued and will be issuing additional regulations to implement the Program. This final rule provides critical information concerning the definitions of Program terms that lays the groundwork for Treasury's implementation of the Program. No one can predict if, or when, an act of terrorism may occur. There is an urgent need for Treasury, as Program administrator, to lay the groundwork for Program implementation through regulations to provide clarity and certainty concerning which entities are required to participate in the Program; the scope and conditions of Program coverage; and other implementation issues that immediately affect insurers, their policyholders, State regulators and other interested parties. This includes the need to supplement, or modify as
Accordingly, pursuant to 5 U.S.C. 553(d)(3), Treasury has determined that there is good cause for the final rule to become effective immediately upon publication.
This final rule is a significant regulatory action and has been reviewed by the Office of Management and Budget under the terms of Executive Order 12866.
It is hereby certified that this final rule will not have a significant economic impact on a substantial number of small entities. The Act requires all licensed or admitted insurers to participate in the Program. This includes all insurers regardless of size or sophistication. The Act also defines property and casualty insurance to mean commercial lines without any reference to the size or scope of the commercial entity. Although the Act affects small insurers, the proposed rule also gives insurers flexibility in calculating their direct earned premium for policies that have both commercial and personal exposures, and it provides a safe harbor to exclude policies that have incidental coverage for commercial purposes. Accordingly, any economic impact associated with the proposed rule flows from the Act and not the proposed rule. However, the Act and the Program are intended to provide benefits to the U. S. economy and all businesses, including small businesses, by providing a federal reinsurance backstop to commercial property and casualty insurance policyholders and spreading the risk of insured loss resulting from an act of terrorism.
The collection of information contained in § 50.8 of this final rule has been reviewed and approved by the Office of Management and Budget (OMB) in accordance with the requirements of the Paperwork Reduction Act (44 U.S.C. 3507(j)) under control number 1505-0190. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number assigned by OMB.
This information is required in order for Treasury to determine whether an insurer has rebutted a presumption that the insurer exercises a controlling influence over the management or policies of another insurer. The collection of information is mandatory with respect to an insurer seeking to rebut a presumption. The estimated average burden associated with the collection of information in this final rule is 40 hours per respondent.
Comments concerning the accuracy of this burden estimate and suggestions for reducing this burden should be directed to the Office of Financial Institutions Policy, Room 3160 Annex, Department of the Treasury, 1500 Pennsylvania Ave., NW., Washington, DC 20220 and to OMB, Attention: Desk Officer for the Department of the Treasury, Office of Information and Regulatory Affairs, Washington, DC 20503.
Terrorism risk insurance.
5 U.S.C. 301; 31 U.S.C. 321; Title I, Pub. L. 107-297, 116 Stat. 2322 (15 U.S.C. 6701 note).
The office responsible for the administration of the Terrorism Risk Insurance Act in the Department of the Treasury is the Terrorism Risk Insurance Program Office. The Treasury Assistant Secretary for Financial Institutions prescribes the regulations under the Act.
(c)(1)
(2) For purposes of paragraph (c)(1) of this section, an insurer has control over another insurer for purposes of the Program if:
(i) The insurer directly or indirectly or acting through one or more other persons owns, controls, or has power to vote 25 percent or more of any class of voting securities of the other insurer;
(ii) The insurer controls in any manner the election of a majority of the directors or trustees of the other insurer; or
(iii) The Secretary determines, after notice and opportunity for hearing, that an insurer directly or indirectly exercises a controlling influence over the management or policies of the other insurer, even if there is no control as defined in paragraph (c)(2)(i) or (c)(2)(ii) of this section.
(3) An insurer described in paragraph (c)(2)(i) or (c)(2)(ii) of this section is conclusively deemed to have control.
(4) For purposes of a determination of controlling influence under paragraph (c)(2)(iii) of this section, if an insurer is not described in paragraph (c)(2)(i) or (c)(2)(ii) of this section, the following rebuttable presumptions will apply:
(i) If an insurer controls another insurer under any State law, and at least one of the factors listed in paragraph (c) (4)(iv) of this section applies, there is a rebuttable presumption that the insurer that has control under State law exercises a controlling influence over the management or policies of the other insurer for purposes of paragraph (c)(2)(iii) of this section.
(ii) If an insurer provides 25 percent or more of another insurer's capital (in the case of a stock insurer), policyholder surplus (in the case of a mutual insurer), or corporate capital (in the case of other entities that qualify as insurers), and at least one of the factors listed in paragraph (c)(4)(iv) of this section applies, there is a rebuttable presumption that the insurer providing such capital, policyholder surplus, or corporate capital exercises a controlling influence over the management or policies of the receiving insurer for purposes of paragraph (c)(2)(iii) of this section.
(iii) If an insurer, at any time during a Program Year, supplies 25 percent or more of the underwriting capacity for that year to an insurer that is a syndicate consisting of a group including incorporated and individual unincorporated underwriters, and at least one of the factors in paragraph (c)(4)(iv) of this section applies, there is a rebuttable presumption that the insurer exercises a controlling influence over the syndicate for purposes of paragraph (c)(2)(iii) of this section.
(iv) If paragraphs (c)(4)(i) through (c)(4)(iii) of this section are not applicable, but two or more of the following factors apply to an insurer, with respect to another insurer, there is a rebuttable presumption that the insurer exercises a controlling influence over the management or policies of the other insurer for purposes of paragraph (c)(2)(iii) of this section:
(A) The insurer is one of the two largest shareholders of any class of voting stock;
(B) The insurer holds more than 35 percent of the combined debt securities and equity of the other insurer;
(C) The insurer is party to an agreement pursuant to which the insurer possesses a material economic stake in the other insurer resulting from a profit-sharing arrangement, use of common names, facilities or personnel, or the provision of essential services to the other insurer;
(D) The insurer is party to an agreement that enables the insurer to influence a material aspect of the management or policies of the other insurer;
(E) The insurer would have the ability, other than through the holding of revocable proxies, to direct the votes of more than 25 percent of the other insurer's voting stock in the future upon the occurrence of an event;
(F) The insurer has the power to direct the disposition of more than 25 percent of a class of voting stock of the other insurer in a manner other than a widely dispersed or public offering;
(G) The insurer and/or the insurer's representative or nominee constitute more than one member of the other insurer's board of directors; or
(H) The insurer or its nominee or an officer of the insurer serves as the chairman of the board, chairman of the executive committee, chief executive officer, chief operating officer, chief financial officer or in any position with similar policymaking authority in the other insurer.
(5) An insurer that is not described in paragraph (c)(2)(i) or (c)(2)(ii) of this section may request a hearing in which the insurer may rebut a presumption of controlling influence under paragraph (c)(4)(i) through (c)(4)(iv) of this section or otherwise request a determination of controlling influence by presenting and supporting its position through written submissions to Treasury, and in Treasury's discretion, through informal oral presentations, in accordance with the procedure in § 50.8.
(d) * * *
(l)
(i) Premium information as reported to the NAIC should be included in the calculation of direct earned premiums for purposes of the Program only to the extent of commercial property and casualty coverage issued by the insurer against an insured loss under the Program.
(ii) Premiums for personal property and casualty insurance coverage (coverage primarily designed to cover personal, family or household risk exposures, with the exception of coverage written to insure 1 to 4 family rental dwellings owned for the business purpose of generating income for the property owner) or for insurance coverage for any loss that would not be an insured loss under the Program, should be excluded in the calculation of direct earned premiums for purposes of the Program.
(iii) Personal property and casualty insurance coverage that includes incidental coverage for commercial purposes is primarily personal coverage, and therefore premiums may be fully excluded by an insurer from the calculation of direct earned premium. For purposes of the Program, commercial coverage is incidental if less than 25 percent of the total direct earned premium is attributable to commercial coverage. Property and casualty insurance coverage for any loss that would not be an insured loss under the Program that includes incidental coverage for an insured loss under the Program is primarily non-Program coverage, and therefore premiums may be fully excluded by an insurer from the calculation of direct earned premium. For purposes of the Program, coverage for an insured loss is incidental if less than 25 percent of the total direct earned premium is attributable to such coverage.
(iv) If a property and casualty insurance policy covers both commercial and personal risk exposures, insurers may allocate the premiums in accordance with the proportion of risk between commercial and personal components in order to ascertain direct earned premium. If a property and casualty insurance policy covers risk exposures for both insured losses and losses that would not be insured losses under the Program, insurers may allocate the premiums in accordance with the proportion of risk between the insured loss and non-insured loss components in order to ascertain direct earned premium.
(f)
(1)(i) The entity must fall within at least one of the following categories:
(A) It is licensed or admitted to engage in the business of providing primary or excess insurance in any State, (including, but not limited to, State licensed captive insurance companies, State licensed or admitted risk retention groups, and State licensed or admitted farm and county mutuals), and, if a joint underwriting association, pooling arrangement, or other similar entity, then the entity must:
(B) It is not licensed or admitted to engage in the business of providing primary or excess insurance in any State, but is an eligible surplus line carrier listed on the Quarterly Listing of Alien Insurers of the NAIC, or any successor to the NAIC;
(C) It is approved or accepted for the purpose of offering property and casualty insurance by a Federal agency in connection with maritime, energy, or aviation activity, but only to the extent of such federal approval of commercial property and casualty insurance coverage offered by the insurer in connection with maritime, energy, or aviation activity;
(D) It is a State residual market insurance entity or State workers' compensation fund; or
(E) As determined by the Secretary, it falls within any other class or type of captive insurer or other self-insurance arrangement by a municipality or other entity, to the extent provided in Treasury regulations issued under section 103(f) of the Act.
(ii) If an entity falls within more than one category described in paragraph (f)(1)(i) of this section, the entity is considered to fall within the first category within which it falls for purposes of the Program.
(l)
(1) Means commercial lines within only the following lines of insurance from the NAIC's Exhibit of Premiums and Losses (commonly known as Statutory Page 14): Line 1—Fire; Line 2.1—Allied Lines; Line 3—Farmowners Multiple Peril; Line 5.1—Commercial
(2) Does not include:
(i) Federal crop insurance issued or reinsured under the Federal Crop Insurance Act (7 U.S.C. 1501
(ii) Private mortgage insurance (as defined in section 2 of the Homeowners Protection Act of 1988 (12 U.S.C. 4901) or title insurance;
(iii) Financial guaranty insurance issued by monoline financial guaranty insurance corporations;
(iv) Insurance for medical malpractice;
(v) Health or life insurance, including group life insurance;
(vi) Flood insurance provided under the National Flood Insurance Act of 1968 (42 U.S.C. 4001
(vii) Reinsurance or retrocessional reinsurance.
(a) An insurer or insurers not having control over another insurer under § 50.5(c)(2)(i) or (c)(2)(ii) may make a written submission to Treasury to rebut a presumption of controlling influence under § 50.5(c)(4)(i) through (iv) or otherwise to request a determination of controlling influence. Such submissions shall be made to the Terrorism Risk Insurance Program Office, Department of the Treasury, Suite 2110, 1425 New York Ave NW, Washington, D.C. 20220. The submission should be entitled, “Controlling Influence Submission,” and should provide the full name and address of the submitting insurer(s) and the name, title, address and telephone number of the designated contact person(s) for such insurer(s).
(b) Treasury will review submissions and determine whether Treasury needs additional written or orally presented information. In its discretion, Treasury may schedule a date, time and place for an oral presentation by the insurer(s).
(c) An insurer or insurers must provide all relevant facts and circumstances concerning the relationship(s) between or among the affected insurers and the control factors in § 50.5(c)(4)(i) through (iv); and must explain in detail any basis for why the insurer believes that no controlling influence exists (if a presumption is being rebutted) in light of the particular facts and circumstances, as well as the Act's language, structure and purpose. Any confidential business or trade secret information submitted to Treasury should be clearly marked. Treasury will handle any subsequent request for information designated by an insurer as confidential business or trade secret information in accordance with Treasury's Freedom of Information Act regulations at 31 C.F.R. Part 1.
(d) Treasury will review and consider the insurer submission and other relevant facts and circumstances. Unless otherwise extended by Treasury, within 60 days after receipt of a complete submission, including any additional information requested by Treasury, and including any oral presentation, Treasury will issue a final determination of whether one insurer has a controlling influence over another insurer for purposes of the Program. The determination shall set forth Treasury's basis for its determination.
(e) This § 50.8 supersedes the Interim Guidance issued by Treasury in a notice published on March 27, 2003 (68 FR 15039).
Persons actually or potentially affected by the Act or regulations in this Part may request an interpretation of the Act or regulations by writing to the Terrorism Risk Insurance Program Office, Suite 2110, Department of the Treasury, 1425 New York Ave NW, Washington, DC 20220, giving a detailed explanation of the facts and circumstances and the reason why an interpretation is needed. A requester should segregate and mark any confidential business or trade secret information clearly. Treasury in its discretion will provide written responses to requests for interpretation. Treasury reserves the right to decline to provide a response in any case. Except in the case of any confidential business or trade secret information, Treasury will make written requests for interpretations and responses publicly available at the Treasury Department Library, on the Treasury Web site, or through other means as soon as practicable after the response has been provided. Treasury will handle any subsequent request for information that had been designated by a requester as confidential business or trade secret information in accordance with Treasury's Freedom of Information Act regulations at 31 CFR Part 1.
Bureau of the Public Debt, Fiscal Service, Treasury.
Final rule.
The Bureau of the Public Debt (Public Debt) is issuing regulations governing Depositary Compensation Securities that will be used to compensate financial agents for work performed on behalf of the Department of the Treasury.
July 11, 2003.
You can download this final rule at the following World Wide Web address:
For information contact Ann Fowler in the Office of the Chief Counsel, Bureau of the Public Debt, at 304-480-8692, or at
The former 31 CFR part 348 is being reinstituted and revised to provide for
These special issue securities, formerly known as 2-Percent Depositary Bonds, were first offered in 1941 as a means to compensate depositaries and financial agents of the Government for essential banking services provided in support of the day-to-day operations of the Government, including the collection and deposit of all Treasury receipts. The securities were phased out when other methods of compensation were used. Hence, the offering was terminated in 1994.
The former 31 CFR part 348 is now being reinstituted and revised because we have determined that the use of Depositary Compensation Securities to compensate financial agents is in the public interest.
Financial agents will purchase Depositary Compensation Securities with funds placed by the United States Treasury in a non-interest bearing time balance account at the financial agent equal to the principal amount of the security. The interest earned from Depositary Compensation Securities will serve to compensate financial agents for services performed on behalf of the Treasury. Some financial agents have inquired regarding the proper accounting of this transaction and the potential impact on their balance sheet. The transaction, as more fully described in agreements between Treasury and its Financial Agents, is structured so that the principal amount of the security and the time balance will be set-off at maturity consistent with the criteria described in Financial Accounting Standards Board (FASB) Interpretation No. 39. Financial agents should consult with their auditors regarding the applicability of FASB Interpretation 39 to this transaction.
This final rule does not meet the criteria for a “significant regulatory action” as defined in Executive Order 12866. Therefore, the regulatory review procedures contained therein do not apply.
This final rule relates to matters of public contract and procedures for United States securities. The notice and public procedures requirements and delayed effective date requirements of the Administrative Procedure Act are inapplicable, pursuant to 5 U.S.C. 553(a)(2).
As no notice of proposed rulemaking is required, the Regulatory Flexibility Act (5 U.S.C. 601,
Banks, Banking, Electronic funds transfer, Government securities.
31 U.S.C. 3121; 5 U.S.C. 301.
The Secretary of the Treasury (the Secretary) under authority of Title 31, Chapter 31, offers, at par, Depositary Compensation Securities (securities) to financial agents of the Department of the Treasury. The securities are offered to financial agents of the Department of the Treasury designated under federal law (including, but not limited to: 12 U.S.C. 90, 265-266, 1464(k), and 1789a; 31 U.S.C. 3303) which have executed a Depositary, Financial Agency, and Collateral Agreement satisfactory to the Secretary, and are authorized to provide essential banking services to the Department of the Treasury. The securities will be issued in an amount not to exceed, in any case, the amount for which the financial agents are authorized. The securities are non-marketable Treasury securities that will be utilized to compensate financial agents, in whole or in part, for services performed on behalf of the Department of the Treasury. The financial agents will be compensated from the interest earned on the securities. This offering will continue until terminated by the Secretary. The Fiscal Assistant Secretary is authorized to act on behalf of the Secretary upon all matters contained in these regulations.
(a)
(b)
(c)
(a)
(b)
(c)
The Secretary reserves the right to reject any application for the purchase of securities hereunder, in whole or in part, and to refuse to issue or permit to be issued any such securities in any case if the Secretary deems such action to be in the public interest, and the Secretary's action in any such respect shall be final. The Secretary may also at any time, supplement or amend the terms of these regulations, or of any amendments or supplements thereto.
Coast Guard, DHS.
Temporary final rule.
The Coast Guard is establishing a temporary Regulated Navigation Area (RNA) during the Huntington Cleveland Harborfest and a moving safety zone during the Parade of Sail in the Port of Cleveland, Ohio. These regulations are necessary to manage vessel traffic and ensure the safety of both spectators and participant vessels. These regulations are intended to restrict vessel traffic from a portion of Lake Erie in the vicinity of Cleveland Harbor.
This rule is effective from 12 p.m. on Wednesday, July 9, 2003 through 1 p.m. on Monday, July 14, 2003.
Documents indicated in this preamble as being available in the docket are part of docket (CGD09-03-206) and are available for inspection or copying at U.S. Coast Guard Marine Safety Office (MSO) Cleveland between 8 a.m. and 3:30 p.m., Monday through Friday, except Federal holidays.
Lieutenant Allen Turner, Chief Port Operations Department, Coast Guard MSO Cleveland (216) 937-0128.
On Wednesday, April 16, 2003, the Coast Guard published a notice of proposed rulemaking (NPRM) entitled Regulated Navigation Area and Safety Zone; Huntington Cleveland Harborfest and Parade of Sail, Cleveland Harbor, Cleveland, OH in the
Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the
During Huntington Cleveland Harborfest, tall ships will moor in Cleveland Harbor at the Cleveland Port Authority and along Cleveland's Inner Harbor. A Regulated Navigation Area (RNA) will be established inside Cleveland's break wall to protect tall ships and spectators from other vessels passing at excessive speed and creating large wakes. The RNA will also aid in preventing obstructed waterways.
A moving Safety Zone will be established around the Parade of Sail during the transit through Cleveland Harbor and Lake Erie. Vessel congestion is expected, and the Safety Zone will ensure that spectator craft do not impede the path of the parade vessels.
The RNA will be established from 12 p.m. (noon) on Wednesday, July 9, 2003 until 1 p.m. on Monday, July 14, 2003. The RNA will encompass Cleveland Harbor, between Dock 28 of Cleveland Port Authority and the western edge of Burke Lake Front Airport, and include the Inner Harbor. No vessel shall exceed 5 mph nor produce a wake within the RNA. Any vessel within the RNA shall not pass within 20 feet of a moored tall ship. Any vessel within the RNA must adhere to the direction of the Patrol Commander or other official patrol craft.
On July 9, 2003, from 2 p.m. until the conclusion of the Parade of Sail, the moving Safety Zone will be established around and between all tall ships participating in the parade. The Safety Zone will extend 100 yards ahead of the first vessel in the parade, 50 yards abeam each vessel and the line formed by the parade, and 50 yards astern of the last vessel in the parade. The parade will begin approximately 2 miles northwest of Cleveland Harbor inlet and pass through Cleveland Harbor via the main entrance channel. The parade will travel east through the harbor inside the eastern end of the break wall and exit through the eastern inlet. The parade will turn around in Lake Erie east of the harbor, and then reenter the harbor through the eastern inlet of the break wall south of the original track. The parade will terminate once the vessels are moored. The Safety Zone will be in effect until the last vessel moors at approximately 6 p.m.
This rule is not “significant regulatory action” under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of the Order. The Office of Management and Budget has not reviewed it under that Order. It is not significant under the regulatory policies and procedures of the Department of Homeland Security.
We expect the economic impact of this temporary final rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary.
This determination is based on the short amount of time that vessels will be restricted from the zones, and the actual location of the safety zones within the waterways.
Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this rule would have a significant impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.
The Coast Guard certifies under 5 U.S.C. 605(b) that this rule would not have a significant economic impact on a substantial number of small entities. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule so that they can better evaluate its effects and participate in the rulemaking process. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact Marine Safety Office Cleveland (see
This rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
We have analyzed this rule under Executive Order 13132 and have determined that this rule does not have implications for federalism under that Order.
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.
This rule would not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.
This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.
The Coast Guard has analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not concern an environmental risk to health or risk to safety that may disproportionately affect children.
This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.
The Coast Guard has analyzed this rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that Order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.
We have considered the environmental impact of this rule and concluded that, under figure 2-1, paragraph 32(g) of Commandant Instruction M16475.1C, this rule is categorically excluded from further environmental documentation. A written categorical exclusion determination is available in the docket for inspection or copying where indicated under
Harbors, Marine safety, Navigation (water), Reporting and recordkeeping requirements, Waterways.
33 U.S.C. 1226, 1231; 46 U.S.C. chapter 701; 50 U.S.C. 191, 195; 33 CFR 1.05-1(g), 6.04-1, 6.04-6, and 160.5; Pub. L. 107-295, 116 Stat. 2064; Department of Homeland Security Delegation No. 0170.1.
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Coast Guard, DHS.
Temporary final rule.
The Coast Guard is establishing a temporary safety encompassing a portion of Lake Michigan, Chicago, IL. This safety zone is necessary to protect vessels and spectators from potential airborne hazards during a planned fireworks display over a portion of Lake Michigan. The safety zone is intended to restrict vessel traffic from a portion of Lake Michigan, Chicago, Illinois.
This temporary final rule is effective from 11 p.m. (local), July 14, 2003 until 1 a.m. on July 15, 2003.
Documents indicated in this preamble as being available in the docket are part of docket CDG09-03-222 and are available for inspection or copying at U.S. Coast Guard Marine Safety Office Chicago, 215 W. 83rd Street, Suite D, Burr Ridge, IL 60527, between 7:30 a.m. and 4 p.m. Monday through Friday, except Federal holidays.
MST2 Kenneth Brockhouse, U. S. Coast Guard Marine Safety Office Chicago, at (630) 986-2125.
We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. The permit application was not received in time to publish an NPRM followed by a final rule before the effective date. Delaying this rule would be contrary to the public interest of ensuring the safety of spectators and vessels during this event and immediate action is necessary to prevent possible loss of life or property. The Coast Guard has not received any complaints or negative comments previously with regard to this event.
For the same reasons, under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the
A temporary safety zone is necessary to ensure the safety of vessels and spectators from the hazards associated with fireworks display. Based on recent accidents that have occurred in other Captain of the Port zones, and the explosive hazard of fireworks, the Captain of the Port Chicago has determined fireworks launches in close proximity to watercraft pose significant risks to public safety and property. The likely combination of large numbers of recreational vessels, congested waterways, darkness punctuated by bright flashes of light, alcohol use, and debris falling into the water could easily result in serious injuries or fatalities. Establishing a safety zone to control vessel movement around the location of the launch platform will help ensure the safety of persons and property at these events and help minimize the associated risks.
The safety zone will encompass all waters of Lake Michigan bounded by the arc of a circle with a 700 foot radius with its center in approximate position 41°52′15″ N; 087°36′44″ W. These coordinates are based upon North American Datum 1983 (NAD 83). All vessels except those officially participating in this event are prohibited from entering the safety zone without the permission of the Captain of the Port Chicago or his on-scene representative. The on-scene representative will be the Patrol Commander, and may be contacted via VHF Channel 16.
This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed this rule under that Order. It is not significant under the regulatory policies and procedures of the Department of Homeland Security (DHS).
We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under paragraph 10(e) of the regulatory policies and procedures of DOT is unnecessary.
This determination is based on the minimal time that vessels will be restricted from the zone and the zone is in an area where the Coast Guard expects insignificant adverse impact to mariners from the zones' activation.
Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this rule will have a significant impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.
The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.
This rule will affect the following entities, some of which might be small entities: The owners or operators of commercial vessels intending to transit a portion of an activated safety zone.
This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons: The zone is only in effect for two hours on the day of the event. The designated area is being established to allow for maximum use of the waterway for commercial vessels to enjoy the fireworks display in a safe manner. In addition, commercial vessels transiting the area can transit around the area. The Coast Guard will give notice to the public via a Broadcast to Mariners that the regulation is in effect.
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule so that they can better evaluate its effects and participate in the rulemaking process. If the rule will affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact Marine Safety Office Chicago (
Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).
This rule will call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
We have analyzed this rule under Executive Order 13132 and have determined that this rule does not have implications for federalism under that Order.
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) governs
This rule will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, governmental Actions and Interference with Constitutionally Protected Property Rights.
This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.
The Coast Guard has analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not concern an environmental risk to health or risk to safety that may disproportionately affect children.
We have considered the environmental impact of this rule and concluded that, under figure 2-1, paragraph 32(g) of Commandant Instruction Manual M16475.1D, this rule is categorically excluded from further environmental documentation. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under
We have analyzed this rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that Order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.
This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.
Harbors, Marine safety, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.
33 U.S.C. 1226, 1231; 46 U.S.C. Chapter 701; 50 U.S.C. 191, 195; 33 CFR 1.05-1(g), 6.04-1, 6.04-6 and 160.5; Pub. L. 107-295, 116 Stat. 2064; Department of Homeland Security Delegation No. 0170.1.
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Environmental Protection Agency (EPA).
Final rule; technical correction.
EPA issued a final rule in the
This document is effective on July 11, 2003.
Shaja R. Brothers, Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW.,Washington, DC 20460-0001; telephone number: (703) 308-3194; e-mail address:
The Agency included in the final rule a list of those who may be potentially affected by this action. If you have questions regarding the applicability of this action to a particular entity, consult the person listed under
1.
2.
An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at
In a final rule published in the
Section 553 of the Administrative Procedure Act (APA), 5 U.S.C. 553(b)(B), provides that, when an Agency for good cause finds that notice and public procedure are impracticable, unnecessary or contrary to the public interest, the agency may issue a final rule without providing notice and an opportunity for public comment. EPA has determined that there is good cause for making today's technical correction final without prior proposal and opportunity for comment, because EPA is merely inserting language that was inadvertently omitted from the previously published final rule. EPA finds that this constitutes good cause under 5 U.S.C. 553(b)(B).
This final rule implements a technical correction to the CFR, and it does not otherwise impose or amend any requirements. As such, the Office of Management and Budget (OMB) has determined that a technical correction is not a “significant regulatory action” subject to review by OMB under Executive Order 12866, entitled
The Congressional Review Act, 5 U.S.C. 801
Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.
21 U.S.C. 321(q), 346(a) and 371.
(a) * * *
Environmental Protection Agency (EPA).
Notice of deletion of the Pepe Field Superfund Site (Site) from the National Priorities List.
The EPA Region II Office announces the deletion of the Pepe Field Superfund Site, located in Boonton, New Jersey from the National Priorities List (NPL). The NPL is appendix B of 40 CFR part 300 which is the National Oil and Hazardous Substances Pollution Contingency Plan (NCP), which EPA promulgated pursuant to section 105 of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), as amended. EPA and the State of New Jersey have determined that the Site poses no significant threat to public health or the environment and, therefore, no further remedial measures pursuant to CERCLA are appropriate.
July 11, 2003.
Romona Pezzella, Remedial Project Manager; U.S. Environmental Protection Agency; Region II, 290 Broadway, 19th Floor; New York, New York 10007-1866; (212) 637-4385;
The site to be deleted from the NPL is: Pepe Field Superfund Site, Boonton, New Jersey.
A Notice of Intent To Delete for this Site was published in the
EPA identifies sites that appear to present a significant risk to public health, welfare, or the environment and it maintains the NPL as the list of those sites. Any site deleted from the NPL remains eligible for Fund-financed remedial actions in the unlikely event that conditions at the site warrant such action. Section 300.425(e)(3) of the NCP states that Fund-financed actions may be taken at sites deleted from the NPL. Deletion of a site from the NPL does not affect responsible party liability or impede agency efforts to recover costs associated with response efforts.
Environmental protection, Air pollution control, Chemicals, Hazardous substances, Hazardous waste, Intergovernmental relations, Penalties, Reporting and recordkeeping requirements, Superfund, Water pollution control, Water supply.
42 U.S.C. 9601-9657; 33 U.S.C. 1321(c)(2); E.O. 12777, 56 FR 54757, 3 CFR, 1991 Comp., p. 351; E.O. 12580, 52 FR 2923, 3 CFR, 1987 Comp., p. 193.
Office of Finance, General Services Administration (GSA).
Proposed rule.
The General Services Administration (GSA) is proposing to amend and reissue its regulations concerning the procedures used to collect debts owed to GSA by incorporating applicable provisions as required by the Debt Collection Improvement Act of 1996 (DCIA) and the Federal Claims Collection Standards.
Interested parties should submit comments in writing on or before September 9, 2003 to be considered in the formulation of a final rule.
Submit written comments to: General Services Administration, Office of Finance (BCD), Office of the Chief Financial Officer, 1800 F Street, NW, Room 3121, ATTN: Michael J. Kosar, Washington, DC 20405. Submit electronic comments via the Internet to:
The Regulatory Secretariat, Room 4035, GS Building, Washington, DC, 20405, at (202) 501-4755 for information pertaining to status or publication schedules. For clarification of content, contact Michael J. Kosar, Office of the Chief Financial Officer (202) 501-2029. Please cite GSPMR case 2003-105-1.
The GSA proposes to amend and reissue its debt collection procedures to incorporate changes presented in the amended Federal Claims Collection Standards (FCCS) issued jointly on November 22, 2000, by the Department of the Treasury (Treasury) and the Department of Justice (DoJ), under the Debt Collection Improvement Act of 1996 (DCIA). GSA currently has rules for collecting unpaid debts through three offset methods: administrative, salary, and tax refund. These rules were adopted with then existing provisions of the Debt Collection Act of 1982, the FCCS of 1966, and other authorities governing the collection of Federal debts.
GSA has determined this regulation is not a significant regulatory action as defined in Executive Order 12866 and, accordingly, this regulation has not been reviewed by the Office of Management and Budget.
It is hereby certified this regulation will not have a significant economic impact on a substantial number of small entities because the regulation either: (1) Results in greater flexibility for GSA to streamline debt collection regulations, or (2) reflects the statutory language contained in the DCIA. Accordingly, a Regulatory Flexibility Analysis is not required.
This regulation will not have a substantial direct effect on the states, on the relationship between the national government and the states, or on distribution of power and responsibilities among the various levels of government. Therefore, in accordance with Executive Order 13132, it is determined this regulation does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment.
This regulation will not result in the expenditure by state, local and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one (1) year, and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.
This rule is not a major rule as defined by section 251 of the Small Business Regulatory Enforcement Act, 5 U.S.C. 804. This rule will not result in an annual effect on the economy of $100 million or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-based companies in domestic or export markets.
This rule does not contain information collection requirements that require approval by the Office of Management and Budget under the Paperwork Reduction Act, 44 U.S.C. 3507,
Claims owed the United States, antitrust, fraud, taxes, interagency claims, offset, payments, administrative practice and procedure, credit bureaus, compromise, suspension, termination and discharge of debts, hearing and appeals procedures, debts.
5 U.S.C. 552-553, 31 U.S.C. 321, 3701, 3711, 3716, 3717, 3718, 3719, 3720B, 3720D; 31 CFR Parts 900-904.
(a) The Secretary of the Treasury and the Attorney General of the United States issued regulations for collecting debts owed the United States under the authority contained in 31 U.S.C. 3711(d)(2). The regulations in this part prescribe standards for GSA use in the administrative collection, offset, compromise, and the suspension or termination of collection activity for civil claims for money, funds, or property, as defined by 31 U.S.C. 3701(b), unless specific GSA statutes or regulations apply to such activities or, as provided for by Title 11 of the United States Code, when the claims involve bankruptcy. The regulations in this part also prescribe standards for referring debts to the Department of Justice for litigation. Additional guidance is contained in the Office of Management and Budget's Circular A-129 (Revised), “Policies for Federal Credit Programs and Non-Tax Receivables” (available at
(b) GSA is not limited to the remedies contained in this part and will use all authorized remedies, including alternative dispute resolution and arbitration, to collect civil claims, to the extent such remedies are not inconsistent with the Federal Claims Collection Act, as amended, Chapter 37 of Title 31, U.S. Code; the Debt Collection Act of 1982, 5 U.S.C. 5514; the Debt Collection Improvement Act of 1996, 31 U.S.C. 3701,
(c) Standards and policies regarding the classification of debt for accounting purposes (for example, write off of uncollectible debt) are contained in the Office of Management and Budget's Circular A-129 (Revised), “Policies for Federal Credit Programs and Non-Tax Receivables.”
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(b)
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(f) For the purposes of the standards in this part, unless otherwise stated, the term
(g) For the purposes of the standards in this part, the terms
(h) For the purposes of the standards in this part, unless otherwise stated, the terms
(i) For the purposes of the standards in this part, unless otherwise stated,
(j) For the standards in this part, Federal agencies include agencies of the executive, legislative, and judicial branches of the Government, including Government corporations.
(k)
(1)
(m) In this part, words in the plural form shall include the singular and vice versa, and words signifying the masculine gender shall include the feminine and vice versa. The terms
(n)
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(a) The standards in this part relating to compromise, suspension, and termination of collection activity do not apply to any debt based in whole or in part on conduct in violation of the antitrust laws or to any debt involving fraud, the presentation of a false claim, or misrepresentation on the part of the debtor or any party having an interest in the claim. The standards of this part relating to the administrative collection of claims do apply, but only to the extent authorized by the Department of Justice in a particular case. Upon identification of a claim based in whole or in part on conduct in violation of the antitrust laws or any claim involving fraud, the presentation of a false claim, or misrepresentation on the part of the debtor or any party having an interest in the claim, GSA will promptly refer the case to the GSA Office of Inspector General (OIG). The OIG has the responsibility for investigating or referring the matter, where appropriate, to the Department of Justice (DoJ) for action. At its discretion, DoJ may return the claim to GSA for further handling in accordance with the standards of this part.
(b) This part does not apply to tax debts.
(c) This part does not apply to claims between GSA and other Federal agencies.
(d) This part does not apply to claims over $100,000.
Nothing in this part precludes GSA disposition of any claim under statutes and implementing regulations other than subchapter II of chapter 37 of Title 31 of the United States Code (Claims of the United States Government) and the standards in this part.
Claims may be paid in the form of money or, when a contractual basis exists, GSA may demand the return of specific property or the performance of specific services.
Debts will not be subdivided to avoid the monetary ceiling established by 31 U.S.C. 3711(a)(2). A debtor's liability arising from a particular transaction or contract shall be considered a single debt in determining whether the debt is one of less than $100,000 (excluding interest, penalties, and administrative costs) or such higher amount as the Attorney General shall from time to time prescribe for purposes of compromise, suspension, or termination of collection activity.
GSA is not required to omit, foreclose, or duplicate administrative proceedings required by contract or other laws or regulations.
The standards in this part do not create any right or benefit, substantive or procedural, enforceable at law or in equity by a party against the United States, its agencies, its officers, or any other person, nor shall the failure of GSA to comply with any of the provisions of this part be available to any debtor as a defense.
(a) GSA will aggressively collect all debts arising out of activities of, or referred or transferred for collection services to, GSA. Collection activities will be undertaken promptly, including letters, telephone calls, electronic mail (e-mail), and internet inquiries, with follow-up action taken as necessary.
(b) Debts referred or transferred to Treasury, or Treasury-designated debt collection centers under the authority of 31 U.S.C. 3711(g), will be serviced, collected, or compromised, or the collection action will be suspended or terminated, in accordance with the statutory requirements and authorities applicable to the collection of such debts.
(c) GSA will cooperate with other agencies in their debt collection activities.
(d) GSA will consider referring debts that are less than 180 days delinquent to Treasury or to Treasury-designated “debt collection centers” to accomplish efficient, cost effective debt collection. Treasury is a debt collection center, is authorized to designate other Federal agencies as debt collection centers based on their performance in collecting delinquent debts, and may withdraw such designations. Referrals to debt collection centers shall be at the discretion of, and for a time period acceptable to, the Secretary. Referrals may be for servicing, collection, compromise, suspension, or termination of collection action.
(e) GSA will transfer to the Secretary any debt that has been delinquent for a period of 180 days or more so the Secretary may take appropriate action to collect the debt or terminate collection action. See 31 CFR 285.12(Transfer of Debts to Treasury for Collection). This requirement does not apply to any debt that—
(1) Is in litigation or foreclosure;
(2) Will be disposed of under an approved asset sale program;
(3) Has been referred to a private collection contractor for a period of time acceptable to the Secretary;
(4) Is at a debt collection center for a period of time acceptable to the Secretary (see paragraph (d) of this section);
(5) Will be collected under internal offset procedures within three years after the debt first became delinquent;
(6) Is exempt from this requirement based on a determination by the Secretary that exemption for a certain class of debt is in the best interest of the United States. GSA may request the Secretary to exempt specific classes of debts;
(7) Is in bankruptcy (see § 105-55.010(h) of this part);
(8) Involves a deceased debtor;
(9) Is owed to GSA by a foreign government; or
(10) Is in an administrative appeals process, until the process is complete and the amount due is set.
(f) Agencies operating Treasury-designated debt collection centers are authorized to charge a fee for services rendered regarding referred or transferred debts. The fee may be paid out of amounts collected and will be added to the debt as an administrative cost (see § 105-55.016 of this part).
(a) Written demand, as described in paragraph (b) of this section, will be made promptly upon a debtor of the United States in terms informing the debtor of the consequences of failing to cooperate with GSA to resolve the debt. The specific content, timing, and number of demand letters (usually no more than three, thirty days apart) will depend upon the type and amount of the debt and the debtor's response, if any, to GSA's letters, telephone calls, electronic mail (e-mail) or internet inquiries. In determining the timing of the demand letter(s), GSA will give due regard to the need to refer debts promptly to the Department of Justice for litigation, in accordance with § 105-55.031 of this part. When necessary to protect the Government's interest (for example, to prevent the running of a statute of limitations), written demand
(b) Demand letters will inform the debtor of—
(1) The basis and the amount of the indebtedness and the rights, if any, the debtor may have to seek review within GSA (see § 105-55.011(e) of this part);
(2) The applicable standards for imposing any interest, penalties, or administrative costs (see § 105-55.016 of this part);
(3) The date by which payment should be made to avoid late charges (
(4) The name, address, and phone number of a contact person or office within GSA.
(c) GSA will exercise care to ensure that demand letters are mailed or hand-delivered on the same day they are dated. For the purposes of written demand, notification by electronic mail (e-mail) and/or internet delivery is considered a form of written demand notice. There is no prescribed format for demand letters. GSA will utilize demand letters and procedures that will lead to the earliest practicable determination of whether the debt can be resolved administratively or must be referred for litigation.
(d) GSA may include in demand letters such items as the willingness to discuss alternative methods of payment; agency policies with respect to the use of credit bureaus, debt collection centers, and collection agencies; agency remedies to enforce payment of the debt (including assessment of interest, administrative costs and penalties, administrative garnishment, the use of collection agencies, Federal salary offset, tax refund offset, administrative offset, and litigation); the requirement that any debt delinquent for more than 180 days will be transferred to the Department of the Treasury for collection; and, depending on applicable statutory authority, the debtor's entitlement to consideration of a waiver.
(e) GSA will respond promptly to communications from debtors, within 30 days whenever feasible, and will advise debtors who dispute debts to furnish available evidence to support their contentions.
(f) Prior to the initiation of the demand process or at any time during or after completion of the demand process, if GSA determines to pursue, or is required to pursue offset, the procedures applicable to offset will be followed (see § 105-55.011 of this part). The availability of funds or money for debt satisfaction by offset and GSA's determination to pursue collection by offset will release the agency from the necessity of further compliance with paragraphs (a), (b), (c), and (d) of this section.
(g) Prior to referring a debt for litigation, GSA will advise each person determined to be liable for the debt that, unless the debt can be collected administratively, litigation may be initiated. This notification will comply with Executive Order 12988 (3 CFR, 1996 Comp. pp. 157-163) and may be given as part of a demand letter under paragraph (b) of this section or in a separate document.
(h) When GSA learns a bankruptcy petition has been filed with respect to a debtor, before proceeding with further collection action, the agency will ascertain the impact of the Bankruptcy Code on any pending or contemplated collection activities. Unless the agency determines the automatic stay imposed at the time of filing pursuant to 11 U.S.C. § 362 has been lifted or is no longer in effect, in most cases collection activity against the debtor will stop immediately.
(1) A proof of claim will be filed in most cases with the bankruptcy court or the Trustee. GSA will refer to the provisions of 11 U.S.C. 106 relating to the consequences on sovereign immunity of filing a proof of claim.
(2) If GSA is a secured creditor, it may seek relief from the automatic stay regarding its security, subject to the provisions and requirements of 11 U.S.C. 362.
(3) Offset is stayed in most cases by the automatic stay. However, GSA will determine whether its payments to the debtor and payments of other agencies available for offset may be frozen by the agency until relief from the automatic stay can be obtained from the bankruptcy court. GSA also will determine whether recoupment is available.
(a)
(2) This section does not apply to—
(i) Debts arising under the Social Security Act, except as provided in 42 U.S.C. 404;
(ii) Payments made under the Social Security Act, except as provided for in 31 U.S.C. 3716(c) (see 31 CFR 285.4, Federal Benefit Offset);
(iii) Debts arising under, or payments made under, the Internal Revenue Code (see 31 CFR 285.2, Tax Refund Offset) or the tariff laws of the United States;
(iv) Offsets against Federal salaries to the extent these standards are inconsistent with regulations published to implement such offsets under 5 U.S.C. 5514 and 31 U.S.C. 3716 (see 5 CFR part 550, subpart K, and 31 CFR 285.7, Federal Salary Offset);
(v) Offsets under 31 U.S.C. 3728 against a judgment obtained by a debtor against the United States;
(vi) Offsets or recoupments under common law, State law, or Federal statutes specifically prohibiting offsets or recoupments of particular types of debts; or
(vii) Offsets in the course of judicial proceedings, including bankruptcy.
(3) Unless otherwise provided for by contract or law, debts or payments that are not subject to administrative offset under 31 U.S.C. 3716 may be collected by administrative offset under the common law or other applicable statutory authority.
(4) Unless otherwise provided by law, administrative offset of payments under the authority of 31 U.S.C. 3716 to collect a debt may not be conducted more than 10 years after GSA's right to collect the debt first accrued, unless facts material to GSA's right to collect the debt were not known and could not reasonably have been known by the official or officials of GSA who were charged with the responsibility to discover and collect such debts. This limitation does not apply to debts reduced to a judgment.
(5) In bankruptcy cases, GSA will ascertain the impact of the Bankruptcy Code, particularly 11 U.S.C. 106, 362, and 553, on pending or contemplated collections by offset.
(b)
(2) The names and taxpayer identifying numbers (TINs) of debtors who owe debts referred to the Secretary as described in paragraph (b)(1) of this section will be compared to the names and TINs on payments to be made by Federal disbursing officials. Federal disbursing officials include disbursing officials of the Department of the Treasury, the Department of Defense, the United States Postal Service, other
(3) Federal disbursing officials will notify the debtor/payee in writing that an offset has occurred to satisfy, in part or in full, a past due, legally enforceable delinquent debt. The notice will include a description of the type and amount of the payment from which the offset was taken, the amount of offset that was taken, the identity of GSA as the creditor agency requesting the offset, and a contact point within GSA who will respond to questions regarding the offset.
(4)(i) Offsets may be initiated only after the debtor—
(A) Has been sent written notice of the type and amount of the debt, the intention of GSA to use administrative offset to collect the debt, and an explanation of the debtor's rights under 31 U.S.C. 3716 (c)(7); and
(B) The debtor has been given—
(
(
(
(ii) The procedures set forth in paragraph (b)(4)(i) of this section may be omitted when—
(A) The offset is in the nature of a recoupment;
(B) The debt arises under a contract as set forth in
(C) In the case of non-centralized administrative offsets conducted under paragraph (c) of this section, GSA first learns of the existence of the amount owed by the debtor when there is insufficient time before payment would be made to the debtor/payee to allow for prior notice and an opportunity for review. When prior notice and an opportunity for review are omitted, GSA will give the debtor such notice and an opportunity for review as soon as practicable and will promptly refund any money ultimately found not to have been owed to the Government.
(iii) When GSA previously has given a debtor any of the required notice and review opportunities with respect to a particular debt (see,
(5) When referring delinquent debts to the Secretary, GSA will certify, in a form acceptable to the Secretary, that—
(i) The debt(s) is (are) past due and legally enforceable; and
(ii) GSA has complied with all due process requirements under 31 U.S.C. 3716(a) and agency regulations.
(6) Payments that are prohibited by law from being offset are exempt from centralized administrative offset. The Secretary shall exempt payments under means-tested programs from centralized administrative offset when requested in writing by the Administrator. Also, the Secretary may exempt other classes of payments from centralized offset upon the written request of the Administrator.
(7) Benefit payments made under the Social Security Act (42 U.S.C. 301
(8) In accordance with 31 U.S.C. 3716(f), the Secretary may waive the provisions of the Computer Matching and Privacy Protection Act of 1988 concerning matching agreements and post-match notification and verification (5 U.S.C. 552a(o) and (p)) for centralized administrative offset upon receipt of a certification from GSA that the due process requirements enumerated in 31 U.S.C. 3716(a) have been met. The certification of a debt in accordance with paragraph (b)(5) of this section will satisfy this requirement. If such a waiver is granted, only the Data Integrity Board of the Department of the Treasury is required to oversee any matching activities, in accordance with 31 U.S.C. § 3716(g). This waiver authority does not apply to offsets conducted under paragraphs (c) and (d) of this section.
(c)
(2) Such offsets will occur only after—
(i) The debtor has been provided due process as set forth in paragraph (b)(4) of this section; and
(ii) The payment authorizing agency has received written certification from GSA that the debtor owes the past due, legally enforceable delinquent debt in the amount stated, and that GSA has fully complied with its regulations concerning administrative offset.
(3) Payment authorizing agencies will comply with offset requests by GSA to collect debts owed to the United States, unless the offset would not be in the best interests of the United States with respect to the program of the payment authorizing agency, or would otherwise be contrary to law.
(4) When collecting multiple debts by non-centralized administrative offset, GSA will apply the recovered amounts to those debts in accordance with the best interests of the United States, as determined by the facts and circumstances of the particular case, particularly the applicable statute of limitations.
(d)
(e)
(2) For purposes of this section, whenever GSA is required to afford a debtor a review within the agency, the hearing official will provide the debtor with a reasonable opportunity for an oral hearing when the debtor requests reconsideration of the debt and the hearing official determines that the question of the indebtedness cannot be resolved by review of the documentary evidence; for example, when the validity of the debt turns on an issue of credibility or veracity.
(3) Witnesses will be asked to testify under oath or affirmation, and a written transcript of the hearing will be kept and made available to either party in the event of an appeal under the Administrative Procedure Act, 5 U.S.C. 701-706. Arrangements for the taking of the transcript will be made by the hearing official, and all charges associated with the taking of the transcript will be the responsibility of GSA.
(4) In those cases when an oral hearing is not required by this section, the hearing official will accord the debtor a “paper hearing,” that is, a determination of the request for reconsideration based upon a review of the written record.
(5) Hearings will be conducted by a Board Judge of the GSBCA. GSA must provide proof that a valid non-tax debt exists, and the debtor must provide evidence that no debt exists or that the amount of the debt is incorrect.
(6) If an oral hearing is provided, the debtor may choose to have it conducted in the hearing official's office located at GSA Central Office, 1800 F St., NW., Washington, DC 20405, at another location designated by the hearing official, or may choose a hearing by telephone. All personal and travel expenses incurred by the debtor in connection with an in-person hearing will be borne by the debtor. All telephonic charges incurred during a hearing will be the responsibility of GSA.
(7) If the debtor is an employee of GSA, the employee may represent himself or herself or may be represented by another person of his or her choice at the hearing. GSA will not compensate the employee for representation expenses, including hourly fees for attorneys, travel expenses, and costs for reproducing documents.
(8) A written decision will be issued by the hearing official no later than 60 days from the date the petition for review is received by GSA. The decision will state the—
(i) Facts supporting the nature and origin of the debt;
(ii) Hearing official's analysis, findings, and conclusions as to the debtor's and/or GSA's grounds;
(iii) Amount and validity of the debt; and
(iv) Repayment schedule, if applicable.
(9) The hearing official's decision will be the final agency action for the purposes of judicial review under the Administrative Procedure Act (5 U.S.C. 701
(f)
(2) GSA procedures for waiving a claim of erroneous payment of pay and allowances can be found in GSA Order CFO 4200.1, “Waiver of Claims for Overpayment of Pay and Allowances”.
(3) GSA will follow the procedures of 5 U.S.C. 5584 when considering a request for waiver of erroneous payment of travel, transportation, or relocation expenses and allowances.
(a) Subject to the provisions of paragraph (b) of this section, GSA may contract with private collection contractors, as defined in 31 U.S.C. 3701(f), to recover delinquent debts provided that—
(1) GSA retain the authority to resolve disputes, compromise debts, suspend or terminate collection activity, and refer debts for litigation;
(2) The private collection contractor is not allowed to offer the debtor, as an incentive for payment, the opportunity to pay the debt less the private collection contractor's fee unless GSA has granted such authority prior to the offer;
(3) The contract provides that the private collection contractor is subject to the Privacy Act of 1974 to the extent specified in 5 U.S.C. 552a(m), and to applicable Federal and state laws and regulations pertaining to debt collection practices, including but not limited to the Fair Debt Collection Practices Act, 15 U.S.C. 1692; and
(4) The private collection contractor is required to account for all amounts collected.
(b) GSA will use Governmentwide debt collection contracts to obtain debt collection services provided by private collection contractors. However, GSA may refer debts to private collection contractors pursuant to a contract between the agency and the private collection contractor only if such debts are not subject to the requirement to transfer debts to Treasury for debt collection. See 31 U.S.C. 3711(g); 31 CFR 285.12(e).
(c) GSA may fund private collection contractor contracts in accordance with 31 U.S.C. 3718(b), or as otherwise permitted by law.
(d) GSA may enter into contracts for locating and recovering assets of the United States, such as unclaimed assets.
(e) GSA may enter into contracts for debtor asset and income search reports. In accordance with 31 U.S.C. 3718(b), such contracts may provide that the fee a contractor charges the agency for such services may be payable from the amounts recovered, unless otherwise prohibited by statute.
(a) Unless waived by the Administrator, GSA will not extend financial assistance in the form of a loan, loan guarantee, or loan insurance to any person delinquent on a non-tax debt owed to a Federal agency. This prohibition does not apply to disaster loans. The authority to waive the application of this section may be delegated to the Chief Financial Officer and re-delegated only to the Deputy Chief Financial Officer of GSA. GSA may extend credit after the delinquency has been resolved. The Secretary may exempt classes of debts from this prohibition and has prescribed standards defining when a “delinquency” is “resolved” for purposes of this prohibition. See 31 CFR 285.13.
(b) In non-bankruptcy cases, GSA, when seeking the collection of statutory penalties, forfeitures, or other types of claims, will consider the suspension or revocation of licenses, permits, or other privileges for any inexcusable or willful failure of a debtor to pay such a debt in accordance with GSA regulations or governing procedures. The debtor will be advised in GSA's written demand for payment of the agency's ability to suspend or revoke licenses, permits, or privileges. If GSA makes, guarantees, insures, acquires, or participates in loans, the agency will consider suspending or disqualifying any lender, contractor, or broker from doing further business with the agency or engaging in programs sponsored by the agency if such lender, contractor, or broker fails to pay its debts to the Government within a reasonable time or if such lender, contractor, or broker has been
(c) The suspension or revocation of licenses, permits, or privileges also may extend to GSA programs or activities administered by the states on behalf of GSA, to the extent they affect GSA's ability to collect money or funds owed by debtors.
(d) In bankruptcy cases, before advising the debtor of GSA's intention to suspend or revoke licenses, permits, or privileges, the agency will ascertain the impact of the Bankruptcy Code, particularly 11 U.S.C. 362 and 525, which may restrict such action.
(a) GSA will liquidate security or collateral through the exercise of a power of sale in the security instrument or a non-judicial foreclosure, and apply the proceeds to the applicable debt(s), if the debtor fails to pay the debt(s) within a reasonable time after demand and if such action is in the best interest of the United States. Collection from other sources, including liquidation of security or collateral, is not a prerequisite to requiring payment by a surety, insurer, or guarantor unless such action is expressly required by statute or contract.
(b) When GSA learns a bankruptcy petition has been filed with respect to a debtor, the agency will ascertain the impact of the Bankruptcy Code, including, but not limited to, 11 U.S.C. 362, to determine the applicability of the automatic stay and the procedures for obtaining relief from such stay prior to proceeding under paragraph (a) of this section.
(a) Whenever feasible, GSA will collect the total amount of a debt in one lump sum. If a debtor is financially unable to pay a debt in one lump sum, GSA may accept payment in regular installments. GSA may obtain financial statements from debtors who represent they are unable to pay in one lump sum and independently verify such representations whenever possible (see §105-55.020(g) of this part). When GSA agrees to accept payments in regular installments, a legally enforceable written agreement from the debtor will be obtained specifying all of the terms of the arrangement and containing a provision accelerating the debt in the event of default. If the debtor's financial statement discloses the ownership of assets which are free and clear of liens or security interests, or assets in which the debtor owns an equity, the debtor may be asked to secure the payment of an installment note by executing a Security Agreement and Financing Statement transferring to the United States a security interest in the asset until the debt is paid.
(b) The size and frequency of installment payments will bear a reasonable relation to the size of the debt and the debtor's ability to pay. The installment payments will be sufficient in size and frequency to liquidate the debt in three years or less, unless circumstances warrant a longer period.
(c) Security for deferred payments may be obtained in appropriate cases. GSA may accept installment payments notwithstanding the refusal of the debtor to execute a written agreement or to give security, at the agency's option.
(a) Except as provided in paragraphs (g), (h), and (i) of this section, GSA will charge interest, penalties, and administrative costs on debts owed to the United States pursuant to 31 U.S.C. 3717. GSA will send by U.S. mail, overnight delivery service, or hand-delivery a written notice to the debtor, at the debtor's most recent address available to the agency, explaining the agency's requirements concerning these charges, except where these requirements are included in a contractual or repayment agreement. These charges will continue to accrue until the debt is paid in full or otherwise resolved through compromise, termination, or waiver of the charges.
(b) GSA will charge interest on debts owed the United States as follows:
(1) Interest will accrue from the date of delinquency, or as otherwise provided by law.
(2) Unless otherwise established in a contract, repayment agreement, or by statute, the rate of interest charged will be the rate established annually by the Secretary in accordance with 31 U.S.C. 3717(a)(1). Pursuant to 31 U.S.C. 3717, GSA may charge a higher rate of interest if it is reasonably determined that a higher rate is necessary to protect the rights of the United States. GSA will document the reason(s) for a determination that the higher rate is necessary.
(3) The rate of interest, as initially charged, will remain fixed for the duration of the indebtedness. When a debtor defaults on a repayment agreement and seeks to enter into a new agreement, GSA may require payment of interest at a new rate that reflects the Current Value of Funds Rate (CVFR) at the time the new agreement is executed. Interest will not be compounded; that is, interest will not be charged on interest, penalties, or administrative costs required by this section. If a debtor defaults on a previous repayment agreement, charges that accrued but were not collected under the defaulted agreement will be added to the principal under the new repayment agreement.
(c) GSA will assess administrative costs incurred for processing and handling delinquent debts. The calculation of administrative costs will be based on actual costs incurred or upon estimated costs as determined by the agency.
(d) Unless otherwise established in a contract, repayment agreement, or by statute, GSA will charge a penalty, pursuant to 31 U.S.C. 3717(e)(2), not to exceed six percent a year on the amount due on a debt that is delinquent for more than 90 days. This charge will accrue from the date of delinquency.
(e) GSA may increase an “administrative debt” by the cost of living adjustment in lieu of charging interest and penalties under this section. “Administrative debt” includes, but is not limited to, a debt based on fines, penalties, and overpayments, but does not include a debt based on the extension of Government credit, such as those arising from loans and loan guaranties. The cost of living adjustment is the percentage by which the Consumer Price Index for the month of June of the calendar year preceding the adjustment exceeds the Consumer Price Index for the month of June of the calendar year in which the debt was determined or last adjusted. Increases to administrative debts will be computed annually. GSA will use this alternative only when there is a legitimate reason to do so, such as when calculating interest and penalties on a debt would be extremely difficult because of the age of the debt.
(f) When a debt is paid in partial or installment payments, amounts received by GSA will be applied first to outstanding penalties, second to administrative charges, third to interest, and last to principal.
(g) GSA will waive the collection of interest, penalty and administrative charges imposed pursuant to this section on the portion of the debt that is paid within 30 days after the date on which interest began to accrue. GSA may extend this 30-day period on a
(h) Unless a statute or regulation specifically prohibits collection, interest, penalties and administrative costs will continue to accrue for periods during which collection activity has been suspended pending agency review or waiver consideration.
(i) GSA is authorized to impose interest and related charges on debts not subject to 31 U.S.C. 3717, in accordance with the common law.
(a) When attempting to locate a debtor in order to collect or compromise a debt under this part or other authority, GSA may send a request to the Secretary (or designee) to obtain a debtor's mailing address from the records of the Internal Revenue Service.
(b) GSA is authorized to use mailing addresses obtained under paragraph (a) of this section to enforce collection of a delinquent debt and may disclose such mailing addresses to other agencies and to collection agencies for collection purposes.
(a) The preceding sections of this part, to the extent they reflect remedies or procedures prescribed by the Debt Collection Act of 1982 and the Debt Collection Improvement Act of 1996, such as administrative offset, use of credit bureaus, contracting for collection agencies, and interest and related charges, do not apply to debts arising under, or payments made under, the Internal Revenue Code of 1986, as amended (26 U.S.C. 1
(b) Claims arising from the audit of transportation accounts pursuant to 31 U.S.C. 3726 will be determined, collected, compromised, terminated or settled in accordance with regulation published under the authority of 31 U.S.C. 3726 (see 41 CFR part 101-41, administered by the Director, Office of Transportation Audits) and are otherwise exempted from this part.
(a) The standards set forth in this section apply to the compromise of debts pursuant to 31 U.S.C. 3711. GSA may exercise such compromise authority for debts arising out of activities of, or referred or transferred for collection services to, the agency when the amount of the debt then due, exclusive of interest, penalties, and administrative costs, does not exceed $100,000 or any higher amount authorized by the Attorney General. The Administrator may designate other GSA officials to exercise the authorities in this section.
(b) Unless otherwise provided by law, when the principal balance of a debt, exclusive of interest, penalties, and administrative costs, exceeds $100,000 or any higher amount authorized by the Attorney General, the authority to accept the compromise rests with the Department of Justice. GSA will evaluate the compromise offer, using the factors set forth in § 105-55.020 of this part. If an offer to compromise any debt in excess of $100,000 is acceptable to the agency, GSA will refer the debt to the Civil Division or other appropriate litigating division in the Department of Justice using a Claims Collection Litigation Report (CCLR). The referral will include appropriate financial information and a recommendation for the acceptance of the compromise offer. Justice Department approval is not required if GSA rejects a compromise offer.
(a) GSA may compromise a debt if the full amount cannot be collected because—
(1) The debtor is unable to pay the full amount in a reasonable time, as verified through credit reports or other financial information;
(2) GSA is unable to collect the debt in full within a reasonable time by enforced collection proceedings;
(3) The cost of collecting the debt does not justify the enforced collection of the full amount; or
(4) There is significant doubt concerning the Government's ability to prove its case in court.
(b) In determining the debtor's inability to pay, GSA will consider relevant factors such as the following:
(1) Age and health of the debtor.
(2) Present and potential income.
(3) Inheritance prospects.
(4) The possibility that assets have been concealed or improperly transferred by the debtor.
(5) The availability of assets or income that may be realized by enforced collection proceedings.
(c) GSA will verify the debtor's claim of inability to pay by using a credit report and other financial information as provided in paragraph (g) of this section. GSA will consider the applicable exemptions available to the debtor under state and Federal law in determining the Government's ability to enforce collection. GSA also may consider uncertainty as to the price that collateral or other property will bring at a forced sale in determining the Government's ability to enforce collection. A compromise effected under this section will be for an amount that bears a reasonable relation to the amount that can be recovered by enforced collection procedures, with regard to the exemptions available to the debtor and the time that collection will take.
(d) If there is significant doubt concerning the Government's ability to prove its case in court for the full amount claimed, either because of the legal issues involved or because of a bona fide dispute as to the facts, then the amount accepted in compromise of such cases will fairly reflect the probabilities of successful prosecution to judgment, with due regard given to the availability of witnesses and other evidentiary support for the Government's claim. In determining the litigative risks involved, GSA will consider the probable amount of court costs and attorney fees pursuant to the Equal Access to Justice Act, 28 U.S.C. 2412 that may be imposed against the Government if it is unsuccessful in litigation.
(e) GSA may compromise a debt if the cost of collecting the debt does not justify the enforced collection of the full amount. The amount accepted in compromise in such cases may reflect an appropriate discount for the administrative and litigative costs of collection, with consideration given to the time it will take to effect collection. Collection costs may be a substantial factor in the settlement of small debts. In determining whether the cost of collection justifies enforced collection of the full amount, GSA will consider whether continued collection of the debt, regardless of cost, is necessary to further an enforcement principle, such as the Government's willingness to pursue aggressively defaulting and uncooperative debtors.
(f) GSA generally will not accept compromises payable in installments. This is not an advantageous form of compromise in terms of time and administrative expense. If, however, payment of a compromise in installments is necessary, GSA will obtain a legally enforceable written agreement providing that, in the event of default, the full original principal balance of the debt prior to compromise, less sums paid thereon, is reinstated. Whenever possible, GSA will obtain security for repayment in the manner set forth in § 105-55.015 of this part.
(g) To assess the merits of a compromise offer based in whole or in part on the debtor's inability to pay the full amount of a debt within a reasonable time, GSA may obtain a current financial statement from the debtor, executed under penalty of perjury, showing the debtor's assets, liabilities, income and expenses. GSA also may obtain credit reports or other financial information to assess compromise offers. GSA may use their own financial information form or may request suitable forms from the Department of Justice or the local United States Attorney's Office.
Pursuant to this section, GSA may compromise statutory penalties, forfeitures, or claims established as an aid to enforcement and to compel compliance, if the agency's enforcement policy in terms of deterrence and securing compliance, present and future, will be adequately served by the agency's acceptance of the sum to be agreed upon.
(a) When two or more debtors are jointly and severally liable, GSA may pursue collection activity against all debtors, as appropriate. GSA will not attempt to allocate the burden of payment between the debtors but will proceed to liquidate the indebtedness as quickly as possible.
(b) GSA will ensure that a compromise agreement with one debtor does not release the agency's claim against the remaining debtors. The amount of a compromise with one debtor will not be considered a precedent or binding in determining the amount that will be required from other debtors jointly and severally liable on the claim.
If GSA is uncertain whether to accept a firm, written, substantive compromise offer on a debt that is within the agency's delegated compromise authority, it may refer the offer to the Civil Division or other appropriate litigating division in the Department of Justice, using a CCLR accompanied by supporting data and particulars concerning the debt. The Department of Justice may act upon such an offer or return it to GSA with instructions or advice.
In negotiating a compromise, GSA may consider the tax consequences to the Government. In particular, GSA may consider requiring a waiver of tax-loss-carry-forward and tax-loss-carry-back rights of the debtor. For information on discharge of indebtedness reporting requirements see § 105-55.030 of this part.
In all appropriate instances, a compromise that is accepted by GSA may be implemented by means of a mutual release, in which the debtor is released from further non-tax liability on the compromised debt in consideration of payment in full of the compromise amount and the Government and its officials, past and present, are released and discharged from any and all claims and causes of action arising from the same transaction that the debtor may have. In the event a mutual release is not executed when a debt is compromised, unless prohibited by law, the debtor is still deemed to have waived any and all claims and causes of action against the Government and its officials related to the transaction giving rise to the compromised debt.
(a) The standards set forth in §§ 105-55.027 and 105-55.028 of this part apply to the suspension or termination of collection activity pursuant to 31 U.S.C. 3711 on debts that do not exceed $100,000, or such other amount as the Attorney General may direct, exclusive of interest, penalties, and administrative costs, after deducting the amount of partial payments or collections, if any. Prior to referring a debt to the Department of Justice for litigation, GSA may suspend or terminate collection under this part with respect to debts arising out of activities of, or referred or transferred for collection services to, the agency.
(b) If, after deducting the amount of any partial payments or collections, the principal amount of a debt exceeds $100,000, or such other amount as the Attorney General may direct, exclusive of interest, penalties, and administrative costs, the authority to suspend or terminate rests solely with the Department of Justice. If GSA believes suspension or termination of any debt in excess of $100,000 may be appropriate, the agency will refer the debt to the Civil Division or other appropriate litigating division in the Department of Justice, using the CCLR. The referral will specify the reasons for the agency's recommendation. If, prior to referral to the Department of Justice, GSA determines a debt is plainly erroneous or clearly without legal merit, the agency may terminate collection activity regardless of the amount involved without obtaining Department of Justice concurrence.
(a) GSA may suspend collection activity on a debt when—
(1) The agency cannot locate the debtor;
(2) The debtor's financial condition is expected to improve; or
(3) The debtor has requested a waiver or review of the debt.
(b) Based on the current financial condition of the debtor, GSA may suspend collection activity on a debt when the debtor's future prospects justify retention of the debt for periodic review and collection activity and—
(1) The applicable statute of limitations has not expired; or
(2) Future collection can be effected by administrative offset, notwithstanding the expiration of the applicable statute of limitations for litigation of claims, with due regard to the 10-year limitation for administrative offset prescribed by 31 U.S.C. 3716(e)(1); or
(3) The debtor agrees to pay interest on the amount of the debt on which collection will be suspended, and such suspension is likely to enhance the debtor's ability to pay the full amount of the principal of the debt with interest at a later date.
(c)(1) GSA will suspend collection activity during the time required for consideration of the debtor's request for waiver or administrative review of the debt if the statute under which the request is sought prohibits the agency from collecting the debt during that time.
(2) If the statute under which the request is sought does not prohibit collection activity pending consideration of the request, GSA will use discretion, on a case-by-case basis, to suspend collection. Further, GSA ordinarily will suspend collection
(d) When GSA learns a bankruptcy petition has been filed with respect to a debtor, in most cases the collection activity on a debt will be suspended, pursuant to the provisions of 11 U.S.C. 362, 1201, and 1301, unless the agency can clearly establish the automatic stay has been lifted or is no longer in effect. GSA will, if legally permitted, take the necessary legal steps to ensure no funds or money are paid by the agency to the debtor until relief from the automatic stay is obtained.
(a) GSA may terminate collection activity when—
(1) The agency is unable to collect any substantial amount through its own efforts or through the efforts of others;
(2) The agency is unable to locate the debtor;
(3) Costs of collection are anticipated to exceed the amount recoverable;
(4) The debt is legally without merit or enforcement of the debt is barred by any applicable statute of limitations;
(5) The debt cannot be substantiated; or
(6) The debt against the debtor has been discharged in bankruptcy.
(b) Before terminating collection activity, GSA will pursue all appropriate means of collection and determine, based upon the results of the collection activity, that the debt is uncollectible. Termination of collection activity ceases active collection of the debt. The termination of collection activity does not preclude GSA from retaining a record of the account for purposes of—
(1) Selling the debt, if the Secretary determines that such sale is in the best interests of the United States;
(2) Pursuing collection at a subsequent date in the event there is a change in the debtor's status or a new collection tool becomes available;
(3) Offsetting against future income or assets not available at the time of termination of collection activity; or
(4) Screening future applicants of loans and loan guaranties, licenses, permits, or privileges for prior indebtedness.
(c) Generally, GSA will terminate collection activity on a debt that has been discharged in bankruptcy, regardless of the amount. GSA may continue collection activity, however, subject to the provisions of the Bankruptcy Code, for any payments provided under a plan of reorganization. Offset and recoupment rights may survive the discharge of the debtor in bankruptcy and, under some circumstances, claims also may survive the discharge. For example, the claims of GSA that it is a known creditor of a debtor may survive a discharge if the agency did not receive formal notice of the proceedings.
When a significant enforcement policy is involved, or recovery of a judgment is a prerequisite to the imposition of administrative sanctions, GSA may refer debts for litigation even though termination of collection activity may otherwise be appropriate.
(a) Before discharging a delinquent debt (also referred to as a close out of the debt), GSA will take all appropriate steps to collect the debt in accordance with 31 U.S.C. 3711(g), including, as applicable, administrative offset, tax refund offset, Federal salary offset, referral to Treasury, Treasury-designated debt collection centers or private collection contractors, credit bureau reporting, wage garnishment, litigation, and foreclosure. Discharge of indebtedness is distinct from termination or suspension of collection activity and is governed by the Internal Revenue Code. When collection action on a debt is suspended or terminated, the debt remains delinquent and further collection action may be pursued at a later date in accordance with the standards set forth in this part. When GSA discharges a debt in full or in part, further collection action is prohibited. Therefore, GSA will make the determination that collection action is no longer warranted before discharging a debt. Before discharging a debt, GSA will terminate debt collection action.
(b) Section 3711(i), Title 31, United States Code, requires GSA to sell a delinquent non-tax debt upon termination of collection action if the Secretary determines such a sale is in the best interests of the United States. Since the discharge of a debt precludes any further collection action (including the sale of a delinquent debt), GSA may not discharge a debt until the requirements of 31 U.S.C. 3711(i) have been met.
(c) Upon discharge of a debt of more than $600, GSA must report the discharge to the IRS in accordance with the requirements of 26 U.S.C. 6050P and 26 CFR 1.6050P-1. GSA may request Treasury or Treasury-designated debt collection centers to file such a discharge report to the IRS on the agency's behalf.
(d) When discharging a debt, GSA will request the GSA Office of General Counsel to release any liens of record securing the debt.
(a) GSA will promptly refer to the Department of Justice (DoJ) for litigation debts on which aggressive collection activity has been taken in accordance with § 105-55.009 of this part and that cannot be compromised, or on which collection activity cannot be suspended or terminated, in accordance with §§ 105-55.027 and 105-55.028 of this part. GSA may refer those debts arising out of activities of, or referred or transferred for collection services to, the agency. Debts for which the principal amount is over $1,000,000, or such other amount as the Attorney General may direct, exclusive of interest and penalties, will be referred to the Civil Division or other division responsible for litigating such debts at DoJ, Washington, DC. Debts for which the principal amount is $1,000,000, or less, or such other amount as the Attorney General may direct, exclusive of interest or penalties, will be referred to DoJ's Nationwide Central Intake Facility as required by the CCLR instructions. Debts will be referred as early as possible, consistent with aggressive GSA collection activity and the observance of the standards contained in this part, and, in any event, well within the period for initiating timely lawsuits against the debtors. GSA will make every effort to refer delinquent debts to DoJ for litigation within one year of the date such debts last became delinquent. In the case of guaranteed or insured loans, GSA will make every effort to refer these delinquent debts to DoJ for litigation within one year from the date the loan was presented to the agency for payment or re-insurance.
(b) DoJ has exclusive jurisdiction over the debts referred to it pursuant to this section. GSA, as the referring agency, will immediately terminate the use of any administrative collection activities to collect a debt at the time of the referral of that debt to DoJ. GSA will advise DoJ of the collection activities which have been utilized to date, and their result. GSA will refrain from having any contact with the debtor and will direct all debtor inquiries concerning the debt to DoJ, except as
(a) Unless excepted by the Department of Justice (DoJ), GSA will complete the Claims Collection Litigation Report (CCLR) (see § 105-55.019(b) of this part), accompanied by a signed Certificate of Indebtedness, to refer all administratively uncollectible claims to DoJ for litigation. GSA will complete all sections of the CCLR appropriate to each claim as required by the CCLR instructions and furnish such other information as may be required in specific cases.
(b) GSA will indicate clearly on the CCLR the actions DoJ should take with respect to the referred claim. The CCLR permits the agency to indicate specifically any of a number of litigative activities which DoJ may pursue, including enforced collection, judgment lien only, renew judgment lien only, renew judgment lien and enforce collection, program enforcement, foreclosure only, and foreclosure and deficiency judgment.
(c) GSA also will use the CCLR to refer claims to DoJ to obtain approval of any proposals to compromise the claims or to suspend or terminate agency collection activity.
GSA will take care to preserve all files and records that may be needed by DoJ to prove their claims in court. GSA ordinarily will include certified copies of the documents that form the basis for the claim in the packages referring their claims to DoJ for litigation. GSA will provide originals of such documents immediately upon request by DoJ.
(a) GSA will not refer for litigation claims of less than $2,500, exclusive of interest, penalties, and administrative costs, or such other amount as the Attorney General shall from time to time prescribe. The Department of Justice (DoJ) will notify GSA if the Attorney General changes this minimum amount.
(b) GSA will not refer claims of less than the minimum amount unless—
(1) Litigation to collect such smaller claims is important to ensure compliance with the agency's policies or programs;
(2) The claim is being referred solely for the purpose of securing a judgment against the debtor, which will be filed as a lien against the debtor's property pursuant to 28 U.S.C. 3201 and returned to GSA for enforcement; or
(3) The debtor has the clear ability to pay the claim and the Government effectively can enforce payment, with due regard for the exemptions available to the debtor under state and Federal law and the judicial remedies available to the Government.
(c) GSA will consult with the Financial Litigation Staff of the Executive Office for United States Attorneys in DoJ prior to referring claims valued at less than the minimum amount.
Federal Communications Commission.
Final rule.
The Commission, at the request of Central Michigan University, substitutes DTV channel *17 for DTV channel *58 at Cadillac, and substitutes DTV channel *58 for DTV channel *17 at Manistee.
Effective August 21, 2003.
Pam Blumenthal, Media Bureau, (202) 418-1600.
This is a synopsis of the Commission's Report and Order, MB Docket No. 02-45, adopted July 2, 2003, and released July 7, 2003. The full text of this document is available for public inspection and copying during regular business hours in the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC. This document may also be purchased from the Commission's duplicating contractor, Qualex International, Portals II, 445 12th Street, SW, CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail
Digital television broadcasting, Television.
47 U.S.C. 154, 303, 334 and 336.
Federal Communications Commission.
Final rule; suspension.
This document suspends the effectiveness of §§ 74.502(d) and 74.638(b), of the rules published March 17, 2003, (68 FR 12743) from April 16, 2003 to October 16, 2003. Society of Broadcast Engineers requested a
Effective April 16, 2003, §§ 74.502(d) and 74.638(b), of 47 CFR Chapter I are suspended until October 16, 2003.
Ted Ryder, Office of Engineering and Technology, (202) 418-2803.
This is a summary of the Commission's Order, ET Docket No. 01-75, DA 03-1141, adopted April 15, 2003, and released April 15, 2003. The full text of this document is available for inspection and copying during regular business hours in the FCC Reference Center (Room CY-A257), 445 12th Street, SW., Washington, DC 20554. The complete text of this document also may be purchased from the Commission's copy contractor, Qualex International, 445 12th Street, SW., Room, CY-B402, Washington, DC 20554. The full text may also be downloaded at:
1. In the
2. In the
3. SBE requests a one-year stay to allow BAS licensees time to correct inaccurate receive site information, such as geographic coordinates, antenna height, make, and model. It notes that these errors are a legacy of licensing schemes previous to the ULS and occur in 29% of all fixed point-to-point BAS license records. SBE further notes that receive site information was not even required prior to 1974 and that it remains missing on many old licenses. SBE explains that, compared to the information coordination procedures currently in effect, prior coordination procedures require a more accurate database. SBE acknowledges previous Commission public notices asking broadcasters to examine and correct inaccuracies in the ULS, via informal correction procedures, but asserts that with the adoption of the prior coordination procedures, BAS licensees will now have a greater incentive to ensure that their license records are up to date. We also note that SBE asserts that interference standards for the mix of analog, hybrid analog-digital, and digital links encountered in BAS need to be developed and formalized before prior coordination procedures can take effect. Life Talk Radio and CPBE support SBE's Request.
4. We agree with SBE that legacy database inaccuracies in the ULS could seriously affect the efficacy of prior coordination procedures, which was not anticipated when the
5. The Commission generally employs a four-part test under the standard set forth in
6. First, we believe the database issues raised by SBE are valid and have merit. The period of the stay will provide time for Commission staff to address completion and correction of receive site information in the ULS database, so that prior coordination procedures can begin. Second, we find that SBE has demonstrated that, absent a stay, BAS licensees will suffer irreparable harm because there is an increased likelihood of interference to their receive facilities. Third, we find that granting a stay for six months will not harm any interested parties. As with our finding in the
7. With regard to SBE's assertion that adequate time must be provided for interference standards to be developed, we note that five months has already passed since the release of the
8. Pursuant to sections 4(i) of the Communications Act, as amended, 47 U.S.C. 154(i), and 1.429 (k) of the Commission's rules, 47 CFR 1.429 (k), that the Society of Broadcast Engineers' Request for Temporary Stay of the rules
General Services Administration (GSA), Office of Acquisition Policy.
Final rule.
The General Services Administration (GSA) is amending the General Services Administration Acquisition Regulation (GSAR) to give GSA's Federal Supply Service (FSS) the unilateral right to change the percentage rate of the Industrial Funding Fee (IFF) in Multiple Award Schedule (MAS) contracts. The final rule also modifies and consolidates provisions of two existing GSA clauses that implement collection of the IFF by FSS on sales from all Federal Supply Schedule contracts. These clauses are Industrial Funding Fee and Contractor's Report of Sales. They have been consolidated into a single clause, Industrial Funding Fee and Sales Reporting. This new clause eliminates duplicative information from the preceding clauses, clarifies sales reporting procedures, and describes the procedures FSS will utilize to unilaterally effect future IFF rate changes.
Additionally, while the GSAR does not specify the percentage rate of the IFF, GSA's Federal Supply Service intends to lower the current IFF rate from 1.0 percent to 0.75 percent of reported sales, effective January 1, 2004. The final rule gives GSA's Federal Supply Service the authority to change the IFF after consulting with OMB prior to effecting any future changes.
The January 1, 2004, change will be implemented by means of a bilateral contract modification to be executed electronically. As consideration to Federal Supply Schedule contractors for any potential costs incurred as the direct result of this change, FSS will allow these vendors to continue to include the 1 percent IFF in their contract prices until December 31, 2003, but to forward to FSS an IFF of 0.75 percent for reported sales for the period of October 1, 2003, through December 31, 2003. Examples of the type of costs GSA anticipates contractors could incur include updating published prices and modifying accounting systems.
Ms. Laurie Duarte, Regulatory Secretariat, Room 4035, GS Building, Washington, DC, 20405, (202) 501-4225, for information pertaining to status or publication schedules. For clarification of content, contact Vonda J. Sines, Procurement Analyst, at (703) 305-7542, or Linda Nelson, Procurement Analyst, at (202) 501-1900. Please cite GSAR Amendment 2003-02, GSAR case 2002-G507. The TTY Federal Relay Number for further information is 1-800-877-8973.
The General Services Administration published a proposed rule in the
1. Revises the clause at 552.238-74(a)(3) to make clear that reportable sales do not include those made under FAR Part 14 or non-FAR contracts, but do include sales to states and localities under Cooperative Purchasing authority.
2. Makes minor restructuring and editorial changes to the clause at 552.238-74 to provide a clearer intent of the clause language.
3. Adds the words “and Sales Reporting” to the clause at 552.215-71, Examination of Records by GSA (Multiple Award Schedules).
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Since vendors always have the ability to make sales outside the Schedule, they need to establish with their customers at the time of order placement whether a sale is being conducted under or outside the Schedule. This distinction is important, since FSS, as a fee-for-service operation, must rely on the fees generated from Schedule sales to cover expenses associated with the MAS program.
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This is not a significant regulatory action and, therefore, was not subject to review under Section 6(b) of Executive
The General Services Administration certifies that this final rule will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601,
Prior clause 552.238-74, Contractor's Report of Sales, contained an information requirement subject to the Paperwork Reduction Act (44 U.S.C. 3501
The consolidation of information from these two clauses into a single clause results in no additional burden and, therefore, no additional approval from OMB is required.
Government procurement.
40 U.S.C. 486(c).
(b) * * *
(1) 552.238-74, Industrial Funding Fee and Sales Reporting.
(b)
___552.238-74 Industrial Funding Fee and Sales Reporting
As prescribed in 538.273(b)(1), insert the following clause:
(a)
(1) The Contractor shall accurately report the dollar value, in U.S. dollars and rounded to the nearest whole dollar, of all sales under this contract by calendar quarter (January 1-March 31, April 1-June 30, July 1-September 30, and October 1-December 31). The dollar value of a sale is the price paid by the Schedule user for products and services on a Schedule task or delivery order. The reported contract sales value shall include the Industrial Funding Fee (IFF). The Contractor shall maintain a consistent accounting method of sales reporting, based on the Contractor's established commercial accounting practice. The acceptable points at which sales may be reported include—
(i) Receipt of order;
(ii) Shipment or delivery, as applicable;
(iii) Issuance of an invoice; or
(iv) Payment.
(2) Contract sales shall be reported to FSS within 30 calendar days following the completion of each reporting quarter. The Contractor shall continue to furnish quarterly reports, including “zero” sales, through physical completion of the last outstanding task order or delivery order of the contract.
(3) Reportable sales under the contract are those resulting from sales of contract items to authorized users unless the purchase was conducted pursuant to a separate contracting authority such as a Governmentwide Acquisition Contract (GWAC); a separately awarded FAR Part 12, FAR Part 13, FAR Part 14, or FAR Part 15 procurement; or a non-FAR contract. Sales made to state and local governments under Cooperative Purchasing authority shall be counted as reportable sales for IFF purposes.
(4) The Contractor shall electronically report the quarterly dollar value of sales, including “zero” sales, by utilizing the automated reporting system at an Internet website designated by the General Services Administration (GSA)'s Federal Supply Service (FSS). Prior to using this automated system, the Contractor shall complete contract registration with the FSS Vendor Support Center (VSC). The website address, as well as registration instructions and reporting procedures, will be provided at the time of award. The Contractor shall report sales separately for each National Stock Number (NSN), Special Item Number (SIN), or sub-item.
(5) The Contractor shall convert the total value of sales made in foreign currency to U.S. dollars using the “Treasury Reporting Rates of Exchange” issued by the U.S. Department of Treasury, Financial
(b) The Contractor shall remit the IFF at the rate set by GSA's FSS.
(1) The Contractor shall remit the IFF to FSS in U.S. dollars within 30 calendar days after the end of the reporting quarter; final payment shall be remitted within 30 days after physical completion of the last outstanding task order or delivery order of the contract.
(2) The IFF represents a percentage of the total quarterly sales reported. This percentage is set at the discretion of GSA's FSS. GSA's FSS has the unilateral right to change the percentage at any time, but not more than once per year. FSS will provide reasonable notice prior to the effective date of the change. The IFF reimburses FSS for the costs of operating the Federal Supply Schedules Program and recoups its operating costs from ordering activities. Offerors must include the IFF in their prices. The fee is included in the award price(s) and reflected in the total amount charged to ordering activities. FSS will post notice of the current IFF at
(c) Within 60 days of award, an FSS representative will provide the Contractor with specific written procedural instructions on remitting the IFF. FSS reserves the unilateral right to change such instructions from time to time, following notification to the Contractor.
(d) Failure to remit the full amount of the IFF within 30 calendar days after the end of the applicable reporting period constitutes a contract debt to the United States Government under the terms of FAR Subpart 32.6. The Government may exercise all rights under the Debt Collection Improvement Act of 1996, including withholding or setting off payments and interest on the debt (see FAR clause 52.232-17, Interest). Should the Contractor fail to submit the required sales reports, falsify them, or fail to timely pay the IFF, this is sufficient cause for the Government to terminate the contract for cause.
Office of Finance, General Services Administration (GSA).
Proposed rule.
The General Services Administration (GSA) is proposing to amend its regulations to implement the administrative wage garnishment provisions contained in the Debt Collection Improvement Act of 1996 (DCIA). Wage garnishment is a process whereby an employer withholds amounts from an employee's wages and pays those amounts to the employee's creditor in satisfaction of a withholding order. The DCIA authorizes Federal agencies to administratively garnish the disposable pay of an individual to collect delinquent non-tax debts owed to the United States in accordance with regulations issued by the Secretary of the Treasury.
This part was previously titled Collection of Debts by Tax Refund Offset. Effective January 1, 1999, the Department of Treasury started to conduct the tax refund offset program as part of the centralized offset program, known as the Treasury Offset Program (TOP), operated by the Financial Management Service (FMS), a bureau of the Department of Treasury. Since GSA has a cross-servicing agreement with FMS, which includes the TOP, the collection of debts by tax refund offset is no longer valid and is rescinded and replaced with the new part regarding administrative wage garnishment.
Interested parties should submit comments in writing on or before September 9, 2003 to be considered in the formulation of a final rule.
Submit written comments to: General Services Administration, Office of the Chief Financial Officer (BCD), 1800 F Street, NW., Room 3121, ATTN: Michael J. Kosar, Washington, DC 20405. Submit electronic comments via the Internet to:
The Regulatory Secretariat, Room 4035, GS Building, Washington, DC 20405, at (202) 501-4755 for information pertaining to status or publication schedules. For clarification of content, contact Mr. Michael J. Kosar, (202) 501-2029. Please cite GSPMR case 2003-105-2.
This rule is proposed to implement the wage garnishment provision in section 31001(o) of the Debt Collection Improvement Act of 1996 (DCIA), Pub. L. 104-134, 110 Stat. 1321-358 (Apr. 26, 1996), codified at 31 U.S.C. 3720D. Wage garnishment is a process whereby an employer withholds amounts from an employee's wages and pays those amounts to the employee's creditor in satisfaction of a withholding order. The DCIA authorizes Federal agencies to administratively garnish up to 15% of the disposable pay of a debtor to satisfy delinquent non-tax debt owed to the United States. Prior to the enactment of the DCIA, agencies were required to obtain a court judgment before garnishing the wages of non-Federal employees. Section 31001(o) of the DCIA pre-empts State laws that prohibit wage garnishment or otherwise govern wage garnishment procedures.
As authorized by the DCIA, a Federal agency collecting delinquent non-tax debt may administratively garnish a delinquent debtor's wages in accordance with regulations promulgated by the Secretary of the Treasury. The Financial Management Service (FMS), a bureau of the Department of the Treasury, is responsible for promulgating the regulations implementing this and other debt collection tools established by the DCIA.
In accordance with the requirements of the DCIA, this proposed rule establishes the following rules and procedures:
At least 30 days before GSA initiates garnishment proceedings, the Agency will give the debtor written notice informing him or her of the nature and amount of the debt, the intention of GSA to collect the debt through deductions from pay, and an explanation of the debtor's rights regarding the proposed action.
GSA will provide the debtor with an opportunity to inspect and copy records related to the debt, to establish a repayment agreement, and to receive a hearing concerning the existence and/or amount of the debt and/or the terms of a repayment schedule. A hearing will be held prior to the issuance of a withholding order if the debtor's request is received timely. For hearing requests that are not received in the specified time frame, GSA will not delay issuance of the withholding order prior to conducting a hearing. GSA will not garnish the wages of a debtor who has been involuntarily separated from employment until that individual has been reemployed continuously for at least 12 months. The debtor bears the burden of informing GSA of the circumstances surrounding an involuntary separation from employment.
GSA will send to the employer of a delinquent debtor a wage garnishment order directing that the employer pay a portion of the debtor's wages to GSA. This proposed rule requires the debtor's employer to certify certain payment information about the debtor. Employers will not be required to vary their normal pay cycles in order to comply with the garnishment order.
The DCIA prohibits employers from taking disciplinary actions against the debtor based on the fact that the debtor's wages are subject to administrative garnishment. In addition, the DCIA authorizes GSA to sue an employer for amounts not properly withheld from the wages payable to the debtor.
This rule is not a significant regulatory action as defined in Executive Order 12866. It is hereby certified this regulation, including the certification referenced in this proposed rule (see § 105-57.007 of this part), will not have a significant economic impact on a substantial number of small entities. Although a substantial number
It is hereby certified this regulation will not have a significant economic impact on a substantial number of small entities because the regulation either (1) results in greater flexibility for GSA to streamline debt collection regulations, or (2) reflects the statutory language contained in the DCIA. Accordingly, a Regulatory Flexibility Analysis is not required.
This regulation will not have a substantial direct effect on the states, on the relationship between the national government and the states, or on distribution of power and responsibilities among the various levels of government. Therefore, in accordance with Executive Order 13132, it is determined this regulation does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment.
This regulation will not result in the expenditure by state, local and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one (1) year, and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.
This rule is not a major rule as defined by section 251 of the Small Business Regulatory Enforcement Act, 5 U.S.C. 804. This rule will not result in an annual effect on the economy of $100 million or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-based companies in domestic or export markets.
This rule does not contain information collection requirements that require approval by the Office of Management and Budget under the Paperwork Reduction Act, 44 U.S.C. 3507
Claims, Government public contracts and property management, income taxes.
For the reasons set out in the preamble, GSA proposes to amend 41 CFR part 105-57 as follows:
1. Revise part 105-57 to read as follows:
5 U.S.C. §§ 552-553, 31 U.S.C. 3720D, 31 CFR part 285.11.
(a) This part provides standards and procedures for GSA to collect money from a debtor's disposable pay by means of administrative wage garnishment to satisfy delinquent non-tax debt owed to the United States.
(b) These standards and procedures are authorized under the wage garnishment provisions of the Debt Collection Improvement Act of 1996, codified at 31 U.S.C. 3720D, and Department of Treasury Wage Garnishment Regulations at 31 CFR 285.11.
(c)
(2) This part will apply notwithstanding any provision of State law.
(3) Nothing in this part precludes the compromise of a debt or the suspension or termination of collection action in accordance with applicable law. See, for example, the Federal Claims Collection Standards (FCCS), 31 CFR parts 900 through 904.
(4) The receipt of payments pursuant to this part does not preclude GSA from pursuing other debt collection remedies, including the offset of Federal payments to satisfy delinquent non-tax debt owed to the United States. GSA may pursue such debt collection remedies separately or in conjunction with administrative wage garnishment.
(5) This part does not apply to the collection of delinquent non-tax debt owed to the United States from the wages of Federal employees from their Federal employment. Federal pay is subject to the Federal salary offset procedures set forth in 5 U.S.C. 5514 and other applicable laws. GSA standards and procedures for offsetting Federal wage payments are stated in 41 CFR part 105-56.
(6) Nothing in this part requires GSA to duplicate notices or administrative proceedings required by contract or other laws or regulations.
(a)
(b)
(c)
(d)
(e) “
(f)
(g)
(h)
(i)
(j) For the purposes of the standards in this part, unless otherwise stated, the term “Administrator” refers to the Administrator of General Services or the Administrator's delegate.
(k) For the purposes of the standards in this part, the terms “claim” and “debt” are synonymous and interchangeable. They refer to an amount of money, funds, or property that has been determined by GSA to be due the United States from any person, organization, or entity, except another Federal agency, from sources which include loans insured or guaranteed by the United States and all other amounts due the United States from fees, leases, rents, royalties, services, sales of real or personal property, overpayments, penalties, damages, interest, fines and forfeitures and all other similar sources, including debt administered by a third party as an agent for the Federal Government. For the purposes of administrative offset under 31 U.S.C. 3716, the terms “claim” and “debt” include an amount of money, funds, or property owed by a person to a State (including past-due support being enforced by a State), the District of Columbia, American Samoa, Guam, the United States Virgin Islands, the Commonwealth of the Northern Mariana Islands, or the Commonwealth of Puerto Rico.
(l) For the purposes of the standards in this part, unless otherwise stated, the terms “GSA” and “Agency” are synonymous and interchangeable.
(m) For the purposes of the standards in this part, unless otherwise stated, “Secretary” means the Secretary of the Treasury or the Secretary's delegate.
(n)
(o)
(p)
(q)
(r) In this part, words in the plural form shall include the singular and vice versa, and words signifying the masculine gender shall include the feminine and vice versa. The terms “includes” and “including” do not exclude matters not listed but do include matters that are in the same general class.
Whenever GSA determines a delinquent debt is owed by an individual, the Agency may initiate administrative proceedings to garnish the wages of the delinquent debtor.
(a) At least 30 days before the initiation of garnishment proceedings, GSA will send, by first class mail, overnight delivery service, or hand delivery to the debtor's last known address a written notice informing the debtor of—
(1) The nature and amount of the debt;
(2) The intention of GSA to initiate proceedings to collect the debt through deductions from pay until the debt and all accumulated interest, penalties and administrative costs are paid in full; and
(3) The debtor's rights, including those set forth in paragraph (b) of this section, and the time frame within which the debtor may exercise his or her rights.
(b) The debtor will be afforded the opportunity:
(1) To inspect and copy Agency records related to the debt;
(2) To enter into a written repayment agreement with GSA under terms agreeable to the Agency; and
(3) To request a hearing in accordance with § 105-57.005 of this part concerning the existence and/or amount of the debt, and/or the terms of the proposed repayment schedule under the garnishment order. However, the debtor is not entitled to a hearing concerning the terms of the proposed repayment schedule if these terms have been established by written agreement under paragraph (b)(2) of this section.
(c) The notice required by this section may be included with GSA's demand letter required by 41 CFR 105-55.010.
(d) GSA will keep a copy of the evidence of service indicating the date of submission of the notice. The evidence of service may be retained electronically so long as the manner of retention is sufficient for evidentiary purposes.
(a) GSA will provide a hearing, which at the hearing official's option may be oral or written, if within fifteen (15) business days of submission of the notice by GSA, the debtor submits a signed and dated written request for a hearing, to the official named in the notice, concerning the existence and/or amount of the debt, and/or the terms of the repayment schedule (for repayment schedules established other than by written agreement under § 105-57.004(b)(2) of this part). A copy of the request for a hearing must also be sent to the GSA Board of Contract Appeals at the address indicated in paragraph (b)(2) of this section.
(b) Types of hearing or review.
(1) For purposes of this section, whenever GSA is required to afford a debtor a hearing, the hearing official will provide the debtor with a reasonable opportunity for an oral hearing when he/she determines that the issues in dispute cannot be resolved by review of the documentary evidence, for example, when the validity of the
(2) If the hearing official determines that an oral hearing is appropriate, he/she will establish the time and location of the hearing. An oral hearing may, at the debtor's option, be conducted either in-person or by telephone conference. In-person hearings will be conducted in the hearing officials office located at GSA Central Office, 1800 F St., NW., Washington, DC 20405, or at another location designated by the hearing official. All personal and travel expenses incurred by the debtor in connection with an in-person hearing will be borne by the debtor. All telephonic charges incurred during a hearing will be the responsibility of GSA.
(3) The debtor may represent himself or herself or may be represented by another person of his or her choice at the hearing. GSA will not compensate the debtor for representation expenses, including hourly fees for attorneys, travel expenses, or costs for reproducing documents.
(4) In those cases when an oral hearing is not required by this section, the hearing official will nevertheless conduct a “paper hearing”, that is, the hearing official will decide the issues in dispute based upon a review of the written record. The hearing official will establish a reasonable deadline for the submission of evidence.
(c) Subject to paragraph (k) of this section, if the debtor's written request is received by GSA on or before the 15th business day after the submission of the notice described in § 105-57.004(a) of this part, the Agency will not issue a withholding order under § 105-57.006 of this part until the debtor has been provided the requested hearing and a decision in accordance with paragraphs (h) and (i) of this section has been rendered.
(d) If the debtor's written request for a hearing is received by GSA after the 15th business day following the mailing of the notice described in § 105-57.004(a) of this part, GSA may consider the request timely filed and provide a hearing if the debtor can show that the delay was because of circumstances beyond his or her control. However, GSA will not delay issuance of a withholding order unless the Agency determines that the delay in filing the request was caused by factors over which the debtor had no control, or GSA receives information that the Agency believes justifies a delay or cancellation of the withholding order.
(e) After the debtor requests a hearing, the hearing official will notify the debtor of:
(1) The date and time of a telephonic hearing;
(2) The date, time, and location of an in-person oral hearing; or
(3) The deadline for the submission of evidence for a written hearing.
(f) Burden of proof. (1) GSA will have the burden of establishing the existence and/or amount of the debt.
(2) Thereafter, if the debtor disputes the existence and/or amount of the debt, the debtor must prove by a preponderance of the evidence that no debt exists or that the amount of the debt is incorrect. In addition, the debtor may present evidence that the terms of the repayment schedule are unlawful, would cause a financial hardship to the debtor, or that collection of the debt may not be pursued due to operation of law.
(g) The hearing official will maintain a written transcript of any hearing provided under this section. The transcript will be made available to either party in the event of an appeal under the Administrative Procedure Act, 5 U.S.C. 701-706. A hearing is not required to be a formal evidentiary-type hearing, however, witnesses who testify in oral hearings will do so under oath or affirmation.
(h) The hearing official will issue a written opinion stating his or her decision, as soon as practicable, but not later than sixty (60) days after the date on which the request for such hearing was received by GSA. If the hearing official is unable to provide the debtor with a hearing and render a decision within 60 days after the receipt of the request for such hearing—
(1) GSA will not issue a withholding order until the hearing is held and a decision rendered; or
(2) If GSA had previously issued a withholding order to the debtor's employer, the Agency will suspend the withholding order beginning on the 61st day after the receipt of the hearing request and continuing until a hearing is held and a decision is rendered.
(i) The written decision will include—
(1) A summary of the facts presented;
(2) The hearing official's findings, analysis and conclusions; and
(3) The terms of any repayment schedules, if applicable.
(j) The hearing official's decision will be the final Agency action for the purposes of judicial review under the Administrative Procedure Act (5 U.S.C. 701
(k) In the absence of good cause shown, a debtor who fails to appear at a hearing scheduled pursuant to paragraph (e) of this section, or to provide written submissions within the time set by the hearing official, will be deemed to have waived his or her right to appear and present evidence.
(a) Unless GSA receives information it believes justifies a delay or cancellation of the withholding order, the Agency will send, by first class mail, overnight delivery service or hand delivery, a SF 329A (Letter to Employer & Important Notice to Employer), a SF 329B (Wage Garnishment Order), a SF 329C (Wage Garnishment Worksheet), and a SF 329D (Employer Certification), to the debtor's employer—
(1) Within 30 days after the debtor fails to make a timely request for a hearing (
(2) If a timely request for a hearing is made by the debtor, within 30 days after a final decision is made by the hearing official to proceed with garnishment.
(b) The withholding order sent to the employer under paragraph (a) of this section will contain the signature of, or the image of the signature of, the Administrator or his or her delegate. The order will contain only the information necessary for the employer to comply with the withholding order. Such information includes the debtor's name, address, and social security number, as well as instructions for withholding and information as to where payments are to be sent.
(c) GSA will retain a copy of the evidence of service indicating the date of submission of the order. The evidence of service may be retained electronically so long as the manner of retention is sufficient for evidentiary purposes.
The employer must complete and return the SF 329D (Employer Certification) to GSA within the time-frame prescribed in the instructions to the form. The certification will address matters such as information about the debtor's employment status and disposable pay available for withholding.
(a) After receipt of the garnishment order issued under this part, the employer shall deduct from all disposable pay paid to the applicable debtor during each pay period the amount of garnishment described in paragraph (b) of this section. The employer may use the SF 329C (Wage Garnishment Worksheet) to calculate the amount to be deducted from the debtor's disposable pay.
(b) Subject to the provisions of paragraphs (c) and (d) of this section, the amount of garnishment will be the lesser of—
(1) The amount indicated on the garnishment order up to 15% of the debtor's disposable pay; or
(2) The amount set forth in 15 U.S.C. 1673(a)(2) (Restriction on Garnishment), which is the amount by which a debtor's disposable pay exceeds an amount equivalent to thirty times the minimum wage.
(c) When a debtor's pay is subject to withholding orders with priority, the following will apply:
(1) Unless otherwise provided by Federal law, withholding orders issued under this part will be paid in the amounts set forth under paragraph (b) of this section and will have priority over other withholding orders which are served later in time. Notwithstanding the foregoing, withholding orders for family support will have priority over withholding orders issued under this part.
(2) If amounts are being withheld from a debtor's pay pursuant to a withholding order served on an employer before a withholding order issued pursuant to this part, or if a withholding order for family support is served on an employer at any time, the amounts withheld pursuant to the withholding order issued under this part will be the lesser of—
(i) The amount calculated under paragraph (b) of this section, or
(ii) An amount equal to 25% of the debtor's disposable pay less the amount(s) withheld under the withholding order(s) with priority.
(3) If a debtor owes more than one debt to GSA, the Agency may issue multiple withholding orders provided the total amount garnished from the debtor's pay for such orders does not exceed the amount set forth in paragraph (b) of this section.
(d) An amount greater than that set forth in paragraphs (b) and (c) of this section may be withheld upon the written consent of the debtor.
(e) The employer shall promptly pay to GSA all amounts withheld in accordance with the withholding order issued pursuant to this part.
(f) An employer will not be required to vary its normal pay and disbursement cycles in order to comply with the withholding order.
(g) Any assignment or allotment by an employee of his or her earnings will be void to the extent it interferes with or prohibits execution of the withholding order issued under this part, except for any assignment or allotment made pursuant to a family support judgment or order.
(h) The employer will withhold the appropriate amount from the debtor's wages for each pay period until the employer receives notification from GSA to discontinue wage withholding. The garnishment order will indicate a reasonable period of time within which the employer is required to commence wage withholding, usually the first payday after the employer receives the order. However, if the first payday is within ten (10) days after the receipt of the garnishment order, the employer may begin deductions on the second payday.
(i) Payments received through a wage garnishment order will be applied in the following order:
(1) To outstanding penalties.
(2) To administrative costs incurred by GSA to collect the debt.
(3) To interest accrued on the debt at the rate established by the terms of the obligation under which it arose or by applicable law.
(4) To outstanding principal.
GSA will not garnish the wages of a debtor who it knows has been involuntarily separated from employment until the debtor has been reemployed continuously for at least 12 months. The debtor has the burden of informing GSA of the circumstances surrounding an involuntary separation from employment.
(a) A debtor whose wages are subject to a wage withholding order under this part, may, at any time, request a review by GSA of the amount garnished, based on materially changed circumstances such as disability, divorce, or catastrophic illness which result in financial hardship.
(b) A debtor requesting a review under paragraph (a) of this section shall submit the basis for claiming the current amount of garnishment results in a financial hardship to the debtor, along with supporting documentation.
(c) If a financial hardship is found, GSA will downwardly adjust, by an amount and for a period of time agreeable to the Agency, the amount garnished to reflect the debtor's financial condition. GSA will notify the employer of any adjustments to the amounts to be withheld.
(a) Once GSA has fully recovered the amounts owed by the debtor, including interest, penalties, and administrative costs consistent with the FCCS, the Agency will send the debtor's employer notification to discontinue wage withholding.
(b) At least annually, GSA will review its debtors' accounts to ensure that garnishment has been terminated for accounts that have been paid in full.
An employer may not discharge, refuse to employ, or take disciplinary action against the debtor due to the issuance of a withholding order under this part. See 31 U.S.C. 3720D(e).
(a) If a hearing official, at a hearing held pursuant to § 105-57.005 of this part, determines that a debt is not legally due and owing to the United States, GSA will promptly refund any amount collected by means of administrative wage garnishment.
(b) Unless required by Federal law or contract, refunds under this part will not bear interest.
GSA may sue any employer for any amount that the employer fails to withhold from wages owed and payable to an employee in accordance with §§ 105-057.006 and 105-57.008 of this part, plus attorney's fees, costs, and if applicable, punitive damages. However, a suit may not be filed before the termination of the collection action involving a particular debtor, unless earlier filing is necessary to avoid expiration of any applicable statute of limitations period. For purposes of this part, “termination of the collection action” occurs when GSA has terminated collection action in accordance with the FCCS or other applicable standards. In any event, termination of the collection action will have been deemed to occur if GSA has not received any payments to satisfy the debt from the particular debtor whose wages were subject to garnishment, in whole or in part, for a period of one (1) year.
Advisory Council on Historic Preservation.
Notice of adoption of amendment to the Army alternate procedures.
On June 30, 2003, the Advisory Council on Historic Preservation (“ACHP”) adopted an amendment to the Army Alternate Procedures (“AAP”) setting a process for technical and administrative amendments to the AAP.
The approved amendment went into effect on June 30, 2003.
Mr. David Berwick, Army Program Manager, Advisory Council on Historic Preservation, 202-606-8531.
A notice of intent to amend the AAP was published in the
The approved amendment will allow the Chairman of the ACHP to approve administrative and technical amendments to the AAP:
7.1(d) Upon request by Headquarters, Department of the Army, the Council may adopt technical and/or administrative amendments to the Army Alternate Procedures. Such amendments will take effect upon approval by the Council's Chairman. The Council shall publish in the
36 CFR 800.14(a)
Forest Service, USDA.
Notice of intent to prepare an environmental impact statement.
The USDA, Forest Service, will prepare an environmental impact statement (EIS) to disclose the environmental effects of the salvage harvest of timber killed as a result of fire in the Canyon Creek, Boulder Creek, Cascade Creek, Sage Creek, and Runaway Creek drainages (herein referred to as the Sheep Creek Project). The project area is located 15 miles west of Wisdom, Montana, north of State Highway 43, just west of the Placer Creek Road. The project area is outside of inventoried roadless areas.
Comments concerning the scope of the analysis must be postmarked within 30 days of the date of publishing of this legal notice. The draft environmental impact statement is expected February, 2004 and the final environmental impact statement is expected June of 2004.
Written comments concerning this notice or a request to be placed on the project mailing list should be addressed to Chris Tootell, TEAMS, 200 East Broadway, suite 251, Missoula, Montana, 59807. Comments may also be sent via e-mail to
All comments, including names and addresses when provided, are placed in the record and are available for public inspection and copying. The public may inspect comments received at the Wisdom Ranger District, Wisdom, MT. Visitors are encouraged to call ahead to (406) 689-3243 to facilitate entry to the building.
Chris Tootell, Environmental Resource Coordinator, TEAMS Enterprise unit, USDA Forest Service (406) 329-3459. Individuals who use telecommunication devices for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1-800-877-8339 between 8 a.m. to 8 p.m., Eastern Standard Time, Monday through Friday.
The proposed project area is located within sections 4, 5, 6, 7, 8, 9 & 18, T.2S., R.17W., and sections 1, 12 and 13. T.2S., R.18W.
The purpose and need for the proposed action is to move toward the desired conditions as described in the Beaverhead National Forest Land and Resource Management Plan (LRMP). The proposed action is located on lands classified as “available and suitable for timber production” (LRMP, p. III-48 and III-63). Congress has recognized the treatments; the estimated timber volume to make available from the project area; the estimated amount of temporary road construction needed; and mitigation measures and monitoring requirements.
Public participation is important to this analysis. Part of the goal of public involvement is to identify additional issues and to refine the general, tentative issues. The Beaverhead-Deerlodge National Forest has developed a listing of individuals and organizations that have expressed an interest in being informed of and providing input to vegetation management and fuel redcution projects. This list of individuals and organizations include private citizens, businesses, various organizations, Native American groups, and federal, state and county agencies. All of these contacts will be sent the initial scoping document.
The following list of preliminary issues was developed for the project area by the Forest Service
• Timber sale value.
• Potential reduction of big game “security cover” within harvest units may result in a need for a nonsignificant site specific Forest Plan amendment for elk effective cover standards.
• Loss of future potential Lynx denning habitat by removal of heavy fuels.
• Potential for introduction and spread of noxious weeds from logging and log hauling.
• Potential soil disturbance.
• Residual fuel loads exceeding desired thresholds within treatment units.
• Potential for introduction of sediment to streams impacting fish species.
• Loss of habitat for snag dependent and cavity nesting species.
This notice of intent initiates the scoping process which guides the development of the draft environmental impact statement, including the identification of the range of alternatives to be considered. While public participation is strictly optional at this stage, the Forest Service believes that it is important to give reviewers notice of several court rulings related to public participation in the subsequent environmental review process. First, reviewers of draft statements must structure their participation in the environmental review of the proposal so that it is meaningful and alerts an agency to the reviewer's position and contentions.
Because of these court rulings, it is very important that those interested in this proposed action participate by the close of the 45 day draft environmental impact statement comment period so that substantive comments and objections are made available to the Forest Service at a time when it can meaningfully consider them and respond to them in the final environmental impact statement. To assist the Forest Service in identifying and considering issues and concerns on the proposed action, comments on the draft environmental impact statement should be as specific as possible. It is also helpful if comments refer to specific pages or chapters of the draft statement. Comments also may address the adequacy of the draft environmental impact statement or the merits of the alternatives formulated and discussed in the statement. In addressing these points, reviewers may wish to refer to the Council on Environmental Quality regulations which implement the procedural provisions of the National Environmental Policy Act at 40 CFR 1503.3.
Forest Service, USDA.
Notice of meeting.
The Land Between The Lakes Advisory Board will hold a meeting on Wednesday, July 30, 2003. Notice of this meeting is given under the Federal Advisory Committee Act, 5 U.S.C. App.2.
The meeting agenda includes the following:
(1) Welcome/Introductions/Agenda.
(2) LBL Land and Resource Management Plan (LRMP).
(3) Board Discussion of Comments Received.
(4) Update on LBL Activities.
(5) Environmental Education Update.
The meeting is open to the public. Written comments are invited and may be mailed to: William P. Lisowsky, Area Supervisor, Land Between The Lakes, 100 Van Morgan Drive, Golden Pond, Kentucky 42211. Written comments must be received at Land Between The Lakes by July 22, 2003, in order for copies to be provided to the members at the meeting. Board members will review written comments received, and at their request, oral clarification may be requested at a future meeting.
The meeting will be held on Wednesday, July 30, 2003, 9 a.m. to 3 p.m., CDT.
The meeting will be held at Kentucky Dam Village State Resort Park, Village Green Meeting Room, Gilbertsville, KY, and will be open to the public.
Sharon Byers, Advisory Board Liaison, Land Between The Lakes, 100 Van Morgan Drive, Golden Pond, Kentucky 42211, 270-924-2002.
None.
National Agricultural Statistics Service, USDA.
Notice.
This notice announces the intent of the National Agricultural Statistics Service (NASS) to discontinue information collection for the Monthly Hogs and Pigs Survey.
The Monthly Hogs and Pigs Report will be terminated on September 9, 2003.
Not open for comment.
Contact Dan Kerestes, Chief, Livestock Branch, National Agricultural Statistics Service, U.S. Department of Agriculture, Room 6435 South Building, 1400 Independence Avenue SW., Washington, DC 20250-2000, (202) 720-3570.
Authorized funding for implementation of the Monthly Hog Survey was specified in Title IX—Livestock Mandatory Reporting, Subtitle C—Related Swine Reporting Provisions, Section 931, Improvements of Hogs and Pigs Inventory Report, which passed as part of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies the Appropriation Act, 2000. The survey was requested by the National Pork Producers Council and others in the hog industry to aid in forecasting pig production and to provide the pork industry with more knowledge of and quicker realization of market conditions. The Monthly Hogs and Pigs Survey questionnaire was developed to be consistent with the Quarterly Hogs and Pigs Survey questionnaire. The questionnaire was pre-tested with hog producers by NASS staff in mid-2000. NASS began collecting hog information in October 2000. Monthly data were released in the December, 2000, Quarterly Hogs and Pigs report. The first published Monthly Hogs and Pigs report occurred in January 2001. Response rates for the Monthly Hogs and Pigs Survey deteriorated due to increased respondent burden. The continued deterioration in response rates impacted the monthly survey indication by causing a greater portion of the indication to be estimated. The increase in monthly estimation also raised concern that the monthly report adversely impacted response rates of the Quarterly Hogs and Pigs Survey. NASS will be discontinuing collection and publication of the monthly report.
Committee for Purchase From People Who Are Blind or Severely Disabled.
Proposed Additions to and Deletions from Procurement List.
The Committee is proposing to add to the Procurement List products and services to be furnished by nonprofit agencies employing persons who are blind or have other severe disabilities, and to delete products previously furnished by such agencies.
August 10, 2003.
Committee for Purchase From People Who Are Blind or Severely Disabled, Jefferson Plaza 2, Suite 10800, 1421 Jefferson Davis Highway, Arlington, Virginia 22202-3259.
Sheryl D. Kennerly, (703) 603-7740.
This notice is published pursuant to 41 U.S.C 47(a)(2) and 41 CFR 51-2.3. Its purpose is to provide interested persons an opportunity to submit comments on the proposed actions.
If the Committee approves the proposed additions, the entities of the Federal Government identified in this notice for each product or service will be required to procure the products and services listed below from nonprofit agencies employing persons who are blind or have other severe disabilities.
I certify that the following action will not have a significant impact on a substantial number of small entities. The major factors considered for this certification were:
1. If approved, the action will not result in any additional reporting, recordkeeping or other compliance requirements for small entities other than the small organizations that will furnish the products and services to the Government.
2. If approved, the action will result in authorizing small entities to furnish the products and services to the Government.
3. There are no known regulatory alternatives which would accomplish the objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-48c) in connection with the products and services proposed for addition to the Procurement List. Comments on this certification are invited. Commenters should identify the statement(s) underlying the certification on which they are providing additional information.
The following products and services are proposed for addition to Procurement List for production by the nonprofit agencies listed:
I certify that the following action will not have a significant impact on a substantial number of small entities. The major factors considered for this certification were:
1. If approved, the action will not result in any additional reporting, recordkeeping or other compliance requirements for small entities.
2. If approved, the action will result in authorizing small entities to furnish the products to the Government.
3. There are no known regulatory alternatives which would accomplish the objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-48c) in connection with the products proposed for deletion from the Procurement List.
The following products are proposed for deletion from the Procurement List:
Committee for Purchase from People Who Are Blind or Severely Disabled.
Additions to Procurement List.
This action adds to the Procurement List products and services to be furnished by nonprofit agencies employing persons who are blind or have other severe disabilities.
August 10, 2003.
Committee for Purchase From People Who Are Blind or Severely Disabled, Jefferson Plaza 2, Suite 10800, 1421 Jefferson Davis Highway, Arlington, Virginia, 22202-3259.
Sheryl D. Kennerly, (703) 603-7740.
On March 7, March 28, April 18, April 25, May 2, and May 9, 2003, the Committee for Purchase From People Who Are Blind or Severely Disabled published notice (68 F.R. 11036, 15150, 19188, 20371, 23441, and 24919) of proposed additions to the Procurement List. After consideration of the material presented to it concerning capability of qualified nonprofit agencies to provide the products and services and impact of the additions on the current or most recent contractors, the Committee has determined that the products and services listed below are suitable for procurement by the Federal Government under 41 U.S.C. 46-48c and 41 CFR 51-2.4.
I certify that the following action will not have a significant impact on a substantial number of small entities. The major factors considered for this certification were:
1. The action will not result in any additional reporting, recordkeeping or other compliance requirements for small entities other than the small organizations that will furnish the products and services to the Government.
2. The action will result in authorizing small entities to furnish the products and services to the Government.
3. There are no known regulatory alternatives which would accomplish the objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-48c) in connection with the products and services proposed for addition to the Procurement List.
Accordingly, the following products and services are added to the Procurement List:
This action does not affect current contracts awarded prior to the effective date of this addition or options that may be exercised under those contracts.
The Department of Commerce has submitted to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
Copies of the above information collection proposal can be obtained by calling or writing Diana Hynek, Departmental Paperwork Clearance Officer, (202) 482-0266, Department of Commerce, Room 6625, 14th and Constitution Avenue, NW, Washington, DC 20230 (or via the Internet at
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to David Rostker, OMB Desk Officer, Room 10202, New Executive Office Building, Washington, DC 20503.
The Department of Commerce has submitted to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
Copies of the above information collection proposal can be obtained by calling or writing Diana Hynek, Departmental Paperwork Clearance Officer, (202) 482-0266, Department of Commerce, Room 6625, 14th and Constitution Avenue, NW, Washington, DC 20230 (or via the Internet at
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to David Rostker, OMB Desk Officer, Room 10202, New Executive Office Building, Washington, DC 20503.
The Department of Commerce has submitted to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
Copies of the above information collection proposal can be obtained by calling or writing Diana Hynek, Departmental Paperwork Clearance Officer, (202) 482-0266, Department of Commerce, Room 6625, 14th and Constitution Avenue, NW, Washington, DC 20230 (or via the Internet at dHynek@doc.gov).
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to David Rostker, OMB Desk Officer, Room 10202, New Executive Office Building, Washington, DC 20503.
Notice.
The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C. 3506(C)(2)(A)).
Written comments must be submitted on or before September 9, 2003.
Direct all written comments to Diana Hynek, Departmental Paperwork Clearance Officer, Room 6625, 14th and Constitution Avenue, NW., Washington, DC 20230 (or via the Internet at
Requests for additional information or copies of the information collection instruments and instructions should be directed to Edison Gore, U.S. Census Bureau, Building 2, Room 2012, Washington, DC 20233-9200, 301-763-3998.
The 2004 Census Test is part of an extended test cycle leading up to the next decennial census. This testing cycle is an opportunity to evaluate new methods, procedures, systems, questions, and instructions designed to improve coverage and data quality in order to select the most promising ones for use in Census 2010.
The test will be conducted in two sites—Queens, NY, and three rural counties in Georgia (Colquitt, Tift, and Thomas)—and will use two modes for data collection (paper and a Mobile Computing Device [MCD]). The 2004 Census Test will include an array of data collection, data capture, and data processing operations along with the associated support activities necessary for obtaining the data required for evaluation. No prototype data products or counts will be published.
The Census Bureau also will conduct a two-part assessment (the Race and Hispanic/Latino Response Evaluation) in conjunction with the 2004 Census Test. In the first part of the assessment, enumerator taping assistants (ETAs) will accompany enumerators during Nonresponse Followup ([NRFU]—See Definition of Terms) in order to record enumerator behavior and respondent reaction to the race and Hispanic questions. The second part will consist of telephone re-interviews. The Race and Hispanic/Latino Response Evaluation is scheduled to begin during the NRFU phase of the 2004 Census Test.
Our experience in Census 2000 taught us important lessons emphasizing the need to begin planning and development early in the decade. Consequently, the Census Bureau established a number of Census 2010 Planning Groups to investigate potential changes for the next decennial census. As part of the development cycle, the 2004 Census Test will evaluate the effectiveness of:
1. Methodological innovations (
2. Content modifications (
3. Incorporation of evolving technologies (using an MCD for data collection during NRFU).
The Race and Hispanic/Latino Response Evaluation is intended to evaluate personal visit respondent reactions to removing the “Some other race” category. The primary vehicle for this evaluation will combine the ETA interviews taped as part of the personal visits during 2004 NRFU with the 2003 National Census Test results.
Approximately 175,000 housing units in the test sites will receive a census form by mail. These housing units are expected to complete these forms and mail them back (mailout/mailback universe,
Beginning in June 2004, a sample of approximately 2,800 households in the Queens, NY site will be re-interviewed via telephone for the Hispanic/Latino Response Evaluation. (Although the Behavior Coding segment of the test will involve about 2,000 households, it will not involve an increase in respondent burden, since the coding will be done as the NRFU interview is conducted.)
Prior to receiving the 2004 questionnaire, each housing unit included in the test will be mailed an advance letter informing respondents that they will soon receive a census form. A few days after the questionnaire packages are delivered, each household will receive a reminder postcard that asks respondents to fill out and return their questionnaires, if they have not already done so. The postcard also will thank respondents who have already returned their forms.
Census Day is scheduled for April 1, 2004. About 10 days after that date, each household in the mailout/mailback universe that did not return the initial form will receive a replacement questionnaire. After respondents have had a chance to complete and return their forms, enumerators will visit each housing unit that has not responded (NRFU). NRFU is scheduled to begin approximately three weeks after Census Day. Enumerators will use handheld MCDs rather than paper questionnaires for data collection during NRFU.
Although the 2004 mailback form is similar to the Census 2000 short form in both content and format, there are several significant differences. These include revised wording for residence rules instructions; the addition of two coverage questions; a revised race question that eliminates the “Some other race” option; revisions in wording in the Hispanic origin question; and a format that allows a respondent to record information for up to 12 household members.
Completing the paper questionnaire and responding to the questions again during the telephone section of the Race and Hispanic/Latino Response Evaluation will take approximately 10 minutes. Preliminary research indicates enumerator-filled forms (data collected using MCDs during NRFU) also will take about 10 minutes. All data capture operations will be conducted at the Census Bureau's National Processing Center (NPC) located in Jeffersonville, Indiana.
In order to conduct the 2004 Census Test, we hope to create content and wording that will allow data collection using the MCDs to be comparable to other modes of response. The Census Bureau is designing software for handheld devices that is intended to incorporate both Spanish and English language capabilities and that will result in MCDs that will be easy for enumerators to use.
The goal of the two-part Race and Hispanic/Latino Response Evaluation is to understand how changes to the Race and Hispanic origin questions affect response behavior. The evaluation will study missing data rates, NRFU response distributions, and behavior coding data gathered in the process of conducting some NRFU interviews.
The Behavior Coding section of the test will involve taping and coding the behavior of about 2,000 enumerators and respondents during the NRFU personal visit interviews in the Queens, NY site. An ETA who accompanies each enumerator will record the selected interviews using a handheld recorder. ETAs will be trained to use basic interviewing techniques, operate the recorder, and take notes on respondent and interviewer behavior during the interview. Behavior coding is intended to provide data about respondents' verbal reaction to the race and Hispanic origin question as well as information about interviewer behavior while asking these questions. These interviews will be conducted and voice-recorded with the respondent's permission.
The second section of the Race and Hispanic/Latino Response Evaluation—Re-interview Follow-up—also is restricted to the Queens, NY site. The 2004 Census Test questionnaire will be administered to selected respondents after the NRFU visit. We will re-administer the 2004 Census Test questionnaire by telephone in order to evaluate the response distribution of the race question. The resulting response distribution is intended to provide information for evaluating the effect of changes in the race and Hispanic origin questions and response categories, as well as dropping the “Some other race” option.
Employees from the NPC will contact a sample of approximately 2,800 households to re-administer the 2004 questionnaire beginning in June 2004. Data gathered as a result of these interviews will be processed at NPC. The goal for this segment of the Race and Hispanic/Latino Response Evaluation is 2,000 completed interviews.
Title 13 of the United States Code, sections 141 and 193.
Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.
Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.
Import Administration, International Trade Administration, U.S. Department of Commerce.
Notice.
In response to a timely request from petitioners, Bethlehem Steel Corp., National Steel Corp., and United States Steel Corp., the Department of Commerce (the Department) initiated an administrative review of Stelco Inc. (Stelco) and Dofasco Inc. (Dofasco) under the antidumping duty order on certain corrosion-resistant carbon steel flat products (CORE) from Canada covering the period August 1, 2001 through July 31, 2002.
July 11, 2003.
Christian Hughes or Elfi Blum-Page, AD/CVD Enforcement Group III, Office 7, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington D.C. 20230; telephone (202) 482-0190 or (202) 482-0197, respectively.
The Department published in the
The Department is rescinding the antidumping duty administrative review of Stelco, covering the period August 1, 2001 through July 31, 2002, in accordance with section 351.213(d)(1) of the Department's regulations. Although petitioners' withdrawal request for this review was not within the normal time limit as prescribed in section 351.213(d)(1) of the Department's regulations, we find that, under the circumstances of this review, it is appropriate to accept the withdrawal request and rescind the review with respect to Stelco. According to section 351.213(d)(1) of the Department's regulations, the Department will rescind an administrative review “if a party that requested the review withdraws the request within 90 days of the date of publication of notice of initiation of the requested review.” The regulations further provide that the Secretary “may extend this time limit if the Secretary decides that it is reasonable to do so.” In this case, petitioners' withdrawal request was not within the 90-day time limit. However, the Department has determined that rescinding the review is appropriate. Continuing this review would only require Stelco, the domestic industry and the Department to expend time and resources on a review in which the only parties that requested the review are no longer interested. The Department has not released supplemental questionnaires with respect to Stelco, nor conducted verification. Therefore, the Department does not believe the administrative review has proceeded to a point at which it would be “unreasonable” to rescind the review. Furthermore, there are no overarching policy issues which would warrant continuing with this review.
The Department, therefore, has determined that it is reasonable to extend the 90-day time limit and to rescind, in part, the administrative review of CORE for the period August 1, 2001 through July 31, 2002 with respect to Stelco. (For a full discussion of the comments filed with respect to whether to rescind this review,
This notice serves as a reminder to importers of their responsibility under section 351.402(f) of the Department's regulations to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this period of time. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and subsequent assessment of double antidumping duties.
This notice also serves as a reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with section 351.305(a)(3) of the Department's regulations. Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a sanctionable violation.
This determination and notice are issued and published in accordance with sections 351.213(d)(4) and sections 751(a)(2)(c) and 777(I)(1) of the Tariff Act of 1930, as amended.
Import Administration, International Trade Administration, Department of Commerce.
Notice of final results of antidumping duty administrative review.
On March 7, 2003, the Department of Commerce published the preliminary results of the third administrative review of the antidumping duty order on certain preserved mushrooms from India. The review covers three manufacturers/exporters. The period of review is February 1, 2001, through January 31, 2002.
Based on our analysis of the comments received, we have made changes in the margin calculations. Therefore, the final results differ from the preliminary results. The final weighted-average dumping margins for the reviewed firms are listed below in the section entitled “Final Results of Review.”
July 11, 2003.
David J. Goldberger or Katherine Johnson, Office 2, AD/CVD Enforcement Group I, Import Administration—Room B099, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-4136 or (202) 482-4929, respectively.
The review covers three manufacturers/exporters: Agro Dutch Foods Ltd. (“Agro Dutch”), Himalya International Ltd. (“Himalya”), and Weikfield Agro Products Ltd. (“Weikfield”). The period of review is February 1, 2001, through January 31, 2002.
On March 7, 2003, the Department of Commerce published the preliminary results of the third administrative review of the antidumping duty order on certain preserved mushrooms from India (68 FR 11045). We invited parties to comment on the preliminary results of review. On April 7, 2003, we received a request for a public hearing from respondent Weikfield. We received case briefs from the petitioner,
The products covered by the order are certain preserved mushrooms, whether imported whole, sliced, diced, or as stems and pieces. The preserved mushrooms covered under the order are the species
Excluded from the scope of the order are the following: (1) All other species of mushroom, including straw mushrooms; (2) all fresh and chilled mushrooms, including “refrigerated” or “quick blanched mushrooms”; (3) dried mushrooms; (4) frozen mushrooms; and (5) “marinated,” “acidified” or “pickled” mushrooms, which are prepared or preserved by means of vinegar or acetic acid, but may contain oil or other additives.
The merchandise subject to the order is classifiable under subheadings 2003.10.0127, 2003.10.0131, 2003.10.0137, 2003.10.0143, 2003.10.0147, 2003.10.0153, and 0711.51.0000 of the
All issues raised in the case and rebuttal briefs by parties to this antidumping duty administrative review are addressed in the “Issues and Decision Memorandum” (“Decision Memo”) from Jeffrey May, Deputy Assistant Secretary for Import Administration, to Joseph A. Spetrini, Acting Assistant Secretary for Import Administration, dated July 7, 2003, which is hereby adopted by this notice. A list of the issues which parties have raised and to which we have responded, all of which are in the Decision Memo, is attached to this notice as an Appendix. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum which is on file in the Central Records Unit, room B-099 of the main Department building. In addition, a complete version of the Decision Memo can be accessed directly on the Web at
Based on our analysis of comments received, we have made certain changes to the margin calculations, including:
• We revised the calculation for Weikfield's indirect selling expenses to exclude the amounts for commissions and discounts Weikfield and its affiliate paid to unaffiliated parties.
• We revised Weikfield's U.S. indirect selling expenses used as an offset to home market commissions to include inventory carrying expenses.
• We excluded a deduction from Weikfield's home market price for “Discount Program 2.”
• We did not make a deduction for the Indian export tax to the price of one of Weikfield's U.S. sales.
• We revised Weikfield's reported general and administrative (G&A) expenses to include idle depreciation costs experienced during the POR.
• We revised Weikfield's reported financial expenses to exclude long-term financial and non-financial income. In addition, we included all financial expenses incurred during the POR, including certain expenses associated with debt restructuring. Finally, we
• As Agro Dutch had no comparison market during the POR, and its constructed value selling expenses and profit rate were based on the weighted-average selling and profit amounts incurred on home market sales by Himalya and Weikfield, we revised the selling expenses and profit used to calculate Agro Dutch's constructed value to account for the revisions to the Weikfield margin calculation outlined above. For a discussion of these changes, see the “Margin Calculations” section of the Decision Memo and the various comments discussed in the Decision Memo.
We determine that the following weighted-average margin percentages exist:
The Department shall determine, and the U.S. Bureau of Customs and Border Protection (BCBP) shall assess, antidumping duties on all appropriate entries. The Department will issue appropriate assessment instructions directly to BCBP within 15 days of publication of these final results of review. In accordance with 19 CFR 351.106(c)(1), we will instruct BCBP to assess antidumping duties on all appropriate entries covered by this review if any importer-specific assessment rate calculated in the final results of this review is above
The following cash deposit requirements will be effective for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, as provided by section 751(a)(1) of the Act: (1) The cash deposit rates for the reviewed companies will be those established in the final results of this review, except if the rate is less than 0.50 percent, and therefore,
This notice also serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of doubled antidumping duties.
This notice serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation. We are issuing and publishing this determination and notice in accordance with sections 751(a)(1) and 777(i) of the Act.
Import Administration, International Trade Administration, Department of Commerce.
Notice of final results and partial rescission of the new shipper review and final results and partial
On March 6, 2003, the Department of Commerce published the preliminary results and partial rescission of the new shipper review and the third antidumping duty administrative review of the antidumping duty order on certain preserved mushrooms from the People's Republic of China.
Based on the additional publicly available information used in these final results and the comments received from the interested parties, we have made changes in the margin calculations for certain respondents in these reviews. The final weighted-average dumping margins for the reviewed firms in these reviews are listed below in the section entitled “Final Results of Reviews.”
July 11, 2003.
Brian Smith or Davina Hashmi, Import Administration, International Trade Administration, U.S. Department of Commerce, Washington, DC 20230; telephone: (202) 482-1766 or (202) 482-0984, respectively.
While the Department initiated an administrative review of 7 companies,
On March 6, 2002, the Department published in the
On March 7, 2003, after determining that the 2001-2002 financial report submitted for one Indian producer contained in Gerber's February 5, 2003, submission was incomplete, we requested that Gerber provide the complete financial report for that Indian producer in order to further consider the data for the final results. In response to our request, the petitioners provided this data on April 18, 2003, for the Department's consideration in the final results.
On March 10, 2003, the petitioners placed information on the record indicating that one of Guangxi Yulin's owners may have made shipments of subject merchandise during the period of investigation (“POI”)
On March 31, 2003, in accordance with 19 CFR 351.301(c)(3), we received additional publicly available information from two respondents, Gerber and Green Fresh.
On April 25, 2003, we placed on the record additional publicly available information on truck freight rates for consideration in the final results.
The petitioners and three respondents, Gerber, Guangxi Yulin and Shenzhen Qunxingyuan Trading Co., Ltd. (“Shenzhen Qunxingyuan”) submitted their case briefs on April 30, 2003. On May 7, 2003, the petitioners and two respondents, Gerber and Guangxi Yulin, submitted rebuttal briefs. The other respondents participating in these reviews did not submit case or rebuttal briefs.
On May 7, 2003, we determined that the petitioner and Shenzhen Qunxingyuan had submitted new factual information in their case briefs in violation of the regulatory requirement provided in 19 CFR 351.301(c)(3)(ii), and requested these parties to remove this data and resubmit their case briefs. On May 19, 2003, we determined that the petitioner had also submitted new factual information in its rebuttal brief and requested the petitioner to remove this data as well and resubmit its rebuttal brief. Also, on May 19, 2003, the petitioner requested a meeting with the Department to discuss the relationship between Gerber and Green Fresh during the period of review (“POR”) as discussed in its case brief. On May 22, 2003, Gerber and Green Fresh requested a similar meeting. On June 11, and June 27, 2003, we held
On June 5, 2003, we placed on the record additional publicly available price information on copper wire scrap, water, and the components included in laterite, and additional public financial data from an Indian producer submitted in this review for consideration in the final results of this review. On June 19, 2003, Gerber and Green Fresh submitted comments on the publicly available information we had placed on the record on June 5, 2003.
No party requested a hearing, as specified under 19 CFR 351.310(c).
The Department has conducted these reviews in accordance with section 751 of the Act.
The products covered by this order are certain preserved mushrooms whether imported whole, sliced, diced, or as stems and pieces. The preserved mushrooms covered under this order are the species
Excluded from the scope of this order are the following: (1) All other species of mushroom, including straw mushrooms; (2) all fresh and chilled mushrooms, including “refrigerated” or “quick blanched mushrooms''; (3) dried mushrooms; (4) frozen mushrooms; and (5) “marinated,” “acidified” or “pickled” mushrooms, which are prepared or preserved by means of vinegar or acetic acid, but may contain oil or other additives.
The merchandise subject to this order is classifiable under subheadings: 2003.10.0127, 2003.10.0131, 2003.10.0137, 2003.10.0143, 2003.10.0147, 2003.10.0153 and 0711.51.0000 of the Harmonized Tariff Schedule of the United States
We have rescinded this review with respect to China Processed, Compania Envasador, and Raoping Xingyu pursuant to 19 CFR 351.213(d)(1), because the petitioners withdrew their request for review and no other interested party requested a review of these companies.
In the
In the
After considering the comments submitted by the parties on this matter, we find that our preliminary decision with respect to Gerber and Green Fresh did not sufficiently address the fact that both companies withheld crucial information prior to verification and actively colluded to circumvent the cash deposit rates in effect during the POR. After a re-examination of the facts on the record of this review, we find that the use of total adverse facts available is warranted in this case with respect to determining Gerber's and Green Fresh's cash deposit and assessment rates for the reasons stated below.
With respect to Gerber, we find that Gerber continually misrepresented in its questionnaire responses the true nature of its relationship with Green Fresh during the POR. In its questionnaire responses, which were accompanied by a certification from Gerber officials attesting to the validity and truthfulness of these responses, Gerber claimed that Green Fresh acted as an agent on its behalf by arranging for the shipment on some of its reported U.S. sales of self-produced subject merchandise during the POR (see May 23, 2003, Section A response at A-11). Moreover, Gerber indicated that Green Fresh acted as its agent from September 2001 to May 2002 and Gerber paid it a commission for each container of Gerber-produced merchandise which Green Fresh shipped to the U.S. market on Gerber's behalf (see September 11, 2002, submission at 6).
Based on this information, the Department was led to believe prior to verification that Gerber's business with Green Fresh was at arms-length, and constituted a
Gerber's misrepresentations were highly material to the Department's analysis and call into question the veracity of other responses provided by Gerber. Despite Gerber's pre-verification claims to the contrary, Green Fresh never acted as Gerber's agent for most of the Gerber/Green Fresh reported transactions. Green Fresh had at most negligible commercial involvement with the specific transactions involving the export of Gerber's merchandise to the United States from the PRC using its invoices. Although the nature of this relationship came to light at verification, the Department deems it critical to the resolution of this issue the
Under these circumstances, section 776(a)(2) of the Act states that the Department may use “facts available” if an interested party (A) withholds information that has been requested by the Department, (C) significantly impedes a proceeding under this title or (D) provides such information but the information cannot be verified. All of these provisions apply in this case. Because the Department relies on original sales invoices to verify the accuracy of the sales listing, the information Gerber mis-characterized and withheld was fundamental and material to the Department's analysis. Gerber's actions now lead us to question our verification findings which were predicated on the reliability of Gerber's own information and records. Gerber's consistent mis-characterization of the facts on the record impeded a proper review of Gerber's transactions. This is particularly true, given that the vast majority of Gerber's reported U.S. sales were made using Green Fresh's sales invoices. Without the necessary information pertaining to these transactions, the Department could not realistically conduct an accurate review of Gerber. Clearly in this case, Gerber did not act to the best of its ability by providing the Department with incorrect and misleading mis-characterizations of its agreement with Green Fresh and misusing Green Fresh's invoices to evade the payment of cash deposits during the POR.
For these reasons, the Department has determined that it will apply total adverse facts available to Gerber in this case. Thus, as adverse facts available, in light of record evidence of material misrepresentations by Gerber as noted above and the potential for future misconduct, the assignment of a cash deposit and assessment rate equal to the PRC-wide rate of 198.63 percent is appropriate. The application of this cash deposit rate reflects the Department's best estimate as to what the company's ultimate assessed duty liability would be in the next stage of the proceeding, given the uncertainty created by the misconduct that has characterized the parties' behavior to date. The Department considers the assignment of this rate to Gerber sufficient to encourage it to cooperate with the Department in future reviews, and to ensure that Gerber cannot undermine the efficacy of the antidumping duty law by posting insufficient and improper deposits.
With respect to Green Fresh, its misrepresentations on the record significantly impeded this proceeding as well. Like Gerber, Green Fresh also stated in its questionnaire responses that it acted as an agent for sales made and produced by Gerber, whereby it received a commission for exporting that merchandise on Gerber's behalf to the U.S. market during the POR (see May 23, 2002, submission at 11). In describing its role as Gerber's agent, Green Fresh indicated that it provided Gerber with specific export documents (
Furthermore, the willingness of Green Fresh to assist another company to evade the payment of legally required cash deposits, as well as its consistent mis-characterization of the facts on the record (despite its representatives' certification of the facts contained in multiple submissions to the Department as truthful when they were not), leads us again to question the validity of the books and records examined by the Department at verification. Thus, consistent with our analysis for Gerber, we do not believe that Green Fresh's reported information can be relied upon by the Department in calculating an antidumping duty margin and cash deposit/assessment rates. Consequently, pursuant to sections 776(a)(2)(A), (C) and (D) of the Act, the Department is applying total facts available to Green Fresh. Furthermore, pursuant to section 776(b) of the Act, an adverse inference is warranted because Green Fresh's sale of invoices for purposes of aiding Gerber to evade cash deposits, as well as its mis-characterization of the facts in this case, clearly demonstrate that Green Fresh did not act to the best of its ability during this administrative review.
Thus, as adverse facts available, in light of record evidence of material misrepresentations by Green Fresh as noted above and the potential for future misconduct, the assignment of a cash deposit and assessment rate equal to the PRC-wide rate of 198.63 percent is appropriate. (
Section 776(c) of the Act provides that where the Department selects from among the facts otherwise available and relies on “secondary information,” the Department shall, to the extent practicable, corroborate that information from independent sources reasonably at the Department's disposal. The Statement of Administrative Action, H.R. Doc. 103-316 (“SAA”), states that “corroborate” means to determine that the information used has probative value.
In this segment of the proceeding, in accordance with Department practice, as adverse facts available, we have assigned to exports of the subject merchandise by Gerber and Green Fresh the PRC-wide rate of 198.63 percent, a
We corroborated the petition information, and found that we had not received any information that warranted revisiting the issue.
We have rescinded this new shipper review with respect to Zhangzhou Jingxiang because it failed to provide us with the necessary documentation for determining which entity or entities own it and because it was unable to explain whether or not its owner was affiliated with any PRC exporters or producers of the subject merchandise (
In the preliminary results, we determined that the sole U.S. sale of subject merchandise made by Shenzhen Qunxingyuan during the POR was not
We are also rescinding the new shipper review with respect to Shenzhen Qunxingyuan because we find that it did not have a
In this case, we find that the price of its single reported sale was aberrationally high relative to the average unit value of all U.S. imports of comparable canned mushroom imports during the POR. More importantly, with respect to the commercial legitimacy of the one reported U.S. sale, we continue to find that Shenzhen Qunxingyuan had no other sales of any merchandise, subject or non-subject, during or after the POR and therefore, had no commercial income during this period. In addition, it appears that Shenzhen Qunxingyuan's reported U.S. sale incurred a loss. Therefore, we determine that the record evidence does not support a finding that this company is a
For the final results of these reviews, we have determined it appropriate to treat water as a factor of production separate from factory overhead consistent with the Department's current practice (
Shantou Hongda and Shenxian Dongxing reported water consumption data which appeared to be erroneous
Because Shantou Hongda and Shenxian Dongxing provided the Department with incomplete and/or unreliable information which could not be verified, use of facts available is appropriate pursuant to section 776(a)(2)(D) of the Act. We believe that Shantou Hongda and Shenxian Dongxing were unaware at the time the Department requested this information that it would be necessary to use the water consumption data in its margin calculation because the Department had not separately valued this input in any prior segment of this proceeding. Thus, in order to account for water consumption usage by each of these respondents in the final results, as non-adverse facts available, we have used the water factor reported by Guangxi Yulin, the only other respondent under review (for which we are calculating a margin in the final results) which reported a correct and complete water factor (as verified by the Department), and valued water for the other respondents using Guangxi Yulin's reported water factor.
All issues raised in the case briefs are addressed in the
Based on the use of additional publicly available information and the comments received from the interested parties, we have made changes in the margin calculation for each respondent. For a discussion of these changes,
For the final results, we calculated average surrogate percentages for factory overhead, SG&A expenses, and profit using the 2001-2002 financial reports of Agro Dutch Foods Ltd. (“Agro Dutch”) and Flex Foods Ltd. (“Flex Foods”).
We used freight rates published in the February 2002-June 2002 issues of
We treated water as a separate factor of production. To value water, we used 1995-1996 and 1996-1997 data from the
To value tin can sets (
To value urea (carbamide), we used data in the 2001-2002 financial report of Flex Foods and February 2001-January 2002 data in
To value super phosphate and grain, we used data in the 2001-2002 financial report of Flex Foods.
To value spawn, cow manure and straw, we used price data contained in the 2001-2002 financial reports of Flex Foods and Agro Dutch.
To value gypsum, we used the 2001-2002 financial report of Flex Foods and April 2001-December 2001 data from
To value copper wire scrap, we used April 2001-December 2001 data from
We corrected a programming error by including Guangxi Yulin's tape cost only in its total packing costs (and not in its material costs).
We corrected a calculation error by including the total surrogate cost for seal glue in Guangxi Yulin's total material costs.
We determine that the following weighted-average margin percentages exist for the period February 1, 2001, through January 31, 2002:
The Department shall determine, and the U.S. Bureau of Customs and Border Protection (“BCBP”) shall assess, antidumping duties on all appropriate entries. The Department will issue appropriate appraisement instructions for the companies subject to these reviews directly to the BCBP within 15 days of publication of the final results of these reviews. For assessment purposes, we do not have the actual entered value for any of the respondents for which we calculated a margin because it is not the importer of record for the subject merchandise. Therefore, we have calculated individual importer- or customer-specific assessment rates by aggregating the dumping margins calculated for all of the U.S. sales
Bonding will no longer be permitted to fulfill security requirements for shipments from Guangxi Yulin, Shenzhen Qunxingyuan, or Zhangzhou Jingxiang of certain preserved mushrooms from the PRC entered, or withdrawn from warehouse, for consumption on or after the publication date of these final results.
The following deposit rates shall be required for merchandise subject to the order entered or withdrawn from warehouse, for consumption on or after the publication date of these final results, as provided by section 751(a)(1) and 751(a)(2)(B) of the Act: (1) The cash deposit rates for Gerber, Green Fresh, Guangxi Yulin (
This notice also serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of doubled antidumping duties.
This notice also serves as the only reminder to parties subject to administrative protective orders (APO) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a). Timely written notification of the return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a violation which is subject to sanction.
We are issuing and publishing these determinations and notice in accordance with sections 751(a)(1), 751(a)(2)(B), and 777(i) of the Act and 19 CFR 351.213 and 351.214.
1. The Application of Facts Available to Gerber and Green Fresh.
2. The
3. The Rescission of the New Shipper Review for Guangxi Yulin.
4. The Use of Himalya's Financial Data to Derive Surrogate Percentages.
5. The Valuation of Water.
6. Surrogate Value for Cans.
7. The Treatment of Tin Scrap as an Offset.
8. Surrogate Value for Copper Wire Scrap.
Import Administration, International Trade Administration, Department of Commerce.
Notice of final results of countervailing duty administrative review.
On April 4, 2003, the Department of Commerce (the Department) published in the
Based on our analysis of the comments received, the Department has revised the net subsidy rate for the Rafsanjan Pistachios Producers Cooperative (RPPC). The revised final net subsidy rate for the reviewed company is listed below in the “Final Results of Review” section of this notice.
July 11, 2003.
Darla Brown or Eric B. Greynolds, AD/CVD Enforcement, Office VI, Group II, Import Administration, U.S. Department of Commerce, Room 4012, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone (202) 482-2849 or (202) 482-6071, respectively.
On March 11, 1986, the Department published in the
We published the
In accordance with 19 CFR 351.213 (2002), this administrative review covers only those producers or exporters for which a review was specifically requested. Accordingly, this administrative review covers RPPC and nine programs for the period of review (POR) January 1, 2001, through December 31, 2001.
The product covered by this administrative review is in-shell pistachio nuts from which the hulls have been removed, leaving the inner hard shells and edible meat, as currently classifiable in the Harmonized Tariff Schedules of the United States (HTSUS) under item number 0802.50.20.00. The HTSUS subheadings are provided for convenience and customs purposes. The written description of the scope of this proceeding is dispositive.
During the course of this proceeding, we have repeatedly sought information pertaining to all companies that are cross-owned and/or affiliated with RPPC, the producer of subject merchandise, and RPPC's shareholders. In addition, we have repeatedly requested information concerning the total sales and sales of subject merchandise made by RPPC during the POR. Moreover, we have repeatedly asked for specific information concerning RPPC's and its members' usage of the following programs: Provision of Fertilizer and Machinery, Provision of Water and Irrigation Equipment, Duty Refunds on Imported Raw or Intermediate Materials Used in the Production of Exported Goods, Program to Improve the Quality of Exports of Dried Fruit, Tax Exemptions, Technical Assistance from the GOI, and Provision of Credit.
Section 776(a) of the Act requires the use of facts available when an interested party withholds information that has been requested by the Department, or when an interested party fails to provide the information requested in a timely manner and in the form required. As described in the paragraph above and in our
Furthermore, section 776(b) of the Act provides that in selecting from among the facts available, the Department may use an inference that is adverse to the interests of a party if it determines that a party has failed to cooperate to the best of its ability. The Department finds that by not providing necessary information specifically requested by the Department, despite numerous opportunities, the GOI and RPPC have failed to cooperate to the best of their ability. Therefore, in selecting from among the facts available, the Department determines that an adverse inference is warranted.
When employing an adverse inference in an administrative review, the statute indicates that the Department may rely upon information derived from (1) the petition, a final determination in a countervailing duty or an antidumping investigation, any previous administrative review, new shipper review, expedited antidumping review, section 753 review, or section 762 review; or (2) any other information placed on the record.
Specifically, for the Export Certificate Voucher Program, we used publicly available data from the
If the Department relies on secondary information (
Thus, in those instances in which it determines to use secondary information, the Department, in order to satisfy itself that such information has probative value, will examine, to the extent practicable, the reliability and relevance of the information used.
With respect to the relevance aspect of corroboration, the Department will consider information reasonably at its disposal as to whether there are circumstances that would render benefit data not relevant.
All issues raised in the case and rebuttal briefs by parties to this review are addressed in the Decision Memorandum. A list of issues which parties have raised and to which we have responded, all of which are in the Decision Memorandum, is attached to this notice as Appendix I. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum, which is on file in room B-099 of the Main Commerce Building. In addition, a complete version of the Decision Memorandum can be accessed directly on the World Wide Web at
In accordance with section 705(c)(1)(B)(i) of the Act, we determined an ad valorem subsidy rate for RPPC.
Under section 351.526 of the Department's regulations, the Department can adjust cash deposit rates to account for program-wide changes. During the recently-completed new shipper reviews of in-shell pistachios and in-shell roasted pistachios from Iran, the Department verified that the export certificate voucher program has been terminated subsequent to the POR (
We will instruct the U.S. Bureau of Customs and Border Protection (Customs) to assess countervailing duties as indicated above. The Department will instruct Customs to collect cash deposits of estimated countervailing duties in the percentage detailed above of the f.o.b. invoice prices on all shipments of the subject merchandise from the producers/exporters under review, entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this administrative review.
Because the URAA replaced the general rule in favor of a country-wide rate with a general rule in favor of individual rates for investigated and reviewed companies, the procedures for establishing countervailing duty rates, including those for non-reviewed companies, are now essentially the same as those in antidumping cases, except as provided for in section 777A(e)(2) of the Act. The requested review will normally cover only those companies specifically named.
We will instruct Customs to continue to collect cash deposits for non-reviewed companies at the most recent company-specific or country-wide rate applicable to the company. Accordingly, the cash deposit rates that will be applied to non-reviewed companies covered by this order will be the rate for that company established in the most recently completed administrative proceeding conducted under the URAA. If such a review has not been conducted, the rate established in the most recently completed administrative proceeding pursuant to the statutory provisions that were in effect prior to the URAA amendments is applicable.
This notice also serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f) to file a certificate regarding the reimbursement of duties prior to liquidation of the relevant entries during this review period.
This notice serves as a reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.
This administrative review and notice are issued and published in accordance with section 751(a)(1) of the Act.
Use of Facts Available.
NAFTA Secretariat, United States Section, International Trade Administration, Department of Commerce.
Notice of first request for panel review.
On July 2, 2003, Camara Nacional de la Industria de Aceites, Grasas, Jabones y Detergentes (CANAJAD) filed a First Request for Panel Review with the Mexican Section of the NAFTA Secretariat pursuant to Article 1904 of the North American Free Trade Agreement. Panel review was requested of the final countervailing duty determination made by the Secretaria de Economia, respecting Sodium Hydroxide (Caustic Soda) in Aqueous Solution, Originating in the United States of America independently of the country of origin. This determination was published in the
Caratina L. Alston, United States Secretary, NAFTA Secretariat, Suite 2061, 14th and Constitution Avenue, Washington, DC 20230, (202) 482-5438.
Chapter 19 of the North American Free-Trade Agreement (“Agreement”) establishes a mechanism to replace domestic judicial review of final determinations in antidumping and countervailing duty cases involving imports from a NAFTA country with review by independent binational panels. When a Request for Panel Review is filed, a panel is established to act in place of national courts to review expeditiously the final determination to determine whether it conforms with the antidumping or countervailing duty law of the country that made the determination.
Under Article 1904 of the Agreement, which came into force on January 1, 1994, the Government of the United States, the Government of Canada and the Government of Mexico established
A first Request for Panel Review was filed with the Mexican Section of the NAFTA Secretariat, pursuant to Article 1904 of the Agreement, on July 2, 2003, requesting panel review of the final determination described above.
The Rules provide that:
(a) A Party or interested person may challenge the final determination in whole or in part by filing a Complaint in accordance with Rule 39 within 30 days after the filing of the first Request for Panel Review (the deadline for filing a Complaint is August 1, 2003);
(b) A Party, investigating authority or interested person that does not file a Complaint but that intends to appear in support of any reviewable portion of the final determination may participate in the panel review by filing a Notice of Appearance in accordance with Rule 40 within 45 days after the filing of the first Request for Panel Review (the deadline for filing a Notice of Appearance is August 18, 2003); and
(c) The panel review shall be limited to the allegations of error of fact or law, including the jurisdiction of the investigating authority, that are set out in the Complaints filed in the panel review and the procedural and substantive defenses raised in the panel review.
National Institute of Standards and Technology, Department of Commerce.
Notice of renewal.
In accordance with the provisions of the Federal Advisory Committee Act, 5 U.S.C. App. 2, and the General Services Administration (GSA) rule on Federal Advisory Committee Management, 41 CFR part 101-6, and after consultation with GSA, the Secretary of Commerce has determined that the renewal of the Advanced Technology Program Advisory Committee is in the public interest in connection with the performance of the duties imposed on the Department by law.
The Committee was first established in July 1999 to advise ATP regarding their programs, plans, and policies. In renewing the Board, the Secretary has established it for an additional two years. During the next two years, the Committee plans to study and make recommendations regarding a number of issues related to further improving the effectiveness of the program, such as, but not limited to, strengthening ties between the ATP and state technology programs and further encouraging the involvement of universities.
The Committee will consist of not fewer than 6 nor more than 12 members to be appointed by the Director of the National Institute of Standards and Technology to assure a balanced membership that will represent the views and needs of customers, providers, and others involved in industrial extension throughout the United States.
The Committee will function solely as an advisory body and in compliance with the provisions of the Federal Advisory Committee Act. Copies of the renewed charter will be filed with the appropriate committees of the Congress and with the Library of Congress.
Marc Stanley, Director, Advanced Technology Program, National Institute of Standards and Technology, 100 Bureau Drive, Stop 4700, Gaithersburg, Maryland 20899-4700; telephone: 301-975-2162.
National Institute of Standards and Technology (NIST).
Notice of public workshop.
The Cyber Security Research and Development Act of 2002 tasks National Institute of Standards and Technology (NIST) to “develop, and revise as necessary, a checklist setting forth settings and option selections that
It is anticipated that the workshop will support the development of a standard Extensible Markup Language (XML) template for security configuration checklist descriptions, and a guideline on producing consensus checklists that can be searched, compared, shared freely, and used by the USG and Internet community at large. The goal of this initial workshop is to collect suggestions from organizations that have already developed or are involved in the development of such checklists to gain their input on key items that should be included within the template. The detailed draft agenda and supporting documentation for the workshop will be available prior to the workshop from the NIST CSRC Web site at
The workshop will be held on September 25 and 26, 2003, from 9 a.m. to 5 p.m.
The workshop will be held in the Lecture Room B, Bldg 101 at the National Institute of Standards and Technology, Gaithersburg, MD.
Additional information, when available, may be obtained from the Computer Security Resource Center Web site at
NIST will lead an effort in coordination with other agencies and private industry to develop and disseminate a standard template designed to describe security checklists. Examples of key IT product technology areas include: operating systems, database systems, web servers, e-mail servers, firewalls, routers, intrusion detection systems, virtual private Networks, biometric devices, smart cards, telecommunication switching devices and web browsers.
Vendors, agencies, consortia, and other reputable sources will be encouraged to submit checklists and related information called for by the template to populate a public web-based repository. The template will provide a standardized method of centrally cataloging, describing, and categorizing existing and newly developed security checklists for IT products. The XML template will be used to populate an online database hosted by NIST that will provide the USG and Internet community with a centralized database used to consolidate information about IT product security checklists.
The initial workshop is being held to identify the key fields of the template. Workshop topics are planned to include:
• Target environments,
• Risk levels,
• Methods to gain wide agency and vendor support,
• Methods and incentives to encourage vendors' submissions adhering to the proposed template.
Vendors, agencies, and other reputable sources currently developing checklists for IT products are encouraged to present information at the workshop describing their checklist development and testing process. Speakers wishing to formally present information at the workshop should submit proposals to
Because of NIST security regulations, advance registration is mandatory; there will be no on-site, same-day registration. To register, please register via the Web at
This work effort is being initiated pursuant to NIST's responsibilities under the Cyber Security Research and Development Act of 2002.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice of issuance of an incidental harassment authorization.
In accordance with provisions of the Marine Mammal Protection Act (MMPA) as amended, notification is hereby given that an Incidental Harassment Authorization (IHA) to take small numbers of marine mammals, by harassment, incidental to conducting oceanographic surveys in the Hess Deep in international waters of the Eastern Equatorial Pacific Ocean has been issued to Lamont-Doherty Earth Observatory (L-DEO).
Effective from July 3, 2003, through June 30, 2004.
The application, a list of references used in this document, and/or the IHA are available by writing to Kaja A. Brix, Acting Chief, Marine Mammal Conservation Division, Office of Protected Resources, National Marine
Kenneth R. Hollingshead, Office of Protected Resources, NMFS, (301) 713-2055, ext 128,
Sections 101(a)(5)(A) and (D) of the MMPA (16 U.S.C. 1361
Permission may be granted if NMFS finds that the taking will have a negligible impact on the species or stock(s) and will not have an unmitigable adverse impact on the availability of the species or stock(s) for subsistence uses and that the permissible methods of taking and requirements pertaining to the monitoring and reporting of such takings are set forth. NMFS has defined “negligible impact” in 50 CFR 216.103 as ”...an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.
Subsection 101(a)(5)(D) of the MMPA established an expedited process by which citizens of the United States can apply for an authorization to incidentally take small numbers of marine mammals by harassment. Under section 18(A), the MMPA defines “harassment” as:
any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [Level A harassment]; or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [Level B harassment].
Subsection 101(a)(5)(D) establishes a 45-day time limit for NMFS review of an application followed by a 30-day public notice and comment period on any proposed authorizations for the incidental harassment of small numbers of marine mammals. Within 45 days of the close of the comment period, NMFS must either issue or deny issuance of the authorization.
On January 29, 2003, NMFS received an application from L-DEO for the taking, by harassment of several species of marine mammals incidental to conducting a seismic survey program in the Hess Deep portion of the Eastern Equatorial Pacific Ocean about 600 nautical miles (nm)(690 land miles; 1111.2 km) west of the Galapagos Islands during March and April 2003, but rescheduled for July, 2003. The purpose of this survey is to obtain information on movements of the earth's plates and on formations associated with those movements. More specifically, the Hess Deep survey will obtain information on the geologic nature of boundaries of the earth's crust at fast-spreading and intermediate-spreading ridges at the boundaries of tectonic plates.
The seismic survey will involve a single vessel, the
Water depths in the Hess Deep survey area will range from approximately 2,000 to 3,400 m (6,560 to 11,150 ft). A total of 912 km (492 nm) of MCS (Multi Channel Seismic) surveys using a 10-gun array and 189 km (102 nm) of OBS surveys using a 12-gun array are planned to be conducted. These line-kilometer figures represent the planned production surveys. There will be additional operations associated with equipment testing, startup, line changes, and repeat coverage of any areas where initial data quality is sub-standard.
The procedures to be used for the 2003 seismic survey will be similar to those used during previous seismic surveys by L-DEO, (e.g., in the equatorial Pacific Ocean (Carbotte et al., 1998, 2000)). The proposed program will use conventional seismic methodology with a towed airgun array as the energy source and a towed streamer containing hydrophones as the receiver system, sometimes in combination with OBS receivers placed on the bottom. The energy to the airgun array is compressed air supplied by compressors on board the source vessel. In addition, a multi-beam bathymetric sonar will be operated from the source vessel at most times during the Hess Deep survey.
The
The 10-airgun array will have a peak sound source level of 248 dB re 1 μPa or 255 dB peak-to-peak (P-P). The 12-airgun array will have a peak sound source level of 250 dB re 1 μPa or 257 dB P-P. These are the nominal source levels for the sound directed downward, and represent the theoretical source level close to a single point source emitting the same sound as that emitted by the array of 10 or 12 sources. Because the actual source is a distributed sound source (10 or 12 guns) rather than a single point source, the highest sound levels measurable at any location in the water will be less than the nominal source level. Also, because of the downward directional nature of the sound from these airgun arrays, the effective source level for sound propagating in near-horizontal directions will be substantially lower than sounds projected directly beneath the array.
Along selected lines, OBSs will be positioned by the
Along with the airgun operations, one additional acoustical data acquisition activity will occur throughout most of the cruise. The ocean floor will be mapped with an Atlas Hydrosweep DS-2, multi-beam 15.5-kHz bathymetric sonar (Atlas Hydrosweep). The Atlas Hydrosweep is mounted in the hull of the
A notice of receipt of the L-DEO application and proposed IHA was published in the
Table 7 in the application (and referenced in the proposed authorization notice) provides an estimate of the number of animals that might be exposed to a sound pressure level (SPL) of 160 dB (RMS) or greater. This does not necessarily mean that 100 percent of all marine mammals exposed to seismic sounds will have a significant disruption in a biologically important activity at 160 dB. It is likely that some lower percentage would be affected either because of the hearing ability of the affected species or an individual animal to the projected frequencies. For example, Table 7 provides estimates of the number of animals of the 13 species of Delphinidae that might be exposed to received levels ≥ 160 dB. However, the Delphinidae have their best hearing in the higher frequencies and are unlikely to be as sensitive as the mysticete whales to the low frequency of the airgun array. Therefore, they are less likely to experience Level B harassment at 160 dB. A more likely threshold for Delphinidae for onset of Level B harassment in response to seismic sounds is at about 170 dB.
However, based on either sound pressure level, Level B harassment take levels for almost every species would be significantly less than 1 percent of the affected stock and one could reach a level of 2 percent. Since this activity will not result in mortality or serious injury of any marine mammals and has the potential to result in the incidental behavioral (Level B) harassment of only a small percentage of the estimated population size of affected stocks, NMFS has concluded that the takings will be small.
Discussion regarding the potential for taking by Level B harassment of up to 8,901 marine mammals is provided in the previous response. As required by the MMPA, L-DEO has provided significant documentation in its application that the harassment of marine mammals incidental to conducting a scientific survey using a seismic array will have a negligible impact on affected species and stocks of marine mammals. NMFS concurs with this finding and believes that the information contained in the L-DEO application and the NSF EA is a compilation of the best scientific information available on this subject. NMFS is unaware of additional scientifically-based information on which to make an alternative decision and the commenter has not provided any information to support the statement. Refer to the proposed authorization notice (68 FR 17909, April 14, 2003) for discussion on potential seismic noise impacts on marine mammals.
apprehensive about levels above 180 dB re 1 μPa (rms) with respect to overt behavioral, physiological, and hearing effects on marine mammals in general. Therefore, the 180-dB radius, as initially defined by transmission loss model and verified on-site, is recommended as the safety zone distance to be used for all seismic surveys within the southern California study area.
The 1998 NMFS workshop clarified that, because pinniped hearing is different from that of cetaceans, 190 dB would be a safe level preventing pinniped injury from exposure to impulse sounds.
While there is limited empirical evidence on injury at levels below 180 dB, the 180- and 190-dB levels make sense, given that Frankel (1994) estimated the source level for singing humpback whales to be between 170 and 175 dB while Au and Andrews (2001) measured humpback whale calls off Hawaii at 189 dB; the average call source level for blue whales was calculated by McDonald et al. (2001) to be 186 dB; Watkins et al. (1987) and Charif et al. (2002) found source levels for fin whales up to 186 dB; and M hl et al. (2000) recorded source levels for sperm whale clicks up to 223 dB. If marine mammals vocalize at these levels, it is realistic to believe that these species have also evolved mechanisms to protect themselves and conspecifics from high SPLs.
However, it is noted that at times, pinnipeds and even some small cetaceans will actively approach a vessel during transmissions (the vessel itself moving forward at about 3-5 knots) from the side of the vessel or the stern, meaning that the animal is voluntarily approaching a noise source that is increasing in strength as the animal gets closer. Experience indicates that pinnipeds will come from great distances to scrutinize seismic-reflection operations. Seals have been observed swimming within airgun bubbles only 10 m (33 ft) away from active arrays. Also, Canadian scientists, who were using a high-frequency seismic system that produced sound frequencies closer to pinniped hearing than those used by the Ewing, describe how seals frequently approached close to the seismic source, presumably out of curiosity. Therefore, because at least pinnipeds indicated no adverse behavioral reaction to seismic noise, NMFS has concluded that the above-mentioned mitigation requirement is reasonable because the bridge-watch will be concentrating on marine mammals approaching the vessel from the bow. Also, the night-vision ability of the trained bridge-watch staff will be better than observers elsewhere on the vessel where normal ship-board lighting is more likely. Finally, an observer is still required to be on standby, meaning his/her presence would be in the vicinity of the bridge and is not precluded from conducting observations during night-time.
Therefore, because NMFS has determined that the safety zone must be visible during ramp-up, and because once the Ewing is underway and ramp-up completed, mammals will have sufficient notice of a vessel approaching (at least one hour) to avoid the approaching array if the sounds are annoying, NMFS determined that it is neither practical nor necessary to limit seismic operations to daylight hours since marine mammal are unlikely to be injured. Finally, with an extension of the time needed to complete the work if limited to daylight only operations, ship time would likely be limited for scheduled future research projects, possibly resulting in the utilization of alternative vessels.
For the seismic operations in the Hess Deep, a 12-gun array with a total volume of 3705 in3 and a 10-gun array of 3050 in3 will be used. The airguns comprising these arrays will be spread out horizontally, so that the energy from the array will be directed mostly downward. The directional nature of the two alternative airgun arrays to be used in this project is an important mitigating factor, resulting in reduced sound levels at any given horizontal distance than would be expected at that distance if the source were omnidirectional with the stated nominal source level. Also, the use of the 10- or 12-gun array of 3,050 or 3,705 in3 rather than the largest airgun array that the L-DEO's source vessel can deploy (20 airguns totaling almost 8,600 in3) is another significant mitigation measure.
Modeled results for the 10- and 12-gun arrays indicate that the 180-dB (re 1 μPa (rms)) isopleths (i.e., the current potential injury threshold for cetaceans) are 830 and 880 m (2,723 and 2,887 ft), respectively. The radii around the 10- and 12-gun arrays corresponding to the 190 dB (re 1 μPa (rms)) isopleths (the current potential injury threshold for pinnipeds), are estimated as 250 and 300 m (820 and 984 ft), respectively. A calibration study was conducted prior to this survey to determine the actual radii corresponding to each sound level. These actual radii will be implemented for this study. Until then, or if those measurements appear defective, L-DEO will use a precautionary 1.5 times the 180-dB and 190-dB radii predicted by the model as the safety radii. Under those circumstances, the safety radii for cetaceans would be 1,245 and 1,320 m (4,085 and 4,331 ft), respectively, for the 10- and 12-gun arrays, and the safety radii for pinnipeds would be 375 and 450 m (1,230 and 1,476 ft), respectively.
Vessel-based observers will monitor marine mammals near the seismic vessel during daylight and for 30 minutes prior to start up during darkness throughout the program. Airgun operations will be suspended immediately when marine mammals are observed within, or about to enter, designated safety zones where there is a potential for injury (based on the 180- and 190-dB criteria). The power-down procedure should be accomplished within several seconds or a single seismic “ping” of the determination being made that a marine mammal is within or about to enter the safety zone.
After a power-down of the airguns, the observer(s) will maintain watch to determine when the animal is outside the safety radius. Airgun transmissions can commence/ resume after the mammal(s) is observed to have left the safety zone or 15 minutes (for small odontocetes and pinnipeds) or 30 minutes (for mysticetes/large odontocetes (sperm, pygmy sperm, dwarf sperm, beaked, and bottlenose whales)) from the last visual detection of the mammal(s) within the safety zone. Once the safety zone is clear of marine mammals, the observer will advise that restart procedures can commence.
A 30-minute pre-ramp-up observation period must be conducted after a shutdown (but not after power-down) of the array for a length of time greater than it would take a seismic vessel to travel the distance to the 160-dB isopleth at the time of shutdown. For example, traveling at 4.0 knots (4.0 nm/hr), the Ewing would need about 1 hr to reach that isopleth while operating the 10-gun array and 1.25 hrs when using the 12-gun array. For this cruise, the IHA requires the 30-minute observation period to take place after a shut-down of 1 hour or more. The “ramp-up” procedure will then be followed.
L-DEO will use the standard “ramp-up” (soft-start) procedure when the airgun arrays begin operating after a period without any airgun operations as specified in this paragraph. From a shut-down, ramp-up will begin with the smallest gun in the array that is being used (80 in3 for the 10- and 12-gun arrays), and guns will be added in a sequence such that the source level of the array will increase at a rate no greater than 6 dB per 5-minutes for a total ramp-up duration of approximately 18-20 min (10-12 gun arrays). Under normal operational conditions (vessel speed 4-5 knots), a ramp-up would be required after a “no shooting” period lasting 2 minutes or longer. At 4 knots, the source vessel would travel 247 m (810 ft) during a 2-minute period. If the towing speed is reduced to 3 knots or less, as sometimes required when maneuvering in shallow water (not a factor in Hess Deep), ramp-up is required after a “no shooting” period lasting 3 minutes or longer. At towing speeds not exceeding 3 knots, the source vessel would travel no more than 277 m (909 ft) in 3 minutes. These procedures would require modification if the normal seismic shot interval were more than 2 or 3 min, but that is not expected to occur during the Hess Deep project.
If a marine mammal is detected outside its safety radius and, based on its position and relative motion, is likely to enter the safety radius, alternative ship tracks will be plotted against anticipated mammal locations. The vessel's direct course and/or speed will be changed to avoid the marine mammal entering the safety radius, but in a manner that also minimizes the effect to the planned science objectives. The marine mammal activities and movements relative to the seismic vessel will be closely monitored to ensure that the marine mammal does not approach within the safety radius. If the mammal appears likely to enter the safety radius, further mitigative actions will be taken, i.e., either further course alterations or power-down of the airguns. The Ewing is required to adopt this mitigation measure during the Hess Deep seismic survey program provided that doing so will not compromise operational safety requirements.
L-DEO will conduct marine mammal monitoring during its seismic program in the Hess Deep in order to verify that the taking of marine mammals, by harassment, incidental to conducting the seismic survey will have a negligible impact on marine mammal stocks and to ensure that these harassment takings are at the lowest level practicable.
A minimum of two marine mammal observers will be onboard the
Observers will be on duty in shifts of duration no longer than 4 hours. The second observer will also be on watch part of the time, including the 30-minute periods preceding startup of the airguns and during ramp ups. Use of two simultaneous observers will decrease the potential that marine mammals near the source vessel will be missed. Bridge personnel that are additional to the dedicated observers will also assist in detecting marine mammals and implementing mitigation requirements, and before the start of the seismic survey will be given proper instruction for observing and reporting marine mammals and sea turtles.
Observers will not normally be on duty during ongoing seismic operations at night; bridge personnel will watch for marine mammals during this period and will immediately call for the airguns to be powered down and the stand-by observer will be notified if marine mammals are observed in or about to enter the safety radii. However, if the airguns are started up at night after a shutdown duration of 1 hour or greater, two observers will monitor for marine mammals within the safety radii for 30 minutes prior to beginning ramp-up using night vision devices (NVDs), although NMFS notes that past experience has shown that NVDs are of limited value for this purpose. If the complete safety radii are not visible for at least 30 minutes prior to ramp-up in either daylight or nighttime, ramp-up may not commence unless the seismic source has maintained an SPL of at least 180 dB during the interruption of seismic survey operations. While the 30-minute observation period is only required prior to commencing seismic operations following an extended shut down period, if ramp-up procedures must be performed at night, the two observers must be on duty 30 minutes prior to the start of seismic shooting and during the ramp-up procedures.
The observer(s) will watch for marine mammals from the bridge, the highest practical vantage point on the vessel. The observer(s) will systematically scan
The vessel-based monitoring will provide data required to estimate the numbers of marine mammals exposed to various received sound levels, to document any apparent disturbance reactions, and thus to estimate the numbers of mammals potentially taken by Level B harassment. It will also provide the information needed in order to power-down the airguns at times when mammals are present in or near the safety zone. Results from the vessel-based observations will provide (1) the basis for real-time mitigation (airgun power-down); (2) information needed to estimate the number of marine mammals potentially taken by harassment, which must be reported to NMFS; (3) data on the occurrence, distribution, and activities of marine mammals in the area where the seismic study is conducted; (4) information to compare the distance and distribution of marine mammals relative to the source vessel at times with and without seismic activity; and (5) data on the behavior and movement patterns of marine mammals seen at times with and without seismic activity.
When a mammal sighting is made, the following information about the sighting will be recorded: (1) Species, group size, age/size/sex categories (if determinable), behavior when first sighted and after initial sighting, heading (if consistent), bearing and distance from seismic vessel, sighting cue, apparent reaction to seismic vessel (e.g., none, avoidance, approach, paralleling, etc.), and behavioral pace; and (2) time, location, heading, speed, activity of the vessel (shooting or not), sea state, visibility, cloud cover, and sun glare. The data listed under (2) will also be recorded at the start and end of each observation watch and during a watch, whenever there is a change in one or more of the variables.
All mammal observations and airgun power-downs will be recorded in a standardized format. Data will be entered into a custom database using a laptop computer when observers are off-duty. The accuracy of the data entry will be verified by computerized validity data checks as the data are entered and by subsequent manual checking of the database. These procedures will allow initial summaries of data to be prepared during and shortly after the field program, and will facilitate transfer of the data to statistical, graphical or other programs for further processing and archiving.
A draft report will be submitted to NMFS for review within 90 days after the end of the seismic program in the Hess Deep area which is predicted to occur on or about July 28, 2003. The draft report will cover the seismic surveys in the Hess Deep area and will provide full documentation of methods, results, and interpretation pertaining to all monitoring tasks. The draft report will summarize the dates and locations of seismic operations, sound measurement data, marine mammal sightings (dates, times, locations, activities, associated seismic survey activities), and estimates of the amount and nature of potential “take” of marine mammals by harassment or in other ways. The draft report will be considered the final report unless comments and suggestions are provided by NMFS within 60 days of its receipt of the draft report.
As described previously (see 68 FR 17909, April 14, 2003) and in the L-DEO application, animals subjected to sound levels above 160 dB may alter their behavior or distribution, and therefore might be considered to be taken by Level B harassment.
Based on summer marine mammal survey data collected by NMFS and density calculations by Ferguson and Barlow (2001), L-DEO used their average marine mammal density to compute a “best estimate” of the number of marine mammals that may be exposed to seismic sounds ≥160 dB re 1μPa (rms). The average densities were then multiplied by the proposed survey effort (912 and 189 km for the 10-gun and 12-gun array, respectively) and twice the 160 dB safety radius from the source vessel (the 160-dB radius was 6.5 and 7.25 km for the 10-gun and 12-gun array, respectively) to estimate the “best estimate” of the numbers of animals that might be exposed to sound levels ≥160 dB re 1μPa (rms) during the proposed seismic survey program. Separate estimates were made for the 10-gun and 12-gun arrays because the 160-dB radius was different for the two arrays (see Tables 5 and 6 in L-DEO (2003)). Based on this method, Table 7 in LDEO (2003) provided a “best estimate” of the number of marine mammals (by species) that would be exposed to ≥160 dB (rms), and thus potentially taken by Level B harassment, during the proposed survey, by both the 10-gun and 12-gun arrays. Twelve animals would be endangered species, sperm whales (11) and a single blue whale, while two stocks of dolphins would account for 96 percent of the overall estimate for potential taking by harassment.
Strong avoidance reactions by several species of mysticetes to seismic vessels have been observed at ranges up to 6 to 8 km (3.2-4.3 nm) and occasionally as far as 20-30 km (10.8-16.2 nm) from the source vessel. Some bowhead whales avoided waters within 30 km (16.2 nm) of the seismic operation. However, reactions at such long distances appear to be atypical of other species of mysticetes, and even for bowheads may only apply during migration.
Odontocete reactions to seismic pulses, or at least those of dolphins, are expected to extend to lesser distances than are those of mysticetes. Odontocete low-frequency hearing is less sensitive than that of mysticetes, and dolphins are often seen from seismic vessels. In fact, there are documented instances of dolphins approaching active seismic vessels. However, dolphins as well as some other types of odontocetes sometimes show avoidance responses and/or other changes in behavior when near operating seismic vessels.
Taking account of the mitigation measures that are planned, effects on cetaceans are expected to be limited to avoidance of the area around the seismic operation and short-term changes in behavior, falling within the MMPA definition of “Level B harassment.” In the cases of mysticetes, these reactions are expected to involve small numbers of individual cetaceans because few mysticetes occur in the areas where seismic surveys are proposed. L-DEO's “best estimate” is that 10 Bryde's whales, or 0.1 percent of the estimated Eastern Equatorial Bryde's whale population, will be exposed to sound levels ≥160 dB re 1 μPa (rms) and potentially affected, and 1 blue whale, or 0.1 percent of the endangered ETP blue whale population, would receive ≥160 dB. Therefore, these potential takings by Level B harassment will have a negligible impact on their populations.
Larger numbers of odontocetes may be affected by the seismic survey activities, but the population sizes of the main species are large and the numbers potentially affected are small (<0.1 percent) relative to the population sizes. The total number of odontocetes that might be exposed to ≥160 dB (re 1 μPa
As noted earlier in this document, NMFS believes that Level B harassment take levels would, for almost every affected stock, be significantly less than 1 percent of the stock and only a single stock has the potential of reaching a level of 2 percent for Level B harassment.
Very few if any pinnipeds are expected to be encountered in the Hess Deep area. Thus, a maximum of 20 pinnipeds in the Hess Deep area may be affected by the proposed seismic surveys. If pinnipeds are encountered, the proposed seismic activities would have, at most, a short-term effect on their behavior and no long-term impacts on individual seals or their populations. Responses of pinnipeds to acoustic disturbance are variable, but usually quite limited. Effects are expected to be limited to short-term and localized behavioral changes falling within the MMPA definition of Level B harassment.
Based on the information contained in the L-DEO application, the NSF EA, the April 14, 2003, proposed authorization notice (68 FR 17909) and this document, NMFS has determined that conducting a seismic survey by the
NMFS has concluded consultation under section 7 of the ESA on NMFS' issuance of an IHA to take small numbers of marine mammals, by harassment, incidental to conducting calibration measurements of its seismic array in the Hess Deep by L-DEO. The finding of that consultation was that this study is not likely to jeopardize the continued existence of marine species listed as threatened or endangered under the ESA. No critical habitat has been designated for these species in the equatorial Pacific Ocean; therefore, none will be affected. A conservation recommendation was made to ensure that the safety zone is clear of sea turtles prior to ramp up. This recommendation has been implemented through the IHA to L-DEO. A copy of the Biological Opinion is available upon request (see
On March 18, 2003, the NSF made a determination, based on information contained within its EA that implementation of the subject action is not a major Federal action having significant effects on the environment within the meaning of Executive Order 12114. NSF determined therefore, that an environmental impact statement would not be prepared. On April 14, 2003 (68 FR 17909), NMFS noted that the NSF had prepared an EA for the Hess Deep survey. In accordance with section 6.01 of the NOAA Administrative Order 216-6 (Environmental Review Procedures for Implementing the National Environmental Policy Act, May 20, 1999), NMFS has reviewed the information contained in NSF's EA and determined that the NSF EA accurately and completely describes the proposed action alternative, reasonable additional alternatives, and the potential impacts on marine mammals, endangered species, and other marine life that could be impacted by the preferred alternative and the other alternatives. As a result, NMFS has determined that it is not necessary to issue either a new EA or a Supplemental EA for the issuance of an IHA to L-DEO for this activity. Therefore, based on this review and analysis, NMFS is adopting the NSF EA under NEPA. A copy of the NSF EA for this activity is available upon request (see
NMFS has issued an IHA to take small numbers of marine mammals, by harassment, incidental to conducting a seismic survey by the
Department of Defense (DOD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).
Notice of request for public comments regarding an extension to an existing OMB clearance (9000-0011).
Under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the Federal Acquisition Regulation (FAR) Secretariat will be submitting to the Office of Management and Budget (OMB) a request to review and approve an extension of a currently approved information collection requirement concerning preaward survey forms (Standard Forms 1403, 1404, 1405, 1406, 1407, and 1408). This clearance currently expires October 31, 2003.
Public comments are particularly invited on: Whether this collection of information is necessary for the proper performance of functions of the FAR, and whether it will have practical utility; whether our estimate of the public burden of this collection of information is accurate, and based on valid assumptions and methodology; ways to enhance the quality, utility, and clarity of the information to be
Submit comments on or before September 9, 2003.
Submit comments, including suggestions for reducing this burden to the General Services Administration, FAR Secretariat (MVA), 1800 F Street, NW., Room 4035, Washington, DC 20405.
Victoria Moss, Acquisition Policy Division, GSA, (202) 501-4764.
To protect the Government's interest and to ensure timely delivery of items of the requisite quality, contracting officers, prior to award, must make an affirmative determination that the prospective contractor is responsible,
Department of Defense (DOD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).
Notice of request for public comments regarding an extension to an existing OMB clearance (9000-0047).
Under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), the Federal Acquisition Regulation (FAR) Secretariat will be submitting to the Office of Management and Budget (OMB) a request to review and approve an extension of a currently approved information collection requirement concerning place of performance. The clearance currently expires on October 31, 2003.
Public comments are particularly invited on: Whether this collection of information is necessary for the proper performance of functions of the FAR, and whether it will have practical utility; whether our estimate of the public burden of this collection of information is accurate, and based on valid assumptions and methodology; and ways to enhance the quality, utility, and clarity of the information to be collected. When the On-Line Representation and Certifications Application (ORCA) becomes available, contractors will be able to complete the provision electronically; however, because the data being collected could change for a specific solicitation, contractor's will still be required to submit place of performance information on an exception basis; that is, whenever the place of performance for a specific solicitation is different from the place of performance shown in ORCA.
Submit comments on or before September 9, 2003.
Submit comments regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden to the General Services Administration, FAR Secretariat (MVA), 1800 F Street, NW., Room 4035, Washington, DC 20405
Gerald Zaffos, Acquisition Policy Division, GSA (202) 208-6091.
The information relative to the place of performance and owner of plant or facility, if other than the prospective contractor, is a basic requirement when contracting for supplies or services (including construction). This information is instrumental in determining bidder responsibility, responsiveness, and price reasonableness. A prospective contractor must affirmatively demonstrate its responsibility. Hence, the Government must be apprised of this information prior to award. The contracting officer must know the place of performance and the owner of the plant or facility to (1) determine bidder responsibility; (2) determine price reasonableness; (3) conduct plant or source inspections; and (4) determine whether the prospective contractor is a manufacturer or a regular dealer. The information is used to determine the firm's eligibility for awards and to assure proper preparation of the contract.
Below is a list of individuals who are eligible to serve on the Performance Review Boards for the Department of the Air force in accordance with the Air Force Senior Executive Appraisal and Awards System.
Department of the Army, U.S. Army Corps of Engineers, DoD.
Notice of availability.
In accordance with the National Environmental Policy Act (NEPA) of 1969, as amended, and the U.S. Army Corps of Engineers' (Corps) regulations for NEPA implementation (33 CFR part 230 and 325, Appendices B and C), the Corps has issued a Final Environmental Impact Statement (FEIS) to disclose environmental impacts from constructing and operating the proposed Rueter-Hess Reservoir near the town of Parker, in Douglas County, CO. The project proponent is the Parker Water and Sanitation District (District). The basic purpose of the proposed action is to provide a safe, adequate and sustainable municipal water supply to the District, which is capable of meeting peak demands within the District's currently zoned boundary for the next 50 years. The construction of the proposed project would result in direct impacts to 6.7 acres of wetlands and 5 miles of other waters of the United States, and would require a section 404 permit.
Written comments on the FEIS will be accepted for a period of 30 days following
Copies of the FEIS will be available for review at the following locations:
1. Parker Library, 10851 South Crossroad Drive, Parker, CO 80134.
2. Parker Water and Sanitation District, 19801 East Mainstreet, Parker, CO 80138.
3. U.S. Army Corps of Engineers, Denver Regulatory Office, 9307 South Wadsworth Blvd., Littleton, CO 80128.
Copies can also be obtained from the Corps' third-party contractor, URS Corporation, attention: Paula Daukas, 8181 East Tufts Avenue, Denver, CO 80237; 303-740-3896; Fax 303-694-3946,
Rodney Schwartz, Senior Project Manager, U.S. Army Corps of Engineers, Omaha District-Regulatory Branch, Rm. 151, 12565 West Center Road, Omaha, NE., 68144-3869, Phone: 402-221-4143, Fax: 402-221-4939,
The purpose of the FEIS is to provide decision makers and the public with information pertaining to the proposed action, and to disclose environmental impacts and identify mitigation measures to reduce impacts. The FEIS analyzes the Parker Water and Sanitation District's proposal to construct and operate Rueter-Hess Reservoir and the associated water delivery system. The proposed reservoir would be located in Douglas County, CO approximately 12 miles southeast of Denver and 3 miles southwest of the town of Parker. The reservoir would be located on Newlin Gulch with a diversion structure along Cherry Creek. The project would include a 16,200 acre-foot (AF) reservoir inundating 470 acres, a 5,300-foot long and 135-foot high dam, two pipelines, a water treatment plant and booster pump station, a diversion structure along Cherry Creek with a pump station, and 16 Denver Basin extraction wellfields.
The proposed water supply system would rely upon renewable sources of water, including the capability of capturing, storing, and reusing seasonal high flows in nearby Cherry Creek, and Advanced Wastewater Treatment (AWT) return flows currently discharged into Cherry Creek. The water from the reservoir would be used primarily to help satisfy the District's peak seasonal demands, thereby reducing the loading on nonrenewable Denver Basin aquifer groundwater and maximizing use of renewable water resources. The reservoir is needed by the District to provide operational flexibility to ensure a long-term, reliable water supply. In addition to the proposed action, the FEIS analyzes two alternatives: (1) the Reduced Capacity Reservoir (11,200 AF), and (2) the No Action.
The Draft Environmental Impact Statement (DEIS) was published in February 2002. A combined public hearing on the DEIS and section 404 permit application was held on March 12, 2002 in Parker, CO. The comments and responses are included in the FEIS.
Office of Elementary and Secondary Education, Department of Education.
Notice of proposed requirements.
The Department proposes requirements for the Migrant Education Program (MEP) Consortium Incentive Grant program. Under the authority of section 1308(d) of Title I of the Elementary and Secondary Education Act of 1965 (ESEA), as amended by the No Child Left Behind Act of 2001, the Department would award incentive grants to State educational agencies (SEAs) in high-quality consortium arrangements. The Department may use
We must receive your comments on or before August 11, 2003.
All comments concerning these proposed requirements should be addressed to: Elsa Chagolla, Office of Migrant Education, Office of Elementary and Secondary Education, 400 Maryland Avenue, Room 3E257, FOB-6, SW., Washington, DC 20202-6135. Telephone: (202) 260-2823. If you prefer to send your comments through the Internet, use the following address:
If you want to comment on the information collection requirements, you must send your comments to the Office of Management and Budget at the address listed in the Paperwork Reduction Act section of this preamble. You may also send a copy of these comments to the Department representative named in this section.
Elsa Chagolla, Telephone: (202) 260-2823, or via Internet:
If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (
We invite you to submit comments regarding these proposed requirements. During and after the comment period, you may inspect all public comments about these proposed requirements in room 3E257, 400 Maryland Avenue, Washington, DC, between the hours of 8:30 a.m. and 4 p.m., Eastern time, Monday through Friday of each week except Federal holidays.
On request, we will supply an appropriate aid, such as a reader or print magnifier, to an individual with a disability who needs assistance to review the comments or other documents in the public rulemaking record for these proposed regulations. If you want to schedule an appointment for this type of aid, please contact the person listed under
The Migrant Education Program (MEP), authorized in Title I, Part C of the Elementary and Secondary Education Act of 1965 (ESEA), as amended by the No Child Left Behind Act of 2001, is a State-operated and State-administered formula grant program. The MEP provides assistance to State educational agencies (SEAs) to support high-quality and comprehensive educational programs that provide migratory children appropriate educational and supportive services that address their special needs in a coordinated and efficient manner, and give migratory children the opportunity to meet the same challenging State academic content and student academic achievement standards that all children are expected to meet.
Section 1308(d) of the ESEA authorizes the Secretary to “reserve not more than $3 million to award grants of not more than $250,000 [each] on a competitive basis to SEAs that propose a consortium arrangement with another State or other appropriate entity that the Secretary determines, pursuant to criteria that the Secretary shall establish, will improve the delivery of services to migratory children whose education is interrupted.”
Through this notice, the Department proposes the new requirements, criteria, and procedures to award consortium incentive grants in Fiscal Year (FY) 2003 and subsequent years. In brief, the Department proposes to change: (1) The way proposed consortia are evaluated by using application selection criteria; and (2) the funding formula under which the incentive grants are awarded to SEAs that participate in consortia whose applications are ranked as being of sufficiently high quality. The Department proposes these changes for two reasons. First, it will promote implementation of consortia that will achieve meaningful results. Second, since section 1308(d) now permits the Department to award consortium incentive grants without SEAs having to demonstrate resulting MEP administrative or program function cost savings, the Department will be able to implement a grant selection process that focuses much more on the quality of proposed consortium arrangements.
Section 1308(d) permits an SEA to enter into a consortium arrangement with another State or other appropriate entity. The Department proposes that the term “other appropriate entity” would mean any public or private agency or organization. However, under section 1308(d), only SEAs are eligible applicants to receive consortium incentive grants.
An application for an incentive grant would be submitted by an SEA that will act as the “lead SEA” for the proposed consortium. This application would include—
1. The identity of the lead SEA for the consortium arrangement and of each other SEA or entity participating in the consortium arrangement;
2. The goals and measurable outcomes of the consortium arrangement, and the activities that each participating SEA or entity in the consortium will conduct during each project year to improve the delivery of services to migratory children whose education is interrupted;
3. A concise and cogent explanation of the need for and value of the proposed consortium arrangement to each participating SEA;
4. A description of the process each participating SEA will use for evaluating its progress in achieving the measurable outcomes of the consortium arrangement; and
5. A signed statement from the Chief State School Officer (or his/her authorized representative) of each SEA that is participating in the proposed consortium arrangement of his/her SEA's commitment to implement its activities as described in the application.
Section 75.105(c)(3) of the Education Department General Administrative Regulations (EDGAR) authorizes the Department to establish absolute preferences under which all of a program's funding is reserved for applicants that meet this priority. For competitions in FY 2003 and later years, the Department proposes the following seven absolute priorities that promote key national objectives of the MEP. In order for SEAs to be considered for incentive grants, a proposed consortium arrangement would need to address one or more of the following absolute priorities:
1. Services designed to improve the proper and timely identification and recruitment of eligible migratory children whose education is interrupted;
2. Services designed (based on review of scientifically based research) to improve the school readiness of pre-school age migratory children whose education is interrupted;
3. Services designed (based on review of scientifically based research) to improve the reading proficiency of migratory children whose education is interrupted;
4. Services designed (based on review of scientifically based research) to improve the mathematics proficiency of migratory children whose education is interrupted;
5. Services designed (based on review of scientifically based research) to decrease the dropout rate of migratory students (
6. Services designed (based on review of scientifically based research) to strengthen the involvement of migratory parents in the education of migratory students whose education is interrupted; and
7. Services designed (based on review of scientifically based research) to expand access to innovative educational technologies intended to increase the academic achievement of migratory students whose education is interrupted.
Specifically, an SEA wishing to receive an incentive grant would need to be a partner within a consortium that focuses on one or more of these seven key priorities. The Department believes that these seven priorities reflect the most pressing needs of migratory students that warrant particular attention through work in consortium arrangements.
The area of identification and recruitment is a critical first component of any migrant education program, and one in which consortium activities have proven useful and effective. The areas of early childhood education, reading and mathematics achievement, parental involvement, and reduction in the migrant dropout rate are critical to ensuring that migratory students stay in school and achieve to high academic content and academic performance standards. However, to date, these areas have not been a primary focus of consortia efforts. As school interruption and low levels of student achievement continue to be dominant characteristics of the migrant student population, finding innovative uses of electronic technologies to assist students away from home to continue to master State content and academic achievement standards also remains a priority.
In proposing these particular priorities to govern receipt of consortium incentive grants, the Department understands that migratory students have other significant needs that also warrant the focused attention of interstate and interagency consortia. These efforts, in areas such as improving the responsiveness of teachers to migrant student needs, transfer of key education and health records, and increasing the numbers of migratory students who take and pass State assessments, are clearly important and should continue. However, the Department believes that migratory students will be better served at this time by targeting special financial incentives to SEAs that participate in high-quality consortia that focus on one or more of the proposed seven absolute priorities.
The Department proposes that an SEA that participates in a high-quality consortium arrangement, as determined by use of the program's selection criteria, would receive only one incentive grant award regardless of the number of high-quality consortia in which it participates.
Rather than determine the amount of grant awards on the basis of a cost analysis as described in section 75.232 of the EDGAR, the Department would make awards to SEAs participating in these consortia on the basis of the following two-tiered formula: For each project period, SEAs whose MEP allocations are $1 million or less would receive a grant award that is twice the amount of the award provided to SEAs whose MEP allocations are greater than $1 million. Within each tier, awards would be of equal size. However, no SEA would receive an incentive grant award that exceeds the amount of its Title I, Part C MEP formula grant or $250,000, whichever is less.
It should be noted that, because these requirements would prohibit an SEA from receiving a consortium incentive grant award that exceeds its MEP formula allocation, some SEAs with MEP allocations of $1 million or less may not receive a consortium incentive grant award that is twice the amount of the award provided to SEAs whose MEP allocations are greater than $1 million.
In proposing to award only one incentive grant per SEA and to utilize a two-tiered formula, subject to the limitations discussed above, for making incentive grants, the Department is recognizing that these awards are by law, only “incentives” for SEAs to enter into high-quality consortium arrangements, and as such are not necessarily intended to pay the costs of consortium activities.
While the award of these grants offers all SEAs an incentive to participate in consortium arrangements, the use of this two-tiered formula would recognize the particular resource needs of SEAs whose MEPs are $1 million or less. Section 1303(d)(1) directs the Department to specifically consult with SEAs that receive MEP allocations of $1 million or less in order to determine whether their participation in consortium arrangements would result in the delivery of MEP services in a more effective and efficient manner.
On February 25, 2003, officials of the Department's Office of Migrant Education (OME) met with the MEP Directors from those SEAs that receive an MEP allocation of $1 million or less in order to discuss their States' special needs. One of the foremost concerns these State MEP Directors raised was the need to receive a consortium incentive grant fund amount large enough to encourage and enable their State MEPs' full participation in consortium arrangements. Responding to a possible option of having all SEAs that participated in high-quality consortia receive the same size consortium incentive grant, participants recommended that the Department consider awarding a higher consortium incentive grant amount to those States that receive MEP grants of $1 million or less.
The idea of awarding a higher level of consortium incentive grant funds to SEAs that receive MEP allocations of $1 million or less was later proposed to all the State MEP Directors in attendance at the February 26-27, 2003 Annual Meeting of State MEP Directors, and no objections were raised.
In short, the proposed two-tiered approach for awarding consortium incentive grants eliminates the costs and burdens associated with the individual SEAs and consortia preparing and reviewing their estimated cost savings, as was required under this program in prior years.
Based on these consultations with the State MEP Directors, the Department believes that the proposed two-tiered funding formula offers two advantages over other proposals. First, with little burden on SEAs, it provides a reasonable and efficient basis for awarding consortium incentive grant funds. In addition, it will assist those SEAs that receive MEP allocations of $1 million or less obtain the funds they need to participate effectively in consortium arrangements, while also administering and operating their State MEPs.
For FY 2003, the Department proposes to reserve $2.5 million for consortium incentive awards. The amount of awards in future years would vary and would be announced prior to any future competition. With a $2.5
Consortium incentive grants would be awarded for up to two years. (For example, the Department would not conduct a new incentive grant competition with FY 2004 funds; rather it would use FY 2004 funds for second-year continuation awards to those SEAs receiving FY 2003 incentive awards.) Pursuant to section 75.118 and 75.590 of EDGAR, each SEA that receives a consortium incentive grant award would submit a performance report (through the consortium's lead State) toward the end of the first project year, and a final evaluation report at the end of the second year. Eligibility of each SEA for second-year continuation funding would depend on that State's substantial performance of first-year consortium activities and attaining the outcomes identified in the approved consortium application.
The Department proposes to use the selection criteria from the general criteria for competitive grants contained in section 75.210 of EDGAR to evaluate applications for the incentive grants competition. The proposed selection criteria can be found in the application package, which is available on the following Web site:
An SEA that receives an incentive grant award would use this financial incentive to supplement its MEP formula grant funds provided under ESEA section 1303(a). Therefore, the SEA could use incentive grant funds to implement the consortium arrangement's activities or to carry out any other activities authorized under section 1306(b) of the ESEA. Moreover, general requirements governing the use and reporting of awarded funds would be governed by provisions of part 76 of EDGAR, which govern State-administered formula grant programs rather than provisions of part 75 of EDGAR, which govern discretionary grant programs.
The Department certifies that these proposed requirements would not have a significant economic impact on a substantial number of small entities. Entities that would be affected by these regulations are SEA. The information burden on each of these groups consists only of the time and resources needed to submit grant applications. Hence, the regulations would not have a significant impact on any entity because they would not impose excessive regulatory burden or require unnecessary Federal supervision.
The proposed criteria in this notice identified in the section entitled “Application Requirements,” contain information collection requirements. Under the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), the Department of Education has submitted a copy of this notice and the information collection to the Office of Management and Budget (OMB) for its review.
Applicants for MEP Consortium Incentive Grant funds would need to submit a program application that responds to the selection criteria announced in this notice. Applicants also would need to provide certain minimum information identified in the “Application Requirements” section of this notice.
We collect information once from applicants for this program. We estimate annual reporting and recordkeeping burden for this collection of information to average 50.67 hours for each application for 15 SEA respondents, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Thus, we estimate the total annual reporting and recordkeeping burden for this collection on all those preparing application under the State Program to be a total of 380 hours.
If you want to comment on the information collection requirements, please send your comments to the Office of Information and Regulatory Affairs, OMB, room 10235, New Executive Office Building, Washington, DC 20503; Attention: Desk Officer for U.S. Department of Education. You may also send a copy of these comments to the Department representative named in the
We consider your comments on this proposed collection of information in—
• Deciding whether the proposed collection is necessary for the proper performance of our functions, including whether the information will have practical use;
• Evaluating the accuracy of our estimate of the burden of the proposed collection, including the validity of our methodology and assumptions;
• Enhancing the quality, usefulness, and clarity of the information we collect; and
• Minimizing the burden on those who must respond. This includes exploring the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology;
OMB is required to make a decision concerning the collections of information contained in these proposed regulations between 30 and 60 days after publication of this document in the
Requests for copies of the proposed application packages for the Migrant Education Program Consortium Incentive Grant program may be accessed at
This program is subject to Executive Order 12372 and the regulations in 34 CFR Part 79. One of the objectives of the Executive order is to foster an intergovernmental partnership and a strengthened federalism. The Executive
This document is intended to provide early notification of our specific plans and actions for this program.
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The official version of this document is the document published in the
Office of Elementary and Secondary Education, Department of Education.
Notice announcing application deadline.
Under the Small, Rural School Achievement Program (SRSA) Program, we will award grants on a formula basis to eligible local educational agencies (LEAs) to address the unique needs of rural school districts. An LEA that is eligible for fiscal year (FY) 2003 SRSA funding and that applied last year for FY 2002 SRSA funding does not have to submit another SRSA application in order to receive its FY 2003 grant award. An LEA that is eligible for FY 2003 SRSA funding but did not apply last year for FY 2002 SRSA funding is required to submit a FY 2003 SRSA application in order to receive its FY 2003 SRSA grant award. In this notice, we establish the deadline for submission of the FY 2003 SRSA grant applications.
An LEA is eligible for an award under the SRSA Program if—
(a) The total number of students in average daily attendance at all of the schools served by the LEA is fewer than 600;
(b) All of the schools served by the LEA are designated with a school locale code of 7 or 8 by the Department's National Center for Education Statistics;
Under the regulations at 34 CFR 75.104(a), the Secretary makes grants only to an eligible party that submits an application. The Secretary wants to minimize the burden on small, rural school districts and does not believe that it is necessary for eligible LEAs that applied for FY 2002 SRSA funding to submit another application for FY 2003 funding. Instead of requiring new applications from these LEAs, the Department is including as a condition of their FY 2003 grant award a requirement that they comply with the assurances that they filed as part of their FY 2002 applications. Those eligible LEAs that did not apply for FY 2002 funding will have to submit a FY 2003 SRSA application in order to receive their FY 2003 SRSA grant award.
We have provided on the Department's Web site at
You can access the electronic application for the SRSA Program at:
Once you access this site, you will receive specific instructions regarding the information to include in your application.
The regular hours of operation of the e-Grants Web site are 6 a.m. Monday until 7 p.m. Wednesday; and 6 a.m. Thursday until midnight, Saturday (Washington, DC time). Please note that the system is unavailable on Sundays, Federal holidays, and after 7 p.m. on Wednesday for maintenance (Washington, DC time).
If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this notice in an alternative format (
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The official version of this document is the document published in the
Section 6212 of the ESEA, as amended by the No Child Left Behind Act of 2001 (Pub. L. 107-110).
For FY 2003 the competition for new awards focuses on projects designed to meet the priorities we describe in the PRIORITIES section of this application notice.
The Department is not bound by any estimates in this notice.
Entities receiving a grant under the Demonstration Grants for Student Drug Testing Program are required to provide for the equitable participation of private school children and their teachers or other educational personnel. In order to ensure that grant program activities address the needs of private school children, timely and meaningful consultation with appropriate private school officials must occur during the design and development of the program. Administrative direction and control over grant funds must remain with the grantee.
An LEA may receive a grant under the Demonstration Grants for Student Drug Testing Program only if the State educational agency finds that the combined fiscal efforts per student or the aggregate expenditures of the agency and the State with respect to the provisions of free public education by the agency for the preceding fiscal year was not less than 90 percent of the combined fiscal effort or aggregate expenditures for the second preceding fiscal year.
Applicants other than LEAs must demonstrate that they have established a partnership with one or more LEAs to carry out the program. This partnership must be demonstrated by submitting a partnership agreement signed by the superintendent or an authorized representative of the participating LEA. Letters of support for the proposed project are not sufficient to demonstrate the required partnership.
Applicants must provide an assurance that legal counsel has reviewed the proposed program and advised that the program activities do not appear to violate established constitutional principles or State and Federal requirements related to implementing a student drug testing program.
Contingent upon the availability of funds, we may make additional awards in FY 2004 from the rank-ordered list of unfunded applications from this competition.
Faith-based organizations are eligible to apply for grants under this competition provided they meet all statutory and regulatory requirements.
We will award grants to LEAs and public and private entities to develop or enhance, implement, and evaluate school-based drug testing programs for students. Any random drug testing program conducted with funds awarded under this competition must be limited to one or more of the following: (1) Students who participate in the school's athletic program; (2) students who are engaged in competitive, extracurricular school-sponsored activities; and (3) students who, along with their parents or guardian, have consented or volunteered to participate in a random drug testing program.
In order to be eligible for an award, applicants must:
(1) Identify a target population and demonstrate a significant need for drug testing within the target population;
(2) Explain how the proposed drug testing program will be part of a comprehensive drug prevention program in the schools to be served;
(3) Provide a comprehensive plan for referral to treatment or counseling of students identified as drug users through the testing program; and
(4) Provide a plan to ensure the confidentiality of drug testing results.
For FY 2003, this priority is an absolute priority. Under 34 CFR 75.105(c)(3), we will consider only applications that meet this priority.
In order to determine whether the drug testing projects supported under this program produce meaningful effects on student drug use, we have established a competitive preference priority within the absolute priority for this competition. We will award up to 10 additional points to applicants that propose experimental or quasi-experimental evaluation of projects. These points are in addition to any points the application earns under the selection criteria. The total number of points available for this competition is 110.
Evaluations using an experimental design are the strongest for determining program effectiveness. Thus, the project preferably uses an experimental design. An evaluation using an experimental design is one where subjects (students, teachers, classrooms, or schools) are randomly assigned to receive the program being evaluated or to be in a control group that does not receive the program.
If random assignment is not feasible, the project may employ a quasi-experimental design with carefully matched comparison conditions. This alternative design attempts to approximate a randomly assigned control group by matching subjects (students, teachers, classrooms, or schools) with non-participants possessing similar pre-program characteristics.
Data from reliable and valid measures of the intervention that the program intends to implement and of the outcomes that the program intends to affect, should be collected before and after participation in the program or the comparison condition.
Points awarded under this priority will be determined by the quality of the proposed evaluation. In determining the quality of the evaluation, we will consider the extent to which the applicant presents a feasible, credible plan that includes:
(1) The type of design to be used (random assignment or matched comparison);
(2) Outcomes to be measured;
(3) A discussion of how students, teachers, classrooms, or schools will be assigned to the program or matched for comparison with other students, teachers, classrooms, or schools; and
(4) A proposed evaluator, preferably independent, with the necessary background and technical expertise to carry out the proposed evaluation.
Applicants who apply for the competitive preference will have their applications reviewed separately by a panel of non-federal experts that includes at least one evaluation expert.
The Secretary has established the following key performance measure for assessing the effectiveness of the Demonstration Grants for Student Drug Testing Program: The reduction of the incidence of drug use in the past month and past year. The Secretary has set an overall performance target that calls for the incidence of drug use by students in the target population to decline by five percent annually.
In applying the selection criteria that follow for “Quality of project design” and “Quality of the project evaluation,” the Secretary will take into consideration the extent to which the applicant demonstrates a strong capacity (1) To help achieve this target, and (2) to provide reliable data on this indicator.
The following selection criteria are used to evaluate applications for new grants under this competition. Together with the competitive preference priority, the maximum number of points that may be awarded is 110. The maximum score for each criterion or factor under that criterion is indicated in parentheses.
(1)
In determining the need for the proposed project, the following factor is considered:
The magnitude or severity of the problem to be addressed by the proposed project. (20 points)
Under this criterion we will look for evidence that the applicant has conducted a student drug use survey or other needs assessment that demonstrates a significant need for drug testing in the target population.
(2)
In determining the significance of the proposed project, the following factors are considered:
(a) The potential contribution of the proposed project to the development and advancement of theory, knowledge, and practices in the field of study. (10 points)
(b) The extent to which the proposed project involves the development or demonstration of promising new strategies that build on, or are alternatives to, existing strategies. (5 points)
(c) The potential for generalizing from the findings or results of the proposed project. (5 points)
(3)
In determining the quality of the design of the proposed project, the following factors are considered:
(a) The extent to which the design of the proposed project reflects up-to-date knowledge from research and effective practice. (10 points)
(b) The extent to which the proposed project will establish linkages with other appropriate agencies and organizations providing services to the target population. (5 points)
(c) The quality of the proposed demonstration design and procedures for documenting project activities and results. (10 points)
(d) The extent to which the project demonstrates an exceptional approach to the priority established for the competition. (5 points)
Under this criterion we will look at the likelihood that the applicant's plan will lead to reductions in the incidence of drug use by students in the target population.)
(4)
In determining the quality of the management plan, the following factor is considered:
How the applicant will ensure that a diversity of perspectives are brought to bear in the operation of the proposed project, including those of parents, teachers, the business community, a variety of disciplinary and professional fields, recipients or beneficiaries of services, or others, as appropriate. (10 points)
(5)
In determining the quality of the evaluation, the following factors are considered:
(a) The extent to which the methods of evaluation provide for examining the effectiveness of project implementation strategies. (10 points)
(b) The extent to which the methods of evaluation include the use of objective performance measures that are clearly related to the intended outcomes of the project and will produce quantitative and qualitative data to the extent possible. (10 points)
Under this criterion, we will look for the applicant's plan to provide reliable data that measures declines in the incidence of drug use by students in the target population in the past month and in the past year.)
Heather Carkuff, U.S. Department of Education, Office of Safe and Drug-Free Schools, 400 Maryland Avenue, SW., Room 3E250, Washington, DC 20202-6450. E-mail:
If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 800/877-8339.
Individuals with disabilities may obtain this document in an alternative format (
Individuals with disabilities also may obtain a copy of the application package in an alternative format by contacting that person. However, the Department is not able to reproduce in an alternative
Under the Administrative Procedure Act (5 U.S.C. 553) the Department generally offers interested parties the opportunity to comment proposed regulations. Section 437(d)(2) of the General Education Provisions Act (GEPA), however, exempts from this rulemaking requirement those rules where the Secretary determines it would cause extreme hardship to the beneficiaries of the program that would be affected by those rules. The Secretary, in accordance with section 437(d)(2) of GEPA, has decided to issue these rules without first publishing them for public comment in order to ensure timely and high quality grant awards. These rules will apply only to grant applications submitted in FY 2003.
In FY 2003, the U.S. Department of Education is continuing to expand its pilot project for electronic submission of applications to include additional formula grant programs and additional discretionary grant competitions. The Demonstration Grants for Student Drug Testing Program is one the programs included in the pilot project. If you are an applicant under this competition, you may submit your application to us in either electronic or paper format.
The pilot project involves the use of the Electronic Grant Application System (e-Application) portion of the Grants Administration and Payment System (GAPS). Users of e-Application will be entering data on-line while completing their applications. You may not e-mail a soft copy of a grant application to us. If you participate in this voluntary pilot project by submitting an application electronically, the data you enter on-line will be saved into a database. We request your participation in e-Application. We shall continue to evaluate its success and solicit suggestions for improvement.
If you participate in e-Application, please note the following:
• Your participation is voluntary.
• You will not receive any additional point value because you submit a grant application in electronic format, nor will we penalize you if you submit an application in paper format. When you enter the e-Application system, you will find information about its hours of operation.
• You may submit all documents electronically, including the Application for Federal Education Assistance (ED 424), Budget Information—Non-Construction Programs (ED 524), and all necessary assurances and certifications.
• After you electronically submit your application, you will receive an automatic acknowledgement, which will include a PR/Award Number (an identifying number unique to your application).
• Within three working days after submitting your electronic application, fax a signed copy of the Application for Federal Education Assistance (ED 424) to the Application Control Center after following these steps:
(1) Print ED 424 from the e-Application system.
(2) The institution's Authorizing Representative must sign this form.
(3) Place the PR/Award number in the upper right hand corner of the hard copy signature page of the ED 424.
(4) Fax the signed ED 424 to the Application Control Center at 202/260-1349.
• We may request that you give us original signatures on all other forms at a later date.
•
(1) You must be a registered user of e-Application, and have initiated an e-Application for this competition; and
(2)(a) The e-Application system must be unavailable for 60 minutes or more between the hours of 8:30 a.m. and 3:30 p.m. (ET), on the deadline date; or (b) The e-Application system must be unavailable for any period of time during the last hour of operation (that is, for any period of time between 3:30 p.m. and 4:30 p.m. (ET)) on the deadline date. The Department must acknowledge and confirm these periods of unavailability before granting you an extension. To request this extension you must contact either (1) The person listed elsewhere in this notice under
You may access the electronic grant application for the Demonstration Grants for Student Drug Testing Program:
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The official version of this document is the document published in the
20 U.S.C. 7131.
Office of Fossil Energy, DOE.
Notice of application.
Excel Energy Inc., doing business as Northern States Power Company (NSP), has applied to export electric energy from the United States to Canada, pursuant to section 202(e) of the Federal Power Act.
Comments, protests or requests to intervene must be submitted on or before August 11, 2003.
Comments, protests or requests to intervene should be addressed as follows: Office of Coal & Power Import/Export (FE-27), Office of Fossil Energy, U.S. Department of Energy, 1000 Independence Avenue, SW., Washington, DC 20585-0350 (FAX 202-287-5736).
Rosalind Carter (Program Office) 202-586-7983 or Michael Skinker (Program Attorney) 202-586-2793.
Exports of electricity from the United States to a foreign country are regulated and
On June 23, 2003 Excel Energy Inc., doing business as NSP, applied to the Office of Fossil Energy, of the Department of Energy (DOE) for authority to export electric energy from the United States to Canada. NSP is a Minnesota corporation with its principal place of business in Minneapolis, Minnesota. NSP is an investor-owned utility and a wholly-owned subsidiary of Xcel Energy, Inc., and is engaged in the generation, distribution and sale of electric energy. NSP controls electric power generations and transmission facilities in the States of North Dakota, South Dakota, Minnesota, Wisconsin and Michigan. As a Regulated Utility, NSP produces and distributes electric power and conducts wholesale purchases and sales of capacity and energy.
In FE Docket No. EA-282, NSP proposes to export electric energy that is in excess of the amounts required to meet its native load obligations or that is purchased from generators, power marketers or federal power marketing agencies. NSP will arrange for the delivery of those exports to Canada over the international transmission facilities owned by Basin Electric Power Cooperative, Bonneville Power Administration, Citizens Utilities, Eastern Maine Electric Cooperative, International Transmission Co., Joint Owners of the Highgate Project, Long Sault, Inc., Maine Electric Power Company, Maine Public Service Company, Minnesota Power, Inc., Minnkota Power Cooperative, Inc., New York Power Authority, Niagara Mohawk Power Corp., Northern States Power Company and Vermont Electric Transmission Company. NSP will purchase the power to be exported from electric utilities and federal power marketing agencies as defined in the FPA.
The construction of each of the international transmission facilities to be utilized by NSP has previously been authorized by a Presidential permit issued pursuant to Executive Order 10485, as amended.
Comments on the NSP application to export electric energy to Canada should be clearly marked with Docket EA-282. Additional copies are to be filed directly with Xcel Energy, Inc. for Northern States Power Company, 1099 18th Street, Suite 3000, Denver, CO 80202, ATTN: Director, Contract Administration.
A final decision will be made on this application after the environmental impact has been evaluated pursuant to the National Environmental Policy Act of 1969, and a determination is made by the DOE that the proposed action will not adversely impact on the reliability of the U.S. electric power supply system.
Copies of this application will be made available, upon request, for public inspection and copying at the address provided above or by accessing the Fossil Energy Home Page at
Office of Fossil Energy, DOE.
Notice of application.
Xcel Energy Inc., doing business as Public Service Company of Colorado (PSCO), has applied to export electric energy from the United States to Canada, pursuant to section 202(e) of the Federal Power Act.
Comments, protests or requests to intervene must be submitted on or before August 11, 2003.
Comments, protests or requests to intervene should be addressed as follows: Office of Coal & Power Import/Export (FE-27), Office of Fossil Energy, U.S. Department of Energy, 1000 Independence Avenue, SW., Washington, DC 20585-0350 (FAX 202-287-5736).
Rosalind Carter (Program Office) 202-586-7983 or Michael Skinker (Program Attorney) 202-586-2793.
Exports of electricity from the United States to a foreign country are regulated and require authorization under section 202(e) of the Federal Power Act (FPA) (16 U.S.C. 824a(e)).
On June 23, 2003, Xcel Energy Inc., doing business as PSCO, applied to the Office of Fossil Energy, of the Department of Energy (DOE) for authority to export electric energy from the United States to Canada. PSCO is a Colorado corporation with its principal place of business in Denver, Colorado. PSCO is an investor-owned utility and a wholly-owned subsidiary of Xcel Energy, Inc., and is engaged in the generation, distribution and sale of electric energy. PSCO controls electric power generation and transmission facilities in the States of Arizona, Colorado, Kansas, New Mexico, Oklahoma, Texas, and Wyoming. As a regulated utility, PSCO produces and distributes electric power and conducts wholesale purchases and sales of capacity and energy.
In FE Docket No. EA-283, PSCO proposes to export electric energy that is in excess of the amounts required to meet its native load obligations or that is purchased from generators, power marketers or federal power marketing agencies. PSCO will arrange for the delivery of those exports to Canada over the international transmission facilities owned by Basin Electric Power Cooperative, Bonneville Power Administration, Citizens Utilities, Eastern Maine Electric Cooperative, International Transmission Co., Joint Owners of the Highgate Project, Long Sault, Inc., Maine Electric Power Company, Maine Public Service Company, Minnesota Power, Inc., Minnkota Power Cooperative, Inc., New York Power Authority, Niagara Mohawk Power Corp., Northern States Power Company and Vermont Electric Transmission Company. PSCO will purchase the power to be exported from electric utilities and federal power marketing agencies as defined in the FPA.
The construction of each of the international transmission facilities to be utilized by PSCO has previously been authorized by a Presidential permit issued pursuant to Executive Order 10485, as amended.
Comments on the PSCO application to export electric energy to Canada should be clearly marked with Docket EA-283. Additional copies are to be filed directly with Xcel Energy, Inc., for Public Service Company of Colorado, 1099 18th Street, Suite 3000, Denver, CO 80202, Attn: Director, Contract Administration.
A final decision will be made on this application after the environmental impact has been evaluated pursuant to the National Environmental Policy Act of 1969, and a determination is made by the DOE that the proposed action will not adversely impact on the reliability of the U.S. electric power supply system.
Copies of this application will be made available, upon request, for public inspection and copying at the address provided above or by accessing the Fossil Energy Home Page at
The following filings have been made with the Commission. The filings are listed in ascending order within each docket classification.
Take notice that on June 25, 2003, Athens Generating Company, L.P., Covert Generating Company, LLC, Harquahala Generating Company, LLC, and Millennium Power Partners, L.P. (together, the NEG Companies), each of which is an indirect, wholly-owned subsidiary of PG&E National Energy Group, Inc., and MACH Gen, LLC (together with the NEG Companies, the Applicants) tendered for filing with the Federal Energy Regulatory Commission (Commission) pursuant to Section 203 of the Federal Power Act and part 33 of the Commission's regulations, 18 CFR part 33, a request for additional flexibility in implementing the proposed transfer of jurisdictional facilities (the Transfer) authorized by the Commission's June 5, 2003 order.
Take notice that on June 27, 2003, Francis Street Energy LLC (Applicant), filed with the Federal Energy Regulatory Commission (Commission) an application pursuant to Section 203 of the Federal Power Act seeking authorization for the Applicant to acquire 100% of the upstream membership interests in Capital Center Generating Company, LLC (CCGC). In addition, Applicant gave notice of the change in status that will result from the transaction described in the application.
Take notice that on July 1, 2003, D. E. Shaw Plasma Power, L.L.C. supplemented its Petition for A Declaratory Order Disclaiming Jurisdiction; and Request for Expedition (the Petition) by filing, confidentially, the form of License Agreement referenced in the Petition.
Take notice that on June 30, 2003, Athens Generating Company, L.P., Covert Generating Company, LLC, Harquahala Generating Company, LLC, Millennium Power Partners, L.P., (together the NEG Companies), each of which is an indirect, wholly-owned subsidiary of PG&E National Energy Group, Inc., and MACH Gen, LLC, tendered for filing information that reflects a potential change in upstream ownership that is different from the characteristics relied upon by the Commission in approving market-based pricing for the NEG Companies.
Take notice that on June 30, 2003, Entergy Services, Inc., (Entergy) submitted for filing in compliance with the Commission's order issued March 13, 2003, 102 FERC ¶ 61,28, a status report regarding two issues: (1) Entergy's evaluation of alternative methods of designating short-term network resources under the Network Integration Transmission Service provisions of the Entergy Open Access Transmission Tariff, and
(2) Energy's evaluation of an Available Flowgate Capacity methodology as an alternative to evaluating transmission service requests with Available Transfer Capability and Generator Operating Limits calculations.
Take notice that on June 24, 2003, New York Independent System Operator, Inc. (NYISO) submitted for filing information relating to the proposed revisions to its Market Administration and Control Area Services Tariff and its Open Access Transmission Tariff to implement new pricing rules for the Hydro-Quebec.
Take notice that on June 27, 2003, Dynegy Power Services, Inc. (DPS) pursuant to sections 35.15 and 131.53, 18 CFR 35.15 and 131.53, of the Commission's Regulations, filed with the Federal Energy Regulatory Commission a Notice of Cancellation of DPS's Market-Based FERC Electric Rate Tariff and all rate schedules and/or service agreements thereunder effective June 30, 2003.
Take notice that on June 27, 2003, Illinova Energy Partners, Inc. (IEP)
Take notice that on June 30, 2003, Galt Power, Inc. (Galt Power) petitioned the Commission for acceptance of Galt Power Rate Schedule FERC No. 1; the granting of certain blanket approvals, including the authority to sell electricity at market-based rates; and the waiver of certain Commission Regulations.
Galt Power states that it intends to engage in wholesale electric power and energy purchases and sales as a marketer. Galt Power also states it is not in the business of generating or transmitting electric power.
Take notice that on June 30, 2003, Michigan Electric Transmission Company, LLC (METC) submitted proposed amendments to the following agreements: (1) Project I Transmission Ownership and Operating Agreement Between Consumers Power Company and Michigan South Central Power Agency dated November 20, 1980; (2) Campbell Unit No. 3 Transmission Ownership and Operating Agreement Between Consumers Power Company and Northern Michigan Electric Cooperative, Inc. and Wolverine Electric Cooperative, Inc., dated August 15, 1980; (3) Campbell Unit No. 3 Transmission Ownership and Operating Agreement Between Consumers Power Company and Michigan Public Power Agency dated October 1, 1979; (4) Belle River Transmission Ownership and Operating Agreement Between Consumers Power Company and Michigan Public Power Agency dated December 1, 1982; and (5) Wolverine Transmission Ownership and Operating Agreement Between Consumers Power Company and Wolverine Power Supply Cooperative, Inc., dated July 27, 1992.
METC states that the proposed amendments are intended to allow for the reimbursement to METC for certain Midwest Independent Transmission System Operator, Inc. costs and annual charges associated with the load of the Customers. METC requests an effective date of July 1, 2003 for the proposed amendments.
Take notice that on June 30, 2003, PJM Interconnection, L.L.C. (PJM), submitted for filing five interim interconnection service agreements (Interim ISAs) between PJM and PSEG Fossil, L.L.C., Exelon Corporation, Constellation Power Source Generation, Inc., and PSEG Power, L.L.C. and five notices of cancellation of certain Interim ISAs that have been superseded. PJM requests a waiver of the Commission's 60-day notice requirement to permit effective dates agreed to by the parties to the agreements.
PJM states that copies of this filing were served upon the parties to the agreements and the state regulatory commissions within the PJM region.
Take notice that on July 2, 2003, PJM Interconnection, L.L.C. (PJM) tendered for filing with the Federal Energy Regulatory Commission (Commission) an emergency request for expedited approval of revisions to the PMJ Tariff and PJM Operating Agreement to establish an interim ceiling on the permitted number of bids and offers submitted in the monthly PJM financial transmission rights (FTR) auctions, to be effective during the period of suspension of the changes previously filed in this proceeding. PJM states that expedited approval is required because PJM is concerned that, absent such a ceiling, it may be unable to conduct the next monthly FTR auction, which is scheduled to commence on July 16, 2003.
PJM proposes an effective date of July 15, 2003 for the proposed revisions, and requests waiver of the Commission's 60-day notice requirement to permit such effective date. PJM states that copies of this filing were served upon all PJM members and each state electric utility regulatory commission in the PJM region. PJM states that it also served a copy of its filing by overnight delivery on all persons on the Commission's service list for this proceeding and posted a copy of the entire filing on its Internet site,
Any person desiring to intervene or to protest this filing should file with the Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a motion to intervene. All such motions or protests should be filed on or before the comment date, and, to the extent applicable, must be served on the applicant and on any other person designated on the official service list. This filing is available for review at the Commission or may be viewed on the Commission's Web site at
The following filings have been made with the Commission. The filings are listed in ascending order within each docket classification.
Take notice that on June 30, 2003, New York State Electric & Gas Corporation (NYSEG) tendered for filing its compliance filing and refund report pursuant to the Federal Energy Regulatory Commission's (Commission) Opinion No. 447-C issued June 10, 2003. NYSEG requests that its revised transmission revenue requirement
NYSEG states that all refunds pursuant to Opinion No. 447-C have been made. NYSEG also states that copies of the compliance filing and refund report have been served on all the parties affected by Opinion No. 447-C and the New York State Public Service Commission.
Take notice that on June 30, 2003, ISO New England Inc. submitted a compliance report on the status of its Load Response programs pursuant to the Commission's Order issued February 25, 2003 in Docket No. ER03-345-000, 102 FERC ¶ 61,202.
Take notice that on June 24, 2003, New York Independent System Operator, Inc. (NYISO) submitted for filing information relating to the proposed revisions to its Market Administration and Control Area Services Tariff and its Open Access Transmission Tariff to implement new pricing rules for the Hydro-Quebec.
Take notice that on June 27, 2003, Mirant Kendall, LLC (Mirant Kendall) submitted the fixed cost information supporting the fixed cost portion of the PUSH Reference Level for its two jet turbine units (the Kendall Jets) developed by ISO New England Inc. (ISO-NE) and placed into effect by ISO-NE as of June 30, 2003 in accordance with the New England Power Pool Market Rules.
Mirant Kendall states that copies of this filing are being served upon all parties to this proceeding.
Take notice that on June 30, 2003, the California Independent System Operator Corporation (ISO) submitted a filing in compliance with the Commission's May 30, 2003 Order issued in Docket No. ER03-683-000, 103 FERC ¶ 61,265. The ISO states that it has also served copies of this filing upon all entities that are on the official service list for the docket.
Take notice that on June 30, 2003, Niagara Mohawk Power Corporation, a National Grid Company, submitted an Amended and Restated Rate Schedule FERC No. 159 for the Retail Transmission of Expansion Power for the Power Authority of the State of New York pursuant to sections 205 and 206 of the Federal Power Act.
Take notice that on June 30, 2003, Niagara Mohawk Power Corporation, a National Grid Company, submitted First Amended and Restated Service Agreement Nos. 224, 225 and 226 (the Service Agreements) under the grandfathered Open Access Transmission Tariff (OATT). Niagara Mohawk submits these proposed changes for filing pursuant to sections 205 and 206 of the Federal Power Act 16 U.S.C. 824d and 824e, and Rules 205 and 206 of the Commission's Rules of Practice and Procedure, 18 CFR 385.205 and 385.206.
Take notice that on June 30, 2003, Niagara Mohawk Power Corporation, a National Grid Company, submitted amendments to its Rate Schedule FERC No. 19 for the Retail Transmission of Replacement Power for The Power Authority of the State of New York pursuant to sections 205 and 206 of the Federal Power Act, 16 U.S.C. 824d and 824e, and Rules 205 and 206 of the Commission's Rules of Practice and Procedure, 18 CFR 385.205 and 385.206.
Take notice that on June 30, 2003, Niagara Mohawk Power Corporation, a National Grid Company (Niagara Mohawk) submitted a First Amended and Restated Rate Schedule FERC No. 249 for the Retail Transmission of Economic Development Power for the Power Authority of the State of New York pursuant to sections 205 and 206 of the Federal Power Act.
Take notice that on June 30, 2003, Pacific Gas and Electric Company (PG&E) tendered for filing a proposed executed Must-Run Service Agreement (Agreement) for the 336.6 MW hydroelectric system located at the Kings River Watershed in Auberry, California. PG&E states that it proposes to provide services under the Agreement to the California Independent System Operator Corporation.
PG&E state that copies of this filing have been served upon the California Independent System Operator Corporation, the California Public Utilities Commission and the California Electricity Oversight Board.
Please take notice that on June 30, 2003, Central Maine Power Company (CMP) tendered for filing, in accordance with Section 1.18 of the Settlement Agreement approved in Docket Nos. ER00-26-000,
CMP states that copies of this filing were served on Commission Staff and the Maine Public Utilities Commission.
Take notice that on June 30, 2003, the Midwest Independent Transmission System Operator, Inc. (Midwest ISO) pursuant to Section 205 of the Federal Power Act and section 35.13 of the Commission's regulations, 18 CFR 35.13, submitted for filing an unexecuted Interconnection and Operating Agreement among American Transmission Company, the Midwest ISO and Wisconsin Public Service Company.
Midwest ISO states that a copy of this filing was provided to the American Transmission Company and Wisconsin Public Service Company.
Take notice that on June 30, 2003, the Midwest Independent Transmission System Operator, Inc. (Midwest ISO) pursuant to Section 205 of the Federal Power Act and Section 35.12 of the
Midwest ISO states that a copy of this filing was sent to Interstate Power and Light Company and Interstate Power and Light Company.
Any person desiring to intervene or to protest this filing should file with the Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a motion to intervene. All such motions or protests should be filed on or before the comment date, and, to the extent applicable, must be served on the applicant and on any other person designated on the official service list. This filing is available for review at the Commission or may be viewed on the Commission's Web site at
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Comments must be submitted on or before September 9, 2003.
Submit your comments, referencing docket ID number OAR-2003-0081, to EPA online using EDOCKET (our preferred method), by e-mail to
William L. Johnson, Air Quality Strategies and Standards Division, Ozone Policy Strategies Group, C539-02, Environmental Protection Agency, Research Triangle Park, North Carolina 27711; telephone number: (919) 541-5245; fax number: (919) 541-0824; e-mail address:
The EPA has established a public docket for this ICR under Docket ID number OAR-2003-0081, which is available for public viewing at the Air Docket in the EPA Docket Center (EPA/DC), EPA West, Room B102, 1301 Constitution Ave., NW., Washington, DC 20460. The EPA Docket Center Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Reading Room is (202) 566-1744, and the telephone number for the Air Docket is (202) 566-1742. An electronic version of the public docket is available through EPA Dockets (EDOCKET) at
Any comments related to this ICR should be submitted to EPA within 60 days of this notice. The EPA's policy is that public comments, whether submitted electronically or in paper, will be made available for public viewing in EDOCKET as EPA receives them and without change, unless the comment contains copyrighted material, CBI, or other information whose public disclosure is restricted by statute. When EPA identifies a comment containing copyrighted material, EPA will provide a reference to that material in the version of the comment that is placed in EDOCKET. The entire printed comment, including the coyrighted material, will be available in the public docket. Although identified as an item in the official docket, information claimed as CBI, or whose disclosure is otherwise restricted by statute, is not included in the official public docket, and will not be available for public viewing in EDOCKET. For further information about the electronic docket,
Affected entities: Entities potentially affected by this action are States covered by the NO
The EPA would like to solicit comments to:
(i) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(ii) Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(iii) Enhance the quality, utility, and clarity of the information to be collected; and
(iv) Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated electronic, mechanical, or other technological collection techniques or other forms of information technology,
Availability of EPA comments prepared pursuant to the Environmental Review Process (ERP), under section 309 of the Clean Air Act and section 102(2)(c) of the National Environmental Policy Act as amended. Requests for copies of EPA comments can be directed to the Office of Federal Activities at (202) 564-7167. An explanation of the ratings assigned to draft environmental impact statements (EISs) was published in FR dated April 04, 2003 (68 FR 16511).
ERP No. D-AFS-J36053-UT Rating EC2, Monticello and Blanding Municipal Watershed Improvement Projects, Implementation, Manti-La Sal National Forest, Monticello Ranger District, San Juan County, UT.
ERP No. D-AFS-L65420-AK Rating EC2, Greens Creek Tailings Disposal Project, Additional Dry Tailings Disposal Storage Facilities Construction, Authorization, Admiralty National Park Monument, Tongass National Forest, AK.
ERP No. D-AFS-L65421-WA Rating EC2, 49 Degrees North Mountain Resort Revised Master Development Plan, Implementation, Colville National Forest, Newport Ranger District, Stevens County, WA.
ERP No. D-BLM-J65376-CO Rating LO, Gunnison Gorge National Conservation Area Resource Management Plan, Implementation, Montrose and Delta Counties, CO.
ERP No. D-BLM-K65251-CA Rating EC2, Santa Rosa and San Jacinto Mountains National Monument Management Plan, Implementation, Public Lands Management, Riverside County, CA.
ERP No. D-BLM-L67043-ID Rating EC2, North Rasmussen Ridge Mine, Agrium Conda Phosphate Operations, Proposal to Extend the Existing Mining Operations, Federal Phosphate Leases I-04375 and I-07619 within the Caribou-Targhee National Forest, and State Lease I-9313, Soda Springs, Caribou County, ID.
ERP No. D-COE-E39061-MS Rating LO, Royal D'Iberville Hotel and Casino Development Project, Construction and Operation, U.S. Army COE Section 10 and 404 and NPDES Permits Issuance, City of D'Iberville on the Back Bay, Mississippi, Gulf Coast, Harrison County, MS.
ERP No. D-COE-G35022-TX Rating LO, Gulf Intracoastal Waterway in the Laguna Madre, Maintenance Dredging from the JFK Causeway to the Old Queen Isabella Causeway, Nueces, Kleberg, Kennedy, Willacy and Cameron County, TX.
ERP No. D-COE-K39078-CA Rating LO, Napa River Salt Marsh Restoration Project, Salinity Reduction and Habitat Restoration in the Napa River Unit, San Pablo Bay, Napa and Solano Counties, CA.
ERP No. D-FHW J40160 UT Rating EC2, Southern Corridor Construction, I-15 at Reference Post 2 in St. George to UT-9 near Hurricane, Funding, Right-of-Way Grant and U.S. Army COE Section 404 Permit Issuance, St. George, Washington and Hurricane, Washington County, UT.
ERP No. D-FHW-L40218-WA Rating EC2, I-90 Two-Way Transit and HOV Operation Project, Provision of Reliable Transportation between Seattle and Bellevue, Sound Transit Regional Express, U.S. Coast Guard and U.S. Army COE Nationwide Permits Issuance, King County, WA.
ERP No. D-NPS-D61056-DC Rating LO, Rock Creek Park and the Rock Creek and Potomac Parkway Project, General Management Plan, Implementation, Washington, DC.
However, we requested clarifying information on motorist and visitor safety related to road improvements, including Beach Drive weekday closing and mid-afternoon reopening to motorists and more detail on the implementation plans to protect federally protected species and historic resources in the final EIS.
ERP No. D-NPS-K65253-CA Rating LO, Whiskeytown Fire Management Plan, Implementation, Whiskeytown National Recreation Area, Klamath Mountains, Shasta County, CA.
ERP No. D-NPS-L61225-AK Rating EC2, Denali National Park and Preserve Backcountry Management Plan and General Management Plan Amendment, Implementation, AK.
ERP No. D-NRS-E36181-TN Rating LO, Cane Creek Watershed Remedial Plan, Widening and Degradation of the Cane Creek Channel, Lauderdale County, TN.
ERP No. D-NSA-G81012-NM Rating LO, Chemistry and Metallurgy Research Building Replacement Project, Consolidation and Relocation, Los Alamos National Laboratory, Los Alamos County, NM.
ERP No. DS-AFS-L65357-ID Rating EC2, East Beaver and Miner's Creek Timber Sale and Prescribed Burning Project, Timber Harvesting to Provide Forest Products, Implementation, Dubois Ranger District, Caribou-Targee National Forest, Clark County, ID.
ERP No. DS-BLM-J65325-WY Rating EC2, Jack Morrow Hills Coordinated Activity Plan/Draft Green River Resource Management Plan Amendment, Updated Information, Rock Springs, Portion of Sweetwater, Fremont and Subelette Counties, WY.
ERP No. D1-FHW-L40184-WA Rating EO2, WA-167 Freeway Project, WA-161 (Meridian Street North) in the City of Puyallup to the WA-509 Freeway in the City of Tacoma, Funding, U.S. Coast Guard, NPDES and U.S. Army COE Section 10 and 404 Permits Issuance, Cities of Puyallup, Fife, Edgewood, Milton, and Tacoma, Pierce County, WA.
ERP No. F-AFS-F65030-IL Natural Area Trails Project, Construction, Reconstruction, Maintenance and Designation of Trails for Hikers and Equestrian Use, Approval of Site-Specific Mitigation and/or Monitoring Standards, Shawnee National Forest, Jackson, Pope, Johnson, Union, Hardin and Saline Counties, IL.
ERP No. F-AFS-L65406-ID North Kennedy-Cottonwood Stewardship Project, Existing Transportation System Modifications and Forest Health Improvements through Vegetation Management both Commercial and Non-Commercial Methods, Boise National Forest, Emmett Ranger District, Gem and Valley Counties, ID.
ERP No. F-AFS-L67044-ID Golden Hand No. 3 and No. 4 Lode Mining Claims Plan of Operations Approval, Implementation, Frank Church-River of No Return (FC-RONR) Wilderness, Payette National Forest, Krassel Ranger District, Valley County, ID.
ERP No. F-BLM-K81027-NV Nevada Test and Training Range Resource Management Plan, (formerly known as the Nellis Air Force Range (NAFR)), Implementation, Clark, Nye and Lincoln Counties, NV.
ERP No. F-COE-G01015-TX Three Oaks Mine Project, Construction and Operation of a Surface Lignite Mine, U.S. Army COE Section 404 Permit Issuance, Lee and Bastrop Counties, TX.
ERP No. F-FHW-C40144-NY US 219 between Springville to Salamanca Improvements from NY-39 to NY-17, Funding and US Army COE Section 404 Permit Issuance, Erie and Cattaraugus Counties, NY.
ERP No. F-FHW-L53003-WA Vancouver Rail Project, Rail Improvements at the Burlington Northern and Santa Fe Rail Yard and Possible Elimination of the West 39th Street At-Grade Crossing, Funding and NPDES Permit Issuance, Clark County, WA.
ERP No. F-GSA-F11037-WI Badger Army Ammunition Plant, Property Disposal, Implementation, Townships of Sumpter and Merrimac, Sauk County, WI.
ERP No. F-TVA-E29001-TN Rarity Pointe Commercial Recreation and Residential Development on Tellico Reservoir Project, Request for TVA's Land and Approval of Water Use Facilities, Tellico Reservoir, Loudon County, TN.
ERP No. FB-AFS-L65137-AK Tongass Land Management Plan Revision for Roadless Area Evaluation for Wilderness Recommendations, Implementation, Tongass National Forest, AK.
ERP No. FS-COE-G36148-TX Dallas Floodway Extension, Flood Damage Reduction and Environmental Restoration, New Information concerning Additional Formulation, Trinity River Basin, Dallas County, TX.
ERP No. FS-NPS-J61102-00 Yellowstone and Grand Teton National Parks and John D. Rockefeller, Jr., Memorial Parkway, Winter Use Plans, Updated and New Information on New Generation of Snowmobiles that Produce fewer Emissions and are Quieter, Fremont County, ID; Gallatin and Park Counties, MT and Park and Teton Counties, WY.
Environmental Protection Agency (EPA).
Notice of meeting.
The next meeting of the Good Neighbor Environmental Board, a Federal advisory committee that reports to the President and Congress on environmental and infrastructure projects along the U.S. border with Mexico, will take place in Del Rio, Texas, on July 30 and 31, 2003. It is open to the public.
On July 30, the meeting will begin at 8:30 a.m. (registration at 8 a.m.) and end at 5:30 p.m. On July 31, the Board will hold a routine business meeting from 8 a.m. until 12 noon (registration at 7:30 a.m.).
The meeting site is the Kennedy Room of the City of Del Rio Civic Center, 1915 Veterans Boulevard, Del Rio, Texas.
Elaine M. Koerner, Designated Federal Officer for the Good Neighbor Environmental Board, U.S. Environmental Protection Agency Region 9 Office, 75 Hawthorne St., San Francisco, California, 94105. Tel: (415) 972-3437; E-mail:
During the afternoon of July 30, beginning at 2 p.m., guest speakers will continue to address the meeting theme until 4:30 p.m. From 4:30-5:30 p.m., Board members will report out on recent activities within their organizations. The first day of the meeting will conclude at 5:30 p.m.
The second day of the meeting, July 31, will begin at 8 a.m. and conclude at noon. The format will be a routine business meeting, with agenda items including approval of minutes, planning for upcoming meetings, and status of reports.
Environmental Protection Agency (EPA).
Notice.
This notice announces the closure of benomyl, butylate, chlorothalonil, oxadixyl, primisulfuron-methyl, and vinclozolin reregistration elegibility decisions (REDs) and tolerance reassessment decisions (TREDs). EPA developed these reregistration decisions pursuant to the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) and tolerance reassessments under the Federal Food, Drug, and Cosmetic Act (FFDCA).
Technical questions on the RED and TRED documents should be directed to the appropriate Chemical Review Managers listed in Unit II.A.
This notice is directed to the public in general. As such, the Agency has not attempted to describe all the specific entities that may be affected by this action. If you have any questions regarding the information in this notice, contact the appropriate chemical review manager listed in the table in Unit II.A.
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2.
During fiscal years 1998-2002, EPA published Notices in the
The legal authority for this decision falls under FIFRA, as amended in 1988 and 1996. Section 4(g)(2) of FIFRA directs that, after submission of all data concerning a pesticide active ingredient, “the Administrator shall determine whether pesticides containing such active ingredient are eligible for reregistration” before calling in product-specific data on individual end-use products, and either registering products or taking other “appropriate regulatory action.”
Environmental protection
Environmental Protection Agency (EPA).
Notice.
In accordance with section 6(f)(1) of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), as amended, EPA is issuing a notice of requests by Drexel Chemical Company and Makhteshim Chemical Works, Ltd. to voluntarily cancel the registrations for all of their outdoor non-agricultural manufacturing-use products containing diazinon and a request by Walla Walla Environmental, Inc. to cancel one of its outdoor non-agricultural end-use products containing diazinon [O,O-Diethyl O-(2-isopropyl-6-methyl-4-pyrimidinyl) phosphorothioate]. The EPA intends to grant these requests by issuing a cancellation order at the close of the comment period for this announcement, unless the Agency receives substantive comments within the comment period that would merit its further review of these requests. It is EPA's intent that the cancellation of the outdoor non-agricultural manufacturing-use products will be effective upon issuance of the cancellation order, after the comment period, and that the cancellation of the outdoor non-agricultural end-use product will be effective August 31, 2003. The Agency requests public comment on these voluntary cancellation requests, and is providing a 30-day comment period.
Comments on the requested registration cancellations must be submitted to the address provided below and identified by docket ID number OPP-2003-0189. Comments must be received on or before August 11, 2003.
Stephanie Plummer, Special Review and Reregistration Division (7508C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number: (703) 305-0076; e-mail address:
This action is directed to the public in general. Although this action may be of particular interest to persons who produce or use pesticides, the Agency has not attempted to describe all the specific entities that may be affected by this action. If you have any questions regarding the information in this notice, consult the person listed under
1.
2.
An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at
This notice announces requests made by Drexel Chemical Co. and Makhteshim Chemical Works, Ltd. to voluntarily cancel registrations for all of their outdoor non-agricultural manufacturing-use products containing diazinon and a request by Walla Walla Environmental, Inc. to cancel one of its outdoor non-agricultural end-use products containing diazinon. These registrations are listed in sequence by
Diazinon is an organophosphorous insecticide and is one of the most widely used insecticides in the U.S. It is used for outdoor non-agricultural, as well as agricultural, pest control.
Under the December 5, 2000 MOA between the technical registrants of diazinon and the EPA, as well as a February 14, 2001 letter from Drexel Chemical Co., both Makhteshim Chemical Works, Ltd. and Drexel Chemical Co. requested, under FIFRA section 6(f), that EPA cancel, effective as of June 30, 2003, the registrations of all diazinon manufacturing-use products permitting formulation for outdoor non-agricultural use. In a June 5, 2003 letter, Walla Walla Environmental, Inc. requested, under FIFRA section 6(f), that EPA cancel, effective August 31, 2003, the registration of one outdoor non-agricultural end-use product. EPA intends to grant these requests by issuing a cancellation order at the close of the comment period for this announcement, unless the Agency receives substantive comments within the comment period that would merit its further review of these requests.
The Reregistration Eligibilty Decision (RED) document summarizes the findings of EPA's reregistration process for individual chemical cases, and reflects the Agency's decision on risk assessment and risk management for uses of individual pesticides. Diazinon belongs to a group of pesticides known as organophosphates (OPs). EPA has issued the Interim RED assessing the risks of exposure from diazinon.
Under section 6(f)(1)(A) of FIFRA, registrants may request, at any time, that their pesticide registrations be canceled or amended to terminate one or more pesticide uses. Section 6(f)(1)(B) of FIFRA requires that before acting on a request for voluntary cancellation, EPA must provide a 30-day public comment period on the request for voluntary cancellation. In addition, section 6(f)(1)(C) of FIFRA requires that EPA provide a 180-day comment period on a request for voluntary termination of any minor agricultural use before granting the request, unless (1) the registrants request a waiver of the comment period, or (2) the Administrator determines that continued use of the pesticide would pose an unreasonable adverse effect on the environment. Makhteshim Chemical Works, Ltd., Drexel Chemical Co., and Walla Walla Environmental, Inc. have requested a waiver of the comment period. The EPA will therefore apply a 30-day comment period.
Unless the Agency determines that there are substantive comments that warrant further review of these requests, an order will be issued canceling all of these registrations.
Table 2 of this unit includes the names and addresses of record for all registrants of the products in Table 1 of this unit, in sequence by EPA company number:
Section 6(f)(1) of FIFRA provides that a registrant of a pesticide product may at any time request that any of its pesticide registrations be canceled. FIFRA further provides that, before acting on the request, EPA must publish a notice of receipt of any such request in the
The Agency intends to issue a cancellation order following consideration of all comments received during the comment period, unless the comments warrant further review of this request.
Existing stocks are those stocks of registered pesticide products which are currently in the United States and which have been packaged, labeled, and released for shipment prior to the effective date of the cancellation action. In a 2000 MOA between the EPA and the technical registrants of diazinon, the involved parties agreed to the following existing stocks provisions for outdoor non-agricultural manufacturing-use and end-use products:
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The effective date of the cancellation order is intended to be immediate for the products listed in Table 1; however, EPA will consider any comments received within 30 days of publication of this Notice in the
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Environmental protection, Pesticides and pests.
Environmental Protection Agency (EPA).
Notice.
In accordance with section 6(f)(1) of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), as amended, EPA is issuing a notice of receipt of requests by Sumitomo Chemical Company, Limited and Bayer Environmental Science to voluntarily cancel the registrations for all of their products containing 4-chloro-alpha-(1-methylethyl)benzeneacetic acid, cyano(3-phenoxyphenyl)methyl ester (fenvalerate). At the close of the comment period, EPA intends to issue an order granting these cancellation requests, unless the Agency receives substantive comments within the comment period that would merit its further review of these requests, or the requests have been withdrawn.
Comments must be received by August 11, 2003. Unless the Agency receives any substantive comments within the comment period that would merit its further review of these requests, or the requests have been withdrawn by August 11, 2003, EPA intends to issue orders canceling these registrations at the close of the comment period.
Comments may be submitted electronically, by mail, or through hand delivery/courier. Please follow the detailed instructions for each method as provided in Unit I.C. of the
Wilhelmena Livingston, Special Review and Reregistration Division (7508C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number: (703) 308-8025, e-mail address:
This action is directed to the public in general. Although this action may be of particular interest to persons who produce or use pesticides, the Agency has not attempted to describe all the specific entities that may be affected by this action. If you have any questions regarding the information in this notice, consult the person listed under
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An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at
You may submit comments through the mail, in person, or electronically. To ensure proper receipt by EPA, it is imperative that you identify docket ID number OPP-2003-0183 in the subject line on the first page of your response.
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Do not submit any information electronically that you consider to be CBI. You may claim information that you submit to EPA in response to this document as CBI by marking any part or all of that information as CBI. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.
This notice announces receipt by the Agency of requests from Sumitomo Chemical Company, Limited and Bayer Environmental Science to cancel the registrations of three pesticide products registered under section 3 of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). These three registrations constitute all registrations held by Sumitomo Chemical Company, Limited and Bayer Environmental Science of products containing 4-chloro-alpha-(1-methylethyl)benzeneacetic acid, cyano(3-phenoxyphenyl)methyl ester (fenvalerate). These requests are submitted pursuant to section 6(f) of FIFRA.
Fenvalerate is a synthetic pyrethroid insecticide which is used to control insects and related organisms, molluscs, fouling organisms and miscellaneous invertebrates on agricultural, pet care, domestic home and garden (domestic), and commercial/industrial/food and non-food/mosquito abatement (commercial) sites. On April 10, 2003, Sumitomo Chemical Company, Limited and on April 22, 2003, Bayer Environmental Science requested that EPA waive the 180-day period that typically has been allowed before requests for voluntary cancellation are approved or denied.
These registrations are listed in sequence by registration number in Table 1 of this unit:
At the close of the comment period, EPA intends to issue an order granting these cancellation requests, unless the Agency receives any substantive comments within the comment period that would merit its further review of these requests, or the requests have been withdrawn. Users of these pesticides or anyone else desiring the retention of a registration should send in their comments to EPA. In addition, they may wish to contact the applicable registrant directly.
Table 2 of this unit includes the names and addresses of record for all registrants of the products in Table 1 of this unit, in sequence by EPA company number:
Section 6(f)(1) of FIFRA provides that a registrant of a pesticide product may at any time request that any of its pesticide registrations be canceled. FIFRA further provides that, before acting on the request, EPA must publish a notice of receipt of any such request in the
Registrants who choose to withdraw a request for cancellation must submit such withdrawal in writing to the person listed under
The effective date of cancellation will be the date of the cancellation order. The orders effecting these requested cancellations will generally permit a registrant to sell or distribute existing stocks for 1 year after the date the cancellation is requested. This policy is in accordance with the Agency's statement of policy as prescribed in the
Existing stocks are those stocks of registered pesticide products which are currently in the United States and which have been packaged, labeled, and released for shipment prior to the effective date of the cancellation action. Unless the provisions of an earlier order apply, existing stocks already in the hands of dealers or users can be distributed, sold, or used legally until they are exhausted, provided that such further sale and use comply with the EPA-approved label and labeling of the affected product. Exception to these general rules will be made in specific cases when more stringent restrictions on sale, distribution, or use of the products or their ingredients have already been imposed, as in a Special Review action, or where the Agency has identified significant potential risk concerns associated with a particular chemical. In this case, the Agency does not see a need to deviate from these general rules. Unless the Agency receives substantive comments during the comment period that would merit further review of this matter, the Agency intends to permit existing stocks already in the hands of dealers or users to be distributed, sold, or used until they are exhausted, provided that such further sale and use comply with the EPA-approved label and labeling of the affected product.
Environmental protection, Pesticides and pests.
Environmental Protection Agency (EPA).
Notice.
This notice announces the initial filing of a pesticide petition proposing the establishment of regulations for residues of a certain pesticide chemical in or on various food commodities.
Comments, identified by docket ID number OPP-2003-0145, must be received on or before August 11, 2003.
Comments may be submitted electronically, by mail, or through hand delivery/courier. Follow the detailed instructions as provided in Unit I. of the
Shaja R. Brothers, Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number: (703) 308-3194; e-mail address:
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to:
• Crop production (NAICS 111)
• Animal production (NAICS 112)
• Food manufacturing (NAICS 311)
• Pesticide manufacturing (NAICS 32532)
This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under
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2.
An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at
Certain types of information will not be placed in the EPA Dockets. Information claimed as CBI and other information whose disclosure is restricted by statute, which is not included in the official public docket, will not be available for public viewing in EPA's electronic public docket. EPA's policy is that copyrighted material will not be placed in EPA's electronic public docket but will be available only in printed, paper form in the official public docket. To the extent feasible, publicly available docket materials will be made available in EPA's electronic public docket. When a document is selected from the index list in EPA Dockets, the system will identify whether the document is available for viewing in EPA's electronic public docket. Although not all docket materials may be available electronically, you may still access any of the publicly available docket materials through the docket facility identified in Unit I.B. EPA intends to work towards providing electronic access to all of the publicly available docket materials through EPA's electronic public docket.
For public commenters, it is important to note that EPA's policy is that public comments, whether submitted electronically or in paper, will be made available for public
Public comments submitted on computer disks that are mailed or delivered to the docket will be transferred to EPA's electronic public docket. Public comments that are mailed or delivered to the docket will be scanned and placed in EPA's electronic public docket. Where practical, physical objects will be photographed, and the photograph will be placed in EPA's electronic public docket along with a brief description written by the docket staff.
You may submit comments electronically, by mail, or through hand delivery/courier. To ensure proper receipt by EPA, identify the appropriate docket ID number in the subject line on the first page of your comment. Please ensure that your comments are submitted within the specified comment period. Comments received after the close of the comment period will be marked “late.” EPA is not required to consider these late comments. If you wish to submit CBI or information that is otherwise protected by statute, please follow the instructions in Unit I.D. Do not use EPA Dockets or e-mail to submit CBI or information protected by statute.
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Do not submit information that you consider to be CBI electronically through EPA's electronic public docket or by e-mail. You may claim information that you submit to EPA as CBI by marking any part or all of that information as CBI (if you submit CBI on disk or CD ROM, mark the outside of the disk or CD ROM as CBI and then identify electronically within the disk or CD ROM the specific information that is CBI). Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.
In addition to one complete version of the comment that includes any information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket and EPA's electronic public docket. If you submit the copy that does not contain CBI on disk or CD ROM, mark the outside of the disk or CD ROM clearly that it does not contain CBI. Information not marked as CBI will be included in the public docket and EPA's electronic public docket without prior notice. If you have any questions about CBI or the procedures for claiming CBI, please consult the person listed under
You may find the following suggestions helpful for preparing your comments:
1. Explain your views as clearly as possible.
2. Describe any assumptions that you used.
3. Provide copies of any technical information and/or data you used that support your views.
4. If you estimate potential burden or costs, explain how you arrived at the estimate that you provide.
5. Provide specific examples to illustrate your concerns.
6. Make sure to submit your comments by the deadline in this notice.
7. To ensure proper receipt by EPA, be sure to identify the docket ID number assigned to this action in the subject line on the first page of your response. You may also provide the name, date, and
EPA has received pesticide petitions as follows proposing the establishment and/or amendment of regulations for residues of a certain pesticide chemical in or on various food commodities
Environmental protection, Agricultural commodities, Feed additives, Food additives, Pesticides and pests, Reporting and recordkeeping requirements.
The petitioner summaries of the pesticide petitions are printed below as required by FFDCA section 408(d)(3). The summaries of the petitions were prepared by the petitioner and represent the views of the petitioner. The petition summary announces the availability of a description of the analytical methods available to EPA for the detection and measurement of the pesticide chemical residues or an explanation of why no such method is needed.
EPA has received a pesticide petition (3E6519) from IR-4, 681 U.S. Highway #1 South, North Brunswick, NJ 08902-3390 proposing, pursuant to section 408(d) of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a(d), to amend 40 CFR part 180 by establishing a tolerance for residues of combined residues of fenpyroximate benzoic acid, 4-[[[(E)-(1,3-dimethyl-5-phenoxy-1H-pyrazol-4-yl) methylene]amino] oxy]methyl]-, 1,1-dimethylethyl ester] and its z-isomer benzoic acid, 4-[[[[(Z)-(1,3-dimethyl-5-phenoxy-1H-pyrazol-4-yl) methylene]amino]oxy]methyl]-,1,1-dimethylethyl ester)]] in or on the raw agricultural commodity fruit, pome, group 11 at 0.3 parts per million (ppm). Nichino America, Incorporated.
EPA has also received a pesticide petition (2F6437) from Nichino America, Inc., 4550 New Linden Hill Road, Wilmington, DE 19808 proposing, pursuant to section 408(d) of the FFDCA, 21 U.S.C. 346a(d), to amend 40 CFR part 180 by establishing tolerances for residues of combined residues of fenpyroximate benzoic acid, 4-[[[(E)-(1,3-dimethyl-5-phenoxy-1H-pyrazol-4-yl) methylene]amino] oxy]methyl]-, 1,1-dimethylethyl ester] and its z-isomer benzoic acid, 4-[[[[(Z)-(1,3-dimethyl- 5-phenoxy-1H-pyrazol-4-yl) methylene]amino]oxy]methyl]-,1,1-dimethylethyl ester)]] in or on the following raw agricultural commodities: Cotton, undelinted seed at 0.1 ppm, cotton, gin byproducts at 9.0 ppm, apple, fruit at 0.08 ppm, and grape at 0.3 ppm. Additionally, EPA has received request for tolerances for the combined residues of fenpyroximate benzoic acid, 4-[[[(E)-(1,3-dimethyl-5-phenoxy-1H-pyrazol-4-yl) methylene]amino] oxy]methyl]-, 1,1-dimethylethyl ester] and its z-isomer benzoic acid, 4-[[[[(Z)-(1,3-dimethyl-5-phenoxy-1H-pyrazol-4-yl) methylene]amino]oxy]methyl]-,1,1- dimethylethyl ester)] and the acid metabolite ((E)-4-[(1,3-dimethyl-5-phenoxypyrazol-4-yl)-methyleneamino oxymethyl benzoic acid (M-3)], all expressed as fenpyroximate in or on milk at 0.01 ppm; meat at 0.02 ppm; fat at 0.8 ppm; kidney at 0.5 ppm; liver at 0.5 ppm; and meat byproducts at 0.01 ppm of cattle, goats, hogs, horses and sheep. EPA has determined that the petitions contain data or information regarding the elements set forth in section 408(d)(2) of the FFDCA; however, EPA has not fully evaluated the sufficiency of the submitted data at this time or whether the data support granting of the petitions. Additional data may be needed before EPA rules on the petitions. This summary has been prepared by the Nichino American, Inc., Wilmington, DE 19808, the registrant.
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A full description of the studies describing the toxicity of fenpyroximate can be found in the posting for the import tolerances on hops and wine grapes in the
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In consideration of potential cumulative effects of fenpyroximate and other substances that may have a common mechanism of toxicity, to our knowledge there are no currently available data or other reliable information indicating that any toxic effects produced by fenpyroximate would be cumulative with those of other chemical compounds; thus only the potential risks of fenpyroximate have been considered in this assessment of its aggregate exposure.
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Codex Maximum Residue Levels (MRLs) have been established for residues of fenpyroximate and z-isomer on apples in Brazil at 0.1 ppm, France 0.2 ppm, Japan 1.0 ppm, Spain (pome fruits) 0.3 ppm, and Switzerland 0.2 ppm. Codex MRLs have been established on grapes in France at 0.2 ppm, Japan 2.0 ppm, Spain 0.3 ppm, and Switzerland 0.2 ppm.
Environmental Protection Agency (EPA).
Notice.
This notice announces the initial filing of a pesticide petition proposing the establishment of regulations for residues of a certain pesticide chemical in or on various food commodities.
Comments, identified by docket identification (ID) number OPP-2003-0230, must be received on or before August 11, 2003.
Comments may be submitted electronically, by mail, or through hand delivery/courier. Follow the detailed instructions as provided in Unit I. of the
Kathryn Boyle, Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number: (703) 305-6304; e-mail address:
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to:
• Crop production (NAICS 111)
• Animal production (NAICS 112)
• Food manufacturing (NAICS 311)
• Pesticide manufacturing (NAICS 32532)
This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under
1.
2.
An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at
Certain types of information will not be placed in the EPA Dockets. Information claimed as CBI and other information whose disclosure is restricted by statute, which is not included in the official public docket, will not be available for public viewing in EPA's electronic public docket. EPA's policy is that copyrighted material will not be placed in EPA's electronic public docket but will be available only in printed, paper form in the official public docket. To the extent feasible, publicly available docket materials will be made available in EPA's electronic public docket. When a document is selected from the index list in EPA Dockets, the system will identify whether the document is available for viewing in EPA's electronic public docket. Although not all docket materials may be available electronically, you may still access any of the publicly available docket materials through the docket facility identified in Unit I.B.1. EPA intends to work towards providing electronic access to all of the publicly available docket materials through EPA's electronic public docket.
For public commenters, it is important to note that EPA's policy is that public comments, whether submitted electronically or in paper, will be made available for public viewing in EPA's electronic public docket as EPA receives them and without change, unless the comment contains copyrighted material, CBI, or other information whose disclosure is restricted by statute. When EPA identifies a comment containing copyrighted material, EPA will provide a reference to that material in the version of the comment that is placed in EPA's electronic public docket. The entire printed comment, including the copyrighted material, will be available in the public docket.
Public comments submitted on computer disks that are mailed or delivered to the docket will be transferred to EPA's electronic public docket. Public comments that are mailed or delivered to the docket will be scanned and placed in EPA's electronic public docket. Where practical, physical objects will be photographed, and the photograph will be placed in EPA's electronic public docket along with a brief description written by the docket staff.
You may submit comments electronically, by mail, or through hand delivery/courier. To ensure proper receipt by EPA, identify the appropriate docket ID number in the subject line on the first page of your comment. Please ensure that your comments are
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iii.
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Do not submit information that you consider to be CBI electronically through EPA's electronic public docket or by e-mail. You may claim information that you submit to EPA as CBI by marking any part or all of that information as CBI (if you submit CBI on disk or CD ROM, mark the outside of the disk or CD ROM as CBI and then identify electronically within the disk or CD ROM the specific information that is CBI). Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.
In addition to one complete version of the comment that includes any information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket and EPA's electronic public docket. If you submit the copy that does not contain CBI on disk or CD ROM, mark the outside of the disk or CD ROM clearly that it does not contain CBI. Information not marked as CBI will be included in the public docket and EPA's electronic public docket without prior notice. If you have any questions about CBI or the procedures for claiming CBI, please consult the person listed under
You may find the following suggestions helpful for preparing your comments:
1. Explain your views as clearly as possible.
2. Describe any assumptions that you used.
3. Provide copies of any technical information and/or data you used that support your views.
4. If you estimate potential burden or costs, explain how you arrived at the estimate that you provide.
5. Provide specific examples to illustrate your concerns.
6. Make sure to submit your comments by the deadline in this notice.
7. To ensure proper receipt by EPA, be sure to identify the docket ID number assigned to this action in the subject line on the first page of your response. You may also provide the name, date, and
EPA has received a pesticide petition as follows proposing the establishment and/or amendment of regulations for residues of a certain pesticide chemical in or on various food commodities under section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a. EPA has determined that this petition contains data or information regarding the elements set forth in FFDCA section 408(d)(2); however, EPA has not fully evaluated the sufficiency of the submitted data at this time or whether the data support granting of the petition. Additional data may be needed before EPA rules on the petition.
Environmental protection, Agricultural commodities, Feed additives, Food additives, Pesticides and pests, Reporting and recordkeeping requirements.
The petitioner's summary of the pesticide petition is printed below as required by FFDCA section 408(d)(3). The summary of the petition was prepared by the petitioner and represents the view of the petitioner. The petition summary announces the availability of a description of the analytical methods available to EPA for the detection and measurement of the
EPA has received a pesticide petition (PP OF6179) from PURAC America, Inc., 111 Barclay Boulevard, Lincolnshire Corporate Center, Lincolnshire, IL 60069 proposing, pursuant to section 408(d) of FFDCA, 21 U.S.C. 346a(d), to amend 40 CFR 180.950 to establish an exemption from the requirement of a tolerance for 2-ethylhexyl-L-lactate, when used in accordance with good agricultural or manufacturing practice. EPA has determined that the petition contains data or information regarding the elements set forth in section 408(d)(2) of the FFDCA; however, EPA has not fully evaluated the sufficiency of the submitted data at this time or whether the data support granting of the petition. Additional data may be needed before EPA rules on the petition.
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Environmental Protection Agency (EPA).
Notice.
This notice announces the initial filing of a pesticide petition proposing the establishment of regulations for residues of a certain pesticide chemical in or on various food commodities.
Comments, identified by docket ID number OPP-2003-0227, must be received on or before August 11, 2003.
Comments may be submitted electronically, by mail, or through hand delivery/courier. Follow the detailed instructions as provided in Unit I. of the
Kathryn Boyle, Registration Division (7505C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number: 703-305-6304; e-mail address:
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to:
• Crop production (NAICS code 111)
• Animal production (NAICS code 112)
• Food manufacturing (NAICS code 311)
• Pesticide manufacturing (NAICS code 32532)
This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult
1.
2.
An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at
Certain types of information will not be placed in the EPA Dockets. Information claimed as CBI and other information whose disclosure is restricted by statute, which is not included in the official public docket, will not be available for public viewing in EPA's electronic public docket. EPA's policy is that copyrighted material will not be placed in EPA's electronic public docket but will be available only in printed, paper form in the official public docket. To the extent feasible, publicly available docket materials will be made available in EPA's electronic public docket. When a document is selected from the index list in EPA Dockets, the system will identify whether the document is available for viewing in EPA's electronic public docket. Although not all docket materials may be available electronically, you may still access any of the publicly available docket materials through the docket facility identified in Unit I.B. EPA intends to work towards providing electronic access to all of the publicly available docket materials through EPA's electronic public docket.
For public commenters, it is important to note that EPA's policy is that public comments, whether submitted electronically or in paper, will be made available for public viewing in EPA's electronic public docket as EPA receives them and without change, unless the comment contains copyrighted material, CBI, or other information whose disclosure is restricted by statute. When EPA identifies a comment containing copyrighted material, EPA will provide a reference to that material in the version of the comment that is placed in EPA's electronic public docket. The entire printed comment, including the copyrighted material, will be available in the public docket.
Public comments submitted on computer disks that are mailed or delivered to the docket will be transferred to EPA's electronic public docket. Public comments that are mailed or delivered to the docket will be scanned and placed in EPA's electronic public docket. Where practical, physical objects will be photographed, and the photograph will be placed in EPA's electronic public docket along with a brief description written by the docket staff.
You may submit comments electronically, by mail, or through hand delivery/courier. To ensure proper receipt by EPA, identify the appropriate docket ID number in the subject line on the first page of your comment. Please ensure that your comments are submitted within the specified comment period. Comments received after the close of the comment period will be marked “late.” EPA is not required to consider these late comments. If you wish to submit CBI or information that is otherwise protected by statute, please follow the instructions in Unit I.D. Do not use EPA Dockets or e-mail to submit CBI or information protected by statute.
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ii.
iii.
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Do not submit information that you consider to be CBI electronically through EPA's electronic public docket or by e-mail. You may claim information that you submit to EPA as CBI by marking any part or all of that information as CBI (if you submit CBI on disk or CD ROM, mark the outside of the disk or CD ROM as CBI and then identify electronically within the disk or CD ROM the specific information that is CBI). Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.
In addition to one complete version of the comment that includes any information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket and EPA's electronic public docket. If you submit the copy that does not contain CBI on disk or CD ROM, mark the outside of the disk or CD ROM clearly that it does not contain CBI. Information not marked as CBI will be included in the public docket and EPA's electronic public docket without prior notice. If you have any questions about CBI or the procedures for claiming CBI, please consult the person listed under
You may find the following suggestions helpful for preparing your comments:
1. Explain your views as clearly as possible.
2. Describe any assumptions that you used.
3. Provide copies of any technical information and/or data you used that support your views.
4. If you estimate potential burden or costs, explain how you arrived at the estimate that you provide.
5. Provide specific examples to illustrate your concerns.
6. Make sure to submit your comments by the deadline in this notice.
7. To ensure proper receipt by EPA, be sure to identify the docket ID number assigned to this action in the subject line on the first page of your response. You may also provide the name, date, and
EPA has received a pesticide petition as follows proposing the establishment and/or amendment of regulations for residues of a certain pesticide chemical in or on various food commodities under section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a. EPA has determined that this petition contains data or information regarding the elements set forth in FFDCA section 408(d)(2); however, EPA has not fully evaluated the sufficiency of the submitted data at this time or whether the data support granting of the petition. Additional data may be needed before EPA rules on the petition.
Environmental protection, Agricultural commodities, Feed additives, Food additives, Pesticides and pests, Reporting and recordkeeping requirements.
The petitioner summary of the pesticide petition is printed below as required by FFDCA section 408(d)(3). The summary of the petition was prepared by the petitioner and represents the view of the petitioner.
EPA has received an amendment to pesticide petitions PP 5E4510 and 5E4515 from PURAC America, Inc., 111 Barclay Boulevard, Lincolnshire Corporate Center, Lincolnshire, IL 60069 proposing, pursuant to section 408(d) of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a(d), to amend 40 CFR part 180 to amend the existing exemption from the requirement of a tolerance for lactic acid, n-butyl ester (CAS No. 138-22-7) and lactic acid, ethyl ester (CAS No. 97-64-3), to also include lactic acid, n-butyl ester, (S) (CAS No. 34451-19-9) and lactic acid, ethyl ester, (S) (CAS No. 687-47-8) as also exempt from the requirement for a tolerance under 40 CFR 180.950, when used in accordance with good agricultural or manufacturing practice.
The existing exemptions for lactic acid, ethyl ester and lactic acid, butyl ester were established using the general CAS Registry Numbers. These CAS numbers are correct and do adequately identify the chemical substance. However, the actual test substance for many of the studies submitted by PURAC were performed using an isomeric form of the lactate ester. The form of the lactate ester produced by fermentation from sugar can be referred to as the L (+) or the (S) isomer. The basic chemical and physical properties for these stereochemical isomers are identical to that of the general substances. Use of both the general CAS number and the (S) isomer CAS number better identify the product produced and sold by PURAC.
EPA has determined that the petition contains data or information regarding the elements set forth in section 408(d)(2) of the FFDCA; however, EPA has not fully evaluated the sufficiency of the submitted data at this time or whether the data supports granting of the petition. Additional data may be needed before EPA rules on the petition.
All data currently on file for the general CAS substances were generated using the (L) stereoisomer.
All data currently on file for the general CAS substances were generated using the (L) stereoisomer.
Environmental Protection Agency.
Notice of seventeenth update of the Federal Agency Hazardous Waste Compliance Docket, pursuant to CERCLA section 120(c).
Section 120(c) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), as amended by the Superfund Amendments and Reauthorization Act of 1986 (SARA), requires the Environmental Protection Agency (EPA) to establish a Federal Agency Hazardous Waste Compliance Docket. The docket is to contain certain
This list is current as of February 4, 2003.
Electronic versions of the docket may be obtained at
Section 120(c) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 United States Code (U.S.C.) 9620(c), as amended by the Superfund Amendments and Reauthorization Act of 1986 (SARA), required the establishment of the Federal Agency Hazardous Waste Compliance Docket. The docket contains information on Federal facilities that is submitted by Federal agencies to the U.S. Environmental Protection Agency (EPA) under sections 3005, 3010, and 3016 of the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. 6925, 6930, and 6937, and under section 103 of CERCLA, 42 U.S.C. 9603. Specifically, RCRA section 3005 establishes a permitting system for certain hazardous waste treatment, storage, and disposal (TSD) facilities; RCRA section 3010 requires waste generators and transporters and TSD facilities to notify EPA of their hazardous waste activities; and RCRA section 3016 requires Federal agencies to submit biennially to EPA an inventory of hazardous waste sites that the Federal agencies own or operate. CERCLA section 103(a) requires that the National Response Center (NRC) be notified of a release. CERCLA section 103(c) requires reporting to EPA the existence of a facility at which hazardous substances are or have been stored, treated, or disposed of and the existence of known or suspected releases of hazardous substances at such facilities.
The docket serves three major purposes: (1) To identify all Federal facilities that must be evaluated to determine whether they pose a risk to human health and the environment sufficient to warrant inclusion on the National Priorities List (NPL); (2) to compile and maintain the information submitted to EPA on such facilities under the provisions listed in section 120(c) of CERCLA; and (3) to provide a mechanism to make the information available to the public.
The initial list of Federal facilities to be included on the docket was published on February 12, 1988 (53 FR 4280). Updates of the docket have been published on November 16, 1988 (54 FR 46364); December 15, 1989 (54 FR 51472); August 22, 1990 (55 FR 34492); September 27, 1991 (56 FR 49328); December 12, 1991 (56 FR 64898); July 17, 1992 (57 FR 31758); February 5, 1993 (58 FR 7298); November 10, 1993 (58 FR 59790); April 11, 1995 (60 FR 18474); June 27, 1997 (62 FR 34779); November 23, 1998 (63 FR 64806); June 12, 2000 (65 FR 36994); December 29, 2000 (65 FR 83222), October 2, 2001 (66 FR 50185), July 1, 2002 (67 FR 44200), and January 2, 2003 (68 FR 107). This notice constitutes the seventeenth update of the docket.
Today's notice is divided into three sections: (1) Additions, (2) deletions, and (3) corrections. The additions section lists newly identified facilities that have been reported to EPA since the last update and that now are being included on the docket. The deletions section lists facilities that EPA is deleting from the docket. The corrections section lists changes in information about facilities already listed on the docket.
The information submitted to EPA on each Federal facility is maintained in the docket repository located in the EPA Regional office of the Region in which the facility is located (see 53 FR 4280 (February 12, 1988) for a description of the information required under those provisions). Each repository contains the documents submitted to EPA under the reporting provisions and correspondence relevant to the reporting provisions for each facility. Contact the following docket coordinators for information on Regional docket repositories:
Following is a discussion of the revisions of the previous docket, including additions, deletions, and corrections.
Today, 34 facilities are being added to the docket, primarily because of new information obtained by EPA (for example, recent reporting of a facility pursuant to RCRA sections 3005, 3010, or 3016 or CERCLA section 103). SARA, as amended by the Defense Authorization Act of 1997, specifies that, for each Federal facility that is included on the docket during an update, evaluation shall be completed in accordance with a reasonable schedule.
Of the 34 facilities being added to the docket, none are facilities that have reported to the NRC the release of a reportable quantity (RQ) of a hazardous substance. Under section 103(a) of CERCLA, a facility is required to report to the NRC the release of a hazardous substance in a quantity that equals or exceeds the established RQ. Reports of releases received by the NRC, the U.S. Coast Guard (USCG), and EPA are transmitted electronically to the Transportation Systems Center at the U.S. Department of Transportation (DOT), where they become part of the Emergency Response Notification System (ERNS) database. ERNS is a national computer database and retrieval system that stores information on releases of oil and hazardous substances. Facilities being added to the docket and facilities already listed on the docket for which an ERNS report has been filed are identified by the notation “103(a)” in the “Reporting Mechanism” column.
It is EPA's policy generally not to list on the docket facilities that are small-quantity generators (SQG) and that have never generated more than 1,000 kilograms (kg) of hazardous waste in any single month. If a facility has generated more than 1,000 kg of hazardous waste in any single month (that is, if the facility is an episodic generator), it will be added to the docket. In addition, facilities that are SQGs and have reported releases under CERCLA section 103 or hazardous waste activities pursuant to RCRA section 3016 will be listed on the docket and will undergo site evaluation activities, such as a PA and, when appropriate, an SI. All such facilities will be listed on the docket, whether or not they are SQGs pursuant to RCRA. As a result, some of the facilities that EPA is adding to the docket today are SQGs that had not been listed on the docket but that have reported releases or hazardous waste activities to EPA under another reporting provision.
In the process of compiling the documents for the Regional repositories, EPA identified a number of facilities that had previously submitted PA reports, SI reports, Department of Defense (DoD) Installation Restoration Program (IRP) reports, or reports under another Federal agency environmental restoration program, but do not appear to have notified EPA under CERCLA section 103. Section 120(c)(3) of CERCLA requires that EPA include on the docket, among other things, information submitted under section 103. In general, section 103 requires persons in charge of a facility to provide notice of certain releases of hazardous substances. The reports under various Federal agency environmental restoration programs may contain information regarding releases of hazardous substances similar to that provided pursuant to section 103. EPA believes that CERCLA section 120(c) authorizes the agency to include on the docket a facility that has provided information to EPA through documents such as a report under a Federal agency environmental restoration program, regardless of the absence of section 103 reporting. Therefore, some of the facilities that EPA is adding today are being placed on the docket because they have submitted the documents described above that contain reports of releases of hazardous substances.
EPA also includes privately owned, government-operated (POGO) facilities on the docket. CERCLA section 120(c) requires that the docket contain information submitted under RCRA sections 3005, 3010, and 3016 and CERCLA section 103, all of which impose duties on operators as well as owners of facilities. In addition, other subsections of CERCLA section 120 refer to facilities “owned or operated” by an agency or other instrumentality of the Federal government. That terminology clearly includes facilities that are operated by the Federal government, even if they are not owned by it. Specifically, CERCLA section 120(e), which sets forth the duties of the Federal agencies after a facility has been listed on the NPL, refers to the Federal agency that “owns or operates” the facility. In addition, the primary basis for assigning responsibility for conducting PAs and SIs, as required when a facility is listed on the docket, is Executive Order 12580, which assigns that responsibility to the Federal agency having “jurisdiction, custody, or control” over a facility. An operator may be deemed to have jurisdiction, custody, or control over a facility.
Today, 8 facilities are being deleted from the docket for various reasons, such as incorrect reporting of hazardous waste activity, change in ownership, and exemption as an SQG under RCRA (40 CFR 262.44). Facilities being deleted no longer will be subject to the requirements of CERCLA section 120(d).
Changes necessary to correct the previous docket were identified by both EPA and Federal agencies. The changes needed varied from simple changes in addresses or spelling to corrections of the recorded name and ownership of a facility. In addition, some changes in the names of facilities were made to establish consistency in the docket. Many new entries are simply corrections of typographical errors. For each facility for which a correction has been entered, the original entry (designated by an “O”), as it appeared in the February 12, 1988 notice or subsequent updates, is shown directly below the corrected entry (designated by a “C”) for easy comparison.
In compiling the newly reported facilities for the update being published today, EPA extracted the names, addresses, and identification numbers of facilities from four EPA databases—ERNS, the Biennial Inventory of Federal Agency Hazardous Waste Activities, the Resource Conservation and Recovery Information System (RCRIS), and the Comprehensive Environmental Response, Compensation, and Liability Information System (CERCLIS)—that contain information about Federal facilities submitted under the four provisions listed in CERCLA section 120(c).
Extensive computer checks compared the current docket list with the information obtained from the databases identified above to determine which facilities were, in fact, newly reported and qualified for inclusion on the update. In spite of the quality assurance efforts EPA has undertaken, state-owned or privately owned facilities that are not operated by the Federal government may have been included. Such problems are caused by procedures historically used to report and track data on Federal facilities; EPA is working to resolve them. Representatives of Federal agencies are asked to write to EPA's docket coordinator at the following address if revisions of this update
As explained in the preamble to the original docket (53 FR 4280), the docket does not include the following categories of facilities (note, however, that any of these types of facilities may, when appropriate, be listed on the NPL):
• Facilities formerly owned by a Federal agency and now privately owned will not be listed on the docket. However, facilities that are now owned by another Federal agency will remain on the docket and the responsibility for conducting PAs and SIs will rest with the current owner.
• SQGs that have never produced more than 1,000 kg of hazardous waste in any single month and that have not reported releases under CERCLA section 103 or hazardous waste activities under RCRA section 3016 will not be listed on the docket.
• Facilities that are solely transporters, as reported under RCRA section 3010, will not be listed on the docket.
EPA has expanded the docket database to include information on the NFRAP status of listed facilities. Indicating NFRAP status allows easy identification of facilities that, after submitting all necessary site assessment information, were found to warrant no further involvement on the part of EPA at the time of the status change. Accordingly, the docket database includes the following facility status codes:
NFRAP is a term used in the Superfund site assessment program to identify facilities for which EPA has found that currently available information indicates that listing on the NPL is not likely and further assessment is not appropriate at the time. NFRAP status does not represent an EPA determination that no environmental threats are present at the facility or that no further environmental response action of any kind is necessary. NFRAP status means only that the facility does not appear, from the information available to EPA at this time, to warrant listing on the NPL and that, therefore, EPA anticipates no further involvement by EPA in site assessment or cleanup at the facility. However, additional CERCLA response actions by the Federal agency that owns or operates the facility, whether remedial or removal actions, may be necessary at a facility that has NFRAP status. The status information contained in the docket database is the result of Regional evaluation of information taken directly from CERCLIS. (CERCLIS is a database that helps EPA Headquarters and Regional personnel manage sites, programs, and projects. It contains the official inventory of all CERCLA (NPL and non-NPL) sites and supports all site planning and tracking functions. It also integrates financial data from preremedial, remedial, removal and enforcement programs.) The status information was taken from CERCLIS and sent to the Regional docket coordinators for review. The results of those reviews were incorporated into the status field in the docket database. Subsequently, an updated list of facilities having NFRAP status (those for which an “N” appears in the status field) was generated; the list of updates since the previous publication of the docket is being published today.
Important limitations apply to the list of facilities that have NFRAP status. First, the information is accurate only as of February 4, 2003. Second, a facility's status may change at any time because of any number of factors, including new site information or changing EPA policies. Finally, the list of facilities that have NFRAP status is based on Regional review of CERCLIS data, is provided for information purposes only, and should not be considered binding upon either the Federal agency responsible for the facility or EPA.
The status information in the docket database will be reviewed and a new list of facilities classified as NFRAP will be published at each docket update.
As discussed above, the update information below is divided into three separate sections. The first section is a list of new facilities that are being added to the docket. The second section is a list of facilities that are being deleted from the docket. The third section comprises corrections of information included on the docket. Each facility listed for the update has been assigned a code(s) that indicates a more specific reason(s) for the addition, deletion, or correction. The code key precedes the lists.
SARA, as amended by the Defense Authorization Act of 1997, specifies that, for each Federal facility that is included on the docket during an update, evaluation shall be completed in accordance with a reasonable schedule. Therefore, all facilities on the additions list to this fifteenth docket update must submit a PA and, if warranted, an SI to EPA. The PA must include existing information about a site and its surrounding environment, including a thorough examination of human, food-chain, and environmental targets, potential waste sources, and migration pathways. From information in the PA or other information coming to EPA's attention, EPA will determine whether a follow-up SI is required. An SI augments the data collected in a PA. An SI may reflect sampling and other field data that are used to determine whether further action or investigation is appropriate. This policy includes any facility for which there is a change in the identity of the responsible Federal agency. The reports should be submitted to the Federal facilities coordinator in the appropriate EPA Regional office.
The facilities listed in each section are organized by state and then grouped alphabetically within each state by the Federal agency responsible for the facility. Under each state heading is listed the name and address of the facility, the Federal agency responsible for the facility, the statutory provision(s) under which the facility was reported to EPA, and the correction code(s).
The statutory provisions under which a facility reported are listed in a column titled “Reporting Mechanism.” Applicable mechanisms are listed for each facility: for example 3010, 3016, and 103(c).
The complete list of Federal facilities that now make up the docket and the complete list of facilities classified as no further remedial action planned (NFRAP) are not being published today. However, the lists are available to interested parties and can be obtained at
Categories of Revisions for Docket Update by Correction Code
Further information on definitions of categories can be obtained by calling Augusta K. Wills, the HQ Docket Coordinator at (202) 564-2468.
Environmental Protection Agency (EPA).
Notice.
Notice is hereby given that the State of South Carolina is revising its approved Public Water System Supervision Program. South Carolina has adopted drinking water regulations for the Filter Backwash Recycling Rule. EPA has determined that the State Filter Backwash Recycling Rule meets all minimum federal requirements, and is no less stringent than the corresponding federal regulations. Therefore, EPA has tentatively decided to approve the State program revisions.
All interested parties may request a public hearing. A request for a public hearing must be submitted by August 11, 2003 to the Regional Administrator at the address shown below. Frivolous or insubstantial requests for a hearing may be denied by the Regional Administrator. However, if a substantial request for a public hearing is made by August 11, 2003, a public hearing will be held. If no timely and appropriate request for a hearing is received and the Regional Administrator does not elect to hold a hearing on his own motion, this determination shall become final and effective on August 11, 2003. Any request for a public hearing shall include the following information: (1) The name, address, and telephone number of the individual, organization, or other entity requesting a hearing. (2) A brief statement of the requesting person's interest in the Regional Administrator's determination and of information that the requesting person intends to submit at such hearing. (3) The signature of the individual making the request; or, if the request is made on behalf of an organization or other entity, the signature of a responsible official of the organization or other entity.
All documents relating to this determination are available for inspection between the hours of 8 a.m. and 4:30 p.m., Monday through Friday, at the following offices:
Janine Morris, EPA Region 4, Drinking Water Section at the Atlanta address given above (telephone 404-562-9480).
(Section 1401 and section 1413 of the Safe Drinking Water Act, as amended (1996), and 40 CFR part 142).
The notificants listed below have applied under the Change in Bank Control Act (12 U.S.C. 1817(j)) and § 225.41 of the Board’s Regulation Y (12 CFR 225.41) to acquire a bank or bank holding company. The factors that are considered in acting on the notices are set forth in paragraph 7 of the Act (12 U.S.C. 1817(j)(7)).
The notices are available for immediate inspection at the Federal Reserve Bank indicated. The notices also will be available for inspection at the office of the Board of Governors. Interested persons may express their views in writing to the Reserve Bank indicated for that notice or to the offices of the Board of Governors. Comments must be received not later than July 25, 2003.
Board of Governors of the Federal Reserve System, July 7, 2003.
The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841
The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The application also will be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States. Additional information on all bank holding companies may be obtained from the National Information Center website at www.ffiec.gov/nic/.
Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than August 4, 2003.
Board of Governors of the Federal Reserve System, July 7, 2003.
9 a.m. (EDT),
4th Floor, Conference Room, 1250 H Street, NW., Washington, DC
Parts will be open to the public and parts closed to the public.
1. Approval of minutes of June 16, 2003, Board member meeting.
2. Executive Director's report.
3. Status of new record keeping system.
4. Discussion of personnel matters (closed portion of meeting).
5. Discussion of pending litigation (closed portion of meeting).
6. Discussion of draft request for proposals for audit services (closed portion of meeting).
Thomas J. Trabucco, Director, Office of External Affairs, (202) 942-1640.
Office of Electronic Government and Technology, GSA.
Notice of policy and request for comments.
The General Services Administration, in coordination with the Office of Management and Budget (OMB) request comments on the attached draft policy on E-Authentication for Federal Agencies. GSA has coordinated this draft policy with OMB and will work closely with OMB in reviewing comments and issuing the final policy. In this draft policy, GSA is requiring that agencies implement this E-Authentication Policy, which establishes four assurance levels to create a Governmentwide standard framework for determining what is required to access a particular Government transaction online.
To ensure consideration of comments, comments must be in writing and received by GSA no later than August 11, 2003.
Comments on this notice should be addressed to Ms. Von Harrison, General Services Administration; Office of Electronic Government and Technology (MEI), Washington, DC 20405. You are encouraged to submit these comments by facsimile to (202) 501-6455, or by electronic mail to
Ms. Von Harrison, General Services Administration, Office of Electronic Government and Technology (MEI), Washington, DC 20405; or by phone at (202) 273-0721.
As required by the Government Paperwork Elimination Act of 1998 (Public Law 105-277), most transactions currently accomplished by filing a Government paper form will be converted to an electronic format. These transactions will require some type of identity verification or authentication before taking place. It is also important that these electronic transactions incorporate the appropriate level of security. This attached GSA policy guidance provides agencies with a policy for the use of electronic authentication (or e-authentication) in electronic transactions. As the Federal Government works to expand the use of information technology and e-government, trust in electronic transactions is especially critical.
This memorandum establishes a four level approach for authentication to ensure trustworthy electronic transactions and to fulfill Federal privacy and information security requirements. These four levels reflect an increasing degree of confidence in the identity presented and represent a range of authentication technologies. This guidance will promote for the public—
• Use of a standard set of criteria for assessing e-government transactions authentication requirements;
• Consistent terminology when discussing authentication and levels of assurance;
• Secure, easy-to-use, and consistent method for managing identity in electronic transactions with the Government;
• Burden reduction in Government services and Government filings;
• Reuse of credentials for access to multiple Government services;
• Clearly understood criteria for access to particular Government services; and
• Protection against fraud in online transactions with the Government.
Having a consistent e-authentication process and policy guidance will enable Federal Agencies to—
• Reduce authentication system development and acquisition costs, and reallocate labor resources used to develop such systems;
• Reduce the burden on the public in complying with repeated, duplicate or inconsistent processes of identity proofing;
• Make consistent authentication decisions;
• Promote public trust in the use of online service delivery;
• Use existing and future e-authentication processes, within their organizations or those that are available Governmentwide; and
• Reduce the number and type of electronic credentials that Federal employees, citizens, and businesses need to conduct business electronically with the Government.
This guidance updates the Procedures and Guidance for Implementing the Government Paperwork Elimination Act (GPEA) issued by the Office of Management and Budget (OMB), which requires agencies to provide the option for electronic filing and electronic signature capabilities for Government activities and services unless it is not practicable to do so by October 2003. The GPEA implementation guidance (found at:
This guidance reflects substantial work of the E-Authentication Initiative and the Federal CIO Council in FY 2003. Accordingly, CIOs are responsible for assuring all agencies or cross agency teams that implemented electronic authentication solutions or are planning to use shared authentication services are applying this policy.
All existing transactions/systems which require authentication of their users must complete an e-authentication risk assessment and be categorized into one of the described assurance levels by September 15, 2005. Agencies should complete the e-authentication risk assessment process in the following order:
• The E-Government Initiatives (who have already started the process described in this guidance) must be completed by October 1, 2003.
• Systems classified as “major” should be completed by September 15, 2004.
• New authentication solutions should begin to be categorized within 90 days of the completion of the final E-Authentication Technical Guidance.
The results of the authentication risk assessment must be made publicly available through the agency Web site, the
• This guidance should be applied to all Federal electronic transactions requiring authentication, except those that are national security systems as defined in 44 U.S.C. 3542(b)(2).
• This guidance does
• Agencies are required to review existing and categorize new electronic transactions to ensure that these transactions comply with this guidance.
• As detailed in Section 9c of OMB's GPEA guidance, agencies should continue to minimize the likelihood of denial or repudiation of the information individuals transmit electronically. As an element of assessing the risks that are relevant to the required assurance level, agencies must consider how they plan to minimize the likelihood of repudiation by ensuring the user's approval of the information transmitted in electronic transactions. General guidance on minimizing the likelihood of repudiation is included in Section 8c of the OMB Procedures and Guidance on Implementing GPEA.
• This guidance does not directly apply to authorization. Authentication focuses on establishing a person's identity, based on the reliability of the credential he or she offers; while authorization focuses on what actions that identity, at that level of assurance, is permitted to do. Decisions concerning authorization are and should remain the purview of the electronic business process owner.
• Authentication is an inherent part of an electronic signature; however this guidance does not cover “intent to sign,” or when an agency uses authentication credentials as an electronic signature. For more information on electronic signatures, please consult OMB's guidance on implementing GPEA and the Electronic Signatures in Global and National Commerce Act (found at:
• Agencies should implement an e-authentication process using the following steps, described in Section 2.2: (1) Conduct a risk assessment as explained in Part II of the GPEA guidance and Section 2 of this guidance, (2) match identified risks with assurance levels, and (3) determine implementation technology based on the e-authentication technical guidance.
• Each step of the authentication process—from identity proofing, to issuance of a credential, to technical and administrative management and use of the credential by an application, and ultimately to record keeping and auditing—influences whether the process conforms to the desired assurance level. There are many layers of risk related to authentication. This guidance document is intended to assist agencies in identifying and analyzing risks associated specifically with the improper authentication of users of electronic transactions. These risks are highly dependent on the type of application and transactions offered.
• This document does not address risks that are associated with the improper management of authentication controls or processes, or risks to the underlying authentication technical architecture or infrastructure. This document does not confer, and may not be used to support, any right on behalf of any person or entity against the United States or its agencies or officials.
• This guidance does not refer to the authentication of systems or between services (for example, security socket layer (SSL) authentication). Instead, it is focusing on the attribute or identity authentication of individuals who are authenticated for Government services online.
This document provides agencies with guidance on electronic identity and attribute authentication (or e-authentication). E-authentication is the process of establishing confidence in both identities and attributes after being electronically presented to an information system. Individual authentication is the process of establishing an understood level of confidence that an identifier refers to a specific individual. Attribute authentication is the process of establishing an understood level of confidence that an attribute applies to a specific individual. The process of e-authenticating an individual may involve establishing the individual's unique identity (identity authentication) or establishing that the individual is a member of a group (such as a military veteran or U.S. citizen) (attribute authentication). For a complete list of definitions, refer to the Report of the National Research Council “Who Goes There? Authentication Through the Lens of Privacy” (found at:
E-authentication is the first step in the related process of deciding what an individual ought to be allowed to do, called “authorization.” Authentication focuses on establishing a person's identity, based on the reliability of the credential he or she offers; while authorization focuses on what actions that identity is permitted to do.
Agencies providing the e-government services need to determine how certain they need to be in the identity of an individual and identify the risks inherent in a particular transaction. This guidance will provide the framework for the identified risks to be mapped to the desired assurance level that the authentication technology selected must satisfy.
As described in OMB Circular A-130, Management of Federal Information Resources, agencies must prepare and update a strategy that identifies and mitigates risks associated with each information system; Section 5 of the GPEA guidance detailed the risk factors agencies should consider in planning and implementing electronic transactions. This new e-authentication guidance expands on Section 5 by—
• Instructing agencies how to implement an e-authentication process by outlining a process for assessing risk, and determining the requisite level of identity assurance; and
• Describing four discrete (and increasing) levels of identity assurance.
For the purposes of e-government transactions, this guidance describes four assurance levels for authentication. In this context, assurance is defined as how much confidence the relying party has that the electronic identity credential presented is done so by the person whose identity is asserted by the credential. These levels are each appropriate for different classes of electronic transactions. In general, informal or lower value transactions will require less stringent assurance levels. Higher value or legally significant transactions will require more stringent assurance levels.
Agencies should consider a wide range of possible scenarios in seeking to determine what risks are associated with their business process. It is better to be over inclusive than under inclusive in conducting this analysis. Risk analysis is to some extent a creative process, in which agencies must consider harms that might result from, among other causes, technical failures, malignant third parties, public misunderstandings, and human error.
Note that some technology solutions may create or compound particular risks. Thus, after selecting a specific solution, the agency should validate that the performance of the authentication process itself actually meets the identity assurance requirements for the transaction as part of required security procedures (
This section describes the four assurance levels. The levels represent ranges of confidence in an electronic identity presented to an agency by means of a credential. The levels are numbered from 1 to 4, with 1 being minimal assurance and 4 being the highest level of identity assurance.
For each level, there is a description and examples. The description and examples will assist the agency in identifying the appropriate level of assurance required to authorize a transaction. The key part of each description is a risk profile. This is a description of certain consequential risks that may ensue to participants in a transaction when there is an authentication error.
At level 1, little or no assurance is placed in the asserted electronic identity of the transacting party. In particular, an authentication error of a user's identity at level 1 might result in at most—
• Minimal inconvenience to any party; and
• No financial loss to any party; and
• Minimal distress being caused to any party; and
• Minimal damage to any party's standing or reputation; and
• No risk of harm to agency programs or other public interests; and
• No risk of civil or criminal violations; and
• No release of personal, U.S. government sensitive, or commercially sensitive data to unauthorized parties; and
• No risk to any party's personal safety.
Examples of transactions that might merit level 1 authentication include—
• A user presents a self registered user ID or password to the United States Department of Education web page, which allows customization of a Web site to create a “My.ED.gov” page. There are some possible risks associated with this situation; for example, a third party who gained unauthorized access to such a user ID and password might be able to draw inferences about the user's business interests or plans or the user's personal situation based on the types of information in which the user has an interest. Unless the website is subject to a high degree of customization, however, these risks are probably very minimal.
• A user participates in an online discussion on the whitehouse.gov website. Assuming that the forum is not one that addresses sensitive or private information, there are no obvious risks associated with this situation.
Level 2 is appropriate for transactions in which it is sufficient that, on the balance of probabilities, there is confidence in the asserted electronic identity of the transacting party. In particular, an authentication error of a user's identity at level 2 might result in—
• Minor inconvenience to any party; or
• Minor financial loss to any party; or
• Minor damage to any party's standing or reputation; or
• Minor distress being caused to any party; or
• Minor risk of harm to agency programs or other public interests; or
• A risk of civil or criminal violations of a nature that would not ordinarily be subject to agency enforcement efforts; or
• A minor release of personal, or commercially sensitive data to unauthorized parties; and
• No release of U.S. government sensitive data to unauthorized parties; and
• No risk to any party's personal safety.
Examples of transactions that might merit level 2 assurance include—
• A user engages in online learning on the Gov Online Learning Center at golearn.gov. There is a need for authentication such that the user is recognized by the training service and be connected to the appropriate place in the course or given relevant assignment grades, when training affects compensation or promotion. The only risk associated with this transaction is that a third party will gain access to grading information, causing harm to the privacy interests or reputation of the student. If the agency determines, in the context of the particular program, that any such harm will be minor, the transaction is level 2.
• A user accesses their Social Security retirement account information online.
Level 3 is appropriate for transactions that are official in nature, and for which there is a need for high confidence in the asserted electronic identity of the transacting party. In particular, an authentication error of a user's identity at level 3 might result in—
• Significant inconvenience to any party; or
• Significant financial loss to any party; or
• Significant damage to any party's standing or reputation; or
• Significant distress being caused to any party; or
• Significant harm to agency programs or other public interests; or
• A risk of civil or criminal violations that may be subject to agency enforcement efforts; or
• A significant release of personal, U.S. government sensitive, or commercially sensitive data to unauthorized parties; and
• No risk to any party's personal safety.
Examples of transactions that might merit level 3 assurance include:
• A patent attorney company reports and updates data on-line with the Patent and Trademark Office that would be of great value as competitive intelligence.
• A major contractor or supplier maintains an account with a General Services Administration Contracting Officer for a large government procurement involving significant government expenditures.
• A First Responder accesses a disaster management reporting website to report an incident and to share incident operational information, and to coordinate incident response activities.
Level 4 is appropriate for transactions that are official in nature for which there is a need for very high confidence in the asserted electronic identity of the transacting party. In particular, an authentication error of a user's identity at level 4 might result in—
• Considerable inconvenience to any party; or
• Considerable financial loss to any party; or
• Considerable damage to any party's standing or reputation; or
• Considerable distress being caused to any party; or
• Considerable harm to agency programs or other public interests; or
• A risk of civil or criminal violations that are of special importance to the agency enforcement program; or
• A damaging release of extensive personal, U.S. government sensitive, or commercially sensitive data to third parties; or
• A risk to any party's personal safety.
Examples of transactions that may require level 4 assurance include—
• A State or local law enforcement official accesses a law enforcement database containing information about the criminal records of individuals. Unauthorized access would violate the legal privacy rights of individuals or compromise investigations.
• A VA pharmacist dispenses a controlled drug. He/She would need full assurance that a qualified doctor had signed the prescription. In this case, the pharmacist's actions on the transaction carries criminal liability that the prescription was the correct drug(s), in the correct quantity, and that the prescription was validated before filling the prescription.
Each step of the authentication process—from identity proofing, to issuance of a credential, to management and use of the credential in a well-managed secure application, and ultimately to record keeping and auditing—influences whether the process conforms to the desired assurance level. The level of assurance achieved by each step of the process needs to be considered. The step that provides the lowest level of assurance may often determine the assurance level for the entire authentication process. Ideally each step in the authentication process should be consistent in its strength and robustness. A strong identity proofing process, combined with a strong credential and a robust management practice (including a strong archive and audit process) will contribute to the highest level assurance of identity. However, the best authentication process needs to be supported by well-engineered and tested user and agency software applications.
In making the risk assessment, the business process owner must consider all the direct and indirect consequences as presented in the definitions of the levels. Since each assurance level uses the terms “minimal”, “minor”, “significant”, or “considerable”, the business process owner will need to consider the terms in the context of the parties likely to be affected and their typical views. While it is realized that these terms are subjective, it is expected that these will be solidified through implementation and practice. For example, risk assessments have already been conducted on the E-Government Initiatives to determine their appropriate assurance levels.
As stated in OMB's GPEA guidance, properly implemented technologies can offer degrees of confidence in authenticating identity that are greater than a handwritten signature can offer. However, electronic transactions may in some circumstances affect the risk of criminal and civil violations, increase the harms associated with such violations, and complicate redressing such violations. Legal and law enforcement issues are discussed in the Department of Justice's Guide for Federal Agencies on Implementing Electronic Processes (found at
Violations of the law can present significant policy issues for an agency. The risk assessment process should consider the potential effects of illegal activities or other process failures in light of the agency's enforcement priorities, the agency's programmatic interests, and such broader public interests as national security, the environment, and the proper functioning of markets. Some of these harms are specifically described in each level (such as financial loss or release of personal information); others will depend on a particular agency's programmatic interests.
The risk analysis reflects this issue by referring to risks of criminal or civil violations and harm to agency programs or the public interest. In assessing this risk and designing a process, agencies should take into account not just the effects of a single violation or other act, but the possibility of a pattern of actions that might affect agency programs. For instance, if sensitive information could be obtained from an agency website, the agency should consider the effects of a possible pattern of such activity, not just a single action, in assessing risk levels. (Note that unauthorized access to an agency website is itself a criminal offense, see,
Credential Service Providers (CSPs) are organizations, both governmental and non-governmental, that issue and in some cases may maintain electronic credentials. CSPs can handle several of the steps in the e-authentication process. Because the CSP's issuance and maintenance policy influences the trustworthiness of an e-authentication process, CSPs will also need to be assessed to determine the e-authentication level to which their credentials pertain. For example, if a CSP follows all process/technology requirements for authentication level 3, a user may use a credential provided by the CSP to authenticate himself for a transaction requiring authentication levels 1, 2, or 3. Additional information on CSPs will be included in both the E-Authentication technical guidance and in separate guidance issued by the E-Authentication E-Government Initiative.
When determining e-authentication needs, agencies must consider the entire e-authentication process. An agency cannot simply determine the level of credential that will be required to validate a user's identity without also determining how that credential will be processed by the agency business applications. They must determine the requirements for each step in the e-authentication/authorization process. This process includes the following steps:
• Initial enrollment.
• Repeat visits.
• Verification of identity.
• Transaction management.
• Long term records management.
• Periodic tests of the system.
• Suspension, revocation, reissue.
• Audit.
Each of these steps will be explained in more detail in the e-authentication technical guidance. Responsibility for these steps lies with the individual business process owners or designated agency or cross agency authority.
Anonymous credentials may be appropriate when it is not necessary that authentication be associated with a known personal identity (as opposed to identity authentication). To protect privacy, it is important to balance the need to know who is communicating with Government with a citizen's right to privacy. This includes ensuring that information is used only in the manner in which individuals have been assured it will be used. In some cases, it may be desirable to preserve the anonymity of individuals and it may be sufficient for the purposes of an application to authenticate that—
• The user is a member of a group; and/or
• The user is the same individual who supplied or created information in the first place; and/or
• A particular user is entitled to use a particular pseudonym.
These anonymous credentials will have limited application. In some cases, individuals would have an anonymous as well as a non-anonymous credential. Anonymous credentials can be used up until level 3.
When developing authentication processes, agencies must consider the requirements for managing security in the collection and storage of information associated with the process of validating a user's identity. As required by the E-Government Act of 2002 (Public Law 107-347), section 208, 44 U.S.C. § 3604, agencies are required to conduct privacy impact assessments for electronic information systems and collections, which includes when authentication technology is newly applied to an electronic information system.
The following information is captured in most e-authentication processes:
• Information regarding the individuals/ businesses/governments using the E-Gov service.
• Electronic user credentials (
• Transaction information associated with user authentication, including credential validation method.
• Audit Log/Security information.
Some of this information includes personal information as defined by the Privacy Act and, systems that use the information are considered systems of records that must meet all requirements of the Privacy Act and the E-Government Act.
Data collected and stored during the authentication process should only be accessible routinely to systems administrators and to auditors. As required by the Privacy Act, access to the system of
In order to authenticate a user, it may be necessary for an agency providing an E-Gov service to obtain additional information about that user through the CSP that issued the user his/her credential. In such a case, the CSP must ask the user for permission and be granted that permission by the user to provide the specified information to the e-gov service provider. Disclosure of the additional information by the CSP to the e-gov application or service may also be established prior to the time of the transaction, if it is outlined in the terms of the relationship between the user and the CSP.
In most cases, higher levels of assurance require more costly credentials; however minimizing the number of credentials can create cost savings. Section 3 of the GPEA guidance provides additional information on assessing risks, costs, and benefits. In-person proofing is most likely more expensive. The e-authentication technical guidance will provide alternatives for addressing some of the authentication levels that may help agencies to better manage the costs of authentication.
Federal Bridge levels will be mapped to the assurance levels described in this document. Since these assurance levels take into account a wide range of authentication solutions, the levels described in this guidance differ from the levels established by the Federal Bridge Certification Authority (FBCA) Certificate Policy. For example, levels 1 and 2 in this e-authentication policy are primarily reserved for non-cryptographic authentication solutions not covered by the FBCA. However, it is likely that some public key infrastructure (PKI) solutions and the FBCA Rudimentary Certificate Policy will map to level 1 or level 2. The FBCA Basic Certificate Policies and the FBCA Medium Certificate Policies will fall in level 3, while FBCA High Certificate Policy will fall into level 4.
While this E-Authentication Guidance addresses the consequential risk in making an authentication error, NIST is in the process of developing much broader risk levels for Federal information and Information Systems. NIST is in the process of developing a Federal Information Processing Standards Publication (FIPS) 199, “Standards for Security Categorization of Federal Information and Information Systems” promulgated under the E-Government Act of 2002 (Public Law 107-347). The standards establish three levels of risk (low, moderate, and high) for each of the stated security objectives (confidentiality, integrity, and availability) relevant to securing Federal information and information systems.
It is expected that these levels established in FIPS 199 will map to the levels in the e-authentication guidance. When an authentication error might cause a loss of confidentiality, integrity or availability, then—
• If the risk as defined in FIPS 199 is low, authentication assurance levels 1 through 4 are sufficient;
• If the risk as defined in FIPS 199 is moderate, authentication assurance level 3 or 4 should be used; and
• If the risk as defined in FIPS 199 is high, authentication assurance level 4 should be used.
The Effective Dates for this guidance is 30 days after issuance as final policy. Additional information can be found in the supplemental information above.
In accordance with section 10(a)(2) of the Federal Advisory Committee Act (Pub. L. 92-463), the Centers for Disease Control and Prevention (CDC) announces the following meeting:
Jean Langlois, Sc.D., Epidemiologist, Division of Injury and Disability Outcomes and Programs, National Center for Injury Prevention and Control, CDC, 4770 Buford Highway, NE, Atlanta, GA 30341, Telephone 770.488.1478.
The Director, Management Analysis and Services Office, has been delegated the authority to sign
In accordance with section 10(a)(2) of the Federal Advisory Committee Act (Pub. L. 92-463), the Centers for Disease Control and Prevention (CDC) announces the following meeting:
Mr. Thomas D. Vogelsonger, Public Health Advisor, Office of the Director, National Center for Injury Prevention and Control, CDC, 4770 Buford Highway, NE., Atlanta, GA 30341, Telephone 770.488.4823.
The Director, Management Analysis and Services Office, has been delegated the authority to sign
In accordance with section 10(a)(2) of the Federal Advisory Committee Act (Pub. L. 92-463), the Centers for Disease Control and Prevention (CDC) announces the following meeting:
The Director, Management Analysis and Services Office, has been delegated the authority to sign
Administration for Children and Families (ACF) DHHS.
Announcement of the availability of funds and request for doctoral level graduate student research projects (Priority Area 1.01) in partnership with Head Start programs,
The Administration for Children and Families (ACF) Office of Planning, Research and Evaluation (OPRE) announces the availability of funds for Head Start Graduate Student Research Grants to support field-initiated research activities.
The closing time and date for receipt of applications is 5 p.m. (Eastern Time Zone) August 12, 2003. Regardless of the method by which they are delivered, applications must be received on or before the deadline date.
All packages should be clearly labeled as follows: Application for Head Start Graduate Student Research Grants: Priority Area (indicate 1.01 or 1.02).
The Head Start Research Support Technical Assistance Team (1-877) 663-0250, is available to answer questions regarding application requirements and to refer you to the appropriate contact person in ACF for programmatic questions. You may e-mail your questions to:
Grants Management Contact: William Wilson, Grants Management Officer, Room 2220 Switzer Building, 330 C Street SW., Washington, DC 20447. Telephone Number (202) 205-8913 or e-mail
In order to determine the number of expert reviewers that will be necessary, if you are going to submit an application,
The Supplementary Information section consists of four parts. Part I provides general information about the Head Start research activities, authorities, funding priorities, and the application process. Part II describes the Head Start Graduate Student Research Grants (Priority Area 1.01). Part III describes the Head Start Graduate Student Partnership Development Grants (Priority Area 1.02). Part IV includes two appendices that include all requirements for applications. Appendix 1 provides detailed instructions for preparing and submitting applications. Appendix 2 contains the OMB-approved Uniform Project Description.
The purpose of this announcement is to announce the availability of funds for Head Start Graduate Student Research Grants to support field-initiated research activities in partnership with Head Start programs and to develop ongoing research partnerships with Head Start programs.
Since 1991, ACF has explicitly supported the relationship between established Head Start researchers and their graduate students by awarding research grants, on behalf of specific graduate students, to conduct research in Head Start communities. As many previously funded Head Start graduate students have continued to make significant contributions to the early childhood research field as they have pursued their careers, this funding mechanism is an important research capacity-building effort. To ensure that future research is responsive to the changing needs of low-income families, graduate students need strong and positive role models. Therefore, Head Start's support of the partnership between students and their mentors is essential. The unique partnership that is forged between mentor and student, within the Head Start research context, serves as a model for the establishment of other partnerships within the community (
ACF further recognizes that effectively developing new research partnerships between researchers and Head Start communities requires considerable planning, effort, and commitment. In order to encourage the development of such new research partnerships, and to facilitate the entry of new mentor/student teams to the field of Head Start research, it is also essential to support the process of partnership development and research conceptualization. Therefore, a new priority area has been added this year for that purpose.
Thus, the goals of the two priority areas within the Head Start Graduate Student Research Grant program can be summarized as follows:
1. Provide direct support for graduate students as a way of encouraging the conduct of research with Head Start populations, thus contributing to the knowledge base about the best approaches for delivering services to diverse, low-income families and their children;
2. Promote mentor-student relationships which support students' graduate training and professional development as young researchers engaged in policy-relevant, applied research;
3. Emphasize the importance of developing true working research partnerships with Head Start programs and other relevant entities within the community, thereby fostering skills necessary to build a student's trajectory of successful partnership-building and
4. Support the active communication, networking and collaboration among graduate students, their mentors and other prominent researchers in the field, both during their graduate training, as well as into the early stages of their research careers.
While the specific topics addressed under these Graduate Student Research Grants are intended to be field-initiated, applicants who address issues of both local and national significance will be most likely to succeed. Some illustrative examples of such topics include, but are not limited to the areas of school readiness, children's mental health, serving an increasingly culturally and linguistically diverse population of children and families and promoting child well-being by strengthening responsible fatherhood and healthy marriages in Head Start families.
The project description is approved under OMB control Number 0970-0139 which expires 12/31/03.
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB control number.
In Fiscal Year 2003, ACF anticipates funding between 5 and 10 new projects in Priority Area 1.01 and between 2 and 8 new projects in Priority Area 1.02, pending availability of funds and receipt of satisfactory applications. ACF intends to commit up to $200,000 per year to fund new grants in response to both priority areas within this announcement. It is unlikely that any individual mentor will be funded for more than one graduate student research grant if there are at least 10 applications from different mentors/institutions that qualify for support.
Any application that exceeds the maximum dollar range will be considered “non-responsive” and subsequently returned to the applicant without further review.
For Priority Area 1.01, requests for a second year of funding within the project period should be identified in the current application (on SF-424A), but such requests will be considered at a later date on a noncompetitive basis, subject to the graduate student's eligibility status, the availability of funds, satisfactory progress of the grantee, and a determination that continued funding would be in the best interest of the Government.
This announcement includes all of the information needed to apply for funding in each of the priority areas. Detailed instructions for preparing and submitting applications are contained in the appendices. Applicants are cautioned to follow the prescribed content and format in preparing their application packages. Each priority area describes the purpose, goals, technical requirements and evaluation criteria against which proposals will be reviewed. The Standard Federal Forms that must be included in applications can be downloaded from the Internet at
1. Each application will be screened to determine whether the applicant organization is eligible as specified in each of the priority areas. Applications from ineligible organizations will be excluded from the review.
1.The review will be conducted in Washington, DC. Expert reviewers will include researchers, Federal or State staff, and other individuals experienced in Head Start or related research and evaluation. A panel of at least three reviewers will evaluate each application to determine the strengths and weaknesses of the proposal in terms of the Head Start's research goals and expectations, requirements for the Project Narrative Statement, and evaluation criteria for the priority area under consideration.
3. Given the involvement of non-Federal reviewers, applicants have the option of omitting from the application copies (but not the original), specific salary rates or amounts for individuals specified in the application budget and Social Security Numbers, if otherwise required for individuals. If the applicant omits individual salary information on application copies, the copies must include summary salary information.
4. Panelists will provide written comments and assign numerical scores for each application. The indicated point value for each criterion is the maximum numerical score for that criterion. The assigned scores for each criterion will be summed to yield a total evaluation score for the proposal.
5. In addition to the panel review, ACF may solicit comments from other Federal offices and agencies, States, non-governmental organizations, and individuals whose particular expertise is identified as necessary for the consideration of technical issues arising during the review. ACF will consider their comments, along with those of the panelists, when making funding decisions. ACF will also take into account the best combination of proposed projects to meet overall research goals.
6. The Director of the Office of Planning, Research and Evaluation in the Administration for Children and Families (ACF) will make the final selection of the applicants to be funded. Applications may be funded in whole or in part depending on: (1) The rank order of applicants resulting from the competitive review; (2) staff review and consultations; (3) the combination of projects which best meets the Bureau's research objectives; (4) the funds available; and (5) other relevant considerations.
7. Selected applicants will be notified through the issuance of a Financial Assistance Award. That document establishes the funding level, terms and conditions of the award, reporting requirements, effective date of the award, budget period for which support is given, and total project period for which support is provided.
8. Grants to successful applications will be awarded by September 30, 2003.
All grantees will be required to submit semi-annual progress and fiscal reports as well as a final report.
To be eligible to administer the grant on behalf of the student, the institution must be fully accredited by one of the regional accrediting commissions recognized by the Department of Education and the Council on Post-Secondary Accreditation. Faith-based institutions are also eligible to apply. Although the faculty mentor is listed as the Principal Investigator, this grant is intended for dissertation research for an individual student. Information about both the graduate student and the student's faculty mentor is required as part of this application. Any resultant grant award is not transferable to another student. The award may not be divided between two or more students.
Private, non-profit institutions are encouraged to submit with their applications the optionally survey located under “Grant Manuals & Forms” at
• A university faculty member must serve as a mentor to the graduate student; this faculty member is listed as the “Principal Investigator.” The application must include a letter from this faculty member stating that s/he has reviewed and approved the application, the status of the project as
• The research project must be an independent study conducted by the individual graduate student or well-defined portion(s) of a larger study currently being conducted by a faculty member. If the project is part of a larger research effort, the proposal must clearly distinguish between the student's portion of the research activities and those of the larger project. The graduate student must have primary responsibility for the proposed study described in the application.
• The graduate student must enter into a partnership with a Head Start or Early Head Start program for the purposes of conducting the research.
• The application must contain (A) a letter from the Head Start or Early Head Start program certifying that they have entered into a research partnership with the applicant (graduate student) and (B) a separate letter certifying that the application has been reviewed and approved by the Head Start Program Policy Council. Notification of approval or pending approval by the Policy Council must be received from the official representative of the Policy Council and not an individual from the Head Start or Early Head Start program itself.
• The graduate student applicant must agree to attend
The second meeting each year alternates between the biennial Head Start National Research Conference in Washington, DC (June 28 to July 1, 2004) and the biennial meeting of the Society for Research in Child Development-SRCD (April, 2005). At a minimum, students usually are provided the opportunity to present information on their respective studies in a poster session format, although both meetings also provide other networking and mentoring activities. The grant budget should reflect travel and housing funds for the graduate student for all four of these meetings (or two if only applying for only one year of funding).
• Given the strong emphasis that is placed on supporting the mentor-student relationship, the faculty mentors are strongly encouraged to attend and participate in the activities of the annual grantee meeting for all Head Start Graduate Students. The budget should reflect travel funds for such purposes, as appropriate. However, if the faculty mentor does plan to attend the annual Graduate Student grantee meeting, but will utilize another source of travel funds, such arrangements are encouraged and should be noted in the application.
• Due to the small amount of the grant, the applicant's institution is strongly encouraged to waive indirect costs.
• Contact information, including phone numbers, addresses and e-mail addresses, for
• The graduate student must write the application in its entirety, consistent with the format and style guidelines of the
Criteria for Priority Area 1.01—Head Start Graduate Student Research Grants—The three criteria that follow will be used to review and evaluate each application under this priority area (presented here in descending order of numerical weighting—see instructions in Appendix 2). Address each in the Project Narrative Section of the application. The point values indicate the maximum numerical weight each criterion will be accorded in the review process. (100 points total).
• The extent to which there is a discrete project designed by the graduate student. If the proposed project is part of a larger study designed by others, the approach section should clearly delineate the research component to be carried out by the student and how it is distinguished from the larger research project.
• The extent to which the research design is appropriate and sufficient for addressing the questions of the study.
• The extent to which the planned research specifies the measures to be used, their psychometric properties, and contains an adequately detailed description of the proposed analyses to be conducted.
• The extent to which the planned measures have been shown to be appropriate and sufficient for the
• The extent to which the planned measures and analyses are consistent with one another, and reflect knowledge and use of state-of-the-art measures and analytic techniques, or advance the state-of-the-art, as appropriate.
• The extent to which the analytic techniques are appropriate for the specific research question(s) under consideration.
• The extent to which the proposed sample size is sufficient to answer the range of proposed research questions for the study.
• The extent to which the scope of the project is reasonable for the funds available and feasible for the time frame specified.
• The extent to which the planned approach reflects sufficient written input from and partnership with the Head Start program (including the separate required review and written approval from the Head Start program and the Head Start Program Policy Council).
• The extent to which the budget and budget justification are appropriate for carrying out the proposed project.
• The extent to which the faculty mentor and graduate student possess the research expertise necessary to conduct the study as demonstrated in the application and information contained in their vitae.
• The principal investigator/faculty mentor has earned a doctorate or equivalent in the relevant field and has first or second author publications in major research journals.
• The extent to which the faculty mentor and graduate student reflect an understanding of and sensitivity to the issues of working in a community setting and in partnership with Head Start program staff and parents.
• The adequacy of the time devoted to this project by the faculty mentor for mentoring the graduate student. The proposal should include evidence of the faculty mentor's commitment to mentoring the individual graduate student, and as appropriate, willingness to serve as a resource to the broader group of Head Start Graduate Students funded under this award.
• The research questions are clearly stated.
• The presentation reflects original work done by the student (consistent with the general principles and guidelines of the
• The extent to which the questions are of importance and relevance for low-income children's development and welfare.
• The extent to which the research study makes a significant contribution to the knowledge base.
• The extent to which the literature review is current and comprehensive and supports the need for the study.
• The extent to which the literature review has a complete set of reference citations and is written consistent with the guidelines of the
• The extent to which the questions that will be addressed or the hypotheses that will be tested are sufficient for meeting the stated objectives.
• The extent to which the proposed project is appropriate to the student's level of ability and the stated time frame for completing the project.
To be eligible to administer the grant on behalf of the student, the institution must be fully accredited by one of the regional accrediting commissions recognized by the Department of Education and the Council on Post-Secondary Accreditation. Faith-based institutions are also eligible to apply. Although the faculty mentor is listed as the Principal Investigator and must be committed to taking a central role in maintaining an ongoing research partnership with a Head Start program, this grant is intended for an individual student to be the primary conduit through which the research-related relationship is forged. Information about both the graduate student and the student's faculty mentor is required as part of this application. Any resultant grant award is not transferable to another student. The award may not be divided between two or more students.
• A university faculty member must serve as a mentor to the graduate student; this faculty member is listed as the “Principal Investigator.” The application must include a letter from this faculty member stating that s/he has reviewed and approved the application and describing, in as much detail as is possible, the potential for the research partnership development project to lead to a research effort that would include the student's dissertation study. It should also include a statement of the student's status in the graduate program and a description of how the faculty member will regularly monitor the student's work.
• The research partnership development project must be conducted by the individual graduate student or be a well-defined portion(s) of a larger research effort currently being conducted by a faculty member. If the project is part of a larger research partnership-building effort, the proposal must clearly distinguish between the student's portion and the activities of the larger research project. The graduate student must have primary responsibility for the proposed research efforts described in the application.
• The graduate student must begin to forge a research partnership with a Head Start or Early Head Start program. While one of the long-term purposes of the relationship should be to generate a doctoral dissertation research opportunity in the Head Start setting, the student should take an approach that is based in community/ecological/empowerment models, in which research needs are considered in the larger context of program needs, as well as mutually beneficial and empowering relationships. Appropriate activities during the grant period may include, but are not limited to, providing direct services and assistance to Head Start or Early Head Start programs with program activities, conducting assets/needs assessments, conducting focus groups, jointly identifying or defining problems with Head Start partners, training staff and other activities that foster collaborative, reciprocal relationships with Head Start partners.
• Graduate students will be expected to identify (a) a set of goals and objectives for the year, as well as a set of benchmarks for guiding and assessing incremental progress toward attaining these goals and objectives, and (b) specific
• Grant recipients are encouraged to build upon their work by subsequently applying for the Head Start Graduate Student Research Grants (Priority 1.01) to support doctoral dissertation research.
• The application must contain (A) a letter from at least one Head Start or Early Head Start program certifying that they are receptive to exploring a potential research partnership with the applicant and (B) a separate letter
• The graduate student applicant must agree to attend the annual meeting for all Head Start Graduate Student Research grantees. This annual grantee meeting is typically scheduled during the summer or fall of each year and is held in Washington, DC. The fall 2003 meeting will be held Oct. 20-21, 2003. During this meeting, each student typically presents a brief overview of his or her study or proposed project. The intended goal of the meeting is to stimulate potentially useful and constructive feedback from other students and mentors, as well as to facilitate collaboration, networking and mentoring activities. The grant budget should reflect travel and housing funds for the graduate student for this meeting.
• Due to the small amount of the grant, the applicant's institution is strongly encouraged to waive indirect costs.
• Contact information, including phone numbers, addresses and e-mail addresses, for
• The graduate student must write the application, consistent with the format and style guidelines of the
CRITERIA for Priority Area 1.02—Head Start Graduate Student Research Partnership Development Grants—The three criteria that follow will be used to review and evaluate each application under this priority area. Address each in the Project Narrative Section of the application (presented here in descending order of numerical weighting—see instructions in Appendix 2). The point values indicate the maximum numerical weight each criterion will be accorded in the review process. (100 points total).
• The extent to which there is a discrete project designed by the graduate student. If the proposed project is part of a larger project designed by others, the approach section should clearly delineate the research partnership development component to be carried out by the student and how it is distinguished from the larger project.
• The extent to which the goals and objectives of the proposed activities, as well as the set of benchmarks for guiding and assessing progress, are clearly articulated and reflect an appropriate understanding of how these activities will fit within the context and complexities of the Head Start program's operations.
• The scope of the project is reasonable for the funds available and feasible for the time frame specified.
• The extent to which the planned approach or proposed research partnership activities reflect sufficient opportunities for written input from and an active partnership with the Head Start program (including the separate required review and written approval of the proposed partnership activities from the Head Start program and the Head Start Program Policy Council).
• The extent to which the budget and budget justification are appropriate for carrying out the proposed research project development activities.
• The extent to which proposed products reflect concrete and measurable steps toward design of a future dissertation project.
• The extent to which the faculty mentor and graduate student possess the expertise necessary to successfully form a research partnership with a Head Start program as demonstrated in the application and information contained in their vitae.
• The principal investigator/faculty mentor has earned a doctorate or equivalent in the relevant field and has first or second author publications in major research journals.
• The extent to which the faculty mentor and graduate student reflect an understanding of and sensitivity to the issues of working in a community setting and in a reciprocal partnership with Head Start program staff and parents.
• The adequacy of the time devoted to this project by the faculty mentor for mentoring the graduate student. The proposal should include evidence of the faculty mentor's commitment to mentoring the individual graduate student, and as appropriate, willingness to serve as a resource to the broader group of Head Start Graduate Students funded under this award.
• The extent to which the mentor-mentee relationship is clearly described and has the potential to continue throughout the student's dissertation process.
• The presentation reflects original work done by the student (consistent with the general principles and guidelines of the
• The extent to which the literature review, as well as a description of the needs of the local community if appropriate, is current and comprehensive and supports the need for developing this or similar research partnerships.
• The extent to which proposed goals and objectives for the year address the needs identified.
• The extent to which the specific
• The extent to which the literature review has a complete set of reference citations and is written consistent with the guidelines of the
• The extent to which the proposed project is appropriate to the student's level of ability and the stated time frame for completing the project.
• The extent to which potential research questions are clearly stated and are of importance and relevance for low-income children's development and welfare.
Clarity and conciseness are of utmost importance. ACF strongly encourages applicants to limit their applications to 100 pages, double-spaced and single-sided, with standard one-inch margins and 12 point fonts. This includes the entire Project Narrative Statement including text, tables, charts, graphs, resumes, corporate statements and appendices.
Applicants are cautioned to include all required forms and materials, organized according to the required format. The application packet must include the following items in order:
1. A cover letter that includes the announcement number, priority area and contact information.
2. Standard Federal Forms
a. Standard Form 424, “Application for Federal Assistance.” This form must be completed, signed, and included with the application.
b. Standard Form 424A, “Budget Information—Non-Construction Programs.” This form must be completed and included with the application.
c. Standard Form 424B, “Assurances: Non-Construction Programs.” This form must be completed, signed, and included with the application.
d. Assurance/Identification/Certification/Declaration Regarding Protection of Human Subjects. This form must be completed, signed, and included with the application.
e. Certifications Regarding Lobbying. Applicants must provide a certification regarding lobbying when applying for an award in excess of $100,000. Applicants must sign and return the certification with their applications.
f. Standard Form LLL, “Disclosure of Lobbying Activities.” Applicants must disclose lobbying activities when applying for an award in excess of $100,000. Applicants who have used non-Federal funds for lobbying activities in connection with receiving assistance under this announcement shall complete a disclosure form to report lobbying. Applicants must sign and return the disclosure form, if applicable, with their applications.
g. Certification Regarding Drug-Free Workplace Requirements. Applicants must make the appropriate certification of their compliance with the Drug-Free Workplace Act of 1988. By signing and submitting the application, the applicant is providing the certification and need not mail back the certification with the application.
h. Certification Regarding Debarment, Suspension, and Other Responsibility Matters. Applicants must make the appropriate certification that they are not presently debarred, suspended, or otherwise ineligible for an award. By signing and submitting the application, the applicant is providing the certification and need not mail back the certification with the application.
i. Certification Regarding Environmental Tobacco Smoke. Applicants must make the appropriate certification of their compliance. By signing and submitting the application, the applicant is providing the certification and need not mail back the certification with the application.
3. For-profit entities wishing to receive a grant directly must provide a letter indicating their willingness to waive their profit. Non-profit organizations must submit proof of non-profit status in the application at the time of submission. The applicant can demonstrate proof of non-profit status in any one of five ways, by providing:
a. A copy of the organization's listing in the Internal Revenue Service's (IRS) most recent list of tax-exempt organizations described in Section 501(c3) of the IRS code;
b. A copy of the currently valid IRS tax exemption certificate;
c. A statement from a State taxing body, State attorney general, or other appropriate State official certifying that the applicant organization has a non-profit status and that none of the net earnings accrue to any private shareholders or individuals;
d. A certified copy of the organization's certificate of incorporation or similar document that clearly establishes non-profit status.
e. Any of the items in the subparagraphs immediately above for a State or national parent organization and a statement signed by the parent organization that the applicant organization is a local non-profit affiliate.
Private, non-profit institutions are encouraged to submit with their applications the optional survey located under “Grant Manuals & Forms” at
4. Administrative requirements: 45 CFR Parts 74 and 92.
5. Executive Order 12372—Single Point of Contact
This program is covered under Executive Order 12372, “Intergovernmental Review of Federal Programs”, and 45 CFR part 100, “Intergovernmental Review of Department of Health and Human Services Program and Activities”. Under the Order, States may design their own processes for reviewing and commenting on proposed Federal assistance under covered programs.
All States and Territories except Alabama, Alaska, Arizona, Colorado, Connecticut, Hawaii, Idaho, Indiana, Kansas, Louisiana, Massachusetts, Minnesota, Montana, Nebraska, New Jersey, Ohio, Oklahoma, Oregon, Pennsylvania, South Dakota, Tennessee, Vermont, Virginia, Washington, and Wyoming have elected to participate in the Executive Order process and have established Single Points of Contact (SPOCs). Applicants from these twenty-six jurisdictions need take no action regarding E.O. 12372. Applicants for projects to be administered by Federally-recognized Indian Tribes are also exempt from the requirements of E.O. 12372. Otherwise, applicants should contact their SPOCs as soon as possible to alert them of the prospective applications and receive any necessary instructions. Applicants must submit any required material to the SPOCs as soon as possible so that the program office can obtain and review SPOC comments as part of the award process. It is imperative that the applicant submit all required materials, if any, to the SPOC and indicate the date of this submittal (or the date of contact if no submittal is required) on the Standard Form 424, item 16a.
Under 45 CFR 100.8(a)(2), a SPOC has 60 days from the application deadline to comment on proposed new or competing continuation awards.
SPOCs are encouraged to eliminate the submission of routine endorsements as official recommendations.
Additionally, SPOCs are requested to clearly differentiate between mere advisory comments and those official State process recommendations which may trigger the accommodation or explain rule.
When comments are submitted directly to ACF, they should be addressed to: William Wilson, ACYF's Office of Grants Management, Room 2220 Switzer Building, 330 C Street SW., Washington, DC 20447, Attn: Head Start Discretionary Research Grants Announcement. A list of the Single Points of Contact (SPOCs) for each State and Territory can be found on the following web site:
5. Table of Contents
6. Project Abstract (not to exceed one page) for use in official briefings, decision packages, and public announcement of awards.
7. Project Narrative Statement (
8.
a. Contact Information for all Key Staff
b. Resumes
c. Letters of Support, if appropriate
d. Other
9.
The project description provides a major means by which an application is evaluated and ranked to compete with other applications for available assistance. The project description should be concise and complete and should address the activity for which Federal funds are being requested. Supporting documents should be included where they can present information clearly and succinctly. In preparing your project description, all information requested through each specific evaluation criteria should be provided. Awarding offices use this and other information in making their funding recommendations. It is important, therefore, that this information be included in the application.
ACF is particularly interested in specific factual information and statements of measurable goals in quantitative terms. Project descriptions are evaluated on the basis of substance, not length. Extensive exhibits are not required. Cross-referencing should be used rather than repetition. Supporting information concerning activities that will not be directly funded by the grant or information that does not directly pertain to an integral part of the grant-funded activity should be placed in an appendix.
Pages should be numbered and a table of contents should be included for easy reference.
Applicants required to submit a full project description shall prepare the project description statement in accordance with the following instructions and the specified evaluation criteria. The instructions give a broad overview of what your project description should include while the evaluation criteria expands and clarifies more program-specific information that is needed.
Provide a summary of the project description (a page or less) with reference to the funding request.
Clearly identify the physical, economic, social, financial, institutional, and/or other problem(s) requiring a solution. The need for assistance must be demonstrated and the principal and subordinate objectives of the project must be clearly stated; supporting documentation, such as letters of support and testimonials from concerned interests other than the applicant, may be included. Any relevant data based on planning studies should be included or referred to in the endnotes/footnotes. Incorporate demographic data and participant/beneficiary information, as needed. In developing the project description, the applicant may volunteer or be requested to provide information on the total range of projects currently being conducted and supported (or to be initiated), some of which may be outside the scope of the program announcement.
Outline a plan of action which describes the scope and detail of how the proposed work will be accomplished. Account for all functions or activities identified in the application. Cite factors which might accelerate or decelerate the work and state your reason for taking the proposed approach rather than others. Describe any unusual features of the project such as design or technological innovations, reductions in cost or time, or extraordinary social and community involvement.
Provide quantitative monthly or quarterly projections of the accomplishments to be achieved for each function or activity in such terms as the number of people to be served and the number of activities accomplished. When accomplishments cannot be quantified by activity or function, list them in chronological order to show the schedule of accomplishments and their target dates.
If any data is to be collected, maintained, and/or disseminated, clearance may be required from the U.S. Office of Management and Budget (OMB). This clearance pertains to any “collection of information that is conducted or sponsored by ACF.”
List organizations, cooperating entities, consultants, or other key individuals who will work on the project along with a short description of the nature of their effort or contribution.
Provide a narrative addressing how the results of the project and the conduct of the project will be evaluated. In addressing the evaluation of results, state how you will determine the extent to which the project has achieved its stated objectives and the extent to which the accomplishment of objectives can be attributed to the project. Discuss the criteria to be used to evaluate results, and explain the methodology that will be used to determine if the needs identified and discussed are being met and if the project results and benefits are being achieved. With respect to the conduct of the project, define the procedures to be employed to determine whether the project is being conducted in a manner consistent with the work plan presented and discuss the impact of the project's various activities on the project's effectiveness.
Following are requests for additional information that need to be included in the application:
Provide a biographical sketch for each key person appointed and a job description for each vacant key position. A biographical sketch will also be required for new key staff as appointed.
Provide information on the applicant organization(s) and cooperating partners such as organizational charts, financial statements, audit reports or statements from CPAs/Licensed Public Accountants, Employer Identification Numbers, names of bond carriers, contact persons and telephone numbers, child care licenses and other documentation of professional accreditation, information on compliance with Federal/State/local government standards, documentation of experience in the program area, and other pertinent information. Any non-profit organization submitting an application must submit proof of its non-profit status in its application at the time of submission.
The non-profit agency can accomplish this by providing a copy of the applicant's listing in the Internal Revenue Service's (IRS) most recent list of tax-exempt organizations described in Section 501(c)(3) of the IRS code, or by providing a copy of the currently valid IRS tax exemption certificate, or by providing a copy of the articles of incorporation bearing the seal of the State in which the corporation or association is domiciled.
Provide statements from community, public and commercial leaders that
Provide line item detail and detailed calculations for each budget object class identified on the Budget Information form. Detailed calculations must include estimation methods, quantities, unit costs, and other similar quantitative detail sufficient for the calculation to be duplicated. The detailed budget must also include a breakout by the funding sources identified in Block 15 of the SF-424.
Provide a narrative budget justification that describes how the categorical costs are derived. Discuss the necessity, reasonableness, and allocability of the proposed costs.
The following guidelines are for preparing the budget and budget justification. Both Federal and non-Federal resources shall be detailed and justified in the budget and narrative justification. For purposes of preparing the budget and budget justification, “Federal resources” refers only to the ACF grant for which you are applying. Non-Federal resources are all other resources. It is suggested that budget amounts and computations be presented in a columnar format: first column, object class categories; second column, Federal budget; next column(s), non-Federal budget(s), and last column, total budget. The budget justification should be a narrative.
Whenever the applicant intends to delegate part of the project to another agency, the applicant must provide a detailed budget and budget narrative for each delegate agency, by agency title, along with the required supporting information referred to in these instructions.
Enter the total of all other costs. Such costs, where applicable and appropriate, may include but are not limited to insurance, food, medical and dental costs (noncontractual), professional services costs, space and equipment rentals, printing and publication, computer use, training costs, such as tuition and stipends, staff development costs, and administrative costs.
Food and Drug Administration, HHS.
Notice.
The Food and Drug Administration (FDA) is announcing that the proposed collection of information listed below has been submitted to the Office of Management and Budget (OMB) for review and clearance under the Paperwork Reduction Act of 1995.
Fax written comments on the collection of information by August 11, 2003.
OMB is still experiencing significant delays in the regular mail, including first class and express mail, and messenger deliveries are not being accepted. To ensure that comments on the information collection are received, OMB recommends that written comments be faxed to the Office of Information and Regulatory Affairs, OMB, Attn: Fumie Yokota, Desk Officer for FDA, FAX: 202-395-6974.
Karen L. Nelson, Office of Management Programs (HFA-250), Food and Drug Administration, 5600 Fishers Lane, Rockville, MD 20857, 301-827-1482.
In compliance with 44 U.S.C. 3507, FDA has submitted the following proposed collection of information to OMB for review and clearance.
FDA is requesting OMB approval for the reporting and recordkeeping requirements contained in the survey entitled “Impact of Risk Management Programs on the Practice of Pharmacy.”
Risk management (RM) programs are reviewed by divisions in the Center for Drug Evaluation and Research (CDER) as part of the new drug application (NDA) review process as well as during the postmarketing period. In an effort to address safety risks associated with drug therapy, several RM programs have been implemented (for example, for clozapine, thalidomide, and bosentan). Many RM programs require pharmacists to actively intervene and implement actions that deviate from their normal work procedures. Currently, the impact of RM programs on the practice of pharmacy in terms of pharmacists' compliance, knowledge, burden, and barriers is not known.
The survey is a small investigator-initiated research project to improve science safety review within CDER. The research is intended to help FDA safety evaluators of drug adverse events understand the larger context of RM programs and how they are perceived and implemented by pharmacists. The study is independent from the Prescription Drug User Fee Act III guidance that is currently under development on RM.
The descriptive survey will be sent to a representative sampling of pharmacists in the United States. Approximately 5,000 pharmacists will be chosen at random from listings of licensed pharmacists obtained from participating U.S. State Boards of Pharmacy. Because the number of licensed pharmacists in each State varies and the number of respondents from each State cannot be predicted, either a simple random or a stratified sample design will be used, depending on whether there is a sufficient number of participating pharmacists to evaluate regional differences. The geographic regions will be classified by location in one of the four geographic regions of the United States corresponding to those used by the U.S. Bureau of Census (northeast, midwest, south, and west).
The survey will be conducted via first-class mail. The survey will be mailed with a cover letter to randomly chosen pharmacists along with a preaddressed, stamped return envelope. To ensure anonymity and confidentiality, no premarkings or numbering systems will be recorded on the survey or return envelope.
From the sample size of approximately 5,000 pharmacists, the desirable response rate is approximately 75 to 85 percent. If needed, actions will be taken to increase the response rate, such as resending the survey approximately 2 weeks after the initial mailing.
In the
Concerning the issue of sampling methodology, the comment said that the primary focus of the survey should be on community pharmacists who are most likely to dispense medications associated with RM programs.
FDA believes that RM programs may affect pharmacists in all practice settings; during drug dispensing, answering drug information questions, and/or monitoring drug therapy. For this reason, the primary focus of the survey is not on community pharmacists. However, FDA will analyze responses according to pharmacy practice settings (for example, retail, hospital, and long-term care).
The comment said that the sampling frame should be stratified to obtain an equal distribution of pharmacists working in chain versus independent pharmacies.
FDA notes that the primary objective of the survey is not to compare the responses between chain and independent pharmacies. In addition, because the sampling frame does not include the setting information in which the pharmacist works, the agency cannot stratify the sampling frame. However, the survey contains a question regarding the practice setting of surveyed pharmacists and FDA intends to analyze this data.
The comment said that the survey should be accompanied by an explanation or incentive that provides a compelling reason for a pharmacist to complete it.
FDA believes that the cover letter that will accompany the survey will accomplish this suggestion because the cover letter will explain what the survey is about and that it is intended to gain insight from a pharmacist's point of view. The comment said that the sampling size should be reduced.
The survey's sample size was selected by FDA based on a consideration of response rate and cost. FDA is also concerned about the possibility that a large number of pharmacists in the sample may not have encountered RM programs. The agency believes that in a sample size of 5,000, sufficient responses may be received to gain some insight about pharmacists' experiences in dispensing drugs.
Concerning the enhancement of response rates, the comment said that a cover letter explaining why it is important for selected respondents to participate would result in a greater likelihood that sample pharmacists will participate. The letter should include an offer to send a report of the results directly to the respondent and assurance that the responses will be kept confidential.
FDA notes that a cover letter will be included with the survey explaining why the selected respondents should participate. The letter will state that the surveys are not marked and that the respondents are not identifiable. FDA intends to post the results of the survey on FDA's Web site at:
The comment suggested that disclosures be included on the outside envelope that will make the survey mailing “stand out” from the clutter of other mailings.
FDA intends to include FDA's logo on the outside envelope along with a stamped message (for example, “Important”).
The comment said that a more comprehensive followup plan would result in greater participation.
FDA plans to send two mailings of the same survey to the selected pharmacists. A reminder postcard will be sent between these two mailings to inform the pharmacists that the second mailing will be arriving soon. The reminder postcard will also state that if the survey has already been completed and returned to FDA, the second mailing should be disregarded.
Concerning the enhancement of the quality, utility, and clarity of the information, the comment said that the survey should be revised to include questions about what educational programs might be helpful in facilitating compliance with RM programs.
FDA agrees that educating patients and health care professionals about drug risks is an important component of RM programs. The survey contains questions about existing communication tools (for example, medication guides, dear health professional letters, drug educational material), barriers to compliance, and the ways to improve this communication.
The comment said that question number 20 of the survey should be revised to measure barriers to compliance through the inclusion of: (1) A new section heading and introductory sentence or two to clarify the scope of the queries, and (2) a change to the format that would allow indication of the severity of the problem.
FDA has added self-explanatory section headings to the survey. Because the agency would consider the identification of any barrier to compliance significant, categorizing the severity of the problem would be unnecessary.
The comment said that the survey should include questions that examine the impact on the practice of pharmacy of any of the three different RM components examined (use of special prescription stickers, dear health care professional/pharmacist letters, labeling/patient information/medication guides), because this is the stated goal of the research.
FDA has added a question to the survey specifically addressing the impact of RM programs on the practice of pharmacy. In addition, the format of the question is open-ended so that the response would not be restricted in any way.
FDA estimates that it will take each pharmacist approximately 20 minutes to respond to the survey and return it to FDA.
The burden of this collection of information is estimated as follows:
Food and Drug Administration, HHS.
Notice.
The Food and Drug Administration (FDA) is providing notice that in 2001 it approved a supplemental abbreviated new animal drug application (ANADA) filed by Phoenix Scientific, Inc. The supplemental ANADA provided for topical use of an ivermectin solution on cattle for control of certain internal parasites for 14 days after treatment. The applicable section of the regulation did not require amendment.
Lonnie W. Luther, Center for Veterinary Medicine (HFV-104), Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855, 301-827-8549, e-mail:
In accordance with section 512(i) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360b(i)) and 21 CFR 514.105(a) and 514.106(a), FDA is providing notice that in 2001 it approved a supplemental ANADA that was not the subject of a final rule. A final rule was not published because § 524.1193 (21 CFR 524.1193) did not require amendment.
On May 16, 2001, FDA approved a supplement filed by Phoenix Scientific, Inc., 3915 South 48th St. Terrace, St. Joseph, MO 64503, to ANADA 200-219 for PHOENECTIN (ivermectin) Pour-On. The supplemental ANADA provided for topical use of a 0.5 percent ivermectin solution on cattle for control of infections of
A freedom of information summary containing approved product labeling may be seen in the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852, between 9 a.m. and 4 p.m., Monday through Friday.
Food and Drug Administration, HHS.
Notice of eligibility; request for data and information.
The Food and Drug Administration (FDA) is announcing a call-for-data for safety and effectiveness information on the following conditions as part of FDA's ongoing review of over-the-counter (OTC) drug products: Amiloxate (isoamyl p-methoxycinnamate), up to 10 percent, as a sunscreen single active ingredient and in combination with other sunscreen active ingredients; enzacamene (methyl benzylidene camphor), up to 4 percent, as a sunscreen single active ingredient and in combination with other sunscreen active ingredients; and octyl triazone, up to 5 percent, as a sunscreen single active ingredient and in combination with other sunscreen active ingredients. FDA has reviewed time and extent applications (TEAs) for these conditions and determined that they are eligible for consideration in it's OTC drug monograph system. FDA will evaluate the submitted data and information to determine whether these conditions can be generally recognized as safe and effective (GRAS/E) for their proposed OTC use.
Submit data, information, and general comments by October 9, 2003.
Submit written comments, data, and information to the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852. Submit electronic comments, data, and information to
Matthew R. Holman, Center for Drug Evaluation and Research (HFD-560), Food and Drug Administration, 5600 Fishers Lane, Rockville, MD 20857, 301-827-2222.
In the
Sponsors must provide specific data and information in a TEA to demonstrate that the condition has been marketed for a material time and to a material extent to become eligible for consideration in the OTC drug monograph system. When the condition is found eligible, FDA publishes a notice of eligibility and request for safety and effectiveness data for the proposed OTC use. The TEAs that the agency reviewed (Refs. 1, 2, and 3) and FDA's evaluation of the TEAs (Refs. 4, 5, and 6) have been placed on public display in the Division of Dockets Management (see
The conditions amiloxate, up to 10 percent; enzacamene, up to 4 percent; and octyl triazone, up to 5 percent, as sunscreen single active ingredients and in combination with other existing monograph sunscreen active ingredients will be evaluated for inclusion in the monograph for OTC sunscreen drug products (21 CFR part 352). Accordingly, FDA invites all interested persons to submit data and information, as described in § 330.14(f), on the safety and effectiveness of these single active ingredients for FDA to determine whether they can be GRAS/E and not misbranded under recommended conditions of OTC use. Additional data (from human clinical studies) should be included to establish the safety and effectiveness of combination sunscreen drug products containing amiloxate, enzacamene, or octyl triazone with other existing sunscreen monograph active ingredients.
Interested persons should submit comments, data, and information to the Divison of Dockets Management (see
Under § 330.14(h), any product containing the condition for which data and information are requested may not be marketed as an OTC drug in the United States at this time unless it is the subject of an approved new drug application or abbreviated new drug application.
The following references are on display in the Division of Dockets Management (see
1. TEA for amiloxate (isoamyl p-methoxycinnamate) submitted by Haarmann & Reimer Corp. dated August 14, 2002.
2. TEA for enzacamene (methyl benzylidene camphor) submitted by
3. TEA for octyl triazone submitted by Morgan, Lewis & Bockius LLP on behalf of BASF AG dated August 21, 2002.
4. FDA's evaluation and comments on the TEA for amiloxate.
5. FDA's evaluation and comments on the TEA for enzacamene.
6. FDA's evaluation and comments on the TEA for octyl triazone.
Food and Drug Administration, HHS.
Notice.
The Food and Drug Administration (FDA) is announcing the availability of the report of its Task Force on Consumer Health Information for Better Nutrition (the Task force) and two final guidance documents entitled “Guidance for Industry and FDA: Interim Evidence-Based Ranking System for Scientific Data” and “Guidance for Industry and FDA: Interim Procedures for Health Claims in the Labeling of Conventional Human Food and Human Dietary Supplements.” These documents further update the agency's approach on how it intends to implement the Court of Appeals decision in
The guidances are final on July 11, 2003. However, you may submit written or electronic comments on the guidances at any time.
Submit written requests for single copies of the Task Force report and the final guidances to the Office of Nutritional Products, Labeling, and Dietary Supplements (HFS-800), Food and Drug Administration, 5100 Paint Branch Pkwy., College Park, MD 20740. Send one self-addressed adhesive label to assist that office in processing your request. See the
Submit written comments on the final guidances to the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852. Please identify whether you are commenting on one or both of the guidances when you submit your written comments. Submit electronic comments to
Kathleen Ellwood, Office of Nutritional Products, Labeling, and Dietary Supplements (HFS-800), Food and Drug Administration, 5100 Paint Branch Pkwy., College Park, MD 20740, 301-436-1450.
On December 18, 2002, FDA announced a major new initiative, the Consumer Health Information for Better Nutrition Initiative, to make available more and better information about conventional human food and human dietary supplements to help American consumers improve their health and prevent diseases by making sound dietary decisions. This initiative has as its central focus improving the public availability and consumer understanding of up-to-date scientific evidence on how dietary choices can affect health. FDA announced on January 16, 2003, that one element of this initiative was to set up an FDA Task Force and to issue a report of that Task Force approximately 6 months after the initiative was launched. The Task Force includes representatives from FDA, the Federal Trade Commission (FTC), and the National Institutes of Health.
The Task Force was charged with: (1) Reporting on how the agency can improve consumer understanding of the health consequences of their dietary choices and increase competition by product developers in support of healthier diets, including how the agency should evaluate scientific evidence for qualified health claims in order to achieve these goals; (2) developing a framework of regulations that will give these principles the force and the effect of law; (3) identifying procedures for implementing the initiative, as well as determining the organizational staffing needs necessary for the timely review of qualified health claim petitions; and (4) developing a consumer studies research agenda designed to identify the most effective ways to present scientifically-based, truthful and nonmisleading information to consumers and to identify the kinds of information known to be misleading to consumers.
On March 13, 2003, the Task Force established a public docket (docket number 2003N-0069) to receive views and comments from interested stakeholders. As part of FDA's continued commitment to ensure that stakeholders remain fully informed of our progress as we implement this initiative, FDA is making available the Task Force report, which includes nine attachments (Attachments A through I). Refer to section II of this document for a brief description of the attachments. The Task Force report entitled “Consumer Health Information for Better Nutrition Initiative—Task Force Report—July 2003” is available on FDA's Web sites at
The Task Force report includes a transmittal memorandum from the Chair and Vice Chair of the Task Force to the Commissioner of Food and Drugs, an executive summary, and the following attachments:
This attachment describes three options or alternatives for regulating health claims that do not meet the “significant scientific agreement” standard of evidence by which the health claims regulations require FDA to evaluate the scientific validity of claims.
This interim evidence-based ranking system describes a process for systematically evaluating the scientific evidence relevant to a substance/disease relationship that is the subject of a petition for a qualified health claim. The scientific rating system provides a means by which the totality of the publicly available scientific evidence relevant to a substance/disease
This attachment describes a process to augment the agency's limited scientific review resources on an as-needed basis by using outside contractors.
This attachment sets forth the consumer research studies planned, pending Office of Management and Budget (OMB) approval, to provide the agency with information about consumers' reactions to qualified health claims.
This attachment describes the interim procedures for qualified health claims in the labeling of conventional human food and human dietary supplements.
This attachment consolidates the main activities for June 30, 2003, through June 1, 2004.
The Task Force report also contains the list of the Task Force members, a summary of the four stakeholder meetings the Task Force held, and a summary of public comments submitted to the docket on this initiative (see Task Force report attachments G, H, and I, respectively).
After the enactment of the Nutrition Labeling and Education Act of 1990 (NLEA), FDA issued regulations establishing general requirements for health claims in food labeling (58 FR 2478, January 6, 1993 (conventional foods); 59 FR 395, January 4, 1994 (dietary supplements)). By regulation, FDA adopted the same procedure and standard for health claims in dietary supplement labeling that Congress had prescribed in the NLEA for health claims in the labeling of conventional foods (see 21 U.S.C. 343(r)(3) and (r)(4)). The procedure requires the evidence supporting a health claim to be presented to FDA for review before the claim may appear in labeling (§ 101.14(d) and (e) (21 CFR 101.14(d) and (e) and 101.70)). The standard requires a finding of “significant scientific agreement” (SSA) before FDA may authorize a health claim by regulation (§ 101.14(c)). FDA's current regulations, which mirror the statutory language in 21 U.S.C. 343(r)(3)(B)(i), provide that this standard is met only if FDA determines that there is SSA, among experts qualified by scientific training and experience to evaluate such claims; and that the claim is supported by the totality of publicly available scientific evidence, including evidence from well-designed studies conducted in a manner that is consistent with generally recognized scientific procedures and principles (§ 101.14(c)). Without a regulation authorizing use of a particular health claim, a food bearing the claim is subject to regulatory action as a misbranded food (see 21 U.S.C. 343(r)(1)(B)), a misbranded drug (see 21 U.S.C. 352(f)(1)), and an unapproved new drug (see 21 U.S.C. 355(a)).
NLEA required that FDA itself initially consider health claims for 10 substance/disease relationships. FDA determined that there was SSA concerning a number of these specified substance/disease relationships and in turn authorized eight claims. Not all relationships that Congress specified to be reviewed were found to meet the standard of SSA, and so not all were authorized by FDA.
Several of the substance/disease relationships for which FDA failed to find significant scientific agreement became the subject of a lawsuit brought by a dietary supplement manufacturer. The case is known as
The court of appeals further stated that it did not “rule out the possibility that where evidence in support of a claim is outweighed by evidence against the claim, the FDA could deem it incurable by a disclaimer and ban it outright.” (Id. at 659.) Also, the court saw “no problem with the FDA imposing an outright ban on a claim where evidence in support of the claim is qualitatively weaker than the evidence against the claim.” (Id. at 659 and n.10.) This language was the genesis of the “weight-of-the evidence” criterion discussed in this document.
In the
As discussed previously, on December 18, 2002, FDA announced the Consumer Health for Better Nutrition Initiative to encourage the flow of high quality, science-based information regarding the health benefits of conventional foods and dietary supplements to consumers. In the
Six days after publication of the December 20, 2002, notice and the guidance, the U.S. District Court for the District of Columbia issued its decision in
The reason for the decision to apply
The decision announced in the December 2002 notice was also based on a desire to avoid further litigation over the constitutionality of the health claims provisions of the NLEA applicable to conventional food labeling to the extent that these provisions do not permit qualified claims. As explained previously, the appeals court held that, on the administrative record compiled in the challenged rulemakings, the first amendment does not permit FDA to reject health claims that the agency determines to be potentially misleading unless the agency also reasonably determines that no disclaimer would eliminate the potential deception. The agency, however, did not have any consumer data to show that a disclaimer would not eliminate the potential deception.
In the interim, FDA intends to use the procedures and evidence-based ranking systems for scientific data set out in the below-described guidances on these matters, and consider the exercise of enforcement discretion on a case-by-case basis with respect to qualified health claims in conventional human food and human dietary supplement labeling under certain circumstances. (See
FDA believes that its interim approach to qualified claims is a reasonable effort to combine the spirit of the NLEA with the current public health and legal circumstances, and one that reflects practical common sense. And, as the Court of Appeals for the District of Columbia Circuit observed in
This interim evidence-based ranking system describes a process for systematically evaluating the scientific evidence relevant to a substance/disease relationship that is the subject of a petition for a qualified health claim. The scientific rating system provides a means by which the totality of the publicly available scientific evidence relevant to a substance/disease relationship can be assigned to one of four ranked levels. The evidence-based ranking system presupposes that FTC's requirement of “competent and reliable scientific evidence” to substantiate an advertising claim related to health or safety has been met. FTC defines “competent and reliable scientific evidence” as “tests, analyses, research, studies, or other evidence” based upon the expertise of professionals in the relevant area, that has been “conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted” in the profession to “yield accurate and reliable results.”
FDA intends to use these interim procedures, beginning in September 2003, for qualified health claims in the labeling of conventional human food and human dietary supplements. See the
Consistent with GGPs, the agency will accept comment, but it is implementing these guidance documents immediately in accordance with section 10.115(g)(2) because the agency has determined that prior public participation is not feasible or appropriate. FDA tentatively concludes that the guidances contain no new collection of information. Therefore, clearance by OMB under the Paperwork Reduction Act of 1995 is not required.
Interested persons may submit to the Division of Dockets Management (see
Interested persons may also access the guidance documents at
FDA emphasizes that it intends to use the evidence-based ranking system and the procedures on an interim basis. In the near future, the agency intends to publish an advance notice of proposed
Health Resources and Services Administration, HHS.
Notice of availability of funds.
The Health Resources and Services Administration (HRSA) announces the availability of up to $2,100,000 to support costs associated with the operation of a practice management or managed care network or plan, including the purchase or lease of equipment (including the costs of amortizing the principal of, and paying the interest on, loans for equipment).
The intended time lines for application submission, review, and award are as follows:
Applications will be considered on time if they are: (1) received by 5 p.m. Eastern Standard Time on August 11, 2003; or (2) postmarked on or before the deadline date given in the
When contacting the HRSA GAC please use the following program announcement when requesting application materials: HRSA-03-105, citing “Operational Health Center Networks.” Send the original and two copies of the application to the HRSA GAC. Applicants will receive a letter acknowledging the receipt of their application.
1. A health center, as defined and funded under section 330 of the Public Health Service Act, acting on behalf of the member health centers and the network.
(A) A health center applying on behalf of a managed care network or plan must have received Federal grants under subsection (e)(1)(A) of section 330 for at least the two consecutive preceding years.
(B) A health center (Community Health Center, Migrant Health Center, Health Care for the Homeless, Public Housing Primary Care and Healthy Schools, Healthy Communities) applying on behalf of a practice management network must have received Federal grants under section 330 for at least the two consecutive preceding years.
2. Operational networks, controlled by and acting on behalf of the health center(s) as defined and funded under section 330 of the Public Health Service Act. At the request of all the member health centers, a network may apply for direct funds if it is at least majority controlled and, as applicable, at least majority owned, by such health centers.
3. Eligibility is limited to public and non-profit organizations, including faith-based and community organizations.
1. Appropriateness in meeting expectations of the Integrated Shared Development Initiative—extent to which the application effectively demonstrates the integration and coordination of primary care across business and clinical functions of network members.
2. Appropriateness to State Environment and Marketplace—extent to which the application demonstrates both the (a) appropriateness of the network to the State marketplace and/or
3. Strength of Collaboration—extent to which commitment (as evidenced by the contribution of time, resources, cash,
4. Network Operation: Core Strength and Competencies—extent to which the network design is suited to the organizational/administrative capacity of the network members based on operational history of the network.
5. Capacity of the Network to Support Shared/Integrated Operations—extent to which network members have shared and/or integrated functions or components of their systems.
1. A copy of the face page of the application (SF 424) and
2. A summary of the project, not to exceed one page, which provides:
a. A description of the population to be served,
b. A summary of the services to be provided, and
c. A description of the coordination planned with the appropriate State and local health agencies.
Indian Health Service, HHS.
Request for public comment: 30-day proposed information collection: Indian Health Service Contract Health Service Purchase-Delivery Order for Health Service.
The Indian Health Service, as part of its continuing effort to reduce paperwork and respondent burden, conducts a pre-clearance consultation program to provide the general public and Federal agencies with an opportunity to comment on proposed and/or continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3506(c)(2)(A)). This program helps to ensure that requested data can be provided in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the impact of collection requirements on respondents can be properly assessed. As required by section 3507(a)(1)(D) of the Act, the proposed information collection has been submitted to the Office of Management and Budget (OMB) for review and approval.
The IHS received no comments in response to the 60-day
The table below provides the following: types of data collection instructions, estimated number of respondents, number of responses per respondent, annual number of responses, average burden hour per response, and total annual burden hours.
There are no Capital Costs, Operating Costs and/or Maintenance Costs to report.
For information on the proposed data collection instrument and/or the process for handling the form IHS-843-1A, please contact Mr. Clayton Old Elk, 801 Thompson Avenue, Suite 300, Rockville, MD 20852-1627, Telephone 301-443-2694.
Substance Abuse and Mental Health Services Administration, HHS.
Notice of funding availability for a Supplement to Expand the Cooperative Agreement for the National Center for Child Traumatic Stress (NCCTS)
The Substance Abuse and Mental Health Services Administration (SAMHSA), Center for Mental Health Services (CMHS), announces the availability of FY 2003 funds for the cooperative agreement described below. A synopsis of this funding opportunity, as well as many other Federal Government funding opportunities, is also available at the Internet site:
This notice is not a complete description of the program; potential applicants must obtain a copy of the Request for Applications (RFA), including Part I, Supplement to Expand the Cooperative Agreement for the National Center for Child Traumatic Stress (NCCTS), Part II, General Policies and Procedures Applicable to all SAMHSA applications for Discretionary Grants and Cooperative Agreements, and the PHS 5161-1 (Rev. 7/00) application form before preparing and submitting an application.
Section: 582 of the Public Health Service Act, as amended and subject to the availability of funds.
When requesting an application kit, the applicant must specify the funding opportunity title and number for which detailed information is desired. All information necessary to apply, including where to submit applications and application deadline instructions, are included in the application kit.
Robert DeMartino, M.D., Substance Abuse and Mental Health Services Administration, Center for Mental Health Services, Division of Prevention, Traumatic Stress, and Special Programs, 5600 Fishers Lane, Room 17C-26, Rockville, MD 20857, (301) 443-2940, E-mail:
Substance Abuse and Mental Health Services Administration, HHS.
Notice of funding availability for a Cooperative Agreement to Supplement the Technical Assistance Resource Center for the Prevention of Violence and Behavioral Health Problems.
The Substance Abuse and Mental Health Services Administration (SAMHSA), Center for Mental Health Services (CMHS), announces the availability of FY 2003 funds for the cooperative agreement described below. A synopsis of this funding opportunity, as well as many other Federal Government funding opportunities, is also available at the Internet site:
This notice is not a complete description of the program; potential applicants must obtain a copy of the Request for Applications (RFA), including Part I, Cooperative Agreement to Supplement the Technical Assistance Resource Center for the Prevention of Violence and Behavioral Health Problems, Part II, General Policies and Procedures Applicable to all SAMHSA applications for Discretionary Grants and Cooperative Agreements, and the PHS 5161-1 (Rev. 7/00) application form before preparing and submitting an application.
Section: 520A and 581 of the Public Health Service Act, as amended and subject to the availability of funds.
The Safe Schools Healthy Students (SS/HS) initiative first received funding in 1999. Each grantee is required to evaluate its SS/HS activities to ensure that it is meeting the goals and objectives presented in its application as well as the initiative as a whole. Some grantees include measures that attempt to determine whether the initiative has been successful in preventing or reducing youth violence. While a national evaluation of the SS/HS initiative is under way, no organization has reviewed the evaluations conducted by local grant sites. The activities of this RFA are designed to supplement and complement the national evaluation effort. In order to answer questions from Congress and the General Accounting Office, this effort must be completed rapidly. Given the compressed timeframe in which this activity is needed and the limited resources, SAMHSA believes it is more efficient and cost effective to use an organization already firmly grounded in the objectives of the SS/HS initiative and one that has existing relationships with the SS/HS grantee sites. This familiarity with the program and the grantees will allow the current technical assistance center to more rapidly complete the needed work.
Additionally, this Request for Applications (RFA) proposes that the grantee organization will develop a manual for SS/HS project directors as well as identifying sustainability issues and resources unique to the SS/HS initiative. Since the identified applicant organization will be required to collaborate with the SS/HS project directors to identify requisite material for this manual and to develop guidance on sustaining the initiative after Federal funding, it is most beneficial to the Government to use an organization with an already established relationship with these project directors. The identified organization is the current technical assistance provider for this initiative and has the experience, background, and relationship with these grantees to collaborate with them on the tasks outlined in this RFA and meet the Government's needs in an expedited fashion. In order to eliminate the potential for confusion that could stem from multiple entities contacting grantees for similar activities, it is in the best interest of the Government to use the existing technical assistance provider.
When requesting an application kit, the applicant must specify the funding opportunity title and number for which detailed information is desired. All information necessary to apply, including where to submit applications and application deadline instructions, are included in the application kit.
Brenda Bruun, Substance Abuse and Mental Health Services Administration, Center for Mental Health Services, 5600 Fishers Lane, Room 17C-26, Rockville, MD 20857, (301) 443-4669, E-mail:
Directorate for Management, DHS.
Notice of meeting.
The Human Resource Management System Senior Review Advisory Committee (Committee or SRC) will meet in its inaugural session on Friday, July 25, 2003. The SRC is charged with reviewing the work of the Department of Homeland Security/Office of Personnel Management (DHS/OPM) Design Team and providing options to the Secretary of DHS and the Director of OPM for their consideration in establishing the new Human Resource Management System provided for in section 841 of the Homeland Security Act. The entire meeting will be open to the public.
The SRC will meet July 25, 2003 from 8:30 a.m. to 1 p.m. Notice of this meeting is published less than 15 days in advance (14 days notice is provided) in order to accommodate the schedules of several SRC members who will be unavailable to meet until the next anticipated meeting in September. Requests by members of the public to make oral presentations at the meeting and written statements for the SRC should reach the Designated Federal Official at DHS on or before July 21, 2003. Written statements may also be filed with the SRC at the meeting. All written submissions will become part of the Committee record and deliberations.
The SRC meeting will be held at the Radisson Barcelo Hotel Washington, 2121 P Street NW., Washington DC 20037. Send written statements and requests to make an oral presentation to the SRC Designated Federal Officer (DFO) at: Department of Homeland Security, Washington, DC 20528. For delivery services such as Fedex, UPS,
Ms. Kay Frances Dolan, Director Human Resource Policy, DHS, and Ms. Melissa Allen, Senior Human Resource Advisor, DHS, have been designated as DFOs for the SRC. They can be reached on 202-692-4272;
Customs and Border Protection, Department of Homeland Security.
Notice of Accreditation of Intertek Testing Services/Caleb Brett of Texas City, Texas, as a Commercial Laboratory.
Intertek Testing Services/Caleb Brett of Texas City, Texas has applied to Customs and Border Protection under part 151.12 of the Customs Regulations for an extension of accreditation as a commercial laboratory to analyze petroleum products under Chapter 27 and Chapter 29 of the Harmonized Tariff Schedule of the United States (HTSUS). Customs has determined that this company meets all of the requirements for accreditation as a commercial laboratory. Specifically, Intertek Testing Services/Caleb Brett has been granted accreditation to perform the following test methods at their Texas City, Texas site: (1) Distillation of Petroleum Products, ASTM D86; (2) Flash-Point by Pensky Martens Closed Cup Tester, ASTM D93; (3) API Gravity by Hydrometer, ASTM D287; (4) Kinematic Viscosity of Transparent and Opaque Liquids, ASTM D445; (5)
Intertek Testing Services/Caleb Brett accredited site is located at: 101 20th Street South, Texas City, TX 77590.
July 1, 2003.
Arlene Faustermann, Science Officer, Laboratories and Scientific Services, Customs and Border Protection, 1300 Pennsylvania Avenue, NW., Suite 1500 North, Washington, DC 20229, (202) 927-1060.
Customs and Border Protection, Department of Homeland Security.
Notice of Accreditation of Alchem Laboratory, Inc. of Ponce, Puerto Rico, as a Commercial Laboratory.
Alchem Laboratory, Inc. of Ponce, Puerto Rico has applied to Customs and Border Protection under part 151.12 of the Customs Regulations for an extension of accreditation as a commercial laboratory to analyze petroleum products under Chapter 27 and Chapter 29 of the Harmonized Tariff Schedule of the United States (HTSUS). Customs has determined that this company meets all of the requirements for accreditation as a commercial laboratory. Specifically, Alchem Laboratory, Inc. has been granted accreditation to perform the following test methods at their Ponce, Puerto Rico site: (1) Distillation of Petroleum Products, ASTM D86; (2) Kinematic Viscosity of Transparent and Opaque Liquids, ASTM D445; (3) Density, Relative Density (Specific Gravity), or API Gravity of Crude Petroleum and Liquid Petroleum Products by Hydrometer Method, ASTM D1298; (4) Percent by Weight of Sulfur by Energy-Dispersive X-Ray Fluorescence, ASTM D4294. Therefore, in accordance with part 151.12 of the Customs Regulations, Alchem Laboratory, Inc. of Ponce, Puerto Rico is hereby accredited to analyze the products named above.
Alchem Laboratory, Inc. accredited site is located at: Sabanetas Industrial Park, Building M-1380, Ponce, PR 00731.
July 1, 2003.
Arlene Faustermann, Science Officer, Laboratories and Scientific Services, Customs and Border Protection, 1300 Pennsylvania Avenue, NW., Suite 1500 North, Washington, DC 20229, (202) 927-1060.
Office of the Assistant Secretary for Community Planning and Development, HUD.
Notice.
This Notice identifies unutilized, underutilized, excess, and surplus Federal property reviewed by HUD for suitability for possible use to assist the homeless.
July 11, 2003.
Mark Johnston, Department of Housing and Urban Development, Room 7262, 451 Seventh Street SW., Washington, DC 20410; telephone (202) 708-1234; TTY number for the hearing— and speech-impaired (202) 708-2565, (these telephone numbers are not toll-free), or call the toll-free Title V information line at 1-800-927-7588.
In accordance with the December 12, 1988 court order in
Fish and Wildlife Service, Interior.
Notice of document availability.
The U.S. Fish and Wildlife Service (Service) announces availability for public review of the draft recovery plan for the Tumbling Creek cavesnail (
Comments on the draft recovery plan must be received on or before August 11, 2003.
Persons wishing to review the draft recovery plan may obtain a copy by contacting the Field Supervisor, U.S. Fish and Wildlife Service, Columbia, Missouri Ecological Services Field Office, 608 E. Cherry St., Room 200, Columbia, Missouri 65201-7712 or by accessing the Web site:
Dr. Paul McKenzie at the above address, or
Restoring an endangered or threatened animal or plant to the point where it is again a secure, self-sustaining member of its ecosystem is a primary goal of the Service's endangered species program. To help guide the recovery effort, the Service is working to prepare recovery plans for most of the federally listed threatened and endangered species native to the United States. Recovery plans describe actions considered necessary for conservation of the species, establish criteria for reclassification and delisting, and provide estimates of the time and costs for implementing the recovery measures needed.
The Act requires the development of recovery plans for listed species unless such a plan would not promote the conservation of a particular species. Section 4(f) of the Act, as amended in 1988, requires that public notice and opportunity for public review and comment be provided during recovery plan development. The Service will consider all information presented during a public comment period prior to approval of each new or revised recovery plan. The Service and other Federal agencies will also take these comments into consideration in the course of implementing approved recovery plans.
The Tumbling Creek cavesnail was listed as endangered on August 14, 2002. The number of cavesnails has significantly decreased over the past few decades, to the point where only one individual was found within survey areas between January 11, 2001, and April 22, 2003. A small population containing approximately 40 individuals exists in a small area upstream of the area that is regularly surveyed. Tumbling Creek cavesnail lives on the underside of rocks in areas of Tumbling Creek that have little or no silt. Little is known about the species and its life history, but it is believed to feed on microscopic animals in the stream. Although the exact reason for this species' precipitous decline is unknown, it is believed to be linked to habitat degradation through diminished water quality from upstream locations within the cave's delineated recharge zone.
We propose that the Tumbling Creek cavesnail be considered for reclassification from endangered to threatened when the following criteria have been met: (1) The population is stable or increasing for 10 consecutive years with at least 1,500 individuals; the population shall be considered stable when a linear regression analysis of population numbers estimated within an established survey area reveals no significant decline in numbers; (2) a minimum of 80% of the surface habitat within the recharge area of Tumbling Creek Cave, including a minimum of 75% of all riparian corridors, sinkholes, and losing streams, is properly managed, restored, rehabilitated, or stabilized through long-term voluntary land owner agreements, such as stewardship plans, easements, or memorandums of agreements that promote best management practices; and (3) water quality monitoring including, but not limited to, Tumbling Creek, fails to detect any contaminant or water quality parameter likely to be detrimental to the species for five consecutive years following established water quality criteria set by the Environmental Protection Agency (EPA), and criteria for sediment and suspended organic matter deposition established by EPA are not exceeded for five consecutive years.
We propose that the Tumbling Creek cavesnail be considered for delisting when the downlisting criteria have been met and the following additional criteria have been achieved: (1) The population is stable or increasing for an additional 10 consecutive years with at least 5,000 individuals; the population shall be considered stable when a linear regression analysis of population numbers estimated within an established survey area reveals no significant decline in numbers; (2) a minimum of 90% of the surface habitat within the recharge area of Tumbling Creek Cave, including a minimum of 85% of all riparian corridors, sinkholes, and losing streams, is properly managed, restored, rehabilitated, or stabilized through long-term voluntary land owner agreements, such as stewardship plans, easements, or memorandums of agreements that promote best management practices; and (3) water quality monitoring including, but not limited to, Tumbling Creek, fails to detect any contaminant or water quality parameter likely to be detrimental to the species for an additional five consecutive years following established water quality criteria set by EPA, and criteria for sediment and suspended organic matter deposition established by EPA are not exceeded for an additional five consecutive years.
Because an estimated 75% of the 9.02 square-mile delineated recharge area of Tumbling Creek Cave is under private ownership, many of recovery actions proposed in the draft recovery plan focus on working cooperatively with private land owners to help facilitate recovery of the Tumbling Creek cavesnail. Such cooperation can be achieved by: (1) Encouraging the voluntary enrollment of private land owners into landowner incentive programs that promote good land use while providing financial and technical assistance to participating enrollees, or (2) through voluntary land management agreements that promote beneficial land management practices. Approximately 25% of the recharge area for Tumbling Creek Cave is managed by multiple Federal agencies that have jurisdictional responsibilities under the Act. Such agencies will be encouraged to develop management plans that will contribute to their responsibilities under sections 2(c)(1) and 7(a)(1) of the Act to carry out programs that will assist in the recovery of the Tumbling Creek cavesnail.
The Service solicits written comments on the proposed draft recovery plan. All comments received by the date specified will be considered prior to approval of the plan. Written comments and materials regarding the plan should be sent to the Field Supervisor, Ecological Services Field Office, and comments received will be available for public inspection by appointment during normal business hours (
The authority for this action is section 4 (f) of the Endangered Species Act, 16 U.S.C. 1533(f).
Fish and Wildlife Service, Interior.
Issuance of Permit for Incidental Take of Endangered Species.
On April 4, 2003, a notice was published in the
Notice is hereby given that on June 18, 2003, as authorized by the provisions of the Act, the Service issued a permit (TE-073325-0) to the above named party subject to certain conditions set forth therein. The permit was granted only after the Service determined that it was applied for in good faith, that granting the permit will not be to the disadvantage of the threatened species, and that it will be consistent with the purposes and policy set forth in the Act.
Additional information on this permit action may be requested by contacting the Colorado Ecological Services Field Office at 755 Parfet Street, Suite 361, Lakewood, Colorado 80215, telephone (303) 275-2370, between the hours of 7 a.m. and 4:30 p.m. weekdays.
Bureau of Indian Affairs, Interior.
Notice of tribal consultation meetings.
Notice is hereby given that the Bureau of Indian Affairs (BIA) will conduct consultation meetings to obtain oral and written comments concerning potential issues in Indian Education Programs. The potential issues which will be set forth in a tribal consultation booklet to be issued prior to the meetings are the Office of Facility Management and Construction's proposed revision of the Student Enrollment Projection process, the proposed revision of the Education Space Guidelines used in School Construction planning, the Office of Indian Education Programs' possible realignment of the Education Line Offices, The No Child Left Behind Act of 2001 (NCLB), section 1121(d), School Consolidation and Closure, section 1122, National Criteria for Home Living Standards, section 1125, discussion regarding whether to use the existing Negotiated Rulemaking Committee or establish a separate Negotiated Rulemaking Committee for Facilities Construction regulations. Additionally, participants will be able to suggest other items for comment.
Comments are due on or before September 30, 2003. The meeting dates will be August 11 through 22, 2003 for all locations listed. All meetings will begin at 9 a.m. and continue until 3 p.m. (Local time) or until all meeting participants have an opportunity to make comments.
Send or hand-deliver written comments to William A. Mehojah, Jr., Director, Office of Indian Education Programs, Bureau of Indian Affairs, MS-3512-MIB, 1849 C Street, NW., Washington, DC 20240. Submissions by facsimile should be sent to (202) 273-0030.
Mr. Kenneth Whitehorn at (202) 208-4976.
The meetings are a follow-up to similar meetings conducted by the OIEP/BIA since 1990.
The purpose of the consultation, as required by 25 U.S.C. 2011(b), is to provide Indian tribes, Indian school boards, Indian organizations, parents, student organizations, school employees, Bureau employees and other interested parties with an opportunity to comment on potential issues raised during this or previous consultation meetings.
A consultation booklet for the meetings is being distributed to Federally recognized Indian tribes, Bureau Regional and Agency Offices and Bureau-funded schools. The booklets will also be available from local contact persons at each meeting.
Comments, including names, street addresses, and other contact information of respondents, will be available for public review at the address listed under the
Individual respondents may request confidentiality. If you wish us to withhold your name, street address, and other contact information (such as fax or phone number) from public review or from disclosure under the Freedom of Information Act, you must state this prominently at the beginning of your comment. We will honor your request to the extent allowable by law. We will make available for public inspection in their entirety all submissions from organizations or businesses, and from individuals identifying themselves as representatives or officials of organizations or businesses.
This notice is published in accordance with the authority delegated
The plat representing the dependent resurvey and survey in the N
The plat representing the dependent resurvey and survey in Section 13, Township 1 North, Range 80 West, Sixth Principal Meridian, Group 1373, Colorado, was accepted April 28, 2003.
The plat representing the dependent resurvey and survey, in Township 3 North, Range 86 West, Sixth Principal Meridian, Group 1374, Colorado, was accepted April 29, 2003.
The plat representing the dependent resurvey and survey in Township 42 North, Range 18 West, New Mexico Principal Meridian, Group 1331, Colorado, was accepted April 29, 2003.
The plat representing the dependent resurvey and survey in Township 34 North, Range 7 West, New Mexico Principal Meridian, Group 1342, Colorado, was accepted April 15, 2003.
The plat, of the entire record, representing the dependent resurvey in Township 33 South, Range 65 West, Sixth Principal Meridian, Group 1361, Colorado, was accepted May 8, 2003.
The plat, of the entire record, representing the dependent resurvey and survey in Township 51 North, Range 10 East, New Mexico Principal Meridian, Group 1321, Colorado, was accepted May 8, 2003.
The plat representing the corrective dependent resurvey in Township 33 North, Range 9 West, New Mexico Principal Meridian, Group 1138, Colorado, was accepted June 3, 2003.
The supplemental plat, creating new lots 19 and 20 from old lot 13 and new lots 21 and 22 from old lot 18, in section 20, Township 13 South, Range 72 West, Sixth Principal Meridian, Colorado, was accepted May 14, 2003.
These surveys and plats were requested by the Bureau of Land Management for administrative and management purposes.
The plat representing the dependent resurvey, corrective resurvey and survey, in Sections 30 and 31, Township 41 North, Range 2 East, New Mexico Principal Meridian, Group 1367, Colorado, was accepted April 8, 2003.
This survey and plat was requested by the Forest Supervisor, Rio Grande National Forest, to identify the boundaries between forest and patented lands, and management purposes.
The plat representing the dependent resurvey, and surveys, Township 24 South, Range 68 West, Sixth Principal Meridian, Group 1250, Colorado, was accepted June 3, 2003.
The plat, of the entire record, representing the remonumentation of certain original corners in Township 10 South, Range 72 West, Sixth Principal Meridian, Group 750, Colorado, was accepted June 23, 2003.
The plat, of the entire record, representing the remonumentation of certain original corners in Township 14 South, Range 80 West, Sixth Principal Meridian, Group 750, Colorado, was accepted June 26, 2003.
The plat, of the entire record, representing the remonumentation of certain original corners in Township 31 South, Range 68 West, Sixth Principal Meridian, Group 750, Colorado, was accepted June 26, 2003.
The plat, of the entire record, representing the remonumentation of certain original corners in Township 14 South, Range 68 West, Sixth Principal Meridian, Group 750, Colorado, was accepted June 26, 2003.
The plat, of the entire record, representing the remonumentation of certain original corners in Township 14 South, Range 69 West, Sixth Principal Meridian, Group 750, Colorado, was accepted June 26, 2003.
These surveys, plats and remonumentations were requested by the Forest Supervisor, Pike and San Isabel National Forests, to identify forest boundaries for administrative and management purposes.
The plat representing the dependent resurvey and survey in Township 9 North, Range 102 West, Sixth Principal Meridian, Group 1368, Colorado, was accepted April 24, 2003.
The plat representing the dependent resurvey and survey in Township 10 North, Range 103 West, Sixth Principal Meridian, Group 1368, Colorado, was accepted April 24, 2003.
The plat representing the dependent resurvey and survey in Township 10 North, Range 104 West, Sixth Principal Meridian, Group 1368, Colorado, was accepted April 24, 2003.
These surveys and plats were requested by the U.S. Fish and Wildlife Service, Regional Office, Denver, to identify the Public Land boundaries of the Browns Park Wildlife Refuge, in NW Colorado.
The plat (in two sheets), representing the dependent resurvey and surveys in Township 48 North, Range 4 West, New Mexico Principal Meridian, Group 1344, Colorado, was accepted June 23, 2003.
This survey and plats were requested by the National Park Service, Superintendent, Curecanti National Recreation Area and Black Canyon of the Gunnison National Park, to identify the Public Land boundaries for management purposes.
National Park Service, Interior.
Notice of availability.
Pursuant to section 102(2) of the National Environmental Policy Act (NEPA) of 1969, the National Park Service (NPS) announces the availability of the draft wilderness study/environmental impact statement (EIS) for Apostle Islands National Lakeshore, Wisconsin. This notice is being furnished as required by NEPA Act Regulations 40 CFR 1501.7.
There will be a 90-day public review period for comments on this document. Comments on the draft wilderness study/EIS must be received no later than 90 days after the Environmental Protection Agency publishes its notice of availability in the
Copies of the draft wilderness study/EIS are available by request by writing to Mr. Jim Nepstad, Wilderness Study Coordinator, Apostle Islands National Lakeshore, Route 1, Box 4, Bayfield, Wisconsin 54814, by phone 715-779-3398, extension 102, or by e-mail message at
Mr. Jim Nepstad, Wilderness Study Coordinator, Apostle Islands National Lakeshore, Route 1, Box 4, Bayfield, Wisconsin 54814, or by calling 715-779-3198, extension 102.
The Wilderness Act and the NPS management policies require all lands administered by the NPS be evaluated for their suitability for inclusion within the national wilderness preservation system. The purpose of this wilderness study is to determine if and where lands and waters within the Apostle Islands National Lakeshore should be proposed for wilderness designation. The study identifies four possible wilderness configurations within the park, including a no wilderness alternative, and evaluates their effects. Based on the findings of this study, a formal wilderness proposal may be submitted to the Director of the NPS for approval and subsequent consideration by the Department of the Interior, the President, and Congress under the provisions of the Wilderness Act.
Persons wishing to comment may do so by any one of several methods. They may attend the public hearing or open houses noted above. They may mail comments to Mr. Jim Nepstad, Wilderness Study Coordinator, Apostle Islands National Lakeshore, Route 1, Box 4, Bayfield, Wisconsin 54814. They also may comment via e-mail to
It is the practice of the NPS to make comments, including names and home addresses of respondents, available for public review during regular business hours. Individual respondents may request we withhold their home address from the record, which we will honor to the extent allowable by law. There also may be circumstances in which we would withhold from the record a respondent's identify, as allowable by law. If you wish us to withhold your name and/or address, you must state this prominently at the beginning of your comment. However, we will not consider anonymous comments. We will make all submissions from organizations or businesses, and from individuals identifying themselves as representatives or officials of organizations or businesses available for public inspection in their entirety.
The responsible official is Mr. Ernest Quintana, Acting Midwest Regional Director, NPS.
National Park Service, Department of the Interior.
Notice of Intent to prepare an Environmental Impact Statement for the Long Walk National Historic Trail Study.
Pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. 4332(C), the National Park Service (NPS) is preparing an Environmental Impact Statement for the Long Walk National Historic Trail Study, Arizona and New Mexico. This effort will result in a study that recommends to Congress whether the Long Walk of the Mescalero Apache and Navajo People should be designated a national historic trail. It will also propose alternative means of commemoration should it not be recommended for national historic trail designation. The plan will be developed in consultation with the Mescalero Apache Tribe, the Navajo Nation, the associated American Indian Tribes in the southwest, local communities along the routes of the Long Walk, other federal and state agencies and all other interested and affected organizations and individuals. The area involved includes but is not limited to: the Navajo Reservation in northeastern Arizona from the Grand Canyon area east to the New Mexico state line including Chinle and Window Rock, Arizona. The area in New Mexico includes but is not limited to: the vicinity of Gallup, Grants, Bosque Farms, Albuquerque, Santa Fe, Galisteo, Las Vegas, Fort Union National Monument, Anton Chico, Fort Sumner, and Mescalero, New Mexico. Alternatives to be considered include no-action, designation as a national historic trail, alternative means of commemoration other than national historic trail designation, and other ideas that come out of the public process.
Major issues include: routes of the Long Walk, resources to be preserved along the route, whether the Mescalero Apache Tribe and the Navajo Nation are in favor of national historic trail designation, and how best to preserve and interpret the related events of that period.
A scoping newsletter has been prepared that gives times, places, and dates of public meetings that will be held on the study. It also details the issues identified to date. Copies of that newsletter may be obtained from Harry Myers, NPS, P.O. Box 728, 1100 Old Santa Fe Trail, Santa Fe, New Mexico 87504-0728, (505) 988-6717,
The Park Service will accept comments from the public through August 11, 2003.
Information will be available for public review and comment in the office of the Superintendent, and at the following locations: Jere Krakow, Superintendent, IMR National Trails System Office, P.O. Box 728, 1100 Old Santa Fe Trail, Santa Fe, New Mexico 87504-0728, (505) 988-6888.
Harry Myers, P.O. Box 728, Santa Fe, New Mexico 87504-0728, (505) 988-6717,
If you wish to comment on the scoping brochure or on any other issues associated with the plan, you may submit your comments by any one of
Office of Surface Mining Reclamation and Enforcement.
Notice and request for comments.
In compliance with the Paperwork Reduction Act of 1995, the Office of Surface Mining Reclamation and Enforcement (OSM) is announcing its intention to request approval to continue the collections of information for general provisions at 30 CFR part 700, and the petition process for the designation of Federal lands as unsuitable for all or certain types of surface coal mining operations and for termination of previous designations found at 30 CFR part 769. These information collection activities were previously approved by the Office of Management and Budget (OMB), and assigned them clearance numbers 1029-0094 and -0098, respectively.
Comments on the proposed information collection must be received by September 9, 2003, to be assured of consideration.
Comments may be mailed to John A. Trelease, Office of Surface Mining Reclamation and Enforcement, 1951 Constitution Ave., NW., Room 210-SIB, Washington, DC 20240. Comments may also be submitted electronically to
To request a copy of the information collection requests, explanatory information and related forms, contact John A. Trelease, at (202) 208-2783.
OMB regulations at 5 CFR 1320, which implementing provisions of the Paperwork Reduction Act of 1995 (Pub. L. 104-13), require that interested members of the public and affected agencies have an opportunity to comment on information collection and recordkeeping activities (
Comments are invited on: (1) The need for the collection of information for the performance of the functions of the agency; (2) the accuracy of the agency's burden estimates; (3) ways to enhance the quality, utility and clarity of the information collection; and (4) ways to minimize the information collection burden on respondents, such as use of automated means of collection of the information. A summary of the public comments will accompany OSM's submission of the information collection requests to OMB.
The following information is provided for the information collection: (1) Title of the information collection; (2) OMB control number; (3) summary of the information collection activity; and (4) frequency of collection, description of the respondents, estimated total annual responses, and the total annual reporting and recordkeeping burden for the collection of information.
General wage determination decisions of the Secretary of Labor are issued in accordance with applicable law and are based on the information obtained by the Department of Labor from its study
The determination in these decisions of prevailing rates and fringe benefits have been made in accordance with 29 CFR part 1, by authority of the Secretary of Labor pursuant to the provisions of the Davis-Bacon Act of March 3, 1931, as amended (46 Stat. 1494, as amended, 40 U.S.C. 276a) and of other Federal statutes referred to in 29 CFR part 1, Appendix, as well as such additional statutes as may from time to time be enacted containing provisions for the payment of wages determined to be prevailing by the Secretary of Labor in accordance with the Davis-Bacon Act. The prevailing rates and fringe benefits determined in these decisions shall, in accordance with the provisions of the foregoing statutes, constitute the minimum wages payable on Federal and federally assisted construction projects to laborers and mechanics of the specified classes engaged on contract work of the character and in the localities described therein.
Good cause is hereby found for not utilizing notice and public comment procedure thereon prior to the issuance of these determinations as prescribed in 5 U.S.C. 553 and not providing for delay in the effective date as prescribed in that section, because the necessity to issue current construction industry wage determinations frequently and in large volume causes procedures to be impractical and contrary to the public interest.
General wage determination decisions, and modifications and supersedeas decisions thereto, contain no expiration dates and are effective from their date of notice in the
Any person, organization, or governmental agency having an interest in the rates determined as prevailing is encouraged to submit wage rate and fringe benefit information for consideration by the Department.
Further information and self-explanatory forms for the purpose of submitting this date may be obtained by writing to the U.S. Department of Labor, Employment Standards Administration, Wage and Hour Division, Division of Wage Determinations, 200 Constitution Avenue, NW., Room S-3014, Washington, DC 20210.
The number of the decisions listed to the Government Printing Office document entitled “General Wage Determinations Issued Under the Davis-Bacon and related Acts” being modified are listed by Volume and State. Dates of publication in the
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General wage determinations issued under the Davis-Bacon and related Acts, including those noted above, may be found in the Government Printing Office (GPO) document entitled “General Wage Determinations Issued Under the Davis-Bacon And Related Acts”. This publication is available at each of the 50 Regional Government Depository Libraries and many of the 1,400 Government Depository Libraries across the country.
General wage determinations issued under the Davis-Bacon and related Acts are available electronically at no cost on the Government Printing Office site at
Hard-copy subscriptions may be purchased from: Superintendent of Documents, Government Printing Office, Washington, DC 20402, (202) 512-1800.
When ordering hard-copy subscription(s), be sure to specify the State(s) of interest, since subscriptions may be ordered for any or all of the six separate Volumes, arranged by State. Subscriptions include an annual edition (issued in January or February) which includes all current general wage determinations for the States covered by each volume. Throughout the remainder of the year, regular weekly updates will be distributed to subscribers.
Occupational Safety and Health Administration (OSHA); Labor.
Request for comment.
OSHA solicits comments concerning its proposal to increase the existing burden-hours estimates, and to extend OMB approval of the information-collection requirements of the 4,4′-Methylenedianiline General Industry Standard (the “MDA General Industry Standard”) (29 CFR
Comments must be submitted by the following dates:
The Supporting Statement for the Information Collection Request is available for downloading from OSHA's website at
Todd Owen, Directorate of Standards and Guidance, OSHA, U.S. Department of Labor, Room N-3641, 200 Constitution Avenue, NW., Washington, DC 20210; telephone: (202) 693-2222. A copy of the Agency's Information-Collection Request (ICR) supporting the need for the information-collection requirements specified in the MDA General Industry Standard is available for inspection and copying in the Docket Office, or by requesting a copy from Todd Owen at (202) 693-2222. For electronic copies of the ICR contact OSHA on the Internet at
The Department of Labor, as part of its continuing effort to reduce paperwork and respondent (
The information-collection requirements specified in the MDA General Industry Standard protect employees from the adverse health effects that may result from their exposure to MDA. The major information-collection requirements of the MDA General Industry Standard require employers to perform exposure monitoring; exposure monitoring includes initial monitoring to determine the extent of employee exposure to MDA; periodic (
Other paperwork requirements of the Standard specify that employers must provide employees with medical examinations, including initial examinations for new employees prior to their initial job assignment; follow-up annual examinations for employees receiving initial medical examinations; and emergency examinations if employees receive potentially hazardous MDA exposures under emergency conditions. As part of the medical-surveillance program, employers must provided specific written information to the examining physicians, and obtain from these physicians a written opinion regarding the employee's medical results and exposure limitations.
Additional provisions of the Standard require employers to train employees exposed to MDA at the time of their initial assignment and at least annually thereafter. In addition, employers must post warning signs at entrances or access ways to regulated areas; and label any material or products containing MDA, this includes any containers storing MDA-contaminated protective clothing and equipment. Personnel who launder MDA-contaminated clothing must be informed by the employer that the clothing is contaminated and the potentially harmful effects of MDA.
The Standard also requires employers to establish and maintain exposure-monitoring and medical-surveillance records for each employee who is subject to these respective requirements, make any record required by the Standard available to OSHA compliance officers and the National Institute for Occupational Safety and Health (NIOSH) for examination and copying, and provides exposure-monitoring and medical-surveillance records to employees and their designated representatives. Finally, employers who cease to do business without a successor employer to receive and retain records for the require periods, and employers who plan to dispose of records at the end of the required retention periods, must transfer these records to NIOSH.
OSHA has a particular interest in comments on the following issues:
OSHA proposes to extend the Office of Management and Budget's (OMB) approval of the collection-of-information requirements specified by the Standards on 4, 4'-Methylenedianiline in General Industry (29 CFR 1910.1050). The Agency will summarize the comments submitted in response to this notice, and will include this summary in its request to OMB to extend the approval of these information-collection requirements.
John L. Henshaw, Assistant Secretary of Labor for Occupational Safety and Health, directed the preparation of this notice. The authority for this notice is the Paperwork Reduction Act of 1995 (44 U.S.C. 3506) and Secretary of Labor's Order No. 5-2002 (67 FR 65008).
United States Section, International Boundary and Water Commission, United States and Mexico.
Notice of availability of draft environmental impact statement.
Pursuant to section 102(2)(c) of the National Environmental Policy Act (NEPA) of 1969, as amended, the United States Section, International Boundary and Water Commission (USIBWC), in cooperation with the United States Fish and Wildlife Service (USFWS) and the Texas Parks and Wildlife Department, has prepared a Draft Environmental Impact Statement (DEIS) on Alternative Vegetation Maintenance Practices for the Lower Rio Grande Flood Control Project in Cameron, Hidalgo, and Willacy Counties, Texas. The DEIS analyzes the Continued Maintenance Alternative (No-Action), comprising the current USIBWC vegetation maintenance program, and the impacts of three vegetation maintenance alternatives which vary from the current USIBWC vegetation maintenance practices along the Lower Rio Grande Valley.
Written comments are requested by August 29, 2003. A public meeting will be conducted from 5 to 7 p.m. CDT on Wednesday, July 30, 2003, in Weslaco, Texas. See Addresses below for location and time.
Comments should be addressed to: Carolyn Murphy, Chief, Environmental Section, CESWG-PE-PR, Department of the Army, Galveston District, Corps of Engineers, P.O. Box 1229, Galveston, Texas 77553-1229 (courier deliveries: 2000 Fort Point Rd. Galveston, Texas 77550). A public meeting will be conducted from 5 to 7 p.m. CDT on Wednesday, July 30, 2003, at the Texas A&M Agricultural Research and Extension Center, Hoblitzelle Auditorium, 2415 East Highway 83, Weslaco, Texas, to present your verbal or written comments.
Copies of the DEIS are available for inspection and review at the following locations: Brownsville Public Library, 2600 Central Boulevard, Brownsville, Texas; Harlingen Public Library, 410 ’76 Drive, Harlingen, Texas; McAllen Public Library, 601 North Main Street, McAllen, Texas; USIBWC Mercedes Field Office, 325 Golf Course Rd, Mercedes, Texas; Santa Ana National Wildlife Refuge, FM 307, 7 miles south of Alamo, TX and 1/4-mile east of U.S. 281; and USIBWC HQ, 4171 N. Mesa Street, Ste C-315, El Paso, Texas. The DEIS is also available on the USIBWC Home Page at
Mr. Douglas Echlin, Environmental Protection Specialist, Environmental Management Division, USIBWC, 4171 North Mesa Street, C-100, El Paso, Texas 79902 or call (915) 832-4741, e-mail:
The USIBWC vegetation maintenance program is performed along the United States portion of the Lower Rio Grande Flood Control Project (LRGFCP). The vegetation maintenance program was established to fulfill the United States Government's obligations under International Boundary and Water Commission (IBWC) Minute No. 212 and No. 238 and to protect life and properties in the United States and Mexico from Rio Grande flooding events.
Under Minute No. 212, the United States and Mexico agreed to annual concurrent channel bank mowing to reduce heavy brush growth in the river reach and to ensure a river channel capacity of 20,000 cfs at the Brownsville-Matamoros area. This maintenance mowing was considered necessary to prevent flooding in Brownsville and Matamoros for the design flood and to ensure that brush did not deflect river flood flows toward either country, thus altering the international boundary alignment by erosion. Minute No. 238 called for equally dividing flood flows into interior floodways in each country, thereby ensuring the 20,000 cfs maximum flow at Brownsville and Matamoros.
On November 1, 1989, the Sierra Club, Frontera Audubon Society, and National Audubon Society filed a civil action suit against the USIBWC alleging vegetation maintenance program violations of the Endangered Species Act (ESA) and the National Environmental Policy Act (NEPA). The plaintiffs alleged that the USIBWC had not prepared an Environmental Assessment or Environmental Impact Statement (EIS) relative to the operation and maintenance activities for the
In a 1990 Consent Decree administered by the United States District Court of the District of Columbia, the USIBWC agreed to enter into formal consultation with the USFWS regarding the impacts of all vegetation clearing activities of the LRGFCP on federally listed species. The consultation process resulted in an issuance by the USFWS of a Biological Opinion (BO) on May 6, 1993. The USFWS has recently reissued a new BO. In addition to formal consultation with USFWS, USIBWC agreed to the preparation of this EIS, which specifically addresses alternative vegetation maintenance practices.
This DEIS presents and analyzes the impacts of current and alternative USIBWC vegetation maintenance practices to fulfill commitments under the IBWC Minutes, the Consent Decree, and the new BO. The pertinent elements of the LRGFCP vegetation maintenance program are based on the need to:
• Maintain channel banks to provide adequate flood conveyance.
• Equitably divert flood flows into interior floodways.
• Remove brush and other obstructions within floodways.
• Maintain a wildlife corridor per the USFWS BO and the 1994 LRGFCP Off-River Wildlife Travel Corridor Plan.
Four potential vegetation maintenance alternatives, including the current USIBWC maintenance program, are considered and analyzed in the DEIS. The Preferred Alternative is the Continued Maintenance Alternative (No-Action), representing the continuation of the current USIBWC vegetation maintenance program.
A copy of the DEIS has been filed with the Environmental Protection Agency (EPA) in accordance with 40 CFR parts 1500-1508 and USIBWC procedures. Written comments concerning the DEIS will be accepted at the address provided above until August 29, 2003.
National Science Foundation, National Science Board.
The National Science Foundation, 4201 Wilson Boulevard—Room 130, Arlington, VA 22230,
Robert Webber (703) 292-7000.
This meeting will be open to the public.
Teleconference of the NSB Education and Human Resources Committee Undergraduate Working Group.
Discussion of Undergraduate Working Group plans and activities.
U. S. Nuclear Regulatory Commission (NRC).
Notice of pending NRC action to submit an information collection request to OMB and solicitation of public comment.
The NRC is preparing a submittal to OMB for review of continued approval of information collections under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35).
Information pertaining to the requirement to be submitted:
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Submit, by September 9, 2003, comments that address the following questions:
1. Is the proposed collection of information necessary for the NRC to properly perform its functions? Does the information have practical utility?
2. Is the burden estimate 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 or other forms of information technology?
A copy of the draft supporting statement may be viewed free of charge at the NRC Public Document Room, One White Flint North, 11555 Rockville Pike, Room O-1 F21, Rockville, MD 20852. OMB clearance requests are available at the NRC worldwide Web site:
Comments and questions about the information collection requirements may be directed to the NRC Clearance Officer, Brenda Jo. Shelton, U.S. Nuclear Regulatory Commission, T-6 E6, Washington, DC 20555-0001, by telephone at (301) 415-7233, or by Internet electronic mail at
For the Nuclear Regulatory Commission.
Duke Power Company (the licensee) is the holder of Facility Operating License Nos. NPF-9 and NPF-17 that authorizes operation of the McGuire Nuclear Station, Units 1 and 2 (McGuire). The license provides, among other things, that the facility is subject to all rules, regulations, and orders of the U.S. Nuclear Regulatory Commission (NRC, the Commission) now or hereafter in effect.
The facility consists of two pressurized water reactors located in Mecklenburg County, North Carolina.
Title 10 of the Code of Federal Regulations (10 CFR) section 50.60(a), requires that the fracture toughness and material surveillance requirements of Appendix G to part 50 must be met for the reactor coolant pressure boundary. Appendix G to part 50 requires that pressure and temperature (P/T) limits be established for reactor pressure vessels (RPVs) during normal operating and hydrostatic or leak rate testing conditions. Specifically, section IV.A.2.a of Appendix G to 10 CFR part 50 states that “The appropriate requirements on both the pressure-temperature limits and the minimum permissible temperature must be met for all conditions.” Further, section IV.A.2.b of Appendix G to 10 CFR part 50 requires that these P/T limits must be at least as conservative as limits obtained by following the methods of analysis and the margins of safety of Appendix G to section XI of the American Society of Mechanical Engineers (ASME) Boiler and Pressure Vessel Code (Code). The current ASME Code of Record for McGuire is the 1995 edition through 1996 addenda of the ASME Code. The McGuire Code of Record does not incorporate the provisions of ASME Code Case N-641. Although the provisions of ASME Code Case N-641 were incorporated into Appendix G to section XI of the ASME Code in the 1998 edition through 2000 addenda, which is the latest edition and addenda codified in 10 CFR 50.55a, McGuire has not adopted this edition and consequently must meet its Code of Record to comply with Appendix G to part 50. Therefore, in this case, the licensee is still required to obtain an exemption to apply Code Case N-641.
In order to address provisions of amendments to the McGuire Technical Specification (TS) P/T limit curves, the licensee requested in its submittal dated December 12, 2002, as supplemented by letters dated March 27 and April 23, 2003, that the NRC staff exempt McGuire from application of specific requirements of 10 CFR 50.60 and Appendix G to 10 CFR part 50, and substitute the use of ASME Code Case N-641. ASME Code Case N-641 permits the use of an alternate reference fracture toughness curve for RPV materials and permits the postulation of a circumferentially-oriented flaw for the evaluation of circumferential RPV welds when determining the P/T limits. The proposed exemption request is consistent with, and is needed to support, the McGuire TS amendment that was contained in the same submittal. The proposed McGuire TS amendment will revise the P/T limits for heatup, cooldown, and inservice test limitations for the reactor coolant system (RCS) through 34 effective full power years of operation.
The licensee has proposed an exemption to allow the use of ASME Code Case N-641 in conjunction with Appendix G to ASME section XI, 10 CFR 50.60(a) and 10 CFR part 50, Appendix G, to establish the P/T limits for the McGuire, Units 1 and 2 RPVs.
The proposed TS amendment to revise the P/T limits for McGuire, Units 1 and 2, relies in part, on the requested exemption. These revised P/T limits have been developed using the lower bound K
Use of the K
Likewise, the use of a postulated circumferentially-oriented flaw in lieu of an axially-oriented one for the evaluation of a circumferential RPV weld is more technically correct. The size of flaw required to be postulated for P/T limit determination has a depth of one-quarter of the RPV wall thickness and a length six times the depth. Based on the direction of welding during the fabrication process, the only technically reasonable orientation for such a large flaw is for the plane of the flaw to be circumferentially-oriented (
In addition, P/T limit curves based on the K
Since application of ASME Code Case N-641 provides appropriate procedures to establish maximum postulated defects and to evaluate those defects in the context of establishing RPV P/T limits, this application of the Code Case maintains an adequate margin of safety for protecting RPV materials from brittle failure. The NRC staff has reviewed the exemption request submitted by the licensee and has concluded that an exemption should be granted from the requirements of 10 CFR 50.60 and section IV.A.2.b of Appendix G to 10 CFR part 50 to permit the licensee to use the provisions of ASME Code Case N-641 for the purpose of developing the McGuire Units 1 and 2 RPV P/T limit curves. However, the NRC staff does not agree with the special circumstances cited by the licensee in its December 12, 2002, application regarding the basis for granting the exemption. The NRC staff did not conclude that the circumstances cited above constitute “undue hardship or other costs that are significantly in excess of those contemplated when the regulation was adopted, or that are significantly in excess of those incurred by others similarly situated,” pursuant to 10 CFR 50.12(a)(2)(iii). Rather, the NRC staff concluded that the application of the technical provisions of ASME Code Case N-641 provided sufficient margin in the development of RPV P/T limit curves such that the underlying purpose of the regulations, Appendix G to 10 CFR part 50, will continue to be met and that the specific conditions required by the regulations (
In summary, the ASME section XI, Appendix G, procedure was conservatively developed based on the level of knowledge existing in 1974 concerning reactor coolant pressure boundary materials and the estimated effects of operation. Since 1974, the level of knowledge about the fracture mechanics behavior of RCS materials has been greatly expanded, especially regarding the effects of radiation embrittlement and the understanding of fracture toughness properties under static and dynamic loading conditions. The NRC staff concurs that this increased knowledge permits relaxation of the ASME section XI, Appendix G requirements by application of ASME Code Case N-641, while maintaining, pursuant to 10 CFR 50.12(a)(2)(ii), the underlying purpose of the ASME Code and the NRC regulations to ensure an acceptable margin of safety against brittle failure of the RPV.
The NRC staff has reviewed the exemption request submitted by the licensee and has concluded that an exemption should be granted from the requirements of 10 CFR 50.60(a) and section IV.A.2.b of Appendix G to 10 CFR part 50 to permit the licensee to utilize the provisions of ASME Code Case N-641 for the purpose of developing McGuire Units 1 and 2 RPV P/T limit curves.
Pursuant to 10 CFR 50.12, the Commission may, upon application by any interested person or upon its own initiative, grant exemptions from the requirements of 10 CFR part 50 when (1) the exemptions are authorized by law, will not present an undue risk to public health or safety, and are consistent with the common defense and security; and (2) when special circumstances are present.
Special circumstances, pursuant to 10 CFR 50.12(a)(2)(ii), are present in that continued operation of McGuire, Units 1 and 2, pursuant to the requirements of 10 CFR 50.60 and section IV.A.2.b of Appendix G to 10 CFR part 50, using P/T curves developed in accordance with ASME section XI, Appendix G, without the relief provided by ASME Code Case N-641, is not necessary to achieve the underlying purpose of 10 CFR 50.60 and Appendix G to 10 CFR part 50. Application of ASME Code Case N-641 in lieu of the requirements of ASME Code section XI, Appendix G, provides an acceptable alternate methodology that will continue to meet the underlying purpose of 10 CFR 50.60 and Appendix G to 10 CFR part 50. The underlying purpose of the regulations in 10 CFR 50.60 and Appendix G to 10 CFR part 50 is to provide an acceptable margin of safety against brittle failure of the RCS during any condition of normal operation to which the pressure boundary may be subjected over its service lifetime.
The NRC staff examined the licensee's rationale to support the exemption request, and accepts the licensee's determination that an exemption would be required to approve the use of Code Case N-641. The NRC staff agrees that the use of ASME Code Case N-641 would meet the underlying intent of 10 CFR 50.60 and Appendix G to 10 CFR part 50. The NRC staff concludes that the application of the technical provisions of ASME Code Case N-641 provides sufficient margin in the development of RPV P/T limit curves such that the underlying purpose of the regulations (10 CFR 50.60 and Appendix G to 10 CFR part 50) continues to be met and that the specific conditions required by the regulations (
Based upon a consideration of the conservatism that is explicitly incorporated into the methodologies of Appendix G to 10 CFR part 50; Appendix G to section XI of the ASME Code; and Regulatory Guide 1.99, Revision 2; the NRC staff concludes that application of ASME Code Case N-641, as described, will provide an adequate margin of safety against brittle failure of the RPV. This conclusion is also consistent with the determination that the NRC staff has reached for other licensees under similar conditions based on the same considerations. Therefore, the NRC staff concludes that granting the exemption under the special circumstances of 10 CFR 50.12(a)(2)(ii) is appropriate, and that the methodology of Code Case N-641 may be used to revise the P/T limits for the McGuire, Unit 1 and 2 RPVs.
Accordingly, the Commission has determined that, pursuant to 10 CFR 50.12(a), the exemption is authorized by law, will not present an undue risk to the public health and safety, and is consistent with the common defense and security. Also, special circumstances are present. Therefore, the Commission hereby grants the licensee an exemption from the requirements of 10 CFR 50.60(a), and 10 CFR part 50, Appendix G, section IV.A.2.b, to allow application of ASME Code Case N-641 in establishing TS requirements for the RPV limits for McGuire, Units 1 and 2.
Pursuant to 10 CFR 51.32, the Commission has determined that the granting of this exemption will not have a significant effect on the quality of the human environment (68 FR 31735).
This exemption is effective upon issuance.
For the Nuclear Regulatory Commission.
Commissioners: Nils J. Diaz, Chairman, Edward McGaffigan, Jr., Jeffrey S. Merrifield.
Pursuant to 10 CFR 2.4, notice is hereby given that Dr. Yong Li of the NRC's Office of Research has been appointed as a Commission adjudicatory employee within the meaning of section 2.4, to advise the Commission regarding issues relating to the pending petition for review of LBP-03-08 in the matter of
For the Commission.
The U.S. Nuclear Regulatory Commission (NRC) is considering issuance of an amendment to Title 10 of the Code of Federal Regulations (10 CFR) part 50, for Facility Operating License Nos. NPF-41, NPF-51, NPF-74, issued to Arizona Public Service Company (the licensee), for operation of the Palo Verde Nuclear Generating Station (PVNGS), Units 1, 2, and 3, located in Maricopa County, Arizona. Therefore, as required by 10 CFR 51.21, the NRC is issuing this environmental assessment and finding of no significant impact.
The proposed action would extend the expiration date of the operating license from December 31, 2024, to June 1, 2025, for Unit 1; from December 9, 2025, to April 24, 2026, for Unit 2; and from March 25, 2027, to November 25, 2027, for Unit 3.
The proposed action is in accordance with the licensee's application dated August 28, 2002.
The proposed action would allow the licensee to operate PVNGS, Units 1, 2, and 3, until June 1, 2025, April 24, 2026, and November 25, 2027, respectively. This would allow the licensee to recapture approximately six months of additional plant operation for each unit.
The NRC has completed its evaluation of the proposed action and concludes that there are no significant environmental considerations involved with the proposed action. The extension of the operating licenses does not affect the design or operation of the plants, does not involve any modifications to the plants or any increase in the licensed power for the plants, and will not create any new or unreviewed environmental impacts that were not considered in the Final Environmental Statement (FES) related to the operation of PVNGS, Units 1, 2, and 3, NUREG-0841, dated February 1982. The evaluations presented in the FES were the environmental impacts of generating power at PVNGS and the basis for granting a 40-year operating license for PVNGS. The environmental impacts of the proposed action are based on the evaluations in the FES. The FES also considered the environmental impacts of operating Units 1, 2, and 3.
The FES which in general, assesses various impacts associated with operation of the facility in terms of annual impacts and balances these against the anticipated annual energy production benefits.
The offsite exposure from releases during postulated accidents has been previously evaluated in the Updated Final Safety Analysis Report (UFSAR) for PVNGS. The results are acceptable when compared with the criteria defined in 10 CFR part 100, as documented in the Commission's Safety Evaluation Report, NUREG-0857, dated November 1981, and its 12 supplements.
This conservative design-basis evaluation is a function of four parameters: (1) The type of accident postulated, (2) the radioactivity calculated to be released during the accident, (3) the assumed meteorological conditions at the site, and (4) the population distribution versus distance from the plant. An environmental assessment of accidents is also provided in section 5.9.2 of the FES. The type of accidents and the calculated radioactivity released do not change with the proposed action. The site meteorology as defined in Chapter 2 of the UFSAR is essentially constant. The NRC staff has concluded that the population size and distribution will not change significantly.
The NRC staff has concluded that the impacts associated with the addition of approximately six to eight months to each unit are not significantly different from operating license duration assessed in the PVNGS FES. Therefore, the staff concluded that the FES sufficiently addresses the environmental impacts associated with a full 40-year operating period for each unit.
The annual occupational exposure of workers at the plant, station employees and contractors, is reported in the Annual Operating Report submitted by the licensee. The lowest exposure value is for a year without a refueling outage and the highest value is for a year with a refueling outage. In section 5.9.1.1.1 of the FES, the average occupational exposure for a pressurized water reactor was reported as 440 person-rems. Therefore, the expected annual occupational exposure for the proposed extended period of operation does not
The offsite exposure from releases during routine operations has been previously evaluated in section 5.9.1 of the FES. During the low-power license, the plant was restricted to no more than 5 percent of rated power and the generation of radioactivity at the plants was significantly smaller than would have occurred if the plants were at full-power operation. Therefore, the addition of approximately six to eight months of operation per plant that the licensee has requested does not change previous conclusions presented in the FES on annual public doses.
The proposed action will not significantly increase the probability or consequences of accidents, no changes are being made in the types of effluents that may be released off site, and there is no significant increase in occupational or public radiation exposure. Therefore, there are no significant radiological environmental impacts associated with the proposed action.
With regard to potential nonradiological impacts, the proposed action does not have a potential to affect any historic sites. It does not affect nonradiological plant effluents and has no other environmental impact. Therefore, there are no significant nonradiological environmental impacts associated with the proposed action.
Accordingly, the NRC concludes that there are no significant environmental impacts associated with the proposed action.
As an alternative to the proposed action, the staff considered denial of the proposed action (
The action does not involve the use of any different resource than those previously considered in the FES [or more recently, the Environmental Impact Statement] for the PVNGS, Units 1, 2, and 3.
On July 3, 2003, the staff consulted with the Arizona State official, Mr. William Wright, of the Arizona Radiation Regulatory Agency, regarding the environmental impact of the proposed action. The State official had no comments.
On the basis of the environmental assessment, the NRC concludes that the proposed action will not have a significant effect on the quality of the human environment. Accordingly, the NRC has determined not to prepare an environmental impact statement for the proposed action.
For further details with respect to the proposed action, see the licensee's letter dated August 28, 2002. Documents may be examined, and/or copied for a fee, at the NRC's Public Document Room (PDR), located at One White Flint North, Public File Area O1 F21, 11555 Rockville Pike (first floor), Rockville, Maryland. Publicly available records will be accessible electronically from the Agencywide Documents Access and Management System (ADAMS) Public Electronic Reading Room on the Internet at the NRC Web site,
For the Nuclear Regulatory Commission.
On June 6, 2003, the NRC published a Notice of Availability on Draft Regulatory Guide DG-1121, “Guidelines for Categorizing Structures, Systems, and Components in Nuclear Power Plants According to their Safety Significance,” that contained a number of errors. This Notice of Availability is being reprinted to correct these errors.
The Nuclear Regulatory Commission (NRC) has issued for public comment a proposed guide in its Regulatory Guide Series. Regulatory guides are developed to describe and make available to the public such information as methods acceptable to the NRC staff for implementing specific parts of the NRC's regulations, techniques used by the staff in evaluating specific problems or postulated accidents, and data needed by the staff in its review of applications for permits and licenses.
The draft guide is temporarily identified by its task number, DG-1121, which should be mentioned in all correspondence concerning this draft guide. Draft Regulatory Guide DG-1121, “Guidelines for Categorizing Structures, Systems, and Components in Nuclear Power Plants According to their Safety Significance,” is being developed to describe a process that is acceptable to the NRC staff for the development and assessment of evaluation models that may be used to comply with the NRC's regulations with respect to the categorization of structures, systems, and components that are considered in risk-informing special treatment requirements. This guide conforms to a proposed amendment to 10 CFR 50.69 that was published in the
This draft guide has not received complete staff approval and does not represent an official NRC staff position.
Comments will be most helpful if received by August 1, 2003. You may submit comments by any one of the following methods. Please include the draft guide number (DG-1121) in the subject line of your comments. Comments on regulatory guides submitted in writing or in electronic form will be made available to the public in their entirety on the NRC rulemaking Web site. Personal information will not be removed from your comments.
Mail comments to: Rules and Directives Branch, Office of Administration, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001.
E-mail comments to:
Hand deliver comments to: Rules and Directives Branch, Office of Administration, 11555 Rockville Pike, Rockville, Maryland 20852, between 7:30 am and 4:15 p.m. on Federal workdays.
Fax comments to: Rules and Directives Branch, Office of Administration, U.S. Nuclear Regulatory Commission at (301) 415-5144.
Publicly available documents related to this regulatory guide may be examined and copied for a fee at the
Also, publicly available documents created or received at the NRC are available electronically at the NRC's Electronic Reading Room at
Although a deadline is given for comments on this draft guide, comments and suggestions in connection with items for inclusion in guides currently being developed or improvements in all published guides are encouraged at any time. Requests for single copies of draft or final regulatory guides (which may be reproduced) or for placement on an automatic distribution list for single copies of future draft guides in specific divisions should be made in writing to the U.S. Nuclear Regulatory Commission, Washington, DC 20555, Attention: Reproduction and Distribution Services Section, or by fax to (301) 415-2289; e-mail
For the Nuclear Regulatory Commission.
At its meeting on June 2, 2003, and by paper vote July 3-7, 2003, the Board of Governors of the United States Postal Service voted unanimously to close to public observation its meeting scheduled for July 21, 2003, in McLean, Virginia.
1. Strategic Planning.
2. Personnel Matters.
The General Counsel of the United States Postal Service has certified that the meeting was properly closed under the Government in the Sunshine Act.
Requests for information about the meeting should be addressed to the Secretary of the Board, William T. Johnstone, at (202) 268-4800.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange is proposing changes to its Schedule of Fees in order to extend the term of certain existing fee waivers, to remove language to a fee waiver that has expired, and to eliminate the fee for the Rule 11Ac1-6 Order Report.
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below and is set forth in Sections A, B, and C below.
The Exchange is proposing changes to its Schedule of Fees in order to extend the term of certain existing fee waivers, to remove language referring to a certain fee waiver that is not being renewed and to eliminate the fee for the Rule 11Ac1-6 Order Report.
With respect to the fee waivers, the Exchange is proposing to extend the terms, as follows: (i) the waiver of customer Execution Fees is extended through June 30, 2004;
With respect to the fee elimination, the Exchange is proposing to eliminate the fee for preparing a Rule 11Ac1-6 Order Report, or specialized best execution report, that the Exchange currently offers to members who specifically request this report. The Exchange is eliminating the fee since the Exchange has recovered the technical development costs associated with producing the report, as well as for competitive purposes.
The basis under the Act for this proposed rule change is the requirement under Section 6(b)(4) of the Act that an exchange have an equitable allocation of reasonable dues, fees and other charges among its members and other persons using its facilities.
The proposed rule change does not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from members or other interested parties.
The foregoing proposed rule change has been designated as a fee change pursuant to Section 19(b)(3)(A)(ii) of the Act
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposal is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street NW., Washington, DC 20549-0609. Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission's Public Reference Room.
Copies of such filing will also be available for inspection and copying at the principal office of the ISE. All submissions should refer to File No. SR-ISE-2003-16 and should be submitted by August 1, 2003.
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The proposed rule change would modify NSCC's procedures to accommodate the reporting of trades executed on a system that provides trading anonymity.
In its filing with the Commission, NSCC included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. NSCC has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of such statements.
NSCC may receive locked-in trade data from an SRO that operates a trading system that provides anonymity. At the request of the SRO, NSCC may report back to members such trades identifying an acronym selected by the SRO instead of naming the actual contraside. The purpose of the proposed rule filing is to add language to section II.C.1 of NSCC Rules and Procedures that would provide that in such an event the contraside is one of the members eligible to execute trades on the anonymous trading system. New language would also be added to that section that would provide that if NSCC ceases to act for the unnamed contraside, the applicable entity providing the anonymous trading system will be responsible for identifying to members which of their trades are with the affected member.
The National Association of Securities Dealers, Inc. (“NASD”) recently filed a proposed rule change that would allow it to add an anonymity feature to the Nasdaq Stock Market's SuperMontage trading system.
NSCC believes that the proposed rule change is consistent with the requirements of Section 17A of the Act and the rules and regulations thereunder applicable to NSCC because by allowing NSCC to accommodate trades executed on an anonymous platform it will promote the prompt and accurate clearance and settlement of securities transactions.
NSCC perceives no adverse impact on competition by reason of the proposed rule change.
Comments from NSCC members or others have not been solicited or received on the proposed rule change. NSCC will notify the Commission of any written comments received by it.
Within thirty-five days of the date of publication of this notice in the
(a) by order approve the proposed rule change or
(b) institute proceedings to determine whether the proposed rule change should be disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street NW., Washington, DC 20549-0609. Comments may also be submitted electronically at the following e-mail address:
For the Commission by the Division of Market Regulation, pursuant to delegated authority.
Small Business Administration.
Notice of reporting requirements submitted for OMB review.
Under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35), agencies are required to submit proposed reporting and recordkeeping requirements to OMB for review and approval, and to publish a notice in the
Submit comments on or before August 11, 2003. If you intend to comment but cannot prepare comments promptly, please advise the OMB Reviewer and the Agency Clearance Officer before the deadline.
Address all comments concerning this notice to: Agency Clearance Officer, Jacqueline White, Small Business Administration, 409 3rd Street, SW., 5th Floor, Washington, DC 20416; and OMB Reviewer, Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Washington, DC 20503.
Jacqueline White, Agency Clearance Officer, (202) 205-7044.
Small Business Administration.
Notice of reporting requirements submitted for OMB review.
Under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35), agencies are required to submit proposed reporting and recordkeeping requirements to OMB for review and approval, and to publish a notice in the
Submit comments on or before August 11, 2003. If you intend to comment but cannot prepare comments promptly, please advise the OMB Reviewer and the Agency Clearance Officer before the deadline.
Address all comments concerning this notice to: Agency Clearance Officer, Jacqueline White, Small Business Administration, 409 3rd Street, SW., 5th Floor, Washington, DC 20416; and OMB Reviewer, Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Washington, DC 20503.
Jacqueline White, Agency Clearance Officer, (202) 205-7044.
Small Business Administration.
Notice of reporting requirements submitted for OMB review.
Under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35), agencies are required to submit proposed reporting and recordkeeping requirements to OMB for review and approval, and to publish a notice in the
Submit comments on or before August 11, 2003. If you intend to comment but cannot prepare comments promptly, please advise the OMB Reviewer and the Agency Clearance Officer before the deadline.
Copies: Request for clearance (OMB 83-1), supporting statement, and other documents submitted to OMB for review may be obtained from the Agency Clearance Officer.
Address all comments concerning this notice to: Agency Clearance Officer, Jacqueline White, Small Business Administration, 409 3rd Street, SW., 5th Floor, Washington, DC 20416; and OMB Reviewer, Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Washington, DC 20503.
Jacqueline White, Agency Clearance Officer, (202) 205-7044.
DeKalb County and the contiguous counties of Clayton, Fulton, Gwinnett, Henry and Rockdale in the State of Georgia constitute a disaster area due to damages caused by severe storms and flooding that occurred on June 16-17, 2003. Applications for loans for physical damage as a result of this disaster may be filed until the close of business on September 2, 2003 and for economic injury until the close of business on April 5, 2004 at the address listed below or other locally announced locations:
The interest rates are:
The number assigned to this disaster for physical damage is 351911 and for economic damage is 9W1900.
As a result of the President's major disaster declaration on July 2, 2003, I find that Boyd, Breathitt, Carter, Clay, Elliott, Floyd, Greenup, Harlan, Johnson, Knott, Lawrence, Leslie, Letcher, Lewis, Magoffin, Martin, Owsley, Perry, Pike and Rowan Counties in the Commonwealth of Kentucky constitute a disaster area due to damages caused by severe storms, flooding, mud and rock slides, and tornadoes occurring on June 14, 2003 and continuing. Applications for loans for physical damage as a result of this disaster may be filed until the close of business on September 2, 2003 and for economic injury until the close of business on April 2, 2004 at the address listed below or other locally announced locations: Small Business Administration, Disaster Area 2 Office, One Baltimore Place, Suite 300,Atlanta, GA 30308.
In addition, applications for economic injury loans from small businesses located in the following contiguous counties may be filed until the specified date at the above location: Bath, Bell, Fleming, Jackson, Knox, Laurel, Lee, Mason, Menifee, Morgan and Wolfe in the Commonwealth of Kentucky; Adams, Lawrence and Scioto counties in the State of Ohio; Buchanan, Dickenson, Lee and Wise counties in the Commonwealth of Virginia; and Mingo and Wayne counties in the State of West Virginia.
The interest rates are:
The number assigned to this disaster for physical damage is 352011. For economic injury the number is 9W2000 for Kentucky; 9W2100 for Ohio; 9W2200 for Virginia; and 9W2300 for West Virginia.
Webb County and the contiguous counties of Dimmit, Duval, Jim Hogg, La Salle, Maverick, McMullen and Zapata in the State of Texas constitute a disaster area due to severe storms, damaging winds and hail that occurred on June 2, 2003. Applications for loans for physical damage as a result of this disaster may be filed until the close of business on September 2, 2003 and for economic injury until the close of business on April 5, 2004 at the address listed below or other locally announced locations:
The interest rates are:
The number assigned to this disaster for physical damage is 351811 and for economic injury the number is 9W1800.
Pursuant to the requirements contained in the Foreign Operations, Export Financing, and Related Appropriations, Division E., Title II, of the Consolidated Appropriations Resolution, FY 2003 (Pub. L. 108-7), under the heading of Migration and Refugee Assistance, I hereby determine that the Magen David Adom Society of Israel is not being denied participation in the activities of the International Red Cross and Red Crescent Movement.
This Determination shall be published in the
Office of the United States Trade Representative.
Notice of an partially opened meeting.
The Industry Sector Advisory Committee on Services (ISAC-13) will hold a meeting on July 22, 2003, from 1:30 p.m. to 4:30 p.m. The meeting will be closed to the public from 2:15 p.m. to 4:30 p.m. and opened to the public from 1:30 p.m. to 2:15 p.m.
The meeting is scheduled for July 22, 2003, unless otherwise notified.
The meeting will be held at the Ronald Reagan Bldg., USA Trade Center, Training Room A.
Jennifer Moll, DFO for ISAC-13 at (202) 482-1316, Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230 or Christina Sevilla, Director for Intergovernmental Affairs, on (202) 395-6120.
During the opened portion of the meeting the following agenda item will be discussed.
• Discussion on the International Trade Commission's Recently Released Report: “Recent Trends in U.S. Services Trade”.
• Report on General Agreement on Trade in Services (GATS) Negotiations.
• Report on Iraq Reconstruction and Related Business Opportunities.
Department of Transportation.
Notice of order to show cause (Order 2003-7-7) Dockets OST-02-14027 and OST-02-14028.
The Department of Transportation is directing all interested persons to show cause why it should not issue an order finding Victory Air Transport, Inc., fit, willing, and able, and awarding it certificates of public convenience and necessity to engage in interstate and foreign charter air transportation of persons, property and mail.
Persons wishing to file objections should do so no later than July 21, 2003.
Objections and answers to objections should be filed in Dockets OST-02-14027 and OST-02-14028 and addressed to the Department of Transportation Dockets (M-30, Room PL-401), U.S. Department of Transportation, 400 Seventh Street SW., Washington, DC 20590, and should be served upon the parties listed in Attachment A to the order.
Ms. Delores King, Air Carrier Fitness Division (X-56, Room 6401), U.S. Department of Transportation, 400 Seventh Street, SW., Washington, DC 20590, (202) 366-2343.
Federal Highway Administration (FHWA), DOT.
Notice of Intent.
The FHWA is issuing this notice to advise the public that an environmental impact statement will be prepared for a proposed second access to South Padre Island, in Cameron or Willacy Counties, Texas.
John Mack, District Engineer, Federal Highway Administration, 300 East 8th Street, Austin, Texas, Telephone: (512) 536-5960.
The FHWA, in cooperation with the Texas Department of Transportation, will prepare an environmental impact statement (EIS) proposing to provide a second access to and from South Padre Island. Currently, the Queen Isabella Causeway is the only means of vehicular access to and from the island. The purpose of the proposed project is to provide an alternate route to and from South Padre. Residents and visitors need increased vehicular mobility to enhance their health, safety, and security. This need is heightened during constrained or interrupted traffic flow conditions on the Queen Isabella Causeway resulting from hurricane evacuations, incidents involving the bridge, lane closures associated with bridge repairs and during peak travel periods such as Spring Break and the summer vacation season.
The EIS will examine or evaluate viable alternatives for providing access between the mainland and the island. The project study area includes South Padre Island and the mainland in Cameron and Willacy Counties. Transportation alternatives include taking no action (the no-build alternative), Transportation System Management (TSM), ferrying systems and construction of a second causeway. The environmental study will also include discussions of the social, economic and environmental effects of the proposed project.
A public scoping meeting will be held on August 5, 2003 at 6 p.m. at the South Padre Island Convention Center. This will be the first in a series of meetings to solicit public comments on the proposed action. In addition, a public hearing will be held. Public notice will be given about the time and place of the meetings and hearing. The draft EIS will be available for the public and relevant agencies for comment before the public hearing.
Letters describing the proposed action and soliciting comments will be sent to appropriate Federal, State, and local agencies, and to private organizations and citizens who have previously expressed or are known to have interest in this proposal. A series of public scoping meetings will be held in the area. In addition, a public hearing will be held. Public notice will be given with the time and place of the meetings and hearing. The draft EIS will be available for public and agency review and comment prior to the public hearing.
To ensure that the full range of issues related to this proposed action are addressed and all significant issues identified, comments, and suggestions are invited from all interested parties. Comments or questions concerning this proposed action and the EIS should be directed to the FHWA at the address provided above.
Metro Regional Transit Authority (METRO) has filed a notice of exemption under 49 CFR 1150.31,
METRO indicates that it will not operate any freight rail service on the line. METRO further indicates that this transaction is related to STB Finance Docket No. 34362,
Consummation of the transaction was expected to occur on or after June 19, 2003, the effective date of this exemption.
METRO certifies that the projected annual revenues as a result of the transaction will not exceed $5 million, and thus the transaction will not result in the creation of a Class II or Class I rail carrier.
If the verified notice contains false or misleading information, the exemption is void
An original and 10 copies of all pleadings, referring to STB Finance Docket No. 34361, must be filed with the Surface Transportation Board, 1925 K Street, NW., Washington, DC 20423-0001. In addition, a copy of each pleading must be served on Edward J. Fishman, Esq., Kirkpatrick & Lockhart LLP, 1800 Massachusetts Ave., Second Floor, Washington, DC 20036.
Board decisions and notices are available on our Web site at
By the Board, Joseph H. Dettmar, Acting Director, Office of Proceedings.
Akron Barberton Cluster Railway Company (ABC), a Class III rail carrier, has filed a verified notice of exemption under 49 CFR 1150.41
This transaction is related to STB Finance Docket No. 34361,
Consummation of the transaction was expected to occur on or shortly after June 20, 2003, the effective date of this exemption.
ABC certifies that the projected annual revenues as a result of the transaction will not exceed $5 million, and thus the transaction will not result in the creation of a Class II or Class I rail carrier.
If the verified notice contains false or misleading information, the exemption is void
An original and 10 copies of all pleadings, referring to STB Finance Docket No. 34362, must be filed with the Surface Transportation Board, 1925 K Street, NW., Washington, DC 20423-0001. In addition, a copy of each pleading must be served on William C. Sippel, Fletcher & Sippel, LLC, Two Prudential Plaza, Suite 3125, 180 North Stetson Ave., Chicago, IL 60601-6721.
Board decisions and notices are available on our Web site at
By the Board, Joseph H. Dettmar, Acting Director, Office of Proceedings.
Internal Revenue Service (IRS), Treasury.
Notice and request for comments.
The Department of the Treasury, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C. 3506(c)(2)(A)). Currently, the IRS is soliciting comments concerning Form 3468, Investment Credit.
Written comments should be received on or before September 9, 2003 to be assured of consideration.
Direct all written comments to Glenn Kirkland, Internal Revenue Service, room 6411, 1111 Constitution Avenue, NW., Washington, DC 20224.
Requests for additional information or copies of the form and instructions should be directed to Larnice Mack at Internal Revenue Service, room 6407, 1111 Constitution Avenue, NW., Washington, DC 20224, or at (202) 622-3179, or through the Internet at
The following paragraph applies to all of the collections of information covered by this notice:
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.
Internal Revenue Service (IRS), Treasury.
Notice and request for comments.
The Department of the Treasury, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C. 3506(c)(2)(A)). Currently, the IRS is soliciting comments concerning Form 6478, Credit for Alcohol Used as Fuel.
Written comments should be received on or before September 9, 2003 to be assured of consideration.
Direct all written comments to Glenn Kirkland, Internal Revenue Service, room 6411, 1111 Constitution Avenue, NW., Washington, DC 20224.
Requests for additional information or copies of the form and instructions should be directed to Larnice Mack at Internal Revenue Service, room 6407, 1111 Constitution Avenue, NW., Washington, DC 20224, or at (202) 622-3179, or through the Internet at
The following paragraph applies to all of the collections of information covered by this notice:
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.
Internal Revenue Service (IRS), Treasury.
Notice.
An open meeting of the Area 2 Taxpayer Advocacy Panel will be conducted (via teleconference).
The meeting will be held Tuesday, August 5, 2003.
Inez E. De Jesus at 1-888-912-1227, or 954-423-7977.
Notice is hereby given pursuant to section 10(a)(2) of the Federal Advisory Committee Act, 5 U.S.C. App. (1988) that an open meeting of the Area 2 Taxpayer Advocacy Panel will be held Tuesday, August 5, 2003 from 3 p.m. EDT to 4:30 p.m. EDT via a telephone conference call. The Taxpayer Advocacy Panel is soliciting public comments, ideas and suggestions on improving customer service at the Internal Revenue Service. Individual comments will be limited to 5 minutes. If you would like to have the TAP consider a written statement, please call 1-888-912-1227 or 954-423-7977, or write Inez E. De Jesus, TAP Office, 1000 South Pine Island Rd., Suite 340, Plantation, FL 33324. Due to limited conference lines, notification of intent to participate in the telephone conference call meeting must be made with Inez E. De Jesus. Ms. De Jesus can be reached at 1-888-912-1227 or 954-423-7977.
The agenda will include the following: Various IRS issues.
Last minute changes to the agenda are possible and could prevent effective advance notice.
In rule document 03-16229 beginning on page 38177 in the issue of Friday, June 27, 2003 make the following correction:
On page 38178, in the second column, in §1.382-10T, in amendatory instruction 3., in the first line, “1.382.10T” should read “1.382-10T”.
Office of the Secretary, Homeland Security.
Notice of proposed rulemaking.
This proposed rule would implement Subtitle G of Title VIII of the Homeland Security Act of 2002—the Support of Anti-terrorism by Fostering Effective Technologies Act of 2002 (“the SAFETY Act” or “the Act”). As discussed in detail below, the SAFETY Act, through regulations promulgated by the Department of Homeland Security (“the Department”), will provide critical incentives for the development and deployment of anti-terrorism technologies by providing liability protections for Sellers of “qualified anti-terrorism technologies” and others.
Comments and related material must reach the Docket Management Facility on or before August 11, 2003.
You may submit comments identified by docket number USCG-2003-15425 to the Docket Management Facility at the U.S. Department of Transportation. To avoid duplication, please use only one of the following methods:
(1) Web site:
(2) Mail: Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street SW., Washington, DC 20590-0001.
(3) Fax: 202-493-2251.
(4) Delivery: Room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The telephone number is 202-366-9329.
(5) Federal Rulemaking Portal:
If you have questions on this proposed rule, call Wendy Howe, Directorate of Science and Technology, Department of Homeland Security, telephone 202-772-9887. If you have questions on viewing or submitting material to the docket, call Dorothy Beard, Chief, Dockets, Department of Transportation, telephone 202-366-5149.
We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted, without change, to
We do not now plan to hold a public meeting. You may, however, submit a request for one to the Docket Management Facility at the address under
The Department intends to implement the SAFETY Act as quickly as possible. Our twin aims are these:
(1) To produce by regulation as much certainty as possible regarding the application of the liability protections created by the Act;
(2) To provide the Department with sufficient program flexibility to address the specific circumstances of each particular request for SAFETY Act coverage.
The Department does not intend to resolve every conceivable programmatic issue through this proposed rule. Instead, the Department will set out a basic set of regulations and commence the implementation of the SAFETY Act program while considering possible supplemental regulations as experience with the Act grows.
The Department invites comment on all aspects of these proposed regulations and on the policies that underlie them. The initial comment period is relatively brief (30 days) in order to permit the Department to begin implementation of this critical program as soon as possible. After reviewing the comments, the Department may issue an interim final rule and seek additional comment on some or all aspects of the program. In any event, the Department will begin implementation of the SAFETY Act immediately with regard to Federal acquisitions of anti-terrorism technologies and will begin accepting other SAFETY Act applications on September 1, 2003.
As part of the Homeland Security Act of 2002, Public Law 107-296, Congress enacted several liability protections for providers of anti-terrorism technologies. The SAFETY Act provides incentives for the development and deployment of anti-terrorism technologies by creating a system of “risk management” and a system of “litigation management.” The purpose of the Act is to ensure that the threat of liability does not deter potential manufacturers or Sellers of anti-terrorism technologies from developing and commercializing technologies that could save lives. The Act thus creates certain liability limitations for “claims arising out of, relating to, or resulting from an act of
Together, the risk and litigation management provisions provide the following protections:
• Exclusive jurisdiction in federal court for suits against the Sellers of “qualified anti-terrorism technologies” (§ 863(a)(2));
• A limitation on the liability of Sellers of qualified anti-terrorism technologies to an amount of liability insurance coverage specified for each individual technology, provided that Sellers will not be required to obtain any more liability insurance coverage than is reasonably available “at prices and terms that will not unreasonably distort the sales price” of the technology (§ 864(a)(2));
• A prohibition on joint and several liability for noneconomic damages, so that Sellers can only be liable for that percentage of noneconomic damages proportionate to their responsibility for the harm (§ 863(b)(2));
• A complete bar on punitive damages and prejudgment interest (§ 863(b)(1));
• A reduction of plaintiffs' recovery by amounts that plaintiffs received from “collateral sources”, such as insurance benefits or other government benefits (§ 863(c)); and
• A rebuttable presumption that the Seller is entitled to the “government contractor defense” (§ 863(d)).
The Act provides that these liability protections are conferred by two separate actions by the Secretary. The Secretary's designation of a technology as a “qualified anti-terrorism technology” confers all of the liability protections
This preamble to the proposed rule first addresses the two major aspects of the Act—the designation of qualified anti-terrorism technologies and the approval of technologies for purposes of the government contractor defense. Following that discussion, the preamble addresses specific issues regarding the proposed rule and the Department's interpretation of the Act.
As noted above, the designation of a technology as a qualified anti-terrorism technology confers all of the liability protections provided in the Act, except for the presumption in favor of the government contractor defense. The Act gives the Secretary broad discretion in determining whether to designate a particular technology as a “qualified anti-terrorism technology,” although the Act sets forth the following criteria that must be considered to the extent that they are applicable to the technology: (1) Prior United States Government use or demonstrated substantial utility and effectiveness; (2) availability of the technology for immediate deployment; (3) the potential liability of the Seller; (4) the likelihood that the technology will not be deployed unless the SAFETY Act protections are conferred; (5) the risk to the public if the technology is not deployed; (6) evaluation of scientific studies; and (7) the effectiveness of the technology in defending against acts of terrorism. These criteria are not exclusive—the Secretary may consider other factors that he deems appropriate. The Secretary has discretion to give greater weight to some factors over others, and the relative weighting of the various criteria may vary based upon the particular technology at issue and the threats that the technology is designed to address. The Secretary may, in his discretion, determine that failure to meet a particular criterion justifies denial of an application under the SAFETY Act. However, the Secretary is not required to reject an application that fails to meet one or more of the criteria. Rather the Secretary, after considering all of the relevant criteria, may conclude that a particular technology merits designation as a “qualified anti-terrorism technology” even if a particular criterion is not satisfied. The Secretary's considerations will also vary with the constantly evolving threats and conditions that give rise to the need for the technologies. The proposed rule provides for designation as a qualified anti-terrorism technology for five to eight years.
The SAFETY Act applies to a very broad range of technologies, including products, services, software, and other forms of intellectual property, as long as the Secretary, as an exercise of discretion and judgment, determines that a technology merits designation under the statutory criteria. Further, as the statutory criteria suggest, a “qualified anti-terrorism technology” is not necessarily required to be newly developed—it may have already been employed (
The Act also provides that, before designating a “qualified anti-terrorism technology,” the Secretary will examine the amount of liability insurance the Seller of the technology proposes to maintain for coverage of the technology at issue. Under Section 864(a), the Secretary must certify that the coverage level is appropriate “to satisfy otherwise compensable third-party claims arising out of, relating to, or resulting from an act of terrorism when qualified anti-terrorism technologies have been deployed.” § 864(a)(1). The Act further provides that “the Seller is not required to obtain liability insurance of more than the maximum amount of liability insurance reasonably available from private sources on the world market at prices and terms that will not unreasonably distort the sales price of Seller's anti-terrorism technologies.” § 864(a)(2).
The Secretary does not intend to set a “one-size-fits-all” numerical requirement regarding required insurance coverage for all technologies. Instead, as the Act suggests, the inquiry will be specific to each application and may involve an examination of several factors, including the following: the amount of insurance the Seller has previously maintained; the amount of insurance maintained by the Seller for other technologies or for the Seller's business as a whole; the amount of insurance typically maintained by sellers of comparable technologies; data and history regarding mass casualty losses; and the particular technology at issue. The Secretary will not require insurance beyond the point at which the cost of coverage would “unreasonably distort” the price of the technology. Once the Secretary concludes the analysis regarding the appropriate level of insurance coverage (which might include discussions with the Seller in appropriate cases), the Secretary will identify in a short certification a description of the coverage appropriate for the particular qualified anti-terrorism technology. If, during the term of the designation, the Seller would like to request reconsideration of that insurance certification due to changed circumstances or for other reasons, the Seller may do so. If the Seller fails to maintain coverage at the certified level during that time period, the liability protections of the Act will continue to apply, but the Seller's liability limit will remain at the certified insurance level. Such failure, however, will be regarded as a negative factor in the consideration
The Department solicits comment on the designation of qualified anti-terrorism technologies, including whether the five to eight year period is an appropriate length of time for such a designation.
The Act creates a rebuttable presumption that the government contractor defense applies to qualified anti-terrorism technologies “approved by the Secretary” in accordance with certain criteria specified in § 863(d)(2). The government contractor defense is an affirmative defense that immunizes Sellers from liability for certain claims brought under § 863(a) of the Act.
First, and most obviously, the Act expressly provides that the government contractor defense is available not only to government contractors, but also to those who sell to state and local governments and the private sector.
Second, Sellers of qualified anti-terrorism technologies need not design their technologies to federal government specifications in order to obtain the government contractor defense under the SAFETY Act. Instead, the Act sets forth criteria for the Department's “approval” of technologies. Specifically, the Act provides that during the process of approval for the government contractor defense the Secretary will conduct a “comprehensive review of the design of such technology and determine whether it will perform as intended, conforms to the Seller's specifications, and is safe for use as intended.” § 863(d)(2). The Act also provides that the Seller will “conduct safety and hazard analyses” and supply such information to the Secretary.
Third, the Act expressly states the limited circumstances in which the applicability of the defense can be rebutted. The Act provides expressly that the presumption can be overcome
The applicability of the government contractor defense to particular technologies is thus governed by these express provisions of the Act, rather than by the judicially-developed criteria for applicability of the government contractor defense outside the context of the SAFETY Act.
While the Act does not expressly delineate the scope of the defense (
The government contractor defense under
Procedurally, the presumption of applicability of the government contractor defense is conferred by the Secretary's “approval” of a qualified anti-terrorism technology specifically for the purposes of the government contractor defense. This approval is a separate act from the Secretary's “designation” of a qualified anti-terrorism technology. Importantly, the Seller may submit applications for both designation as a qualified anti-terrorism technology and approval for purposes of the government contractor defense at the same time, and the Secretary may review and act upon both applications simultaneously. The distinction between the Secretary's two actions is important, however, because the approval process for the government contractor defense includes a level of review that is not required for the designation of a qualified anti-terrorism technology. Specifically, the Act provides that during the process of approval for the government contractor defense the Secretary will conduct a “comprehensive review of the design of such technology and determine whether it will perform as intended, conforms to the Seller's specifications, and is safe for use as intended.” § 863(d)(2). The Department believes that certain Sellers will be able to obtain the protections that come with designation as a qualified anti-terrorism technology even if they have not satisfied the requirements for the government contractor defense. Similarly, even if the applicability of the government contractor defense were rebutted under the test set forth in Section 863(d)(1) of the Act, the technology may still retain the designation and protections as a qualified anti-terrorism technology. Fraud or willful misconduct in the submission of information to the Department in connection with an application under the Act may result not only in rebuttal of the presumed application of the government contractor defense, but may also prompt the Department to refer the matter to the Department of Justice for pursuit of criminal or civil penalties.
The Department invites comment regarding the government contractor defense.
1.
2.
Second, Section 25.3(g) of the proposal recognizes that Federal agencies will often be the purchasers of anti-terrorism technologies. The Department recognizes that terms on which Sellers are able to provide anti-terrorism technologies to Federal agencies may vary depending on whether the technologies receive SAFETY Act coverage or not. The proposal thus provides that the Department may coordinate SAFETY Act reviews with agency procurements. The Department also intends to review SAFETY Act applications relating to technologies that are the subject of agency procurements on an expedited basis.
The Department requests public comments regarding the best way for the Department to provide feedback to potential Sellers regarding SAFETY Act coverage and the best way for the Department to coordinate SAFETY Act review with agency procurements.
3.
4.
5.
The exclusive Federal nature of this cause of action is evidenced in large part by the exclusive jurisdiction provision in § 863(a)(2). That subsection states: “Such appropriate district court of the United States shall have original and exclusive jurisdiction over all actions for any claim for loss of property, personal injury, or death arising out of, relating to, or resulting from an act of terrorism when qualified anti-terrorism technologies have been
Further, it is clear that the Seller is the only appropriate defendant in this exclusive Federal cause of action. First and foremost, the Act unequivocally states that a “cause of action shall be brought only for claims for injuries that are
The scope of federal preemption of state laws is highly relevant to the Department's implementation of the Act, as the Department will have to determine the amount of insurance that Sellers must obtain. Accordingly, the Department seeks comment on that matter.
6.
As explained above, the Department eschews any “one-size-fits-all” approach to the insurance coverage requirement. Instead, the Department construes the Act as contemplating the examination of several factors. Section 25.4(b) of the proposed rule therefore sets forth a nonexclusive list of several factors that the Department may consider. These include the amount of insurance the Seller has previously maintained; the amount of insurance maintained by the Seller for other technologies or for the Seller's business as a whole; the amount of insurance typically maintained by sellers of comparable technologies; data and history regarding mass casualty losses; information regarding the amount of liability insurance offered on the world market; the particular technology at issue and its intended use; and the point at which the cost of coverage would “unreasonably distort” the price of the technology.
In the course of determining the amount of insurance required under the Act for a particular technology, the Department may consult with the Seller, the Seller's insurer, and others. While the decision regarding the amount of insurance required will generally be specific to each Seller or each technology, the Department recognizes that the incentive-based purposes of the Act may be furthered if the Department provides information to potential Sellers regarding the types and amounts of insurance that they will likely be required to obtain. Thus the Secretary may, where appropriate, give guidance to potential Sellers regarding the type and amounts of insurance that may be sufficient under the Act for particular technologies or categories of technologies.
The Department also recognizes that the amount of insurance available at prices that will not unreasonably distort the price of the anti-terrorism technology may vary over time. Thus, the proposed rule is written to give the Department flexibility to address fluctuating insurance prices by providing that, during the term of the designation, the Seller may request reconsideration of the insurance certification due to changed circumstances or other reasons.
The Proposed Rule provides that the Seller shall certify on an annual basis that the Seller has maintained the insurance required by the Under Secretary's certification. It further provides that the Under Secretary may terminate the designation as a qualified anti-terrorism technology if the Seller fails to provide the certification or provides a false certification. Termination of the designation would mean that the Seller would not be able to sell the technology as a qualified anti-terrorism technology after the date of the termination. The Seller's failure to maintain the insurance also may adversely affect the Seller's ability to obtain a renewal of the designation for the technology, and may even adversely affect the Seller's ability to obtain future designations of “qualified anti-terrorism technologies.” Finally, a false certification may result in criminal or other penalties under existing laws.
The liability protections of the Act will continue to apply to technologies sold while the SAFETY Act designation was effective, regardless of whether the seller maintains the required insurance. This is necessary because the SAFETY Act protects not only the Seller, but also others in the supply chain. For example, a buyer who purchases the technology while the SAFETY Act designation is still in effect should not be punished for the Seller's failure to maintain the insurance. The Seller, however, will face potential uninsured liability, because the Seller's liability limit will remain at the certified insurance level. This is because subsection (c) of Section 864 makes clear that the Seller's liability is capped at the amount of insurance “
The Department, as part of each certification, will specify the Seller or Sellers of the anti-terrorism technology for purposes of SAFETY Act coverage. The Department may, but need not, specify in the certification the others who are covered by the liability insurance required to be purchased by the Seller.
The Department invites comment regarding the appropriate interpretation of “prices and terms that will not unreasonably distort sales prices,” the factors that the Department should consider in determining the appropriate amount of insurance, and the relevance of any other provisions of law, such as the Terrorism Risk Insurance Act of 2002 (“TRIA”).
7.
8.
In recognition of this close relationship between the SAFETY Act and indemnification authority, in Section 73 of Executive Order 13286 of February 28, 2003, the President recently amended the existing Executive Order on indemnification—Executive Order 10789 of November 14, 1958, as amended. The amendment granted the Department of Homeland Security authority to indemnify under Public Law 85-804. At the same time, it requires that
The Department has examined the economic implications of this proposed rule as required by Executive Order 12866. Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). Executive Order 12866 classifies a rule as significant if it meets any one of a number of specified conditions, including: Having an annual effect on the economy of $100 million, adversely affecting a sector of the economy in a material way, adversely affecting competition, or adversely affecting jobs. A regulation is also considered a significant regulatory action if it raises novel legal or policy issues.
The Department concludes that this proposed rule is a significant regulatory action under the Executive Order because it will have a positive, material effect on public safety under Section 3(f)(1), and it raises novel legal and policy issues under Section 3(f)(4). The Department tentatively concludes, however, that this proposed rule does not meet the significance threshold of $100 million effect on the economy in any one year under Section 3(f)(1), due to the relatively low estimated burden of applying for this technology program, the unknown number of certifications and designations that the Department will dispense, and the unknown probability of a terrorist attack that would have to occur in order for the protections put in place in this proposed rule to have a large impact on the public. The Department requests comments regarding this determination, and invites commenters to submit any relevant data that will assist the agency in estimating the impact of this rule.
This regulation implements the SAFETY Act and is intended to implement the provisions set forth in that Act. The Department believes the current development of anti-terrorism technologies has been slowed due to the potential liability risks associated with their development and eventual deployment. In a fully functioning insurance market, technology developers would be able to insure themselves against excessive liability risk; however, the terrorism risk insurance market appears to be in disequilibrium. The attacks of September 11 fundamentally changed the landscape of terrorism insurance. Congress, in the findings of TRIA, concluded that temporary financial assistance in the insurance market is needed to “allow for a transitional period for the private markets to stabilize, resume pricing of such insurance, and build capacity to absorb any future losses.” TRIA § 101(b)(2). This rulemaking addresses a similar concern, to the extent that potential technology developers are unable to efficiently insure against large losses due to an ongoing reassessment of terrorism issues in insurance markets.
Even after a temporary insurance market adjustment, purely private terrorism risk insurance markets may exhibit negative externalities. Because the risk pool of any single insurer may not be large enough to efficiently spread and therefore insure against the risk of damages from a terrorist attack, and because the potential for excessive liability may render any terrorism insurance prohibitively expensive, society may suffer from less than optimal technological protection against terrorist attacks. The measures set forth in this proposed rule are designed to meet this goal; they will provide certain liability protection from lawsuits and consequently will increase the
Since this rulemaking puts in place an additional voluntary option for technology developers, the expected direct net benefits to firms of this rulemaking will be positive; companies presumably will not choose to pursue the designation of “anti-terrorism technology” unless they believe it to be a profitable endeavor. The Department cannot predict with certainty the number of applicants for this program. An additional source of uncertainty is the reaction of the insurance market to this designation. As mentioned above, insurance markets appear to currently be adjusting their strategy for terrorism risk, so little market information exists that would inform this estimate. The Department invites comments on these issues.
If a firm chooses to invest effort in pursuing SAFETY Act liability protection, the direct costs to that firm will be the time and money required to submit the required paperwork and other information to the Department. Only companies that choose to request this protection will incur costs. In the preliminary Paperwork Reduction Act analysis, we estimate the reporting burden assuming that each applicant will spend at least 40 hours, and perhaps 200 hours, to prepare the information required by the Department for consideration. For the purposes of this analysis, we assume a loaded labor rate of the personnel preparing the information package of $100 per hour. Consequently, the total cost of the application requirements is estimated to be at least $4,000 per application for a relatively simple application. The Department does not yet have sufficient information to estimate the number of applicants annually. If we assume 1,000 applications annually, the total cost of the application requirement is estimated to range from $4,000,000 to $20,000,000 annually (1,000 applicants × 40 to 200 hours × $100 per hour). The regulation further requires that firms conduct safety, effectiveness, utility, and hazard analyses and provide them to the Secretary in the course of applying for this designation. We do not have quantified estimates of the impact of this provision, but we expect that much of the safety, effectiveness, utility, and hazard analysis activity will already take place in the normal course of technology development, since those matters are fundamental characteristics of a product. The Department acknowledges considerable uncertainty in these estimates, but even if the estimates were considerably higher, this does not represent a large investment by firms relative to overall development costs.
The direct benefits to firms include lower potential losses from liability for terrorist attacks, and as a consequence a lower burden from liability insurance for this type of technology. In this assessment, we were careful to only consider benefits and costs specifically due to the proposed rulemaking and not costs that would have been incurred by companies absent the proposed rulemaking. The SAFETY Act requires the sellers of the technology to obtain liability insurance “of such types and in such amounts” certified by the Secretary. The entire cost of insurance is not a cost specifically imposed by the proposed rulemaking, as companies in the course of good business practice routinely purchase insurance absent Federal requirements to do so. Any difference in the amount or price of insurance purchased as a result of the SAFETY Act would be a cost or benefit of this rule for firms.
The wording of the SAFETY Act clearly states that sellers are not required to obtain liability insurance beyond the maximum amount of liability insurance reasonably available from private liability sources on the world market at prices and terms that will not unreasonably distort the sales price of the seller's anti-terrorism technologies. We tentatively conclude, however, that this rulemaking will impact both the prices and terms of liability insurance relative to the amount of insurance coverage absent the SAFETY Act. The probable effect of this rule is to lower the quantity of liability coverage needed in order for a firm to protect itself from terrorism liability risks, which would be considered a benefit of this rule to firms. This change will most likely be a shift back in demand that leads to a movement along the supply curve for technology firms already in this market; they probably will buy less liability coverage. This will have the effect of lowering the price per unit of coverage in this market.
The Department also expects, however, that this rulemaking will lead to greater market entry, which will generate surplus for both technology firms and insurers. Again, this market is still in development, and the Department solicits comments on exactly how to predict the effect of this rulemaking on technology development.
The Department has little information on the future structure of the terrorism risk insurance market, and how this rulemaking will affect that structure. As stated above, this type of intervention could serve to lower the demand for insurance in the current market, thus the static effect on the profitability of insurers is negative. The benefits of the lower insurance burden to technology firms would be considered a cost to insurers; the static changes to insurance coverage would cause a transfer from insurers to technology firms. On the other hand, this type of intervention should serve to increase the surplus of insurers by making some types of insurance products possible that would have been prohibitive to customers or impossible for insurers to design in the absence of this rulemaking. The Department is interested in public comment on any possible negative or positive impacts to insurers caused by the SAFETY Act and this rulemaking, and whether these impacts would result in transfers within this market or an efficiency change not captured by another party. We encourage commenters to be as specific as possible.
The benefits to the public of this proposed rulemaking are very difficult to put in dollar value terms since its ultimate objective is the development of new technologies that will help prevent or limit the damage from terrorist attacks. It is not possible to even determine whether these technologies could help prevent large or small scale attacks, as the SAFETY Act applies to a vast range of technologies, including products, services, software, and other forms of intellectual property that could have a widespread impact. In qualitative terms, the SAFETY Act removes a great deal of the risk and uncertainty associated with product liability and in the process creates a powerful incentive that will help fuel the development of critically needed anti-terrorism technologies. Additionally, we expect the SAFETY Act to reduce the research and development costs of these technologies.
The tradeoff, however, may be that a greater number of technologies may be developed and qualify for this program that have a lower average effectiveness against terrorist attacks than technologies currently on the market, or technologies that would be developed in the absence of this rulemaking. The reason for that tradeoff is that, in the absence of this rulemaking, potential
The Regulatory Flexibility Act requires the Department to determine whether this proposed rulemaking will have a significant impact on a substantial number of small entities. Although we expect that many of the applicants for SAFETY Act protection are likely to meet the Small Business Administration's criteria for being a small entity, we do not believe this proposed rulemaking will impose a significant financial impact on them. In fact, we believe this proposed rule will be a benefit to technology development businesses, especially small businesses, by presenting them with an attractive, voluntary option of pursuing a potentially profitable investment by reducing the amount of risk and uncertainty of lawsuits associated with developing anti-terrorist technology. The requirements of this proposed rulemaking will only be imposed on such businesses that
To the extent that demand for insurance falls, however, insurers may be adversely impacted by this rule. The Department believes that eventual new entry into this market and further opportunities to insure against terrorism risk implies that the long-term impact of this rulemaking on insurers is ambiguous but could very well be positive. We also expect that this rulemaking will affect relatively few firms and relatively few insurers either positively or negatively, as this appears to be a specialized industry. Therefore, we preliminarily certify this notice of proposed rulemaking will not have a significant impact on a substantial number of small entities, and we request comments on this certification.
This rule will not result in the expenditure by State, local and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year, and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.
The Department will submit the following information collection request to the Office of Management and Budget (OMB) for review in accordance with procedures of the Paperwork Reduction Act of 1995. The proposed information collection will be published to obtain comments from the public and affected agencies.
The Department will request comments on at least the following four points:
(1) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) The accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(3) The quality, utility, and clarity of the information to be collected; and
(4) The burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
(1)
(2)
(3)
(4)
(5)
(6)
If additional information is required, contact: Directorate of Science and Technology, SAFETY Act/room 4320, Department of Homeland Security, Washington, DC 20528.
As noted above, the Department has tentatively determined that this proposed rule would not qualify as a “major rule” as defined by section 804 of the Small Business and Regulatory Enforcement Act of 1996.
The Department of Homeland Security does not believe this proposed rule will have substantial direct effects on the States, on the relationship between the national government and the States, or on distribution of power and responsibilities among the various levels of government. States will, however, benefit from this rule to the extent that they are purchasers of qualified anti-terrorism technologies. The Department requests comment on the federalism impact of this Rule. In particular, the Department seeks comment on whether this proposed rule will raise significant federalism implications and, if so, what is the nature of those implications.
Administrative practice and procedure, Business and industry, Insurance, Science and technology, Security measures.
For the reasons discussed in the preamble, 6 CFR Chapter I is proposed to be amended by adding part 25 to read as follows:
Subtitle G of Title VIII of Pub. L. 107-296, 116 Stat. 2238 (6 U.S.C. 441-444).
This part implements the Support Anti-terrorism by Fostering Effective Technologies Act of 2002, Subtitle G of Title VIII of Public Law 107-296 (“the SAFETY Act” or “the Act”).
All of the Secretary's responsibilities, powers, and functions under the SAFETY Act may be exercised by the Under Secretary for Science and Technology of the Department of Homeland Security (“the Under Secretary”) or the Under Secretary's designees.
(a)
(b)
(1) Prior United States Government use or demonstrated substantial utility and effectiveness.
(2) Availability of the technology for immediate deployment in public and private settings.
(3) Existence of extraordinarily large or extraordinarily unquantifiable potential third party liability risk exposure to the Seller or other provider of such anti-terrorism technology.
(4) Substantial likelihood that such anti-terrorism technology will not be deployed unless protections under the system of risk management provided under Subtitle G of Title VIII of Public Law 107-296 are extended.
(5) Magnitude of risk exposure to the public if such anti-terrorism technology is not deployed.
(6) Evaluation of all scientific studies that can be feasibly conducted in order to assess the capability of the technology to substantially reduce risks of harm.
(7) Anti-terrorism technology that would be effective in facilitating the defense against acts of terrorism, including technologies that prevent, defeat or respond to such acts.
(8) Any other factor that the Under Secretary may consider to be relevant to the determination or to the homeland security of the United States.
(c)
(d)
(1) It has the same intended use as the predicate technology; and
(2) It has the same or substantially similar technological characteristics as the predicate technology.
(e)
(1) Public source studies;
(2) Classified and otherwise confidential studies;
(3) Studies, tests, or other performance records or data provided by or available to the producer of the specific technology; and
(4) Proprietary studies that are available to the Under Secretary.
In considering whether or the extent to which it is feasible to defer a decision on a Designation until additional scientific studies can be conducted on a particular technology, the Under Secretary will bring to bear his or her expertise concerning the protection of the security of the American homeland and will consider the urgency of the need for the technology.
(f)
(g)
(h)
(a)
(1) Assist in determining the amount of liability insurance required; or
(2) Show that the Seller or any other provider of qualified anti-terrorism technology otherwise has met all the requirements of this section.
(b)
(1) The particular technology at issue;
(2) The amount of liability insurance the Seller maintained prior to application;
(3) The amount of liability insurance maintained by the Seller for other technologies or for the Seller's business as a whole;
(4) The amount of liability insurance typically maintained by sellers of comparable technologies;
(5) Information regarding the amount of liability insurance offered on the world market;
(6) Data and history regarding mass casualty losses;
(7) The intended use of the technology;
(8) The possible effects of the cost of insurance on the price of the product, and the possible consequences thereof for development, production, or deployment of the technology; and
(9) In the case of a Seller seeking approval to self-insure, the factors described in 48 CFR 28.308(d).
(c)
(1) Contractors, subcontractors, suppliers, vendors and customers of the Seller.
(2) Contractors, subcontractors, suppliers, and vendors of the customer.
(d)
(e)
(f)
(1) Names of insurance companies, policy numbers, and expiration dates;
(2) A description of the types and nature of such insurance (including the extent to which the Seller is self-insured or intends to self-insure);
(3) Dollar limits per occurrence and annually of such insurance, including any applicable sublimits;
(4) Deductibles or self-insured retentions, if any, that are applicable;
(5) Any relevant exclusions from coverage under such policies;
(6) The price for such insurance, if available, and the per-unit amount or percentage of such price directly related to liability coverage for the Seller's Qualified Anti-terrorism Technology deployed in defense against, or response to, or recovery from an act of terror;
(7) Where applicable, whether the liability insurance, in addition to the Seller, protects contractors, subcontractors, suppliers, vendors and customers of the Seller and contractors, subcontractors, suppliers, vendors and customers of the customer to the extent of their potential liability for involvement in the manufacture, qualification, sale, use or operation of Qualified Anti-terrorism Technologies deployed in defense against, response to, or recovery from an act of terrorism;
(8) Any limitations on such liability insurance; and
(9) In the case of a Seller seeking approval to self-insure, all of the information described in 48 CFR 28.308(a)(1) through (a)(10).
(g)
(h)
(a)
(b)
(1) The Application is complete and will be reviewed; or
(2) That the Application is incomplete, in which case the missing or incomplete parts will be specified.
(c)
(1) Request additional information from the Seller;
(2) Meet with representatives of the Seller;
(3) Consult with, and rely upon the expertise of, any other federal or nonfederal entity;
(4) Perform studies or analyses of the technology or the insurance market for such technology; and
(5) Seek information from insurers regarding the availability of insurance for such technology.
(d)
(e)
(f)
(g)
(h)
(i)
The Under Secretary may certify a qualified anti-terrorism technology as an Approved Product for Homeland Security for purposes of establishing a rebuttable presumption of the applicability of the government contractor defense. In determining whether to grant such certification, the Under Secretary or his or her designee shall conduct a comprehensive review of the design of such technology and determine whether it will perform as intended, conforms to the Seller's specifications, and is safe for use as intended. The Seller shall provide safety and hazard analyses and other relevant data and information regarding such technology to the Department in connection with an application. The Under Secretary or his designee may require that the Seller submit any information that the Under Secretary or his designee considers relevant to the application for approval. The Under Secretary or his designee may consult with, and rely upon the expertise of, any other governmental or non-governmental person or entity, and may consider test results produced by an independent laboratory or other person or entity engaged by the Seller.
(a)
(b)
(1) The Application is complete and will be reviewed; or
(2) That the Application is incomplete, in which case the missing or incomplete parts will be specified.
(c)
(1) Request additional information from the Seller;
(2) Meet with representatives of the Seller;
(3) Consult with, and rely upon the expertise of, any other federal or nonfederal entity; and
(4) Perform or seek studies or analyses of the technology.
(d)
(e)
(f)
(g)
(h)
(i)
(j)
The Secretary, in consultation with the Office of Management and Budget and appropriate Federal law enforcement and intelligence officials, and in a manner consistent with existing protections for sensitive or classified information, shall establish confidentiality protocols for maintenance and use of information submitted to the Department under the SAFETY Act and this Part. Such protocols shall, among other things, ensure that the Department will utilize all appropriate exemptions from the Freedom of Information Act.
Food and Drug Administration, HHS.
Final rule.
The Food and Drug Administration (FDA) is amending its regulations on nutrition labeling to require that
This rule is effective January 1, 2006.
Julie Schrimpf, Center for Food Safety and Applied Nutrition (HFS-832), Food and Drug Administration, 5100 Paint Branch Pkwy., College Park, MD 20740, 301-436-2373.
The Nutrition Labeling and Education Act of 1990 (the 1990 amendments) (Public Law 101-535) amended the Federal Food, Drug, and Cosmetic Act (the act) to provide, among other things, that certain nutrients and food components be included in nutrition labeling. Section 403(q)(2)(A) and (q)(2)(B) (21 U.S.C. 343(q)(2)(A) and (q)(2)(B)) of the act state that the Secretary of Health and Human Services (the Secretary) (and, by delegation, FDA) can, by regulation, add or delete nutrients included in the food label or labeling if he or she finds such action necessary to assist consumers in maintaining healthy dietary practices.
In response to these provisions, in the
In the
FDA received a citizen petition, dated February 14, 1994, from CSPI (docket number 94P-0036/CP1) stating that an increasing body of evidence suggests that dietary
On July 13, 1998, CSPI amended its petition in a way that would maintain the definition of saturated fat in § 101.9(c)(2)(i), yet provide consumers with information on the
In response to CSPI's petition, FDA issued a proposed rule in the
In the
In the
Some comments that FDA received after publication of the nutrient content claims final rule objected to the 1 percent criterion for
In the November 1999 proposal, FDA concluded that dietary
In addition, in the November 1999 proposal, FDA requested comment on whether “
In the November 1999 proposal, FDA proposed to deny CSPI's request that the agency require that “partially hydrogenated” fat be listed as “partially saturated” fat (64 FR 62746 at 62762). Among other reasons, the agency stated that “hydrogenated” and “partially
Comments to the November 1999 proposal requested that the final rule define the nutrient content claim “reduced
Subsequent to FDA's November 1999 proposal, the Institute of Medicine of the National Academy of Sciences (IOM/NAS) issued a report entitled “Dietary Reference Intakes for Energy, Carbohydrate, Fiber, Fat, Fatty Acids, Cholesterol, Protein and Amino Acids” (the IOM/NAS macronutrient report) (Ref. 140) and found, similar to the effect of saturated fat, “a positive linear trend” between
In response to the recommendations of the new scientific reports to limit the intake of
In the November 15, 2002,
FDA received over 1,650 letters in response to the November 1999 proposal, over 45 letters in response to the December 5, 2000, notice reopening the comment period, and over 25 letters in response to the November 15, 2002, proposal and notice to reopen the comment period. Each of these letters contained one or more comments. Responses were received from industry, trade associations, consumers, consumer advocacy organizations, academia, health care professionals, professional societies, city and State governments, other Federal agencies, and other countries. Some of the comments supported the proposal generally or supported aspects of the proposal. Other comments objected to specific provisions and requested revisions. Some comments requested that the proposal be withdrawn or reproposed. A few comments addressed issues outside the scope of the proposal and will not be discussed here. On September 18, 2001, the Office of Information and Regulatory Affairs (OIRA), Office of Management and Budget, sent to the Secretary of the Health and Human Services (the Secretary) a letter requesting that the Secretary and FDA consider giving greater priority to the November 1999 proposal (Ref. 156) in light of the growing body of scientific evidence suggesting that consumption of
A summary of the relevant comments that pertain to nutrition labeling of
In this final rule and given the current state of scientific knowledge, FDA is requiring the mandatory declaration in the nutrition label of the amount of
The action the agency is taking in this final rule is based on its evaluation of comments received in response to the November 1999 proposal, the reopening of the comment period on November 15, 2002, and on scientific evidence that shows that consumption of
FDA received a number of comments from trade associations and others in industry asserting that FDA did not meet its burden under the first amendment in proposing to mandate nutrition labeling of
As stated in section VI of this document, FDA is withdrawing those sections of the rule pertaining to the definition for nutrient content claims that were proposed, and to limits on the amounts of
Several comments question whether the agency's proposed requirement for mandatory
A few comments suggest that there was no basis for concluding any health benefit can be expected from disclosure of
Another comment argues that the agency could only require mandatory labeling of
FDA believes it has adequate authority to adopt this rule. FDA's authority under the act to require
The agency believes that the data in the record supports mandatory
Under the act, the agency has the mandate to ensure that labeling provides truthful and nonmisleading information to consumers. Thus, the law provides the agency with authority to require specific label statements when needed for reasons other than to ensure the safe use of food. Under section 403(a)(1) of the act, a food is misbranded if its labeling is false or misleading in any particular. Section 201(n) of the act amplifies what is meant by “misleading” in section 403(a)(1) of the act. Section 201(n) of the act states that, in determining whether labeling is misleading, the agency shall take into account not only representations made about the product, but also the extent to which the labeling fails to reveal facts material in light of such representations made or suggested in the labeling or material with respect to consequences which may result from use of the article to which the labeling relates under the conditions of use prescribed in the labeling or under such
In general, the agency believes the concept of “material fact” is one that must be applied on a case-by-case basis. The agency has required special labeling in cases where information is necessary to ensure that consumers are aware of special health risks associated with consumption of a particular product. For example, although protein products intended for use in weight reduction are not inherently unsafe, FDA requires a warning statement for such products that states, in part, that very low calorie protein diets may cause serious illness or death. Another example of required information is the use of the term “milk derivative” following the ingredient declaration of sodium caseinate when used in a product labeled “non dairy” (21 CFR 101.4(d)).
Consumption of
Consumers must know—and the agency believes is material information that the reasonable consumer should know—the amount of
Moreover, Congress provided the agency with the express authority to add to the list of nutrients on the label under section 403(q)(2)(A) of the act. As stated in section V.A of this document, section 403(q)(2)(A) gives FDA the authority to require that information on additional nutrients be included in nutrition labels if FDA determines that providing such information will assist consumers to maintain healthy dietary practices. Section IV of this document provides ample evidence of the heart unhealthy effects from consumption of
Further, the agency disagrees with the comments that assert that mandatory
The agency is exercising the discretion that Congress gave it in the 1990 amendments to include
Further, section 403(q)(2)(A) provides that mandatory labeling would be appropriate when information about a nutrient would assist consumers to maintain healthy dietary practices. Information on the
Several general comments were received asserting that the agency's action to mandate labeling is subject to review under the first amendment. The comments assert that mandatory labeling of
Some comments assert that FDA's proposal to mandate
A few comments state that treating
FDA believes that this regulation is consistent with the first amendment. As noted previously, the failure to disclose the amount of
Accordingly, FDA believes that this final rule passes muster under the four-part test in
Given this determination, arguably the agency need not address the other three parts of the
Moreover, FDA has a substantial governmental interest in assisting consumers to maintain healthy dietary practices. Such interest is consistent with the purpose of section 403(q)(2)(A) of the act; to provide information to consumers on nutrients (
Under the third prong of
Finally, under the fourth prong of
The agency disagrees with the suggestion that narrow tailoring under the fourth prong of
Moreover, there is a substantial argument that the agency need not satisfy the
Further, the U.S. Court of Appeals for the second circuit upheld a regulation compelling speech where the goal of the statute was to reduce the amount of mercury released into the environment; a goal that was “inextricably intertwined with the goal of increasing consumer awareness of the presence of mercury in a variety of products” (
For all of the foregoing reasons, the agency believes it has complied with its burdens under the first amendment to support mandatory disclosure of the amount of
Providing information to consumers about the
The agency has carefully considered the limitations imposed by the first amendment to avoid unjustified burdens and costs of food labeling where there is no genuine public health benefit from the rule that does not alleviate a harm of potential consumer deception. The agency did carefully calculate the costs and benefits of food labeling (see section IX of this document) and determined that the scope of mandatory
One comment asserts that FDA must adopt regulations that are supported by the rulemaking record and that are not otherwise arbitrary and capricious in light of the statutory limitations on the agency's authority. This comment and another assert that the data do not support a basis for treating
To the extent that comments were raising concerns about the agency going to a final rule based on including
“The distinction between avoidance of risk through regulation and compensation for injuries after the fact is a fundamental one. In the former, risk assessments may lead to control of a toxic substance even though the probability of harm to any individual is small and the studies necessary to assess the risk are incomplete; society as a whole is willing to pay the price as a matter of policy. In the latter, a far higher probability (greater than 50 percent) is required since the law believes it is unfair to require an individual to pay for another's tragedy unless it is shown that it is more likely than not that he caused it * * *.”
The agency has determined, based on this scientific evidence, that consumers need this information to maintain healthy dietary practices. Thus, the agency is not precluded under the APA, as the comment suggests, from issuing this final rule. In addition, the agency has discussed why it believes that this final rule comports with the first amendment, and thus, disagrees with the comment that suggests that because it did not meet its burdens under the first amendment, it did not satisfy the APA requirements.
In the November 1999 proposal, FDA reviewed reports published by the U.S. Federal government and the IOM/NAS. These reports, which were published between 1988 and 1995, showed that conclusions about the role of
Subsequent to the November 1999 proposal, new expert panels have been convened to update, in light of new scientific evidence, the conclusions and recommendations in the reports discussed previously. FDA has reviewed these new reports to evaluate whether their updated conclusions reversed or significantly altered its earlier conclusions.
The Dietary Guidelines 2000 (Ref. 87) makes the following statements regarding
Foods high in
Aim for a total fat intake of no more than 30 percent of calories, as recommended in previous editions of the Guidelines. If you need to reduce your fat intake to achieve this level, do so primarily by cutting back on saturated and
Limit use of solid fats, such as ... hard margarines, ... and partially hydrogenated shortenings. Use vegetable oil as a substitute. (Ref. 87, p. 30).
In the report describing the basis for its recommendations, the Advisory Committee on Dietary Guidelines 2000 (Ref. 88) suggested that information be provided to help the reader of the Dietary Guidelines 2000 distinguish among the different kinds of fats—saturated,
The advisory committee further states:
Recent guidelines from the National Cholesterol Education Program (NCEP) (Ref. 89) provide an update to the 1993 NCEP report (Ref. 5). The 2001 NCEP report is an evidence-based report that extensively references the scientific literature. The expert panel concluded that:
Based on these conclusions, the Expert Panel recommended for individuals at increased risk for CHD that:
Intakes of
Lastly, a recent report of the IOM/NAS found “a positive linear trend between
In summary, the recently updated Dietary Guidelines (Ref. 87 ), NCEP (Ref. 89), and IOM/NAS (Ref. 140) reports, based on current scientific evidence, consistently find that
(Comment 1) Several comments on the November 1999 proposal questioned whether the conclusions regarding
The Dietary Guidelines 2000 have been published (Refs. 87 and 88). While they do not mention
(Comment 2) One comment suggested that
FDA disagrees with the comments' conclusions that the recommendations of the AHA and other scientific bodies that margarine be substituted for butter provides a basis for concluding that
Those comments that said
It should be noted that recommendations to consume margarine instead of butter are based on the fact that the combined amount of cholesterol-raising lipids (
To evaluate the evidence that dietary
In the November 1999 proposal, FDA evaluated results of 12 dietary intervention studies (Refs. 7 through 15, 34, 36, and 82). FDA focused on the physiological measures of serum and plasma LDL-C concentrations to evaluate whether
In the November 1999 proposal, FDA also reviewed nine publications that examined associations between
Thus, in the November 1999 proposal, FDA concluded that controlled intervention studies in different population groups in the United States and other countries consistently indicate that consumption of diets containing
In the November 1999 proposal, FDA also summarized the results of estimates of dietary intake of
Subsequent to the November 1999 proposal, additional studies on the topic of
(Comment 3) Many comments discussed the strength of the scientific evidence for establishing whether
A few comments to the November 15, 2002, proposal to reopen the
Based on an evaluation of the scientific evidence, FDA concludes that the scientific evidence is sufficient to require nutrition labeling of
Moreover, FDA's conclusions were consistent with those of independent Federal Government expert panels that published dietary recommendations for U.S. population groups subsequent to publication of the November 1999 proposal (Refs. 87 and 89 through 91) that were cited in the
In summary, based on the consistent results across a number of the most persuasive types of study designs (i.e., intervention trials and prospective cohort studies) that were conducted using a range of test conditions and across different geographical regions and populations, the agency now agrees with the comments that stated that the available evidence for an adverse relationship between
(Comment 4) Several comments stated that a new observational study by van de Vijver et al., “Association between
FDA disagrees with the comments. The
FDA notes that cross-sectional designs, such as the one used by van de Vijver et al., are relatively weak designs for showing associations between diet and serum lipids (Ref. 93). As an observational study, they are generally considered to be less persuasive than intervention trials. Moreover, compared with other types of observational studies (e.g., prospective (cohort) observational studies and retrospective (case-control) studies), they are considered particularly weak. Considering the weaknesses of the cross-sectional design used in the
For the reasons cited previously, FDA disagrees with the comments that a lack of association between
(Comment 5) Many comments emphasized the inadequacies in the assessment of intakes of
FDA agrees that estimates of dietary intakes of
In the November 1999 proposal, FDA reviewed an analysis that used the results of the 1989-1991 Continuing Survey of Food Intakes by Individuals (CSFII), a national food consumption survey of the U.S. population conducted by the USDA (Ref. 26). This study reported a mean
The second type of
Finally, observational studies conducted in U.S. populations also can provide intake estimates. In the November 1999 proposal, FDA reviewed several observational studies, including several prospective cohort studies conducted in U.S. populations who were healthy at the time of enrollment (Refs. 19, 21, and 38). Estimates of daily
In summary, the different types of studies, and different studies within a study type, estimated different intake levels for the U.S. population. The estimates from the food disappearance data are likely overestimated. The estimates from the observational studies and the national food consumption survey are likely underestimated. All estimates used the same compositional data base which, as noted above, has very limited data on the
Because of the multiple sources of uncertainty in intake estimates, caution must be exercised to avoid over-interpretation of the available dietary intake estimates and their relationship to the
Because of the serious public health consequences of CHD in the U.S. population, prudent public health dictates that we help consumers control those risk factors which they can alter directly through their own behavior. Heart-healthy diets that limit the intakes of both saturated and
(Comment 6) Many comments addressed the issue of the relevance of intervention study intakes to usual conditions of use in the United States. Some comments expressed concern that FDA's conclusions relied on intervention studies in which the intakes of
FDA disagrees with the comments that it relied heavily on intervention trials with high
Thus, in the aggregate, the U.S. intervention studies included an assessment of the effect of a wide range of
(Comment 7) Other comments suggested that the study populations were not representative of the U.S. population. For example, one comment said that the intervention studies included individuals at high risk with serum cholesterol levels greater than (>) 320 milligrams (mg)/deciliter (dL) or LDL-C > 130 mg/dL. Another comment stated that the agency failed to reflect that relative risk will depend on the base risk of the population used for comparisons with the U.S. general population.
FDA disagrees with these comments. Of the 512 subjects included in the dietary intervention studies cited in the November 1999 proposal, 48 percent of the dietary intervention population had an LDL-C level of 100 to 120 mg/dL that is categorized as near or above optimal level according to the NCEP lipid classification scheme (Ref. 89). Thirty-eight percent had an LDL-C of 130 to 159 mg/dL, categorized as borderline high; and 14 percent had a LDL-C of greater than or equal to (≥)160 mg/dL, categorized as high. Only 5 percent of the participants had a low HDL-C level, < 40 mg/dL; and another 7 percent had a high HDL-C level, ≥60 mg/dL. Most (88 percent) had mean HDL-C levels in the range of 41 to 59 mg/dL. Also, 73 percent of the population was in the age group where the CHD risk is lower, e.g., men <45 years of age and women <55 years of age. The study populations were described as participants who had normal cardiac, kidney and liver function, and were not taking medications that affect lipid levels. Many participants had near or optimal LDL-C levels and most had HDL-C levels that were neither high nor low by the NCEP criteria. The data that FDA relied on included a dietary intervention population that is representative of the U.S. general population.
(Comment 8) Some comments suggested that the test products were not representative of available commercial products in the U.S. marketplace. One comment suggested that several studies were designed to study the effects of different food oil sources and not designed to specifically study the effect of
FDA disagrees with these comments. In general, the test products used in studies done by U.S. research groups were either commercially available products or were produced specifically for a study by U.S. manufacturers using oil sources commonly used in the U.S. market (Refs. 12 through 15, 34, and 82). However, regardless of whether studies used products typical of those commercially available in other countries, products commercially available in the United States, or products developed specifically for the study at hand, results were generally consistent across all these studies and consistent with the larger body of evidence that included studies done in Europe and with European oils. That is, there was consistency across studies in finding that higher intakes of
FDA also recognizes that the intervention studies were designed with a variety of objectives in mind. Some were designed to compare two different sources of hydrogenated oils (e.g., Refs. 9, 14, 15, and 36). Many were designed to compare the effects of different types of fatty acids by varying the source oils to achieve the desired fatty acid types and levels (e.g., Refs. 7, 8, 10, 11 through 13, and 34). The study designs also varied significantly in how they identified controls for the comparisons of interest. Despite these differences in objectives and study design, the general consistency across studies in finding that
Thus, most of the intervention trials provide enough information about test products, study population, and study diets to evaluate their relevance to the U.S. general population. The wide range of
(Comment 9) Many comments questioned whether the scientific evidence shows that the physiological effects of
FDA notes that the intervention studies demonstrate that the net physiologic effect of a particular fatty acid or category of fatty acids is dependent upon the composition of both the intervention diet and the comparison diet. In the dietary intervention research reviewed, the study investigators used a variety of study designs to assess the effect of a defined quantity of
For purposes of its regulatory impact analysis in the proposal, FDA needed a basis for quantifying its estimates of the compliance costs and benefits associated with given changes in
In estimating the benefits and costs, FDA also recognized that the type of macronutrient substituted for
Regardless of whether FDA reviewed the effects of saturated fat and
(Comment 10) Many comments addressed the issue of the potential adverse effects of
Based on the recommendations of the 1993 NCEP Expert Panel (Ref. 5), in the November 1999 proposal, FDA concluded that an examination of the effects of
FDA's review of the intervention trials showed that HDL-C decreased when
To date, lowered HDL-C levels have been shown to be a useful predictor of heart disease risk because of its correlation with CHD risk. However, it is not known whether lowering HDL-C is related to CHD risk in a cause and effect manner. Until this relationship is confirmed by appropriate study designs, the use of HDL-C as a surrogate biomarker for CHD risk must be done with caution and clear recognition of the uncertainty surrounding this use. For example, FDA notes that the NCEP 2001 Report (Ref. 89) makes several statements that both recognize and qualify the relationship between
Therefore, while FDA did not place primary reliance upon the relationships among
The question of interpretation of LDL/HDL ratios is more difficult. For example, concurrent small changes in both LDL-C and HDL-C could result in a similar LDL/HDL ratio as would concurrent large changes in both LDL-C and HDL-C assuming the changes are in the same direction. Or, large changes in HDL-C with moderate changes in LDL-C could give similar LDL/HDL ratios as would moderate changes in HDL and small changes in LDL. However, it is likely that the magnitude of the change in the individual blood cholesterol levels is as, or more, important than is a change in the ratio of the two. Thus, interpretation of the LDL/HDL ratio is unclear and until there is evidence by which its meaning can be more precisely defined, use of this ratio requires considerable caution. However, even with these caveats, regardless of whether results are expressed as increased levels of LDL-C or as increases in LDL/HDL ratios, the conclusion is the same:
(Comment 11) A number of comments emphasized that, in addition to HDL-C,
Some comments stated that
FDA recognizes that the relationship of biomarkers, other than LDL-C, and to a lesser degree, HDL-C, with CHD risk is less well established and difficult to interpret. Moreover, at this time, the findings suggesting effects of
In the November 1999 proposal, FDA proposed that when
(Comment 12) The majority of the comments supported the November 1999 proposal, which required the mandatory declaration of
A few comments stated that mandatory labeling of
Some comments stated that, although mandatory labeling of
One comment stated that
FDA disagrees with comments opposed to mandatory declaration of
New studies and recent expert reports (Refs. 87, 90, 95, and 140) have been published and confirm the relationship between
Government and industry surveys consistently find that a majority of American consumers report looking at the nutrition label the first time they purchase a food product (e.g., about 75 percent according to FDA surveys (Ref. 96) and 51 percent according to a 1997 industry survey (Ref. 97). According to the FDA surveys, the most frequently reported label use and the one which increased most following the implementation of the 1990 amendments was “to see how high or low the food is in things like calories, salt, vitamins, fat, etc.” (70 percent in 1995, up 12 percent from 1994) (Ref. 96, table 16.1).
These survey data show that consumers rely on the Nutrition Facts label as a guide to choosing foods that meet their dietary objectives. As consumers learn more about the dietary significance of
Therefore, FDA, as delegated by the Secretary, has concluded that
FDA disagrees with the comments that stated that mandatory labeling of
FDA disagrees with the comments that suggested that the nutrition label would not be misleading if grams of
Similarly, tying mandatory declaration of
Regarding the comment that consumers prefer simplicity and clarity in labels, FDA does not agree that providing a listing of the amount of
FDA is not persuaded by the comment that it is not necessary to make
As mentioned earlier, section 403(q)(2)(A) of the act provides for the inclusion of an additional nutrient(s) if the Secretary (as delegated to FDA in § 5.10) determines that it should be included in nutrition labeling to assist consumers in maintaining healthy dietary practices. FDA is not asserting, as its basis for mandatory
FDA received many comments regarding the proposed option for nutrition labeling of
The agency did not receive comments supporting either of the two options that would declare only the combined amount of saturated fat and
FDA also received a few comments that supported the proposed footnote statement “Intake of
(Comment 13) Many comments supported the proposed option of having the amount of
Comments supporting inclusion of
However, many comments opposed this option of including
In addition, several comments objected to combining both
A few comments expressed concern that by including
Other comments stated that, because of the magnitude of CHD risk in the prospective studies,
Other comments objected to including
One comment said that FDA should not include
Based on comments received, FDA is persuaded that there are inherent weaknesses and inconsistencies in its proposed option. Therefore, the agency has reconsidered its proposal to include
The agency re-evaluated its position, noted in the final rules implementing the 1990 amendments, that there is insufficient knowledge about the physiological effects of particular fatty acids to use anything other than a chemical definition for saturated fats (58 FR 2079 at 2089). In that rulemaking, FDA reconsidered its regulatory position in place since 1973 (38 FR 2132 at 2134, January 19, 1973) of linking the definition of saturated fatty acids to effects of particular fatty acids on blood total and LDL-C and determined that a chemical definition was a more appropriate approach. The agency stated that a chemical definition avoids much of the controversy regarding blood cholesterol effects of short to medium and certain very long chain fatty acids because the definition is not subject to changes in knowledge about the physiological effects of a particular fatty acid. In addition, the agency stated that a chemical definition approach to labeling fatty acids avoids the uncertainty about physiological effects other than those related to CHD (58 FR 2079 at 2089). Based on its re-review of the position noted in the final rules implementing the 1990 amendments, the comments received on proposed rule opposing a contrary position, and current science on
The agency also acknowledges the concerns expressed in comments about the prominence given to the information on
In the November 1999 proposal, FDA expressed concern that consumers may not yet know what
In the November 1999 proposal, FDA tentatively concluded that, in the absence of dietary recommendations for
Accordingly, the agency concludes that other options that disassociate
(Comment 14) Several comments preferred the option identified in the November 1999 proposal that would list “Saturated +
Alternatively, a few comments recommended declaring the individual amounts for saturated fat and
Two comments urged the agency to harmonize its
Other comments did not favor listing saturated and
The agency is not persuaded by comments supporting this option. While this option does indicate more clearly than the proposed rule that saturated and
Those comments stating that saturated and
FDA recognizes that Canada has issued final rules on nutrition labeling that declare saturated fat and
(Comment 15) Several comments recommended a new option that would place an asterisk (or other symbol) after the declaration of total fat (i.e., “Total Fat*”) that references a footnote stating the number of grams of
Some of these comments suggested that declaring
The comments stated that placing the asterisk beside “total fat” has advantages for consumers. At least one comment stated that this type of listing may be more readily seen by consumers since it gives greater prominence to the
The agency disagrees with those comments suggesting that concerns about
Further, placing an asterisk after “Total Fat” on the label with a footnote stating the grams of
Moreover, while total fat in the diet is important, the composition of that total fat intake is at least equally, if not more, important. Recent recommendations from the Dietary Guidelines 2000 (Ref. 87) and the Dietary Guidelines Advisory Committee (Ref. 88) have emphasized reducing intake of both saturated and
The comments suggesting that
The agency acknowledges that the options of using an asterisk next to total fat with a footnote listing
For the reasons noted previously, the agency is not persuaded that the nutrition label should identify levels of
(Comment 16) Many comments recommended that
Several comments argued that by providing a separate line for
A few comments in favor of a separate line for
One comment objected to the option of having a separate line for
FDA agrees with comments that point out that there are chemical differences between saturated and
FDA also acknowledges that while the two types of fatty acids have similar effects on LDL-C, there are other physiological distinctions between them. Because the overall weight of scientific evidence in support of the finding that consumption of
As pointed out by comments, doing so has the advantage of being consistent with: (1) The format used to list the other subcomponents of total fat, namely saturated, polyunsaturated and monounsaturated fats; (2) the declaration of quantitative amounts contiguous to the listing of the nutrient rather than in a footnote; and (3) the agency's regulatory precedent of classifying nutrients based on their chemical definition or structure. Consistency with the existing format can be expected to assist consumers in recognizing
The agency agrees with the majority of the comments that the scientific evidence is not sufficient to support the establishment of a DRV for
The agency recognizes that the absence of a DRV, and thus, the absence of a % DV for
The agency does not believe it would be any more difficult for consumers to look at a separate line for information on
The comment that was concerned that use of a separate line for
Accordingly, FDA is revising § 101.9(c) by adding paragraph § 101.9(c)(2)(ii) to require the quantitative declaration of
As a result of adding paragraph (c)(2)(ii) for
(Comment 17) In response to the November 2002 reopening of the comment period on the November 1999 proposal to require a footnote stating “Intake of
The majority of the comments strongly opposed the proposed footnote statement and recommended that FDA drop the footnote and finalize the quantitative (grams per serving) label declaration of
Similarly, several comments described the proposed footnote statement as an unjustified warning statement on the label of foods that contain
Comments also criticized the proposed footnote for being more prescriptive than, and inconsistent with, other Federal Government dietary recommendations, such as the Dietary Guidelines for Americans 2000 and the NCEP Adult Treatment Panel III Report, 2001. According to the comments, the recommendations of these reports support the need for Americans to choose diets that are low in saturated fat and cholesterol and moderate in fat while reducing, not eliminating, dietary consumption of
Comments also pointed out that the IOM/NAS report gives essentially identical advice for saturated fat and cholesterol as it gives for
Many of the comments expressed concern that the proposed footnote statement is potentially misleading to consumers and will undermine the key goals of this rulemaking. To that end, the comments strongly recommended that FDA drop the proposed footnote statement from the final rule and take time to conduct consumer research to determine the impact of the proposed footnote statement on consumers' understanding and comprehension. A few comments cited FDA's obligation under the 1990 amendments (paragraph 2(b)(1)(A)) to ensure that nutrition labeling is “conveyed to the public in a manner which enables the public to readily observe and comprehend such information and to understand its relative significance in the context of a total daily diet.” The comments argued that the proposed footnote statement should be consumer tested to ensure that the nutrition information provides meaningful guidance to consumers and drives the market in a nutritionally beneficial direction. The majority of comments that opposed the proposed footnote statement commented that even in the absence of a DV, consumers can still find quantitative information useful (similar to the listing of monounsaturated and polyunsaturated fats on the nutrition label).
Many of the comments recommended that FDA not move forward with the proposed footnote until the IOM/NAS completes a study, which is underway, of the uses of DRIs in nutrition labeling. The comments noted that the IOM is under contract with FDA, USDA and Health Canada to assess the objectives, rationale, and recommendations for the methodology for selecting reference values for nutrition labeling of foods based on DRIs and will identify guiding principles for use in setting reference values for nutrients on the food label. The comments also noted that the IOM committee is expected to complete its work on this project in mid-2003 and to issue a report in September 2003.
One comment stated that the prescriptive nature of the proposed footnote may also violate international obligations of the United States under the World Trade Organization (WTO). The comment stated that WTO's Agreement on the Sanitary and Phytosanitary (SPS) Measures requires that SPS measures intended to protect human health be based upon sound science. The comment questions this regarding the proposed footnote statement because it implies a benefit to consumers who avoid consuming
Some comments expressed concern that the proposed footnote statement would provide a disincentive to the industry such that many foods would be reformulated to reduce or remove
Many of the comments stated that FDA did not carry its burden under the first amendment. The comments argued that the proposed footnote statement fails to serve a substantial government interest in alleviating a genuine public harm, does not directly advance that interest and is not narrowly tailored. Several comments stated that the footnote statement is tantamount to a warning statement and is misleading.
Some comments stated that the use of the footnote statement would be establishing a new precedent by providing guidance, not just quantitative information on the Nutrition Facts panel. They argued that there were no consumer data to show that the footnote will help consumers understand the information. Comments stated that the agency had such data when it decided on the Nutrition Facts panel labeling format that only included quantitative information and should have consumer data here, where a new precedent is being considered.
Lastly, a few comments opposed FDA's offer to consider exercising our enforcement discretion to allow products to begin declaring
The agency is persuaded by comments that the statement it proposed may have unintended consequences. It was not FDA's intent to distract consumers from dietary guidance to minimize intake of saturated fat, but rather, in the absence of a DV for
While the online survey was small, its results support concerns expressed by the food industry that some consumers would interpret the footnote as a de facto DV of zero or as a warning statement that they should avoid all
The agency agrees with comments that support consumer testing to ensure that information on the food label provides meaningful guidance to consumers and drives the market in a nutritionally beneficial direction. FDA concludes, therefore, that based on arguments presented in the comments, that while the footnote would provide guidance on dietary recommendations for
Accordingly, as a result of concerns expressed in the comments, asserting that consumers may place undue emphasis on
The agency is also requesting comments on whether it should consider statements about
In the meantime, as noted in the preceding comment, FDA is issuing this final rule to require the quantitative declaration of
FDA acknowledges concerns, expressed in response to the November
(Comment 18) A few comments requested that the term “
The agency agrees that there should be consistent terminology used on the food label and notes that proposed § 101.9(c)(2)(i)(B), which dealt primarily with the proposed footnote about
Because this final rule is making
Special provisions within § 101.9(c) allow for shortened formats that provide manufacturers flexibility to omit noncore nutrients (i.e., mandatory nutrients other than calories, total fat, sodium, total carbohydrate, and protein) that are present in insignificant amounts from the list of nutrients and group them in a summary statement at the bottom of the label that states “Not a significant source of ______” (see 58 FR 2079 at 2083, Comment 8, January 6, 1993). These special provisions are found in § 101.9(c)(1)(ii) for calories from fat, § 101.9(c)(2)(i) for saturated fat, § 101.9(c)(3) for cholesterol, § 101.9(c)(6)(i) for dietary fiber, § 101.9(c)(6)(ii) for sugars, and § 101.9(c)(8)(iii) for vitamin A, vitamin C, calcium, or iron. For consistency with the labeling scheme for these other noncore mandatory nutrients, new § 101.9(c)(2)(ii) provides that if the
Current § 101.9(c)(2)(i) requires label declaration of saturated fat content information on a separate line (the “Not a significant source of ____” statement would not be an option), if claims are made about fat or cholesterol and if “calories from saturated fat” is declared. In the November 1999 proposal, § 101.9(c)(2)(i) was amended to also require label declaration of saturated fat content information when claims are made about fatty acids. Current § 101.9(c)(2)(i) did not include claims about fatty acids because at the time that regulation was proposed (56 FR 60478, November 27, 1991), it was thought unnecessary since no claims were proposed for fatty acids that were present at less than 0.5 g per reference amount. However, when the “saturated fat free” claim was established in the final rules (58 FR 2302 at 2331), FDA inadvertently did not amend § 101.9(c)(2)(i) to require the declaration of saturated fat content on a separate line when fatty acid claims were made. As a result, the declaration of saturated fat content was not required when “saturated fat free” claims were made. This is inconsistent with regulations governing claims for all other nutrients that require the listing of the nutrient that is the subject of the claim within the Nutrition Facts panel so that consumers can easily find quantitative information supporting claims made for a product. Because no comments objected to the proposed requirement in the November 1999 proposal for a label declaration of saturated fat content when fatty acid claims are made, which would require that saturated fat content be listed when a “saturated fat free” claim is used, FDA is finalizing this part of the regulation as proposed. Similarly, new § 101.9(c)(2)(ii) also requires label declaration of
In reference to the statement “Not a significant source of ______” that is to be placed at the bottom of the list of nutrient values, the agency proposed in the November 1999 proposal (64 FR 62746 at 62757) to remove the phrase “in the same type size” in § 101.9(c)(2)(i) where it refers to the size of the statement. This action was intended to correct a technical error in the regulations caused by the fact that current § 101.9(d)(1)(iii) allows the statement, along with all footnotes, to be in type size no smaller than 6 point type while it requires the listing of nutrient values to be in type size no smaller than 8 point type. Accordingly, the phrase “in the same type size” in § 101.9(c)(2)(i) would require the “Not a significant source of ____” statement to be in 8 point type, conflicting with § 101.9(d)(1)(iii). This technical error was addressed in amendments published on August 18, 1993 (58 FR 44063 at 44065-66). To correct the problem, FDA stated at that time (58 FR 44063 at 44065-66) that it was removing the sentence from § 101.9(c)(8)(iii) that required the “Not a significant source of ___” statement to be in the same type size as nutrients listed in the Nutrition Facts panel. However, the agency failed to notice the same error in § 101.9(c)(2)(i), (c)(3), (c)(6)(i), and (c)(6)(ii). Inadvertently, the conflicting sentence was never removed from § 101.9(c)(8)(iii), nor were the statements requiring “in the same type size” removed from any of the other paragraphs. In this final rule, FDA is making the correction in § 101.9(c)(2)(i) and in new § 101.9(c)(2)(ii). The agency intends to remove the phrase “in the same type size” from the remaining sections of § 101.9(c) in the future.
In addition, current nutrition labeling rules provide exemptions for select nutrients when food products qualify for simplified formats (see § 101.9(f)).
FDA is revising § 101.9(f) that pertains to the use of a simplified format when a food product contains insignificant amounts of seven or more of the mandatory nutrients. This section implements section 403(q)(5)(C) of the act, which states that “If a food contains
FDA is modifying sample labels throughout § 101.9 to be consistent with the revisions described previously. The citations for the sample labels that have been modified are as follows: § 101.9(d)(11)(iii) (the tabular display of the nutrition label), paragraph (d)(12) (the full nutrition label), paragraph (d)(13)(ii) (an example of an aggregate nutrition label), and paragraph (e)(5) (nutrition information presented for a food “as purchased” and “as prepared”). Likewise, the sample labels in § 101.9(j)(13)(ii)(A)(
Other conforming amendments to § 101.9 that are required as a result of this rulemaking include revisions to paragraphs (g)(5) and (g)(6) that inform the industry of how FDA will determine compliance with this section. Paragraph (g)(5) addresses those nutrients for which dietary guidance generally recommends limitations on intake. Accordingly, FDA will include
Section 403(q)(5)(F) of the act specifies that dietary supplement products shall bear nutrition labeling “in a manner which is appropriate for the product and which is specified in regulations... .” Accordingly, FDA issued regulations in § 101.36 that specify the nutrition information that must be on the label or labeling of dietary supplements (62 FR 49826, September 23, 1997). In the November 1999 proposal, FDA proposed to amend § 101.36 to maintain consistency in the nutrition labeling of conventional foods and of dietary supplements. Comments unanimously supported revising § 101.36 to be consistent with § 101.9 as it pertains to the provisions for
This final rule also impacts on the voluntary nutrition labeling program of raw fruits, vegetables, and fish in that § 101.45(a)(2) requires that nutrients be declared in accordance with § 101.9. However, because section 403(q)(4)(A) of the act requires the Secretary, and by delegation FDA, to furnish nutrition information for that program and the agency has proposed to update those values (67 FR 12918, March 20, 2002), the agency is deferring action on § 101.45 until a final rule is published on that rulemaking.
In the November 1999 proposal, FDA defined
(Comment 19) Most of the comments on the definition of
Other comments stated that
Another comment requested that FDA explicitly state that the rules on the labeling and claims for
FDA notes that the comments requesting that
FDA notes that, in classifying fatty acids, the IOM report on macronutrients uses a chemical definition of
(Comment 20) One comment asked whether the Association of Official Analytical Chemists (AOAC) Official Method 996.01 can be used for measuring
FDA notes that, as currently written, AOAC Official Method 996.01 is not suitable for quantifying
It is important to note that FDA regulations do not specify the methodology that firms are to use in obtaining values for nutrition labeling purposes. Rather, under § 101.9(g)(2), FDA determines compliance with nutrition labeling rules by using appropriate analytical methods “as given in the `Official Methods of Analysis of the AOAC International' 15th Ed. (1990) or, if no AOAC method is available or appropriate, by other reliable and appropriate analytical procedures.” Firms may choose to use a method other than that which the agency uses to determine compliance, but the firm would be subject to, for compliance purposes, a method the agency considers appropriate under § 101.9(g). With respect to analysis of fats (including
(Comment 21) Several comments asked that FDA recognize AOAC Method 996.06 as modified in the
FDA points out that recommendations for the modification of AOAC Official Method 996.06 (Ref. 105) were published in the
Specific recommendations for modifications include recommendations that the column requirements for the method be changed to a performance-based specification such that a capillary column capable of separating adjacent peaks of C18:3 and 20:1 and the fatty acid methyl ester trio of adjacent peaks of C22:1, C20:3 and C20:4 with a resolution of 1 or greater be used. Column SP-2560, 100 m x 0.25 mm with a 0.20 μm film was identified as a suitable column.
The recommendations referenced in the paragraph above have now been incorporated into AOAC Method 996.06 (
AOAC Method 996.06 cited above for
(Comment 22) One comment noted that detection methodology is not sophisticated enough to accurately measure
FDA disagrees with this statement. While the agency recognizes that AOCS methods have not been extended to cover matrices other than fats and oils, the AOAC method 996.06 (
(Comment 23) A few comments recommended that FDA consider listing amounts of
FDA disagrees with these recommendations. FDA notes that while these recommended levels might be quantifiable by laboratories using GC methodology such as that described in AOAC method 996.06 (
Moreover, FDA notes that the increment for listing
(Comment 24) One comment noted that the IR method of choice in the November 1999 proposal, AOCS Recommended Practice Cd 14d-96 (Ref. 45), generally overestimates
FDA agrees that the detection limits of the AOCS GC method (Ce 1f-96) (Revised 2002, Ref. 146) are lower than those of the AOCS IR recommended practice (Cd 14d-96) (Revised 1999, Ref. 145). FDA notes that AOCS Recommended Practice Cd-14d-96 is applicable to the determination of isolated
The AOCS Official Method Ce 1f-96 (Ref. 146) is designed to evaluate the level of
(Comment 25) One comment asked if
FDA has long recognized that variations occur naturally in the nutrient content of foods. The compliance procedures that FDA follows, which are found in § 101.9(g)(2), provide that a sample for nutrient analysis must consist of a composite of 12 subsamples, taken one from each of 12 randomly chosen shipping cases. FDA will then analyze the nutrient content of this composite test sample. Upon determination of the laboratory analyses, FDA uses the compliance procedures set forth in § 101.9(g)(5) and (g)(6) to determine if the values declared for those nutrients that have recommended dietary limits, such as saturated fat and cholesterol, misbrand the label. The content of a sample composite of these nutrients is in compliance if the analyzed value is no more than 20 percent greater than the value declared on the label. Stated another way, for nutrients listed in § 101.9(g)(5), the ratio between the nutrient level obtained by laboratory analysis and the product's label value, multiplied by 100, cannot be greater than 120 percent for the product to be in compliance. For example, if the laboratory value is 4 grams, and a product's label value is 2 gram, the ratio (4/2) x 100 = 200 percent. This value is greater than 120 percent, hence, the product is out of compliance.
FDA did not address this issue in the proposal because the declaration of “saturated fat” included
FDA's policy since the 1970s assigns the manufacturer the responsibility for assuring the validity of a product label's stated nutrient values (Ref. 108). Accordingly, the source of the data used to calculate nutrition labeling values is the manufacturer's prerogative, but FDA's policy recommends that the nutrient values for labeling be based on product composition, as determined by laboratory analysis of each nutrient. If a manufacturer knows that a nutrient is likely to vary over seasons or due to other factors (e.g., location, growing conditions, product
To ensure that label values will accurately represent the nutrient content of food products to consumers and also have a high probability of being in compliance with nutrition labeling regulations, FDA recommends the calculation of a one-sided 95 percent prediction interval as the most appropriate and the preferred method to use in computing label values (Ref. 108).
Prediction intervals take into account the variability of a nutrient. Mean values do not. A manufacturer of a product, like butter, whose
In its November 1999 proposal, FDA proposed a definition for the nutrient content claim “
With regard to the specific definitions, FDA proposed that “
The comments relating to claims were very diverse and indicated strongly opposing views. With regard to the “
A number of comments supported having a “reduced
Finally, the comments on disclosure and disqualifying levels were equally divergent. Some comments favored the proposed criterion of 4 g or less of saturated and
The objections in the comments against the proposed definitions were generally based on scientific, legal, or economic arguments. Some of the comments believed that the agency is acting in advance of sufficient scientific justification, while others stated that the agency should have acted sooner. There was disagreement as to whether the adverse effects of
Other comments argued that the proposed claims should be included in the final rule for public health reasons, while others argued that less restrictive claims would benefit the public health to a greater extent because they would encourage more reformulation. Some of these comments pointed out that the “
Several comments asserted that FDA did not meet its burden under the first amendment because the threshold levels proposed by FDA for
Economic concerns regarding the proposed nutrient content claims are discussed in section IX of this document.
FDA has carefully reviewed the comments and finds that it has insufficient scientific information at this point in time to support a decision on the appropriate definition for the nutrient content claims discussed in the November 1999 proposal and the December 5, 2000, notice to reopen the comment period. The comments that expressed a preference for a specific threshold level of
As discussed under comment 17, FDA is issuing an ANPRM elsewhere in this issue of the
(Comment 26) Several comments requested that FDA defer rulemaking on
FDA consulted with USDA and both agencies agree that it is important that nutrition labeling rules for both agencies be consistent and that labeling of
(Comment 27) Some comments requested that
These comments are outside the scope of this rule on the nutritional labeling of
(Comment 28) A number of comments to the November 1999 proposal and the November 2002 notice reopening the comment period of the November 1999 proposal stated that there is a great need for consumer education about
FDA agrees that consumer education will be needed as a result of this final rule so that consumers are better able to utilize the new
The agency also plans to initiate a variety of outreach and consumer education programs about this final rule following publication. Electronic dissemination of this information will be provided at FDA's Web site and briefings will be provided to representatives of a variety of health professionals, government agencies, industry representatives, trade associations, and press and consumer groups so that they can communicate
(Comment 29) A few comments suggested using color coding to help consumers quickly recognize unhealthy products, including those containing
These comments are outside the scope of this final rule on the nutrition labeling of
(Comment 30) FDA received only one comment in response to the November 1999 proposal to deny the petitioner's request to require that “partially hydrogenated” fat be listed on food labels as “partially saturated” fat (64 FR 62746 at 62762). The comment concurred with the agency's tentative conclusion to deny the request stating that “partially hydrogenated” fat is the most appropriate terminology for use on food label ingredient statements.
The agency concurs with the comment and, accordingly, is denying this request.
(Comment 31) Although a great many comments supported CSPI's petition in general, these comments did not specifically address the petitioner's request to limit “vegetable oil” claims to foods that are low in saturated and
In the November 1999 proposal, the agency referred to § 101.65(c)(3), which states, in part, that a claim “that a food is made only with vegetable oil is a claim that the food is low in saturated fat,” and tentatively concluded that the petitioner's request was being addressed by the action taken in the proposed rule to limit the amount of
As discussed in section VI of this document, FDA plans to proceed with a new rulemaking pertaining to limits on the amount of
In the November 1999 proposal, the agency proposed that any final rule that may issue based upon the proposal become effective in accordance with the uniform effective date for compliance with food labeling requirements that is announced by notice in the
(Comment 32) FDA received several comments about the effective date for a final rule. One comment stated that the proposed effective date was appropriate while a few other comments recommended that it be sooner than proposed. Several comments suggested that the effective date be 24 months after publication of the final rule or January 1, 2004, whichever comes later. Some comments, however, requested that the effective date be extended several years (e.g., 4 to 7 years) for small businesses. These comments stated that it was important for small businesses to be able to phase in the cost associated with the new label requirements so that they have extra time to absorb the costs of these changes. Many small manufacturers reported that they have significant inventories of labels. Also, smaller manufacturers indicated that they would incur costs including loss and disposal of obsolete packaging inventories, product in obsolete packages, and new printing plates. These small businesses believe that a longer compliance period would allow these companies to more easily manage their inventories and phase in the
To minimize the need for multiple labeling changes and to provide additional time for compliance by small businesses to allow them to use current label inventories and phase in label changes, the agency is setting the effective date at January 1, 2006, the next uniform effective date following publication of this rule. This allows firms more than 2 years to implement this final rule providing some regulatory relief and economic savings for small businesses. Extending the effective date for products containing
The agency notes that there are several methods for measuring the amounts of
Although the effective date of the final rule is some time away, FDA encourages manufacturers to have new labels printed that are in compliance with these final rules so they may be used as soon as current inventories are exhausted to ensure a smooth and timely changeover. The agency will not object to voluntary compliance immediately upon publication of the final rule.
FDA has examined the economic implications of this final rule as required by Executive Order 12866. Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). Executive Order 12866 classifies a rule as significant if it meets any one of a number of specified conditions, including: Having an annual effect on the economy of $100 million, adversely affecting a sector of the economy in a material way, adversely affecting competition, or adversely affecting jobs. A regulation is also considered a significant regulatory action if it raises novel legal or policy issues. FDA has determined that this final rule is a significant regulatory action as defined by Executive Order 12866.
The Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121) defines a major rule for the purpose of congressional review as having caused or being likely to cause one or more of the following: An annual effect on the economy of $100 million; a major increase in costs or prices; significant adverse effects on competition, employment, productivity, or innovation; or significant adverse effects on the ability of U.S.-based enterprises to compete with foreign-based enterprises in domestic or export markets. In accordance with the Small Business Regulatory Enforcement Fairness Act, Office of Management and Budget (OMB) has determined that this final rule is a major rule for the purpose of congressional review.
Current nutrition labeling regulations do not allow manufacturers to disclose information about
As explained in the November 1999 proposal and in section IV of this document, there is a scientifically established link between the consumption of
Although the effect of
This final regulation is needed to amend existing regulations so that manufacturers will be able to provide important health-related information to consumers regarding the amount of
FDA believes that the requirements of this final rule will provide consumers with information they need so that they may consider the amount of
In the analysis of the proposed rule, FDA listed a number of regulatory alternatives regarding
As stated in the analysis to the proposed rule (64 FR 62746 at 62764), to estimate the impacts of this rule, FDA is following the general approach used to estimate the health benefits for the implementation of the 1990 amendments (56 FR 60856 at 60869, November 27, 1991). Accordingly, FDA is estimating: (1) The changes in
This final rule requires the mandatory declaration in the nutrition label of the amount of
The final rule will increase the information provided to consumers on food packages. This change in the nutrition label will reduce the cost to consumers of obtaining information on the
The final rule will also change the incentives and constraints that food producers face in manufacturing and marketing their products. Because these provisions will not be effective until months after publication of the final rule, food manufacturers can use the time between publication of the final rule and its effective date to study the requirements of the rule and the
FDA assumes that producers will decide whether or not to change the composition of existing products on a product-by-product basis, depending on expected private returns. They will choose to reformulate the existing products when the expected private benefits exceed the expected private costs of reformulating the products. In other words, if a product is expected to lose market share without reformulation because of the new disclosure, then manufacturers will compare the private costs from decreased sales to the cost of reformulation.
FDA anticipates that, taken together, changes in food purchases by consumers and reformulation by producers in response to this rule will result in an overall decrease in
a.
As described in the November 1999 proposal (64 FR 62746 at 62765), information on
In the November 1999 proposal, FDA estimated that current average
(Comment 33) Comments generally agreed that FDA's estimate of current
FDA's original estimate that about 30 percent of margarine had been reformulated to remove
In response to the comments requesting clarification about whether naturally-ocurring
As described previously in this section, although there are uncertainties associated with each type of estimate, FDA chose estimation of
The revised estimate of average
The revised estimate of
Allison et al. linked the special 1995 USDA database of
FDA's estimates are also similar to a recently-published estimate from another national food consumption survey, the National Health and Nutrition Examination Survey III (NHANES III), 1988-94 (Refs. 152 and 153). The estimate from NHANES III for mean
b.
(Comment 34) Several comments suggested that FDA overstated consumer response to the proposed change to food labeling. Some comments said that a
FDA is not going forward with the proposed asterisk for saturated fat and footnote listing the amount of
In the November 1999 proposal, FDA used results of earlier research and estimated that direct consumer choice in response to
Based on previous research, the November 1999 proposal projected a 1 percent decrease in
In the process of evaluating these comments about consumer awareness, FDA has identified additional data relevant to these issues. In the 1999 Discovery Health survey, 66 percent of those responding to the survey knew that saturated fat was related to disease and 31 percent knew that partially hydrogenated fat was related to disease (Ref. 118). In the 2001-2002 Consumer Attitudes About Nutrition survey, 83 percent of respondents reported that saturated fat is unhealthy, 46 percent reported that
In the study by Kim et al., 73 percent of individuals surveyed who use nutrition labels and look for information on saturated fat had 15 percent lower saturated fat intake than those who did not use nutrition labels. This corresponds with an overall 11 percent decrease (0.15 x 73 percent = 11 percent) in saturated fat intake because of nutrition labeling. Thus, the study by Kim et al. gave a high estimate of an 11 percent decrease in saturated fat intake because of nutrition labeling and FDA's earlier research gave a low estimate of a 1 percent decrease in saturated fat intake.
The Discovery Health study and the Consumer Attitudes About Nutrition survey indicated that consumer awareness of a nutrient-disease relationship involving
The estimates for decreases in
i.
(Comment 35) A comment stated that FDA had overestimated the proportion of margarine that had already been reformulated and said that the actual amount was about 15 percent of margarine products. Several comments disagreed with FDA's estimate that all margarine would reformulate by the effective date for
FDA accepts the comment about current margarine products. For this analysis, FDA estimates that about 15 percent of margarine has already been reformulated to remove
As noted earlier regarding consumer response to
Although FDA acknowledges considerable uncertainty in the likelihood of additional margarine reformulation, FDA is aware of evidence suggesting that at least some margarine products are likely to reformulate in response to
In response to comments received, because of the absence of
ii.
(Comment 36) A number of comments stated that FDA had overestimated the proportion of baked goods products that would reformulate or the proportion of
In response to the comments about difficulties of reformulation, FDA notes that the analysis for the November 1999 proposal did include the cost of reformulation and the time needed for reformulation, but did not include higher ingredient costs for reformulation. In the long run, ingredient costs may not actually increase, because of increased industrial capacity to produce ingredients made with new technologies. In response to the comments about the cookies and crackers category, FDA acknowledges that its own projection of much higher reformulation for this category than for other baked products may have been unrealistic. Also in response to the comments, FDA notes that the emergence of commercial shortenings with lower
After consideration of the comments and our own re-evaluation, we continue to believe that, ultimately, some proportion of baked products will be reformulated in most subcategories: Crackers, cookies, biscuits, tortillas, quick breads and muffins, doughnuts and sweet rolls, cakes, pies, pancakes and waffles. (In the categories of yeast breads and rolls, it is unlikely that reformulation will occur because yeast breads are relatively low in fat and typically contain less than 0.5 g
Because of the existence of commercial shortenings with lower
(Comment 37) Some comments discussed reformulation of other products, including potato chips, corn chips and similar snacks, microwave popcorn, and candy. Several of these comments emphasized the difficulty of reformulating products in these categories because of the expense, the time required, and the need for costly ingredients. Some of the comments suggested that, because of the difficulties of reformulation,
FDA did not project quantitative decreases in
FDA acknowledges that a large proportion of the U.S. French fried potato intake is consumed in restaurants. Foods typically consumed in restaurants also include other food sources of
iii.
iv.
(Comment 38) Some comments stated that FDA had ignored the question of macronutrient substitutions, or had assumed that reformulation would replace
In response to the comments, FDA notes that it did consider the type of macronutrients substituted for
Based on its consideration of the comments and its own evaluation, FDA continues to believe that the likely substitutions for
Because of the functional requirements for baked products, FDA continues to believe that the most plausible replacement for
The costs of this rule are the activities that change as a result of this rule. The total cost of these regulations is the sum of the total testing costs, total relabeling costs, and total reformulation costs. All labels must be in compliance with this final rule by a single effective date. All costs are estimated at the effective date, taken to be 30 months from the publication date of this final rule. If the effective date is more than 30 months from the date of publication, then the actual costs of this rule will be lower than estimated here.
This final rule covers all food and dietary supplement labeling within FDA's jurisdiction. With a few exceptions, labeling for all FDA regulated foods and dietary supplements will have to be changed by the next uniform effective date following publication of this rule, or about 2 to 3 years after the date of publication. One exception is for products with less than 0.5 g
To estimate the costs of this rule, FDA has used the FDA Labeling Cost Model developed for FDA under contract by RTI International in April 2002 (Ref. 129). This labeling model has more current data than the previous labeling cost model developed for the implementing rules of the 1990 amendments (Ref. 74). The model indicates that there are approximately 308,000 food and dietary supplement stock keeping units (SKUs) sold in the United States in categories for which some products will need to be relabeled. A SKU is a specific product sold in a specific size. For example, there is one SKU for 16 ounce (oz) containers of Brand X Diet Peach Tea. The same brand and flavor of tea (a product) in a 12 oz container would be another SKU, and a 12 oz container of the same brand but different flavor of tea would be still another SKU. The model also indicates that there are about 154,000 products potentially affected by this rule. Table 3 of this document shows the data on the number of SKUs and products affected. From the categories listed in table 3 as “Selected Baking Ingredients,” “Selected Candy,” “Selected Condiments, Dips and Spreads,” and “Selected Dressings and Sauces,” FDA excluded products, such as baking powder, bottled water, gum, jam, and vinegar, that qualify for the “simplified” format and are certain not to be affected by this rule. Even with these products removed, this estimate is still certain to be an overestimate of the actual SKUs and products affected by this rule because FDA has imputed costs to all products and SKUs within these broad product categories. Labels on many products categories such as “Selected Beverages” and “Dietary Supplements” are not likely to need to be changed. However, FDA has no basis to make better estimates of the actual number of products and SKUs affected by this rule.
In the proposed analysis, FDA assumed that all product formulations that include partially hydrogenated oil as an ingredient would be tested to determine the quantity of
In the proposed rule, FDA used a per product cost of testing for
One comment suggested that butter and other products with high butter fat contents, such as some ice cream, would contain a reportable amount of naturally occurring
In the analysis of the proposed rule, FDA estimated that 39,000 SKUs were associated with the 32,000 products that would change their information panels at a cost of $30 million. During the comment period reopened November 2002, FDA received comments that we would have to reestimate the relabeling costs for the final rule. Under this final rule many more labels will have to be changed than under the proposed rule. FDA has used the new Labeling Cost Model to reestimate the relabeling costs of this final rule. Based on information in the model, three-quarters of the labels normally will be scheduled to be changed during the 30 month compliance period. FDA estimates that about 78,000 (25 percent) of the almost 308,000 SKUs will have to be changed earlier than would have been planned without this rule. Included in the cost of relabeling are administrative, graphic design, pre-press preparation, printing and engraving, and the lost value of discarded labels. Across product categories, the average low relabeling cost per SKU is about $1,100 and the average high relabeling cost per SKU is $2,600. The reported estimated costs of changing labels varies within a product category because different packaging converters and food manufacturers reported different costs to RTI International. Table 5 shows the total SKUs changed earlier than planned and the total estimated costs of relabeling per product category and for the entire industry.
One consequence of this regulation will be the reformulation of some foods to reduce levels of
As mentioned previously, based on comments, FDA estimates that 15 percent of margarine products have
Therefore, FDA estimates that 10 percent of the margarine products that have not yet been reformulated will be reformulated to reduce
FDA has not attempted to estimate the ongoing increased cost of substitutes for partially hydrogenated oil. Competition provides producers with incentives to use the least expensive ingredients that are acceptable for the quality of product they are making. Therefore, in general, any change in existing formulations (such as is expected to occur as a result of this rule) can increase the cost of ingredients. Even a very small increase in the price of a minor ingredient can amount to an increase in production costs of millions of dollars when multiplied by millions of units. However, there is good reason to believe that, in the long run, ingredient costs may not increase. To the extent that producers rely on newly formulated ingredients made with new technologies, the price of these ingredients largely depends on the industrial capacity to produce them. As the demand for such ingredients increases, producers will have more incentive to increase capacity and the prices of these ingredients will fall. In the case where producers make use of different mixes of oils, agricultural inputs are well known for being able to be supplied in greater and greater quantities without an increase in price. FDA does not have sufficient information on the types of substitutes that will be used, on the volume of substitutes that will be needed, or on the future price of the substitutes at the time that reformulation is completed.
Costs for testing, relabeling, and reformulation are all expected to occur by the first effective date of the final rule, or about 2 to 3 years after publication. Table 7 shows the estimates of total cost.
FDA acknowledges that there is a significant degree of uncertainty in the cost estimates provided here. The most significant source of potential divergence from the reported estimates would be an ongoing increased cost of substitutes for partially hydrogenated oil for producers of reformulated products. FDA has not included any costs for this item in this analysis, so that, if substitute oils do cost more, the costs here are underestimates.
Reformulation is a second significant area of uncertainty. The unknowns include the number of products that will be reformulated, the cost of reformulation, the number of abandoned attempts at reformulation, the length of time actually needed to reformulate products, and the degree to which the reformulation of some products reduces the cost of reformulating other products of the same or different type. The estimates that are provided in this analysis might be either over- or underestimates of the actual costs of reformulation.
A third major area of uncertainty includes the number of labels that will be changed. Actual costs are likely to be lower than those estimated here because this analysis estimated costs based on broad categories of products some of which will not have to change their labels.
To estimate the health benefits of
FDA has estimated the current
In the November 1999 proposal, FDA used two methods to estimate the potential decrease in CHD likely to result from decreased intake of
a.
b.
As described in section IV of this document, in the November 1999 proposal FDA concluded that the effects of
Section IV of this document notes that observational epidemiological studies can provide evidence of an association between a risk factor and a disease, but cannot establish direct cause and effect. Therefore, FDA considered the evidence from observational epidemiological studies, including large prospective (cohort) studies, as indirect evidence for a relationship between
As described in the November 1999 proposal (64 FR 62746 at 62768 and 62769), the regression equations of Katan et al. (Ref. 62) and Zock et al. (Ref. 69) were based on five intervention studies that made, in total, six dietary comparisons between consumption of
Sample calculations using Method 1 and Method 2 are summarized in table 8 in this document. The table illustrates a decrease in
In the scientific literature,
We generated the factors in table 9 by combining the results of two sets of metaanalyses. Table 9 shows the result of linking: (1) The regression equation coefficients of Katan et al. (Ref. 62) and Zock et al. (Ref. 69), for substitution of
Comparison with the observed data showed that the predicted regression lines explained 64 percent of the variation in changes in LDL-C and 88 percent of the variation in changes in HDL-C. The coefficients of Mensink and Katan (Ref. 65) are expressed as substitution of each type of macronutrient for carbohydrate, but the coefficients of Katan et al. (Ref. 62) and Zock et al. (Ref. 69) are expressed as substitution of
Table 9 also gives examples of changes in CHD risk with replacement of 0.1 percent of energy from
As mentioned earlier, and in the November 1999 proposal (64 FR 62746 at 62769), the economic analysis used changes in both LDL-C and HDL-C as a second method to quantify the effects of
(Comment 39) As described previously in this document, FDA received numerous comments in support of the November 1999 proposal. Several of these comments noted specifically that labeling of
Other comments, which were opposed to the November 1999 proposal or some of its provisions, questioned FDA's conclusions regarding the net health benefits of
A few comments questioned whether health benefits could result from
Regarding the comments that questioned whether the increase in LDL-C and CHD risk due to
Regarding the comment suggesting that it is premature to conclude that
Regarding the comments discussing FDA's statement in the November 1999 proposal (64 FR 62746 at 62752) that no dose response relationship had been demonstrated between
FDA disagrees with the comment that the health benefits estimate did not account for other CHD risk factors. In the health benefits estimate, FDA used the factors shown in table 8 to calculate the amount of CHD risk associated with the expected amount of change in LDL-C and HDL-C. These factors were derived from large population studies of serum lipids and CHD risk, in which statistical methods accounted for other positive and negative risk factors for CHD.
Regarding the comment about the level of
FDA disagrees with the comment that disclosure of 0.5 g
FDA agrees with the comments that average saturated fat intake in the United States is about 5 times greater than average
(Comment 40) Among the comments that supported the potential public health benefits of
In the November 1999 proposal, FDA based its estimate of health benefits on scenarios of projected decreases in
(Comment 41) As summarized in section IV.9 of this document, one comment recommended that comparisons of the health effects of saturated fat and
A few comments to the November 15, 2002, notice to reopen the
As stated in section IV.9 of this document, regardless of whether FDA reviewed the effects of saturated fat and
As previously described in this section and in section IV of this document, although FDA did not place primary reliance upon the relationships among
In response to the comment about relative risk in the prospective studies, FDA acknowledges that relative risk estimates in prospective studies will depend on the base risk used for comparisons and this dependence on base risk may result in inaccuracies when the relative risk is related to the absolute risk in other studies or in the general population. However, FDA does not agree that this difference would change the basic conclusion of the prospective studies, that the CHD risk associated with
A meta-analysis of the relative risk of CHD associated with
Thus, FDA disagrees with the comment about relative risk in the prospective studies, and maintains that the prospective studies do suggest that there may be additional mechanisms, besides changes in LDL-C and HDL-C, by which
In response to the comments about the Ascherio et al. regression equation as discussed in the IOM/NAS report (Ref. 140), FDA notes that according to the NEJM, all submissions to the journal are peer-reviewed before publication. The comments did not cite any published articles questioning the 1999 Ascherio et al. paper (Ref. 83), and did
As noted in section IV and in this section of this document, FDA's primary rationale for
As stated previously in this section (see comment 39), the regression equations of Zock et al. (Ref. 69), showing a positive linear trend between
(Comment 42) One comment stated that FDA's estimate of benefits of the November 1999 proposal neglected to account for the overall reductions of mortality and morbidity from heart disease that have been occurring in the United States for the past few decades. According to the comment, FDA should have projected the future reduction in heart disease that would be expected in the absence of labeling. With such a projection, the baseline for heart disease morbidity and mortality would be progressively lower over time, and the numbers of heart attacks and deaths avoided due to
FDA agrees that the rate of heart disease mortality and morbidity in the United States has been decreasing for several decades (Refs. 132 and 133). For example, the age-adjusted death rate from CHD declined from approximately 290 per 100,000 in 1979 to 190 per 100,000 in 1996 (Ref. 133). However, because the risk of CHD is greater at older ages and the U.S. population is aging, the decline in the overall (crude) CHD death rate in this period was more modest, from approximately 225 per 100,000 to 180 per 100,000. Moreover, because of the increase in the total population, the decline in annual CHD deaths in this period was even more modest, from approximately 550,000 to 500,000, about a 10 percent decrease over 17 years. The number of deaths was fairly level during the period, 1992 through 1996. Thus, the baseline number of CHD deaths, as opposed to age-specific rates, has historically declined at a modest rate, and has been fairly level in recent years. Therefore, FDA did not correct for this in its projection of heart attacks and deaths avoided due to
Regarding the comment about correlations of changes in dietary intake with declines in CHD from 1970 to 1992, information on
Based on the comments received and its own re-evaluation, FDA is not making any changes in the sample calculations for changes in CHD risk (table 8) or in the factors for changes in serum lipids and the examples of changes in CHD risk and the factors for changes in serum lipids with substitution of different macronutrients
As shown in table 2, a 0.0378 percent of energy decrease in
FDA has identified these likely substitutions, but recognizes that once reformulation begins, different combinations of ingredients may emerge. In order to estimate the health effects of reformulation, however, it is less important to identify the exact formulas to be used than it is to identify the range of possible changes in CHD risk. To estimate the potential health benefits from the reformulation of margarine, FDA used a probabilistic model with a distribution of effects based on the distribution of possible changes in CHD risk associated with the three ingredient substitutions. FDA used a distribution rather than a weighted average because we did not know which combination was most likely, or what distribution of combinations would emerge. (The formal distribution we used was a BetaPERT, which uses three points: A minimum, an intermediate, and a maximum. The model used the change in CHD risk for a mixture of 50 percent cis-monounsaturated and 50 percent saturated fat as the minimum, the change with 100 percent cis-monounsaturated fat as intermediate, and the change for a mixture of 50 percent cis-monounsaturated and 50 percent cis-polyunsaturated fat as the maximum. The mean of a BetaPERT distribution = (minimum + (4 x intermediate) + maximum)/6.)
As shown in table 10, the probabilistic model of substitutions for
Approximately 3 years will be needed for predicted changes in
In the previous sections, FDA presented potential changes in food markets because of this final rule and described calculations of the decreases in CHD that would result from those market changes. Uncertainties in these analyses include:
• The size of consumer substitutions among existing products;
• The amount of producer reformulation to avoid losing market shares;
• The types of ingredient substitutions producers will make to reduce the amount of
• The decrease in CHD that will result from decreased
FDA used three specific substitutions to represent the range of likely ingredient substitutions for
FDA estimated the benefits from the final rule for two methods. The two methods give low and high estimates of the change in CHD risk brought about by changing intakes of
The reduction in CHD risk is highly uncertain primarily because of the difficulties in estimating the amount of reformulation, consumer response, and the reduction in CHD risk due to a decrease in
a.
The benefits are expected to begin 3 years after the effective date. The 3-year lag occurs because a dietary change takes several years to begin to affect the CHD risk (Ref. 137). With Method 1, FDA estimated that 3 years after the effective date, the final rule would annually prevent 600 cases of CHD and 240 deaths. Preventing 240 deaths would annually save about 1,920 discounted life years (240 deaths x 8 years) using a 7 percent discount rate, or 2,640 discounted life years (240 deaths x 11 years) using a 3 percent discount rate. With Method 2, FDA estimated that 3 years after the effective date, the final rule would annually prevent 1,200 cases of CHD and 480 deaths, saving about 3,840 discounted life years (480 deaths x 8 years) using a 7 percent discount rate, or 5,280 discounted life years (480 deaths x 11 years) using a 3 percent discount rate. Because the association between
For nonfatal cases, FDA estimated the cost to be the sum of the medical costs, the cost of functional disability, and the cost of pain and suffering. The functional disability, and pain and suffering combine to reduce the quality of life for victims. In a recent study, Cutler and Richardson (Ref. 77) estimated from National Center for Health Statistics data that the quality adjusted life year for a CHD survivor was 0.71, which indicates that the annual loss to the victim is 0.29 quality adjusted years. This loss represents the combined effects of functional disability and pain and suffering. FDA assumed that the loss lasts for 13 years, or 8.4 discounted years. FDA did not estimate the extent to which nonfatal cases reduce life expectancy or increase other health costs. Because nonfatal cases probably do have these effects, FDA may have underestimated the health benefits from preventing nonfatal cases.
The medical costs for nonfatal CHD are also important. The American Heart Association estimates that the cost of a new event is about $22,700 and the total annual costs are $51.1 billion (Ref. 75). If 1.1 million cases lead to $22,700 per case, then all theses cases cost about $25 billion. The remaining 13.9 million cases average about $1,900 per year (($51.1 billion - $25 billion) /13.9 million). FDA, therefore, estimated medical costs per case as $22,700 in the first year and about $1,900 per year thereafter.
The total cost per nonfatal case is the sum of lost quality-adjusted life years multiplied by $100,000 per life year plus the medical costs of $22,700 plus $1,900 per year times the discounted life years. FDA estimated the morbidity cost per case to be about $282,000 ((0.29 x $100,000 x 8.4) + ($1,900 x 8.4) + $22,700).
b.
FDA therefore estimates the benefits of this rule using two approaches that reflect different methods used in the economics literature. First, it calculates benefits as the extensions to longevity multiplied by the value of such increases in life-years gained, plus the number of nonfatal cases prevented multiplied by the costs of nonfatal cases, plus the savings in medical costs associated with reductions in nonfatal CHD. Its second calculation is like the first, except that it values reductions in mortality risk as the number of statistical deaths prevented multiplied by the willingness to pay to reduce the risk of death (rather than the extensions to longevity multiplied by the value of increases in life-years gained), and calculates the value of reducing the number of nonfatal cases as simply the savings in medical costs. This section presents these two approaches in turn, beginning with benefits as the extensions to longevity multiplied by the value of such increases in life-years gained, plus the prevented costs of nonfatal cases and medical costs.
Under the first approach, FDA estimated the costs of nonfatal cases to be the sum of the medical costs, the cost of functional disability, and the cost of pain and suffering. The functional disability, and pain and suffering combine to reduce the quality of life for victims. In a recent study, Cutler and Richardson (Ref. 77) estimated from National Center for Health Statistics data that the quality adjusted life year for a CHD survivor was 0.71, which indicates that the annual loss to the victim is 0.29 quality adjusted years. This loss represents the combined effects of functional disability and pain and suffering. FDA assumed that the loss lasts for 13 years, or 8.4 discounted years (discounted at 7 percent) and 10.6 discounted years (discounted at 3 percent). FDA did not estimate the extent to which nonfatal cases reduce life expectancy or increase other health costs. Because nonfatal cases probably do have these effects, FDA may have
There are also medical costs for nonfatal cases of CHD. The American Heart Association estimates that the cost of a new CHD case is about $22,700 and the total annual costs are $51.1 billion (Ref. 75). If 1.1 million cases lead to $22,700 per case, then all these cases cost about $25 billion. The remaining 13.9 million cases average about $1,900 per year (($51.1 billion - $25 billion) /13.9 million). FDA, therefore, estimated medical costs per case as $22,700 in the first year and about $1,900 per year thereafter.
Under the first approach, the total cost per nonfatal case is the sum of lost quality-adjusted life years multiplied by a value per life year plus the medical costs of $22,700 plus $1,900 per year times the discounted life years. FDA estimates the morbidity cost per case to be about $282,000 ((0.29 x $100,000 x 8.4) + ($1,900 x 8.4) + $22,700), assuming a value of $100,000 per quality-adjusted life year (VSLY).
In the first approach, FDA uses a range to estimate the value of an additional year of life to reflect the uncertainty in the literature. As a lower bound, FDA uses $100,000 per (quality-adjusted) statistical life year. Cutler and Richardson (Ref. 77) use a similar estimate, and Garber and Phelps (Ref. 157) conclude that estimates of the value of a life year are about twice the level of income, though they present a broad range to reflect uncertainty associated with risk aversion and discount rates. Updating Garber and Phelps' estimates suggests that $100,000 per life year is a reasonable estimate, given that median family income in 2002 was about $51,000 (Ref. 158). Moreover, this estimate is close to the estimate used in FDA's economic analysis of the regulations implementing the 1990 amendments. FDA received no public comments on that estimate. To reflect other underlying literature, and following suggestions from other Federal agencies, we begin with an estimate of the value of a statistical life (VSL) of $6.5 million. This estimate is consistent with the survey by Viscusi and Aldy (Ref. 159) on the premium for risk observed in labor markets. Annuitizing this value over 35 years at 3 percent and at 7 percent discount rates, as is consistent with OMB guidance, implies estimates of a value of an additional year of life of about $300,000 and $500,000. Therefore, table 11a shows estimated benefits for three estimates of VSLYs: $100,000, $300,000 and $500,000, for both of the methods of estimating gains in life years. Total benefits differ from mortality-related benefits by including the value of reduced morbidity and health care costs.
In applying the second approach to calculating benefits, FDA assumes values of a statistical life of $5 million and $6.5 million. These values represent reasonable central tendencies for a larger range of VSL estimates reported in the literature: $1 million to $10 million (Ref. 159). The two values FDA uses here are also consistent with one reasonable interpretation of studies of willingness to pay to reduce mortality risks (Refs. 159 and 160). FDA uses the lower value to reflect the fact that many of the estimates of willingness to pay to reduce mortality risk from papers not surveyed by Viscusi and Aldy are relatively low. Table 11B shows the annual benefits estimated in this way for the two different VSLs using both a 3 and 7 percent discount rate. The totals in the final 2 columns of the table are discounted, so direct multiplication of the previous columns does not give the totals in the final columns.
To provide an overview of this analysis, we can compare the estimated total benefits and costs and summarize the sources of information used in making these estimates.
Table 12 shows the timing of the discounted benefits and costs estimated for this rule, as well as the totals. The
Table 12A summarizes the inputs, data sources, and assumptions used in the Final Regulatory Impact Analysis for this final rule.
FDA submitted this economic analysis to the Interagency Economic Peer Review (IEPR) for peer review. The IEPR is a voluntary review process composed of, but not limited to, Federal economists and analysts who review Regulatory Impact Analyses and Regulatory Flexibility Analyses prior to OMB clearance to improve the quality of economic analysis.
Two Federal economists reviewed this analysis. Their specific comments and FDA's responses are detailed in Ref. 155. FDA made the following changes to the analysis in response to the comments of the reviewers:
• Added several sections to repeat information contained in the analysis that accompanied the proposal to provide more background and context for the reader,
• Made some style changes for clarity,
• Added explanations for how some numbers were calculated,
• Added references for the European market experience with margarine reformulation,
• Addressed the comments on costs more explicitly,
• Explained why the costs of reformulation are included in the analysis,
• Added an introduction describing the plan of the benefits model and the linkages between the various parts of the model,
• Corrected our description of study subjects in the 1994-1996 Diet and Health Knowledge Survey (DHKS) in discussing Ref. 119.
FDA has examined the economic implications of this final rule as required by the Regulatory Flexibility Act (5 U.S.C. 601-612). If a rule has a significant economic impact on a substantial number of small entities, the Regulatory Flexibility Act requires agencies to analyze regulatory options that would lessen the economic effect of the rule on small entities. FDA finds that this final rule would have a significant economic impact on a substantial number of small entities.
FDA used data from the 1999 County Business Patterns (Ref. 136) to estimate the number of small businesses affected by this rule. Table 13 shows the number of small businesses affected by the North American Industry Classification System (NAICS). The final rule will affect almost all manufacturers of packaged, labeled food sold in the United States, with the exception of exempt manufacturers. The criteria for exemption are: (1) Annual sales of fewer than 100,000 units; (2) no claims or other nutrition information on product labels, labeling, or advertising; (3) fewer than 100 full-time employees; and (4) filing of a notice with the Office of Food Labeling (§ 101.9(j)(18) 2002). FDA has previously estimated that the exemption for all foods would affect about 1.8 percent of FDA regulated foods by volume (see 58 FR 2927 at 2928, January 6, 1993). FDA estimated the effects of exemptions only for the total costs to small businesses.
FDA calculated the costs to small businesses with the same basic model that we used in section IX.D of this document to estimate the total costs. Although the basic model is the same for large and small firms, the individual components of costs differ for large and small firms. On average, small firms produce fewer products, and market fewer labels. FDA assumes that the estimated margarine reformulation will be done by large producers.
FDA estimated the total costs of the final rule to small business by estimating the individual categories of costs and summing them. The first category is testing costs. Small businesses would need to test their products to determine the amounts of
Under this final rule many more labels will have to be changed than under the proposed rule. FDA has used the new Labeling Cost Model to re-estimate the relabeling costs of this final rule. FDA estimated reprinting costs for information panels on a per label (SKU) basis. FDA assumed that the proportion of SKUs from small businesses as a whole equaled the proportion in the EED (73 percent). Across product categories the average low relabeling cost per SKU is about $1,100 and the average high relabeling cost per SKU is $2,600. The reported estimated costs of changing labels varies within a product category because different packaging converters and food manufacturers reported different costs to RTI International. Table 15 shows the total estimated costs of relabeling per product category and for all small businesses affected.
Table 16 of this document shows the total costs to small businesses of the final rule. The adjusted total costs of the final rule equal the unadjusted total minus 1.8 percent of the total cost of the rule to all businesses (see 58 FR 2927 at 2928, January 6, 1993). The average cost per small business is about $12,000.
FDA has attempted to place the burden that these costs will place on small businesses in the context of the entire environment in which small businesses exist. Eastern Research Group under contract with FDA has developed a model for estimating the impact of regulatory costs on the survival of small businesses. (Reference: Eastern Research Group, “Model for Estimating the Impacts of Regulatory Costs on the Survival of Small Businesses and Its Applications to Four FDA-Regulated Industries,” 2002.) This model does not cover the entire range of products covered by this final rule, so it is not possible to estimate the burden of this rule. However, table 16a gives a sense of the impact that this rule may have on three industry categories that have many small businesses. The model estimates the additional number of small businesses that will have negative cash flow as a result of the costs of complying with a regulation. These estimates are likely to be larger than the actual effects because the model is neither able to take into account the exemption from nutrition labeling that is available to some small businesses, nor can it take into account the compliance period of over 2 years which allows small businesses to budget and plan ahead for the expense of the label change.
The Regulatory Flexibility Act requires that FDA consider options for regulatory relief for small entities.
The exemption of small businesses from the provisions of the final rule would provide regulatory relief. Table 16 of this document shows that small businesses are expected to bear total costs of about $130 million as a result of the final rule, an average of $12,000 per small business. As a first approximation, then, exempting small businesses would reduce the burden by an average of $12,000 per small business.
FDA believes that this option would not be desirable. On the one hand, because so many of the businesses in the food processing industry are classified as small by the Small Business Administration, if small businesses are exempted, most of the potential benefits from the final rule would not be realized. On the other hand, exempt businesses may be forced by market pressures to adopt the final label in any case. In addition, under section 403(q)(5)(E) of the act and implementing regulations, very small producers (those with fewer than 100 full-time employees) that: (1) File a notice with the Office of Nutritional Products, Labeling, and Dietary Supplements; (2) make very low volume products (fewer than 100,000 units annually); and (3) place no claims or other nutrition information on product labels, labeling, or advertising would already be exempt from this final rule.
Longer compliance periods provide regulatory relief for small businesses. Some comments requested that the compliance period be extended several years (e.g., 4 to 7 years) for small businesses. These comments stated that it was important for small businesses to be able to phase in the cost associated with the new label requirements so that they have extra time to absorb the costs of these changes. Some small manufacturers reported that they have significant inventories of labels. Also, smaller manufacturers indicated that they would incur costs, including, loss and disposal of obsolete packaging inventories, product in obsolete packages, and new printing plates. These small businesses believe that a longer compliance period would allow them to more easily manage their inventories and phase in the
To minimize the need for multiple labeling changes and to provide additional time for compliance by small businesses to allow them to use current label inventories and phase in label changes, the agency is setting the effective date at January 1, 2006, the
With small businesses producing 85 percent of the products and 73 percent of the SKUs, extending the compliance period for small businesses to the uniform effective date after January 1, 2006, would leave most labels not listing
FDA has chosen not to exempt small entities because consumption of
Consumers must know the amount of
Further, section 403(q)(2)(A) of the act provides that mandatory labeling would be appropriate when information about a nutrient would assist consumers to maintain healthy dietary practices. Information on the
Survey data show that consumers rely on the Nutrition Facts label as a guide to choosing foods that meet their dietary objectives. As consumers learn more about the dietary significance of
Consumers need the
Furthermore, the benefits of covering products made by small businesses exceed the costs that would be saved by exempting them. The medium estimated cost of covering small businesses is a one time cost of $129 million dollars (table 16). If we assume no benefits from small businesses reformulating, then the benefits associated only with changing labels on all food products is $48 million per year using Method 1 ($99 million using Method 2). If small businesses produce at least 22 percent of food consumed annually, then benefits of covering products made by small businesses will exceed the costs that would be saved by exempting them after 20 years discounted at 3 percent. Using Method 2 for calculating benefits, small businesses would only need to account for production of at least 11 percent of food consumed. Since the Small Business Administration definition of small business includes the vast majority of food firms, products, and SKUs, even the 22 percent amount is quite plausible.
The Regulatory Flexibility Act requires FDA to include a description of the recordkeeping and reporting required for compliance with this final rule. This final rule does not require the preparation of a report or a record.
FDA finds that under the Regulatory Flexibility Act (5 U.S.C. 605(b)) this final rule will have a significant economic impact on a substantial number of small entities. Approximately
The Unfunded Mandates Reform Act of 1995 (Public Law 104-4) requires cost-benefit and other analyses for rules that would cost more than $100 million in 1 single year. The final rule qualifies as a significant rule under the statute. FDA has carried out the cost- benefit analysis in sections IX.C and IX.D of this document. The other requirements under the Unfunded Mandates Act of 1995 include assessing the rule's effects on the following:
1. Future costs;
2. Particular regions, communities, or industrial sectors;
3. National productivity and economic growth;
4. Full employment and job creation; and,
5. Exports.
Most of the costs of this rule will be incurred during the compliance period. Future costs beyond that period would likely be small, because the food industry would have adjusted to the new requirements by that time.
The final rule applies to the food industry and would, therefore, affect that industry disproportionately. Any long run increase in the costs of food production would largely be passed on to the entire population of consumers.
The final rule is not expected to substantially affect productivity or economic growth. It is possible that productivity and growth in certain sectors of the food industry could be slightly lower than otherwise because of the need to divert research and development resources to compliance activities. The diversion of resources to compliance activities would be temporary. Moreover, FDA anticipates that, because the health benefits are estimated to be significant, both productivity and economic growth would be higher than in the absence of the rule. In section IX.C.3 of this document, FDA estimated benefits from the reduction in functional disability associated with a reduction in nonfatal CHD. A reduction of functional disability would result in an increase in productivity. The increased health of the population and the reduction in direct and indirect health costs could increase both productivity and economic growth.
The human resources devoted to producing certain foods would be redirected by the final rule. The final rule could lead to some short-run unemployment as a result of the structural changes within the food industry, the rise of some product lines and decline of others. The growth of employment (job creation) could also be temporarily slower.
Because the final rule does not mandate any changes in products, current export products will not be required to change in any way. Food processors, however, do not necessarily distinguish between production for export and production for the domestic market. The effect of the final rule on U.S. food exports depends on how foreign consumers react to information about
The agency has previously considered the environmental effects of this rule as announced in the proposed rule (64 FR 62746, November 17, 1999). No new information or comments have been received that would affect the agency's previous determination that there is no significant impact on the human environment and that an environmental impact statement is not required.
This final rule contains information collection provisions that are subject to review by OMB under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501- 3520). The title, description, and respondent description of the information collection provisions are shown below with an estimate of the annual reporting burden. Included in the estimate is the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing each collection of information.
The regulations set forth in this final rule require that
FDA estimates the burden of this collection of information as follows:
The impact of these requirements concerning
Multiplying the total number of responses by the hours per response gives the total hours. FDA has estimated operating costs by combining the medium testing and relabeling costs from table 7 of this document ($44.9 million + $126.8 million for relabeling) to get the total operating cost. This total was then apportioned between §§ 101.9 and 101.36 according to the proportion of responses for each section. Based on the labeling cost model, FDA expects that, with a compliance period of over 2 years, 75 percent of firms will coordinate labeling revisions required by this final rule with other planned labeling changes for their products.
The information collection provisions of this final rule have been submitted to OMB for review. Prior to the effective date of this final rule, FDA will publish a document in the
FDA has analyzed this final rule in accordance with the principles set forth in Executive Order 13132. FDA has determined that the rule has a preemptive effect on State law. Section 4(a) of the Executive order requires agencies to “construe * * * a Federal Statute to preempt State law only where the statute contains an express preemption provision, or there is some other clear evidence that the Congress intended preemption of State law, or where the exercise of State authority conflicts with the exercise of Federal authority under the Federal statute.” Section 403A of the act (21 U.S.C. 343-1) is an express preemption provision. That section provides that “no State or political subdivision of a State may directly or indirectly establish under any authority or continue in effect as to any food in interstate commerce” certain food labeling requirements, unless an exemption is provided by the Secretary (and, by delegation, FDA). Relevant to this final rule, one such requirement that States and political subdivisions may not adopt is “any requirement for nutrition labeling of food that is not identical to the requirement of section 403(q) * * * ” (act section 403A(a)(4), 21 U.S.C. 343-1(a)(4)). Prior to the effective date of this rule, this provision operated to preempt States from imposing nutrition labeling requirements concerning trans fat because no such requirements had been imposed by FDA under section 403(q) of the act. Once this rule becomes effective, States will be preempted from imposing any nutritional labeling requirements for trans fat that are not identical to those required by this rule.
Section 403A(a)(4) of the act (21 U.S.C. 343-1(a)(4)) displaces both state legislative requirements and state common-law duties.
Section 4(c) of the Executive order further requires that any “regulatory preemption of State law shall be restricted to the minimum level necessary” to achieve the regulatory objective. The agency is exercising its discretion under section 403(q)(2)(A) of the act, in a manner that is consistent with such section, to require that the amount of
In conclusion, FDA has determined that the preemptive effects of the final rule are consistent with Executive Order 13132.
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81. Guthrie, J. F., B. M. Derby, and A. S. Levy, “What People Know and Do Not Know About Nutrition,” Frazao, E. (Ed.),
82. Lichtenstein, A. H., L. M. Ausman, S. M. Jalbert, and E. J. Schaefer, “Effects of Different Forms of Dietary Hydrogenated Fats on Serum Lipoprotein Cholesterol Levels,”
83. Ascherio, A., M. B. Katan, P. L. Zock, et al, “
84. Willett, W. C., and A. Ascherio, “Response to the International Life Sciences Institute Report on
85. Mensink, R. P., P. L. Zock, M. B. Katan, and G. Hornstra, “Effect of dietary
86. Nestel, P. J., M. Noakes, G. B. Belling, et al., “Plasma Cholesterol-Lowering Potential of Edible-Oil Blends Suitable for Commercial Use,”
87. U.S. Department of Agriculture and U.S. Department of Health and Human Services,
88. Dietary Guidelines Advisory Committee, Report of the Dietary Guidelines Advisory Committee on the Dietary
89. Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults, Third Report of the National Cholesterol Education Program (NCEP) Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults (Adult Treatment Panel III), Chapter II, “Rationale for Intervention” and Chapter V “Adopting Healthful Lifestyle Habits to Lower LDL Cholesterol and Reduce CHD Risk,” 2001, (Internet address: http://www.NHLBI.nih.gov).
90. IOM/NAS, “Letter Report on Dietary Reference Intakes for
91. Krauss, R.M., R.H. Eckel, B. Howard, et al., “American Heart Association Dietary Guidelines, Revision 2000: A Statement for Healthcare Professionals From the Nutrition Committee of the American Heart Association,”
92. FDA, “Questions and Answers on
93. van de Vijer, L.P.L., A.F.M. Kardinaal, C. Couet, et al., “Association Between
94. U.S. FDA/CFSAN, “Guidance for Industry. Significant Scientific Agreement in the Review of Health Claims for Conventional Foods and Dietary Supplements,” 1999 (Internet address: http://www.cfsan.fda.gov/~dms/ssaguide.html).
95. Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults, Executive Summary of the Third Report of the National Cholesterol Education Program (NCEP) Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults (Adult Treatment Panel III)
96. Derby, B.M. and A.S. Levy, “Do Food Labels Work? Gauging the Effects of Food Labels Pre-and Post-NLEA,” In P.N. Bloom & G.T. Gundlach (Eds.), Handbook of Marketing and Society, Sage, Thousand Oaks, CA, pp. 372-398. 2001.
97. Food Marketing Institute, “Trends in the United States: Consumer Attitudes and the Supermarket 1997,” Washington, DC, pp. 17-18, 66-67, 70-73, and 75, 1997.
98. Judd, J.T., D.J. Baer, B.A. Clevidence, et al., “Dietary
99. de Roos, N.M., M.L. Bots, and M.B. Katan, “Replacement of Dietary Saturated Fatty Acids by
100. deRoos, N.M., E.G. Schouten, and M.B. Katan, “Consumption of a Solid Fat Rich in Lauric Acid Results in a More Favorable Serum Lipid Profile in Healthy Men and Women Than Consumption of a Solid Fat Rich in
101. Denke, M.A., B. Adams-Huet, B.S. Nguyen, “Individual Cholesterol Variation in Response to a Margarine- or Butter-Based Diet—A Study in Families,”
102. Oomen, C.M., M.C. Ocke, E.J. Feskens, et al., “Association Between
103. Canadian Government, “Regulations Amending the Food and Drug Regulations (Nutrition Labeling, Nutrition Claims and Health Claims),
104. List, G., K.R. Steidley, and W.E. Neff, “Commercial Spreads Formulation, Structure and Properties,”
105. AOAC, “AOAC Official Method 996.06, Fat (Total, Saturated, and Unsaturated) in Foods,”
106. Firestone, D., “General Referee Report: Fats and Oils,”
107. DeVries, J.W., L. Kjos, L. Groff, et al., “Studies in Improvement of Official Method 996.06,”
108. Guidance for Industry, FDA Nutrition Labeling Manual—A Guide for Developing and Using Data Bases,” 1998 (Internet address: http://www.cfsan.fda.gov/~dms/nutrguid.html).
109. Levy, A.S., S. Fein, and R.E. Schucker, “Performance Characteristics of Seven Nutrition Label Formats,”
110. Stouffer Foods Corp. Docket 9250 (September 26, 1994), 118 FTC 746.
111. Center for Food Safety and Applied Nutrition (CFSAN)/FDA, “Questions and Answers Volume II, A Guide for Restaurants and Other Retail Establishments,” 1996, (Internet address: http://www.cfsan.fda.gov/~frf/qaintro.html).
112. U.S. Department of Agriculture (USDA)/DHHS, “Dietary Guidelines for Americans,” 1st ed., 1980.
113. National Center for Health Statistics, Healthy People 2000 Final Review, Hyattsville, MD: Public Health Service, pp. 76-92, 2001.
114. USDA, Agricultural Research Service, “Data Tables: Results From USDA's 1994-96 Continuing Survey of Food Intakes by Individuals and 1994-96 Diet and Health Knowledge Survey, Table Set 10,” USDA, Agricultural Research Service, 1997.
115. Smiciklas-Wright H., D.C. Mitchell, S.J. Mickle, et al., “Foods Commonly Eaten in the United States: Quantities Per Eating Occasion and in a Day, 1994-1996,” U.S. Department of Agriculture NFS Report No 96-5, pre-publication version, 2002 (pp. i-xii, 1-8, 202-204, 216-244, and 252).
116. Koehler, K. M., D. Zorn and C. Nardinelli, “Estimation of
117. Krebs-Smith, S. M., P. M. Guenther, A. Cook, et al., U.S. Department of Agriculture, Agricultural Research Service, “Foods Commonly Eaten in the United States: Quantities Consumed Per Eating Occasion and in a Day, 1989-91,” U.S. Department of Agriculture NFS Report No. 91-3, November, 1997 (pp. i-xi, 1-7, 196-198, 210-238, and 248-249).
118. “Discovery Health Pulse Top-Line Poll Results,” Penn, Schoen & Berland Associates, Inc., Washington, DC, 1999.
119. Kim, S. Y., R. M. Nayga Jr., and O. Capps Jr., “The Effect of Label Use on Nutrient Intakes: An Endogenous Switching Regression Analysis,”
120. Kochhar, S. P., “Stable and Healthful Frying Oils for the 21st Century,”
121. Haumann, B. F., “Fat Modification Tools: Hydrogenation, Interesterification,”
122. “Questions Remain Over Hydrogenated Fats,”
123. “Legal Sea Foods Leads the Way in Healthy Eating With Innovative All-Natural and Heart-Healthy Frying Oil,” Legal Sea Foods, 1998, http://www.lsf.com/fresh/11_3_98.htm.
124. Bayard, C. C. and R. L. Wolff, “
125. Becker, W., “Intake of
126. Haumann, B. F., “Widening Array of Spreads Awaits Shoppers,”
127. Ovesen, L., T. Leth, and K. Hansen, “Fatty Acid Composition of Danish Margarines and Shortenings, With Special Emphasis on
128. Ratnayake, W. M. N., G. Pelletier, R. Hollywood, et al., “
129. RTI International, FDA Labeling Cost Model, April 2002.
130. Muller, H., B. Kirkhus, and J. I. Pedersen, “Serum Cholesterol Predictive Equations With Special Emphasis on
131. Stampfer, M. J., F. M. Sacks, S. Salvini, et al., “A Prospective Study of Cholesterol, Apolipoproteins, and the Risk of Myocardial Infarction,”
132. “Decline in Deaths From Heart Disease and Stroke—United States, 1900-1999,”
133. National Institutes of Health, National Heart Lung and Blood Institute, “Morbidity and Mortality: 1998 Chartbook on Cardiovascular, Lung and Blood Diseases,”
134. American Heart Association, 2000 Heart and Stroke Statistical Update, American Heart Association, Dallas, TX, 1999 (p. 10).
135. National Report 2001-2002: Consumer Attitudes About Nutrition, Untied Soybean Board, Chesterfield, MO, 2002.
136. U.S. Census Bureau, County Business Patterns, 1999, United States, Washington, DC, 2001.
137. Stinnett, A. A., M. A. Mittleman, M. C. Weinstein, et al., “Appendix C: The Cost-Effectiveness of Dietary and Pharmacologic Therapy for Cholesterol Reduction in Adults,” Gold, M. R., J. E. Siegel, L. B. Russell and M. C. Weinstein (editors),
138. Law, M. R., N. J. Wald, and S. G. Thompson, “By How Much and How Quickly Does Reduction in Serum Cholesterol Lower Risk of Ischaemic Heart Disease?”
139. USDA, Agricultural Research Service, USDA Nutrient Database for Standard Reference, Release 15, 2002 (Internet address: http://www.nal.usda.gov/fnic/cgi-bin/nut_search.pl).
140. IOM/NAS, “Dietary Reference Intakes for Energy, Carbohydrate, Fiber, Fat, Protein and Amino Acids (Macronutrients),” chapters 8 and 11, National Academy Press, Washington, DC, pp. 335-432, 2002 (Internet address: http://www.nap.edu).
141. Congressional House Record, “Nutrition Labeling and Education Act of 1990,” H 12951-12953, October 26, 1990.
142. USDA, Agricultural Research Service, “Food and Nutrient Intakes by Individuals in the United States, 1 Day, 1989-91,” table 8.1, USDA, Agricultural Research Service, 1995, p. 118.
143. AOAC,
144. AOCS,
145. AOCS, AOCS Recommended Practice Cd 14d-96 (reapproved 1997 and revised 1999), “Isolated
146. AOCS, AOCS Official Method Ce 1f-96 (reapproved 1997 and revised 2002), “Determination of
147. Kaufman, Marc, “McDonald's to Give Fat a Break, Washington Post, September 4, 2002, p. A07.
148. Beil, Laura, “
149. McDonald's Press Release, “McDonald's USA Announces Significant Reduction of
150. Pepsico Inc., Press Release, “Frito-Lay Eliminates
151. Fischer, K., “Sorting Fat From Fiction,”
152. Schakel, S. F., L. Harnack, C. Wold, et al., “Incorporation of
153. Bialostosky, K., J. D. Wright, J. Kennedy-Stephenson, et al., “Dietary Intake of Macronutrients, Micronutrients, and Other Dietary Constituents: United States, 1988-94,” National Center for Health Statistics: Vital and Health Statistics, series 11, no. 245, 2002, pp. 1-9, 84-85, and 150-158.
154. Zock, P. L. and R. P. Mensink, “Dietary
155. Memo to file from D. Zorn, Comments and responses to comments from Interagency Economic Peer Review, 2002.
156. Letter to file from J. D. Graham to T. G. Thompson, September 18, 2001.
157. Garber, A. M. and C. E. Phelps, “Economic Foundations of Cost-Effectiveness Analysis,”
158. U.S. Census Bureau, Statistical Abstract of the United States, pp. 413-416 and 436, 2002.
159. Viscusi, W. K. and J. E. Aldy, “The Value of Statistical Life: A Critical Review of Market Estimates throughout the World,”
160. Alberini, A., M. Cropper, A. Krupnik, et al., “Does the Value of a Statistical Life Vary with Age and Health Status? Evidence from the United States and Canada,”
Food labeling, Nutrition, Reporting and recordkeeping requirements.
15 U.S.C. 1453, 1454, 1455; 21 U.S.C. 321, 331, 342, 343, 348, 371.
a. Redesignating paragraphs (c)(2)(ii) and (c)(2)(iii) as (c)(2)(iii) and (c)(2)(iv),
b. Adding new paragraph (c)(2)(ii), and
c. Revising paragraphs (c)(2)(i), (d)(1)(ii)(A), the first sentence of paragraph (f), the first sentence of paragraph (g)(5), the second sentence of paragraph (g)(6), and the sample labels in paragraphs (d)(11)(iii), (d)(12), (d)(13)(ii), (e)(5), (j)(13)(ii)(A)(
(c) * * *
(2) * * *
(i) “Saturated fat,” or “Saturated”: A statement of the number of grams of saturated fat in a serving defined as the sum of all fatty acids containing no double bonds, except that label declaration of saturated fat content information is not required for products that contain less than 0.5 gram of total fat in a serving if no claims are made about fat, fatty acid, or cholesterol content, and if “calories from saturated fat” is not declared. Except as provided for in paragraph (f) of this section, if a statement of the saturated fat content is not required and, as a result, not declared, the statement “Not a significant source of saturated fat” shall be placed at the bottom of the table of nutrient values. Saturated fat content shall be indented and expressed as grams per serving to the nearest 0.5 gram (1/2) gram increment below 5 grams and to the nearest gram increment above 5 grams. If the serving contains less than 0.5 gram, the content shall be expressed as zero.
(ii) “
(d)(1) * * *
(ii) * * *
(A) Except as provided for in paragraph (c)(2)(ii) of this section, a single easy-to-read type style,
(11) * * *
(iii) * * *
(12) * * *
(13) * * *
(ii) * * *
(e) * * *
(5) * * *
(f) The declaration of nutrition information may be presented in the simplified format set forth herein when a food product contains insignificant amounts of eight or more of the following: Calories, total fat, saturated fat,
(g) * * *
(5) A food with a label declaration of calories, sugars, total fat, saturated fat,
(6) * * * Reasonable deficiencies of calories, sugars, total fat, saturated fat,
(j) * * *
(13) * * *
(ii) * * *
(A) * * *
(
(
(b) * * *
(2) * * *
(i) The (b)(2)-dietary ingredients to be declared, that is total calories, calories from fat, total fat, saturated fat,
Food and Drug Administration, HHS.
Advance notice of proposed rulemaking.
The Food and Drug Administration (FDA) is issuing this advance notice of proposed rulemaking (ANPRM) to solicit information and data that potentially could be used to establish new nutrient content claims about
Submit written or electronic comments by October 9, 2003.
Submit written or electronic comments to the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852. Submit electronic comments to
Julie Schrimpf, Center for Food Safety and Applied Nutrition (HFS-800), Food and Drug Administration, 5100 Paint Branch Pkwy., College Park, MD 20740, 301-436-2373.
In the
Comments received in response to the November 1999 proposal were very diverse. Many comments strongly opposed the inclusion of
In September of 2002, the IOM/NAS issued the report entitled “Dietary Reference Intakes for Energy, Carbohydrate, Fiber, Fat, Fatty Acids, Cholesterol, Protein and Amino Acids” (the IOM/NAS macronutrient report) and found that, similar to saturated fat, there is “a positive linear trend” between
Dietary guidance for the general population similar to that in the IOM/NAS macronutrient report was included in the
In light of recommendations in the IOM/NAS macronutrient report, the agency published in the
A few comments to the November 2002 reopening of the comment period supported the proposed footnote statement, “Intake of
The dominant concern, from both industry and consumers, was that the footnote would create a goal of achieving a “zero”
Another concern expressed in comments was that the proposed footnote statement was inconsistent with the IOM/NAS report (Ref. 1) and other dietary guidelines. The comments argued that the footnote statement implies that intake of
Thus, the comments expressed the belief that the proposed footnote statement could mislead consumers into selecting foods with more saturated fat in an effort to avoid foods containing
Comments also raised concerns about the absence of consumer studies to determine how the proposed footnote would be perceived. As noted previously, industry comments perceived it as a warning label for consumers to avoid
In the
FDA has a mandate to provide nutrition information on food labels to assist consumers in maintaining healthy dietary practices. As explained in the
In addition to the information on the Nutrition Facts panel, nutrient content and health claims are important tools for providing consumers with information about the level of one or more nutrients in a food product. Because the level of scientific evidence does not currently support the establishment of an appropriate reference value for daily consumption of
The agency is concerned about ensuring that consumers obtain the best possible information related to
The agency is also interested in comments on the impact on consumers' shopping choices of a qualifying criterion for
We are asking interested persons and those with expertise in consumer research to submit, as part of their comments on the ANPRM, information and consumer research data on any of the following footnote statements:
• Intake of saturated fat and
• Intake of
• Intake of saturated fat,
• As part of a nutritionally balanced diet, intake of saturated fat,
• Healthy diets start with diets low in saturated fat,
• Nutritionally adequate diets include diets low in saturated fat,
Other footnote statements may also be considered.
In particular, we are interested in information about whether a footnote about
We intend to conduct consumer research of this kind in the near future.
Comments are also requested on the following questions:
• How will nutrient content or health claims or a footnote or disclosure statement about
• Will a claim or a footnote or disclosure statement have an impact on consumers' shopping choices, and, if so, what kinds of products will consumers buy more of and less of?
• Is there any information, other than claims or a footnote or disclosure statement, that FDA should consider requiring in labeling that would be more helpful to consumers with respect to cholesterol-raising lipids in maintaining a healthy diet and in getting accurate and reliable nutrition information, or that would help consumers make better use of the information about cholesterol-raising lipids on the label?
• Since the amount of
• What kinds of existing products will manufacturers reformulate because of claims or a footnote or disclosure statement?
• What kinds of new products will manufacturers develop because of claims or a footnote or disclosure statement?
• What kinds of products will manufacturers stop producing because of claims or a footnote or disclosure statement?
• What First Amendment issues, if any, would be raised by establishing qualifying criteria for
• How will manufacturers weigh the consumer concerns about both saturated and
• In order to comply with the Small Business Regulatory Enforcement Fairness Act of 1996, what options for regulatory relief should we consider giving to small businesses?
The following references have been placed on display in the Division of Dockets Management (see
1. IOM/NAS, “Dietary Reference Intakes for Energy, Carbohydrate, Fiber, Fat, Fatty Acids, Cholesterol, Protein and Amino Acids,” National Academy Press, Washington, DC, pp. S1-S17, 8-1 to 8-97, and 11-1 to 11-48, 2002 (Internet address:
2. U.S. Department of Agriculture and U.S. Department of Health and Human Services,
3. Third Report of the National Cholesterol Education Program (NCEP) Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults (Adult Treatment Panel III), chapter II, “Rationale for Intervention” and Chapter V “Adopting Healthful Lifestyle Habits to Lower LDL Cholesterol and Reduce CHD Risk,” 2001, (Internet address:
4. Committee on Diet and Health, Food and Nutrition Board, National Research Council, “Diet and Health: Implications for Reducing Chronic Disease Risk,” chapter 28, Washington, DC, National Academy Press, 1989.
5. Population Panel, National Cholesterol Education Program, National Heart, Lung, and Blood Institute, National Institutes of Health, “Report of the Expert Panel on Population Strategies for Blood Cholesterol Reduction, Executive Summary” Bethesda, MD, NIH Publication No. 90-3047, November 1990.
Interested persons may submit to the Division of Dockets Management (see
This ANPRM is issued under sections 201, 403, and 701 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321, 343, and 371) and under the authority of the Commissioner of Food and Drugs.
Office of the Secretary, Labor.
Notice of proposed rulemaking.
This Notice of Proposed Rulemaking sets out the Department of Labor's (“DOL” or “the Department”) proposed rules for implementing the Age Discrimination Act of 1975, as amended (“Age Act”). The Age Act prohibits discrimination on the basis of age in programs or activities receiving Federal financial assistance. The Age Act also contains certain exceptions that permit, under limited circumstances, use of age distinctions or factors other than age that might have a disproportionate effect on the basis of age. The Age Act applies to persons of all ages.
Comments must be received by September 9, 2003.
Address all comments about this proposed rule to Annabelle T. Lockhart, Director, Civil Rights Center (“CRC”), Frances Perkins Building, 200 Constitution Ave., NW., Room N-4123, Washington, DC 20210. Brief comments (maximum five pages) may be submitted by facsimile machine (FAX) to 202/693-6505. Comments by electronic mail may be sent to
Comments that CRC receives will be available for public inspection at DOL during normal business hours. Appropriate aids are available on request to persons needing assistance to review the comments. In addition, copies of this proposed rule are available, upon request, in large print and electronic file on computer disk. Other formats will be considered upon request. To schedule an appointment to review the comments and/or to obtain the proposed rule in an alternate format, contact CRC at the telephone number or address listed above.
Annabelle T. Lockhart, Director, Civil Rights Center (CRC), Frances Perkins Building, 200 Constitution Ave. NW., Room N-4123, Washington, DC 20210,
The Age Discrimination Act of 1975, 42 U.S.C. 6101
The Age Act required the former Department of Health, Education, and Welfare (HEW) to issue general, government-wide regulations setting standards to be followed by all Federal agencies implementing the Age Act. These government-wide regulations, which were issued on June 12, 1979 (45 CFR part 90; 44 FR 33768), and became effective on July 1, 1979, require each Federal agency providing financial assistance to any program or activity to publish final regulations implementing the Age Act, and to submit final agency regulations to HEW (now the Department of Health and Human Services (HHS)), before publication in the
On December 29, 1998, DOL published its first NPRM to implement the Age Act.
As part of the clearance process required by the government-wide Age Act regulations, DOL submitted its draft final rule to the Department of Health and Human Services (HHS) for review prior to publication as required by 45 CFR 90.31(c). HHS raised concerns about consistency between the draft DOL final Age Act rule and the government-wide Age Act regulations, as well as a few additional minor matters. The purpose of this NPRM is to address the HHS concerns and to propose minor technical corrections to the rule. These changes are discussed below in the section-by-section review of the proposed rule.
The NPRM published today is identical to NPRM II with five exceptions. The proposed language in sections 35.2(b), 35.3, 35.13, 35.15 and 35.37 is different from the language proposed for these sections in NPRM II. The differences between today's proposal and NPRM II are discussed below. Individuals interested in information about those sections of the proposed rule not discussed below are referred to the December 29, 1998, NPRM (63 FR 71714) and the June 10, 2002, NPRM II (67 FR 39830) for additional information.
NPRM II proposed that Section 35.2(b) state that “[c]ompliance with Section 188 of the Workforce Investment Act of 1998 (WIA) (29 U.S.C. 2938) and implementing regulations at 29 CFR part 37, will satisfy the obligations of recipients of Federal financial assistance from DOL under WIA to comply with this part. CRC will use the legal standards in Subpart B of this part when evaluating whether a WIA recipient has engaged in unlawful age discrimination.” Today the Department is proposing not to include this language in the rule.
Compliance with the implementing regulations for section 188 of WIA will not satisfy recipient obligations under the Age Act. The definition of “WIA Title I-funded program or activity” found in the WIA regulations is not consistent with the definition of “program or activity” found in the Age Act, which was amended by the Civil Rights Restoration Act of 1987 (CRRA). The effect of the CRRA on the Age Act was to define “program or activity” to encompass all parts of the recipient's operations;
Section 35.3 would contain definitions applicable to the Age Act regulations. The definition for “program or activity” has been modified in two respects in today's NPRM: the modified definition contains an updated statutory citation to the definition of “local educational agency,” and the definition is now proposed to match the definition used in the Civil Rights Restoration Act of 1987. As discussed above, the CRRA amended the definition of “program or activity” in the Age Act to encompass all parts of the recipient's operations. The definition proposed today is the same as the definition proposed for the Department of Justice common rule which will amend the definition of “program or activity” for various Executive branch agencies’ Title VI, Section 504 of the Rehabilitation Act, and Age Act regulations. (For more information on this change,
Section 35.13 is proposed to contain certain exemptions to the rules against age discrimination. Today's proposal differs from NPRM II in that the word “reasonable” has been deleted from the text of this section to conform its language to that of the government-wide Age Act regulation.
Section 35.15 is proposed to allow recipients to take steps to overcome the effects of conditions that result in a limited participation on the basis of age. Today's NPRM proposes to revise the title of this section and to clarify that this section does not allow recipients to take actions that would permit any otherwise prohibited use of age distinctions in any program or activity receiving Federal financial assistance from DOL.
In NPRM II DOL proposed to use its procedures for conducting hearings, issuing decisions, and conducting post-termination proceedings under Section 188 of the Workforce Investment Act to conduct such proceedings under the Age Act as well. Differences between the Age Act and WIA coverage, discussed above, make it more appropriate to propose use of DOL Title VI enforcement procedures for Age Act cases. Section 37.37 of today's proposal would accomplish that end.
These proposed Age Discrimination Act regulations have been drafted and reviewed in accordance with Executive Order 12866, section 1(b), Principles of Regulation. The Department has determined that this proposed rule is a “significant regulatory action” under Executive Order 12866, section 3(f), Regulatory Planning and Review, yet is not economically significant as defined in section 3(f)(1), and, therefore, the information enumerated in section 6(a)(3)(C) of the order is not required. Pursuant to Executive Order 12866, this proposed rule has been reviewed by the Office of Management and Budget.
Executive Order 12875—This proposed rule would not create an unfunded Federal mandate on any State, local or tribal government.
Unfunded Mandates Reform Act of 1995—This proposed rule would not include any Federal mandate that might result in increased expenditures by State, local and tribal governments, in the aggregate, of $100 million or more, or increased expenditures by the private sector of $100 million or more.
This proposed rule clarifies existing requirements for entities receiving financial assistance from DOL. The requirements prohibiting age discrimination by recipients of Federal financial assistance that are in the Age Act and the government-wide regulations have been in effect since 1979. In addition, entities receiving financial assistance from DOL under WIA have been expressly informed of their obligations to comply with the Age Act by both WIA statutory language and by the DOL regulations implementing the civil rights provisions of WIA. Because this proposed rule will not substantively change existing obligations on recipients, but merely clarifies such duties, the Department certifies that the proposed rule would not have a significant economic impact on a substantial number of small entities. Consequently, a regulatory flexibility analysis is not required.
Section 35.31(c)(1) of the proposed rule allows a complainant to file a complaint by submitting a written statement that identifies the parties involved and the date the complainant first had knowledge of the alleged violation, describes generally the action or practice complained of, and is signed by the complainant. Section 35.40(b)(3)(iii) of the proposed rule requires a complainant to give 30 days notice to the Secretary of Labor, the Secretary of Health and Human Services, the Attorney General of the United States, and the recipient, before commencing a civil action in the event that CRC issues a finding in favor of the recipient or fails to make a finding within 180 days. Based on the history of the program, the Department projects that fewer than 9 persons per year will either file a complaint with CRC or give notice that a civil action is being pursued. Accordingly, the Department believes the Paperwork Reduction Act is inapplicable to this rule. The Department invites the public to comment on its Paperwork Reduction Act analysis.
This proposed rule has been reviewed in accordance with Executive Order 13132 regarding Federalism. This proposed rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, the requirements of section 6 of Executive Order 13132 do not apply to this rule.
Administrative practice and procedure, Age discrimination, Children, Civil rights, Elderly, Grant programs—Labor.
For the reasons set out in the preamble, 29 CFR subtitle A is proposed to be amended by adding a new part 35 to read as follows:
42 U.S.C. 6101
The purpose of this part is to set out the DOL rules for implementing the Age Discrimination Act of 1975, as amended. The Act prohibits discrimination on the basis of age by recipients of Federal financial assistance and in federally assisted programs or activities, but permits the use of certain age distinctions and factors other than age that meet the requirements of the Act and this part.
(a)
(b)
(1) An age distinction contained in that part of a Federal, State, or local statute or ordinance adopted by an elected, general purpose legislative body that:
(i) Provides persons with any benefits or assistance based on age; or
(ii) Establishes criteria for participation in age-related terms; or
(iii) Describes intended beneficiaries or target groups in age-related terms.
(2) Any employment practice of any employer, employment agency, labor organization, or any labor-management joint apprentice training, except any program or activity receiving Federal financial assistance under the Workforce Investment Act of 1998 (29 U.S.C. 2801
As used in this part:
(1) Funds;
(2) Services of Federal personnel; or
(3) Real and personal property or any interest in or use of property, including:
(i) Transfers or leases of property for less than fair market value or for reduced consideration; and
(ii) Proceeds from a subsequent transfer or lease of property if the Federal share of its fair market value is not returned to the Federal Government.
(1)(i) A department, agency, special purpose district, or other instrumentality of a State or of a local government; or
(ii) The entity of such State or local government that distributes such assistance and each such department or agency (and each other State or local government entity) to which the assistance is extended, in the case of assistance to a State or local government;
(2)(i) A college, university, or other postsecondary institution, or a public system of higher education; or
(ii) A local educational agency (as defined in section 7801 of title 20), system of vocational education, or other school system;
(3)(i) An entire corporation, partnership, or other private organization, or an entire sole proprietorship—
(A) If assistance is extended to such corporation, partnership, private organization, or sole proprietorship as a whole; or
(B) Which is principally engaged in the business of providing education, health care, housing, social services, or parks and recreation; or
(ii) The entire plant or other comparable, geographically separate facility to which Federal financial assistance is extended, in the case of any other corporation, partnership, private organization, or sole proprietorship; or
(4) Any other entity which is established by two or more of the entities described in paragraph (1), (2), or (3) of this section.
The rules stated in this section are subject to the exceptions contained in §§ 35.12 and 35.13.
(a)
(b)
(1) excluding individuals from, denying them the benefits of, or subjecting them to discrimination under, a program or activity receiving Federal financial assistance from DOL; or
(2) denying or limiting individuals in their opportunity to participate in any program or activity receiving Federal financial assistance from DOL.
(c)
As used in this part, the term:
(a)
(b)
A recipient is permitted to take an action otherwise prohibited by § 35.10 if the action reasonably takes age into account as a factor necessary to the normal operation or the achievement of any statutory objective of a program or activity. An action reasonably takes age into account as a factor necessary to the normal operation or the achievement of any statutory objective of a program or activity if:
(a) Age is used as a measure or approximation of one or more other characteristics;
(b) The other characteristic(s) must be measured or approximated in order for the normal operation of the program or activity to continue, or to achieve any statutory objective of the program or activity;
(c) The other characteristic(s) can reasonably be measured or approximated by the use of age; and
(d) The other characteristic(s) are impractical to measure directly on an individual basis.
A recipient is permitted to take an action otherwise prohibited by § 35.10, if that action is based on a factor other than age, even though the action may have a disproportionate effect on persons of different ages. An action is based on a factor other than age only if the factor bears a direct and substantial relationship to the normal operation of the program or activity or to the achievement of a statutory objective.
The recipient has the burden of proving that an age distinction or other action falls within the exceptions outlined in §§ 35.12 and 35.13.
Even in the absence of a finding of discrimination, a recipient, in administering a program, may take steps to overcome the effects of conditions that resulted in a limited participation on the basis of age. Nothing in this section will permit any otherwise prohibited use of age distinctions that have the effect of excluding individuals from, denying them benefits of, subjecting them to discrimination under, or limiting them in their opportunity to participate in any program or activity receiving federal financial assistance from DOL.
If a recipient is operating a program or activity that provides special benefits to the elderly or to children, the use of such age distinctions is presumed to be necessary to the normal operation of the program or activity, notwithstanding the provisions of § 35.12.
Any age distinction in regulations issued by DOL is presumed to be necessary to the achievement of a statutory objective of the program or activity to which the regulations apply, notwithstanding the provisions of § 35.12.
Each DOL recipient has primary responsibility for ensuring that its programs or activities are in compliance with the Act and this part and for taking appropriate steps to correct any violations of the Act or this part.
(a)
(b)
(a) Keep such records as CRC determines are necessary to ascertain whether the recipient is complying with the Act and this part;
(b) Upon request, provide CRC with such information and reports as the Director determines are necessary to ascertain whether the recipient is complying with the Act and this part; and
(c) Permit reasonable access by CRC to books, records, accounts, reports, other recipient facilities and other sources of information to the extent CRC determines is necessary to ascertain whether the recipient is complying with the Act and this part.
A recipient or applicant for Federal financial assistance from DOL shall sign a written assurance, in a form specified by DOL, that the program or activity will be operated in compliance with the Act and this part. In subsequent applications to DOL, an applicant may incorporate this assurance by reference.
Each recipient shall designate at least one employee to coordinate its compliance activities under the Act and this part, including investigation of any complaints that the recipient receives alleging any actions that are prohibited by the Act or this part.
Each recipient shall adopt and publish complaint procedures providing for prompt and equitable resolution of complaints alleging any action that would be prohibited by the Act or this part.
(a) In order to assess a recipient's compliance with the Act and this part, as part of a compliance or monitoring review, or a complaint investigation, CRC may require a recipient employing the equivalent of 15 or more full-time employees to complete a written self-evaluation, in a manner specified by CRC, of any age distinction imposed in its program or activity receiving Federal financial assistance from DOL.
(b) Whenever such an assessment indicates a violation of the Act or this part, the recipient shall take prompt and appropriate corrective action.
(a) CRC may conduct such compliance reviews, pre-award reviews, and other similar procedures as permit CRC to investigate and correct violations of the Act and this part, irrespective of whether a complaint has been filed against a recipient. Such reviews may be as comprehensive as necessary to determine whether a violation of the Act or this part has occurred.
(b) Where a review conducted pursuant to paragraph (a) of this section indicates a violation of the Act or this part, CRC will attempt to achieve voluntary compliance. If voluntary compliance cannot be achieved, CRC will begin enforcement proceedings, as described in § 35.36.
(a)
(b)
(c)
(1) Accept as a complete complaint any written statement that identifies the parties involved and the date the complainant first had knowledge of the alleged violation, describes generally the action or practice complained of, and is signed by the complainant;
(2) Freely permit a complainant to add information to the complaint to meet the requirements of a complete complaint;
(3) Notify the complainant and the recipient of their rights and obligations under the complaint procedure, including the right to have a representative at all stages of the complaint procedure; and
(4) Notify the complainant and the recipient (or their representatives) of their right to contact CRC for information and assistance regarding the complaint resolution process.
(d)
(a)
(1) Fall within the jurisdiction of the Act or this part, unless the age distinction complained of is clearly within an exemption under § 35.2(c); and
(2) Contain all information necessary for further processing, as provided in § 35.31(c)(1).
(b)
(c)
(d)
(e)
(1) 60 days elapse from the time the complaint is filed; or
(2) prior to the end of the 60-day period, either
(i) an agreement is reached; or
(ii) the mediator determines that agreement cannot be reached.
(f)
(a)
(1) As part of the initial investigation, CRC will use informal fact-finding methods, including joint or separate discussions with the complainant and recipient to establish the facts and, if possible, resolve the complaint to the mutual satisfaction of the parties. CRC may seek the assistance of any involved State, local, or other Federal agency.
(2) Where agreement between the parties has been reached pursuant to paragraph (a)(1) of this section, the agreement shall be put in writing by DOL, and signed by the parties and an authorized official of DOL.
(b)
An agreement reached pursuant to either § 35.32(c) or § 35.33(a) shall have no effect on the operation of any other enforcement effort of DOL, such as compliance reviews and investigations of other complaints, including those against the recipient.
A recipient may not engage in acts of intimidation or retaliation against any person who:
(a) Attempts to assert a right protected by the Act or this part; or
(b) Cooperates in any mediation, investigation, hearing or other part of CRC's investigation, conciliation, and enforcement process.
(a) DOL may enforce the Act and this part through:
(1) Termination of, or refusal to grant or continue, a recipient's Federal financial assistance from DOL under the program or activity in which the recipient has violated the Act or this part. Such enforcement action may be taken only after a recipient has had an opportunity for a hearing on the record before an administrative law judge.
(2) Any other means authorized by law, including, but not limited to:
(i) Referral to the Department of Justice for proceedings to enforce any rights of the United States or obligation of the recipient created by the Act or this part; or
(ii) Use of any requirement of, or referral to, any Federal, State, or local government agency that will have the effect of correcting a violation of the Act or this part.
(b) Any termination or refusal under paragraph (a)(1) of this section will be limited to the particular recipient and to the particular program or activity found to be in violation of the Act or this part. A finding with respect to a program or activity that does not receive Federal financial assistance from DOL will not form any part of the basis for termination or refusal.
(c) No action may be taken under paragraph (a) of this section until:
(1) DOL has advised the recipient of its failure to comply with the Act or with this part and has determined that voluntary compliance cannot be obtained; and
(2) Thirty days have elapsed since DOL sent a written report of the circumstances and grounds of the action to the committees of Congress having jurisdiction over the program or activity involved.
(d)
(1) New Federal financial assistance from DOL includes all assistance for which DOL requires an application or approval, including renewal or continuation of existing activities, or authorization of new activities, during the deferral period. New Federal financial assistance from DOL does not include increases in funding as a result of changed computation of formula awards or assistance approved prior to the initiation of a hearing under paragraph (a)(1) of this section.
(2) DOL may not defer a grant until the recipient has received notice of an opportunity for a hearing under paragraph (a)(1) of this section. A deferral may not continue for more than 60 days unless a hearing has begun within the 60-day period or the recipient and DOL have mutually agreed to extend the time for beginning the hearing. If the hearing does not result in a finding against the recipient, the deferral may not continue for more than 30 days after the close of the hearing.
Certain DOL procedural provisions applicable to Title VI of the Civil Rights Act of 1964 apply to DOL enforcement of these regulations. They are found at 29 CFR 31.9 through 31.11.
(a) If funds are withheld from a recipient under this part, the Secretary may disburse the funds withheld directly to an alternate recipient.
(b) The Secretary will require any alternate recipient to demonstrate:
(1) The ability to comply with the Act and this part; and
(2) The ability to achieve the goals of the Federal statute authorizing the Federal financial assistance.
Where CRC finds discrimination on the basis of age in violation of this Act or this part, the recipient shall take any remedial action that CRC deems necessary to overcome the effects of the discrimination. In addition, if a recipient funds or otherwise exercises control over another recipient that has discriminated, both recipients may be required to take remedial action.
(a) A complainant may file a civil action under the Act following the exhaustion of administrative remedies. Administrative remedies are exhausted if:
(1) One hundred eighty days have elapsed since the complainant filed the complaint with CRC, and CRC has made no finding with regard to the complaint; or
(2) CRC issues any finding in favor of the recipient.
(b) If CRC fails to make a finding within 180 days, or issues a finding in favor of the recipient, CRC will promptly:
(1) Notify the complainant;
(2) Advise the complainant of his or her right to bring a civil action for injunctive relief; and
(3) Inform the complainant that:
(i) The complainant may bring a civil action only in a United States district court for the district in which the recipient is found or transacts business;
(ii) A complainant who prevails in a civil action has the right to be awarded the costs of the action, including reasonable attorney's fees, but that the complainant must demand these costs in the complaint filed with the court;
(iii) Before commencing the action, the complainant must give 30 days notice by registered mail to the Secretary, the Secretary of Health and Human Services, the Attorney General of the United States, and the recipient;
(iv) The notice required by paragraph (b)(3)(iii) of this section must state the alleged violation of the Act, the relief requested, the court in which the complainant is bringing the action, and whether or not attorney's fees are demanded in the event that the complainant prevails; and
(v) The complainant may not bring an action if the same alleged violation of the Act by the same recipient is the subject of a pending action in any court of the United States.