This rule is issued in conformance with Executive Order 12866. It has been determined significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.

This rule has been reviewed in accordance with Executive Order 12988, Civil Justice Reform. This rule would have preemptive effect with respect to any State or local laws, regulations or policies which conflict with such provisions or which otherwise impede their full implementation; does not have retroactive effect; and does not require administrative proceedings before suit may be filed.

This program is not subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. See the notice related to 7 CFR part 3014, subpart V, published at 48 FR 29115 (June 24, 1983).

It has been determined that the Regulatory Flexibility Act is not applicable to this rule because the Commodity Credit Corporation is not required by any provision of law to publish a notice of proposed rulemaking with respect to the subject matter of this rule.

This rule contains no Federal mandates under the regulatory provisions of Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) for State, local, and tribal governments or the private sector. Thus, this rule is not subject to the requirements of sections 202 and 205 of the UMRA.

In accordance with provisions of the Paperwork Reduction Act of 1995, the Foreign Agricultural Service submitted an information collection package to the Office of Management and Budget (OMB control number 0551-0038) to support an interim rule published in the Federal Register on September 10, 2002, (67 FR 57326-57329) which implemented the Technical Assistance for Specialty Crops program. Copies of the information collection may be obtained from Kimberly Chisley, the Agency Information Collection Coordinator, on (202) 720-2568 or by e-mail to Kimberly.Chisley@fas.usda.gov.

The Foreign Agricultural Service is committed to compliance with the Government Paperwork Elimination Act, which requires Government agencies, in general, to provide the public the option of submitting information or transacting business electronically to the maximum extent possible. Accordingly, applications for participation in the Technical Assistance for Specialty Crops program may be submitted online, and requests for reimbursement as well as all payments to participants will be handled electronically.

It has been determined that this rule does not have sufficient Federalism implications to warrant the preparation of a Federalism Assessment. The provisions contained in this rule will not have a substantial direct effect on States or their political subdivisions, or on the distribution of power and responsibilities among the various levels of government.

The Commodity Credit Corporation (CCC) will periodically publicly announce that proposals may be submitted for participation in the Technical Assistance for Specialty Crops (TASC) program, which is administered by personnel of the Foreign Agricultural Service (FAS). On May 13, 2002, the President signed the Farm Security and Rural Investment Act of 2002. Section 3205 of that Act directs the Secretary of Agriculture to establish an export assistance program to address barriers that prohibit or threaten the export of U.S. specialty crops. The statute directs the Secretary to make available $2,000,000 of CCC resources for the TASC program in each of fiscal years 2002 through 2007. The TASC program is designed to assist U.S. organizations by providing funding for projects which address sanitary, phytosanitary, and technical barriers that prohibit or threaten the export of U.S. specialty crops. For the purpose of this rule, U.S. specialty crops include all cultivated plants, or the products thereof, produced in the U.S., except wheat, feed grains, oilseeds, cotton, rice, peanuts, sugar, and tobacco.

On September 10, 2002, the CCC published an interim rule in the Federal Register (67 FR 57326-57329) implementing the TASC program. That rule also requested that interested parties submit comments on the rule by November 12, 2002. The FAS received one comment on the interim rule.

Comment: To be more effective in addressing sudden and unpredictable technical barriers to trade, access to TASC program funds should not be limited to once per year. Rather, TASC program funding should be made available as the need arises, perhaps by utilizing a quick-response mechanism.

Response: The agency agrees with this comment and has included language in § 1487.5 to provide for the establishment of a formal quick-response process. The periodic announcements indicating that the CCC will be accepting applications also will provide the details of the various application options that are available.

In addition to the language that was incorporated in § 1487.5 in response to the public comment, this final rule adds a new provision in § 1487.6(a)(8) to complement § 1487.2 and clearly indicate that the TASC program is intended to benefit the represented industry rather than a specific company or brand. This final rule also includes other minor organizational, administrative and editorial changes so as to improve the clarity and consistency of the regulations.

This rule is effective August 18, 2003 but does not apply to projects approved prior to the effective date.

The Animal and Plant Health Inspection Service (APHIS) of the United States Department of Agriculture (the Department) administers regulations at 9 CFR part 53 (referred to below as the regulations) that provide for the payment of indemnity to owners of animals and materials that are required to be destroyed because of foot-and-mouth disease, pleuropneumonia, rinderpest, exotic Newcastle disease, highly pathogenic avian influenza, infectious salmon anemia, or any other communicable disease of livestock or poultry that, in the opinion of the Secretary of Agriculture, constitutes an emergency and threatens the U.S. livestock or poultry population. Payment for animals destroyed is to be based on the fair market value of the animals.

Section 53.2 of the regulations authorizes the APHIS Administrator to cooperate with a State in the control and eradication of disease. In an interim rule published in the Federal Register on November 4, 2002, and made effective December 9, 2002 (67 FR 67089-67096, Docket No. 02-048-1), we amended the regulations to allow the Department to pay indemnity to contract growers and owners for poultry destroyed because of low pathogenic avian influenza (LPAI) associated with a disease situation in Virginia. We provided that, subject to available funding, the Department may pay all eligible losses of contract growers and up to 50 percent of eligible losses of owners, minus any amount paid to the contract grower of a flock. Additionally, we provided that value of poultry destroyed due to the disease may be determined after destruction and disposal of the poultry, and required, except in limited situations, a waiting period of 7 days following cleaning and disinfection before premises that contained poultry affected by the disease may be restocked.

We solicited comments concerning the interim rule for 30 days ending December 4, 2002. We received 41 comments by that date. They were from poultry and egg producers, poultry federations, a farm bureau federation, a State Department of Agriculture, Federal and State congressional officials, and other members of the public. We have carefully considered all of the comments we received. They are discussed below by topic.

In April 2002, birds in a poultry operation in Texas were identified as being affected with the LPAI H5 virus. The disease was subsequently identified in another poultry operation in Texas. All of the affected flocks were depopulated. A number of commenters recommended that indemnity be paid to producers of poultry in Texas for losses incurred from the occurrence of LPAI in that State. Some of the commenters stated that the disease situation in Texas was not as widespread as in Virginia only because Texas producers had been voluntarily taking part in a testing program, and that those producers should not be denied indemnity for losses simply because they took part in an effective program. The commenters stated that not compensating Texas producers would serve as a disincentive to take part in ongoing surveillance programs in the future.

We recognize the proactive efforts of producers and animal health officials in Texas to contain and eradicate LPAI when it occurred in that State in 2002, and we recognize the effects on producers of the LPAI situation in Texas. In this final rule, we are amending the provisions in part 53 to allow the Administrator to pay claims for eligible losses incurred by owners and contract growers related to the 2002 disease situation in Texas associated with the H5 virus. We will apply those payment conditions that we are applying to the disease situation in Virginia to the disease situation in Texas.

Several commenters requested similarly that compensation be paid to producers in North Carolina for losses due to LPAI.

Our interim rule provided that the Department would pay compensation for birds in States other than Virginia if those birds were depopulated because of being epidemiologically linked to the situation in Virginia. Compensation has been paid for flocks in North Carolina epidemiologically linked to the situation in Virginia.

Several commenters requested that poultry owners be compensated at a rate higher than 50 percent of the value of poultry destroyed minus the amount paid to contract growers.

In this final rule, we are providing that, subject to available funding, the Department may pay up to 75 percent of eligible total losses with contract growers being compensated at 100 percent of their eligible losses and the remaining amount being paid to the owner of the flock.

Several commenters requested that compensation be paid for destroyed eggs from affected premises, including destroyed hatching eggs that had been moved to a hatchery after the disease was detected on the premises but before the poultry from that premises were destroyed.

We agree with the commenters that such losses should be eligible for compensation. Additionally, semen collected from or used in affected flocks poses a risk of transmitting the LPAI virus and should be destroyed as part of the eradication process. Therefore, we are providing in this final rule that compensation will be paid for eggs, as well as any poultry semen, destroyed because of LPAI associated with the disease situations in Virginia and Texas.

One commenter expressed concern that the interim rule did not provide for payment for certain items other than poultry on affected premises. The commenter requested indemnity for feed and containers destroyed on affected premises. Additionally, the commenter requested compensation for custom-printed supplies that would not be used again because the destruction of birds and eggs would make it impossible to resume business operations. Other commenters requested compensation for feed used to sustain poultry from the time the disease was diagnosed on a premises until the time of depopulation and for poultry litter that could not be sold and moved from a quarantined premises.

We are making no changes based on the comments. Under the interim rule, growers were compensated fully for production losses and owners were compensated in part for poultry destroyed because of LPAI. With regard to feed and other materials destroyed, it has historically not been the Department's policy to compensate for such materials that were not required to be destroyed by the Department, such as in the Virginia and Texas outbreaks, where actions to control and eradicate the disease were initiated by the States. Any decision to no longer use supplies that were not contaminated by the disease was a voluntary business decision by the entity involved. The issue of compensating for feed used to sustain poultry is further inapplicable because, for those poultry that were allowed to move to slaughtering establishments (controlled slaughter), owners recouped the cost of feed for the poultry. In cases where affected poultry did not go to controlled slaughter, the poultry were required to be destroyed within 24 hours of diagnosis. Litter in the affected area was permitted to be moved from the area after meeting requirements to ensure that it was not contaminated by the LPAI agent.

The interim rule based payments on the age (in weeks) of birds destroyed. Several commenters requested that the indemnification value of breeder flocks be calculated as of the date that the flock was diagnosed positive for LPAI, because, following that date, hatching eggs produced by the flock could not be moved from the premises. One commenter requested that, at the minimum, the value of a breeding bird be calculated as of the last full week of age of the bird before depopulation. For instance, it was requested that, if a flock was 44 weeks and 5 days old when depopulated, we consider the age of that flock to be only 44 weeks. One commenter recommended that the per-bird value in the LPAI compensation plan be prorated to the day of the bird's age.

We are making no changes based on the comments. We decided to be consistent with the method used to determine age, whether the birds were meat birds or breeding birds. We rounded up or down in standard fashion according to how old in days beyond a full week a bird was ( e.g. , a bird 1 week and 2 days old will be considered 1 week old; a bird 1 week and 5 days old will be considered 2 weeks old). Although meat birds and replacement breeders gain in value as they age, breeder birds lose value as they age. An attempt to consider birds in all cases to be only as old as the last full week would have provided overcompensation to some owners and undercompensation to others. Calculation of compensation of a large number of birds based on days of age would delay payments and increase taxpayer expense to process the claims, and, on the average, using daily values would not change the overall payment made.

Several commenters stated that, practically speaking, the LPAI compensation plan bases payments to contract growers of breeder poultry on production records from one flock, whereas payments to growers of meat birds are based on an average of three to seven flocks. The commenters requested that a three-flock average be used to determine compensation for losses of breeder poultry.

We would find it acceptable to use a three-flock average for breeder birds. If companies provide APHIS with breeder data for the past three flocks, then all three flocks can be used in estimating flock productivity.

One commenter recommended that, in calculating a broiler breeder producer's projected flock income for the purposes of compensation, the previous three-flock income average be divided by the capitalized number of hens, and that the resulting payment per unit be multiplied by the capitalized number of hens in the LPAI-affected flock.

We would find the method described by the commenter an acceptable method of calculating projected flock income, provided documentation is provided to support the numbers provided.

One commenter asked whether any payment would be due a producer of broiler breeder birds if the age of the LPAI-affected flock was older than the average age of previous flocks.

It is not clear to us what the commenter means. Payment will be calculated for contract growers based on the amount they received for previous flocks. Contract growers will be compensated at 100 percent of their eligible losses, minus any compensation they already received from the owner. One possible but unlikely scenario the commenter may be referring to would be based on the fact that producers of breeding eggs often receive payment during the production cycle. Thus, it is possible, if the depopulated flock had much greater productivity and lasted in production longer than previous flocks, for the payment already received from the owner to be greater than the average amount received from previous flocks. If such a situation occurred, then no additional compensation would be paid to the producer, because the producer would have already received payment equal to previous flocks.

Several commenters stated that, under the interim rule, compensation would not be paid for male birds in broiler breeder flocks associated with the Virginia disease situation. The commenters requested that payment be made for such male birds disposed of due to the disease.

The compensation plan for Virginia does take into account losses for male birds in broiler breeder flocks; however, that may not be immediately apparent. The per bird compensation value for breeder broilers is shown in Table 1 of that compensation plan. (The compensation plan can be accessed as an appendix to the full economic analysis of the interim rule at http://www.aphis.usda.gov/ppd/rad/avianecon.html. ) An explanation of how to apply that value is set out in the compensation plan under the heading “Female Breeder Birds (in lay), Table Egg Birds (in lay).” See section XXVI, which states, “Per bird compensation values for broiler breeders include the cost of males, thus bird count should be of hens only.” In other words, the value given the hens takes into account the value of male birds in the flock.

One poultry owner stated that, in cases where a contract grower is ruled ineligible for payment because the grower did not adhere to the cleaning and disinfection requirements of the interim rule due to cessation of business, the poultry owner should nonetheless be compensated the total amount the owner is eligible to receive.

In such a case, the owner would receive compensation for the total eligible losses. However, based on the information available to us, all growers have chosen to clean and disinfect affected premises.

Several commenters requested that compensation be paid for income and production losses associated with delays in restocking a premises or neighboring premises after an LPAI test-positive flock had been depopulated and disposed of.

We are making no changes based on the comments. It has traditionally been the policy of the Department not to pay for “downtime.”

Several commenters requested that compensation be paid for the cost of cleaning and disinfecting affected premises.

We are making no changes based on the comments. We consider the amounts that will be paid in accordance with the interim rule, as amended by this final rule, to be equitable compensation for losses incurred.

Several commenters requested that compensation be paid for reduced income to producers whose flocks tested negative, but who, as a precautionary measure due to detection of the disease in premises in the area, sent the flocks to slaughter earlier and at less value than they would have normally.

We recognize that some producers whose flocks were not affected chose to send their birds to slaughter due to detection of the disease in the area. However, APHIS, by law, may compensate only for birds and materials destroyed because they are considered to be infected with or exposed to the disease.

One commenter requested confirmation that compensation would be paid for losses incurred from the destruction of poultry in States other than Virginia that were epidemiologically linked to the Virginia situation.

The commenter is correct in concluding that compensation will be paid for poultry in States other than Virginia that were destroyed because of an epidemiological link to the situation in Virginia.

One commenter opposed the payment of indemnity under the interim rule, stating that losses due to disease are normal costs of doing business for any livestock industry.

We are making no changes based on this comment. In the event of a potentially serious disease situation, it is important to have a rapid, coordinated response by the public and private sectors in the early stages of the situation. The purpose of compensation is to remove possible sources of delay in eradicating the disease, such as grower and owner reluctance to report incidences of the diseases because of uncertainty about whether they will be compensated for losses.

Therefore, for the reasons given in the interim rule and in this document, we are adopting the interim rule as a final rule, with the changes discussed in this document.

This final rule also affirms the information contained in the interim rule concerning Executive Orders 12372 and 12988, and the Paperwork Reduction Act.

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ), the information collection or recordkeeping requirements included in this rule are under review by the Office of Management and Budget under OMB control number 0579-0208.

The Animal and Plant Health Inspection Service is committed to compliance with the Government Paperwork Elimination Act (GPEA), which requires Government agencies in general to provide the public the option of submitting information or transacting business electronically to the maximum extent possible. For information pertinent to GPEA compliance related to this proposed rule, please contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 734—7477.

Pursuant to the administrative procedure provisions in 5 U.S.C. 553, we find good cause for making this rule effective less than 30 days after publication in the Federal Register. The interim rule adopted as final by this rule was effective on December 9, 2002. This rule expands and increases the compensation to be paid for losses associated with an LPAI situation in Virginia and allows compensation to be paid for losses associated with an LPAI situation in Texas. Immediate action is warranted to expedite compensation of persons who incurred eligible losses due to the disease situations.

This rule has been reviewed under Executive Order 12866. The rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.

Below is the economic analysis of the changes in indemnity contained in this document with regard to LPAI in Virginia and Texas. Our November 4, 2002, interim rule included a summary of an initial regulatory flexibility analysis and cost-benefit analysis of the potential economic effects of the interim rule regarding the LPAI situation in Virginia. The full economic analysis for the interim rule, along with addendum for this final rule (the compensation plan for Texas), are available for review at http://www.aphis.usda.gov/ppd/rad/avianecon.html. This final economic analysis affirms the information contained in the economic analysis for the interim rule, with the changes discussed below.

As amended by this document, subject to available funding, the Department may pay up to 75 percent of eligible total losses associated with LPAI outbreaks in Virginia and Texas, with contract growers being compensated at 100 percent of their eligible losses and the remaining amount being paid to the owner of the flock. However, total payments may not exceed 75 percent of all eligible costs. Additionally, this document makes eligible for compensation those losses incurred because of eggs and semen that were destroyed because of low pathogenic avian influenza associated with the disease situations in Virginia and Texas. These actions are necessary to provide appropriate compensation for losses incurred due to this disease.

The interim rule provided for compensation of all eligible losses of contract growers and eligible losses of owners related to the LPAI situation in Virginia, up to 50 percent of the value of affected poultry. However, the interim rule, as does this final rule, provided that payments to owners would be net payments after payments to growers were subtracted. Changes in this final rule will have the effect of more fully compensating poultry owners for losses associated with the LPAI situations in Virginia and Texas.

The economic analysis accompanying the interim rule estimated a total of $50.99 million in compensation due to the LPAI situation in Virginia, with $37.1 million going to owners and $13.9 million going to growers, based on the assumption that compensation would be paid for 4.7 million birds depopulated. Fewer birds (3.7 million) were actually depopulated and eligible for compensation than had originally been predicted. Additionally, although the interim rule provided that total Federal payments would be reduced by any amounts paid by slaughtering establishments for birds sent to slaughter, the original compensation estimate did not assume that any such payments would occur. However, approximately $9 million was realized by the companies at controlled slaughter. Consequently, eligible losses were reduced by this amount and this reduction is reflected in the final rule.

The numbers in Table 1, below, reflect more up-to-date and accurate information on numbers of birds depopulated and average payout per bird. Total payments due to the disease situation in Virginia are expected to be close to $52.4 million—which includes compensation for destroyed eggs ($1.6 million) and disposal costs ($7.7 million)—with approximately $47.8 million of the total going to owners and approximately $4.6 million going to growers. This information was current as of January 28, 2003. No substantial changes were expected after this date, although a few small claims could still be presented for payment.

Under the final rule, growers continue to be compensated for 100 percent of their losses. However, the total dollar amount expected to be paid to growers is less than had originally been anticipated. A number of factors are responsible for the lower total payment to growers.

First, fewer grower farms were eligible for compensation. A significant number of meat birds went to controlled slaughter, plus fewer farms had contract growers than were initially assumed. In the original analysis, we assumed that every farm had a contract grower, but, in reality, this assumption holds true only for meat flocks. Breeder flocks, especially the more valuable turkey breeders, tend to be raised on company farms. Only 20 percent of turkey breeders were raised on grower farms.

Second, the average actual per-bird payout to growers was less than estimated. Actual per-bird payout to growers depends on the age of the flock in weeks and also historical payout records.

Third, a few contract growers refused, for religious reasons, to accept payments from the Federal Government.

The LPAI situation in Texas differed from that in Virginia. Only two operations were affected in Texas. One was a single-site table egg producer; the other was a collection site for spent breeding hens obtained from commercial broiler breeders for subsequent sale to urban live bird markets. Birds owned by two poultry owners from the second operation were depopulated. Therefore, a total of three owners were directly affected in the Texas situation.

As shown in Table 2, below, 238,838 birds were destroyed from the table egg operation. Using a compensation rate of 75 percent, compensation for those birds will total close to $430,000. With the addition of payment for disposal costs at a 75 percent rate, payments for this operation will total approximately $443,000. From the operation with the spent birds, the first party had 5,770 birds depopulated. The second party had 1,429 birds depopulated. Neither party incurred disposal costs. Total compensation for the spent bird operation will be approximately $10,800. Total compensation due to the LPAI situation in Texas will be approximately $453,800.

To the extent that the interim and final rules contribute to the elimination of LPAI in Virginia and Texas, all affected entities should benefit over the long term. In the short term, however, the economic effects will vary.

In Virginia, five or six poultry companies/integrators who owned the affected poultry and 197 contract grower farm/flocks in the Shenandoah Valley of Virginia will be affected by the November 2002 interim rule and this final rule. Three contract grower operations outside the Shenandoah Valley will also be affected. In addition, other entities not yet identified may be directly or indirectly affected by the disease event and/or the final rule. The poultry companies/integrators that own the birds are all large, vertically integrated concerns that do not meet the Small Business Administration (SBA) small-entity criteria. It is unclear at this time exactly how many contract growers will qualify for consideration as small entities. The SBA defines small poultry operations as those earning gross per-farm receipts of no more than $750,000 annually. 1

In Texas, the two owners of spent birds are most likely small entities. It is unclear whether the table egg producer is a small entity. In any case, all three parties will benefit from the compensation payments provided by this rule.

Section 218(a) of the Nuclear Waste Policy Act of 1982, as amended (NWPA), requires that “[t]he Secretary (of the Department of Energy (DOE)) shall establish a demonstration program, in cooperation with the private sector, for the dry storage of spent nuclear fuel at civilian nuclear power reactor sites, with the objective of establishing one or more technologies that the (Nuclear Regulatory) Commission may, by rule, approve for use at the sites of civilian nuclear power reactors without, to the maximum extent practicable, the need for additional site-specific approvals by the Commission.” Section 133 of the NWPA states, in part, that “[t]he Commission shall, by rule, establish procedures for the licensing of any technology approved by the Commission under Section 218(a) for use at the site of any civilian nuclear power reactor.”

To implement this mandate, the NRC approved dry storage of spent nuclear fuel in NRC-approved casks under a general license by publishing a final rule in 10 CFR part 72 entitled, “General License for Storage of Spent Fuel at Power Reactor Sites” (55 FR 29181; July 18, 1990). This rule also established a new subpart L within 10 CFR part 72, entitled “Approval of Spent Fuel Storage Casks” containing procedures and criteria for obtaining NRC approval of spent fuel storage cask designs. The NRC subsequently issued a final rule on March 9, 2000 (65 FR 12444), that approved the NAC-Multipurpose Canister (NAC-MPC) cask design and added it to the list of NRC-approved cask designs in § 72.214 as Certificate of Compliance Number (CoC No.) 1025.

On April 18, 2002, and as supplemented May 15, 2002, July 17, 2002, October 3, 2002, and January 17, 2003, NAC International, Inc. (NAC) submitted an application to the NRC to amend CoC No. 1025 to incorporate changes in support of the Yankee Nuclear Power Station (Yankee Rowe) fuel loading campaign and make corrections to the Connecticut Yankee TS. The amendment specifically incorporates fuel enrichment tolerances, 432-kg (950-lb) fuel assemblies, damaged fuel, damaged fuel cans, and recaged fuel for Yankee Rowe. For Connecticut Yankee, the amendment corrects the tables for fuel assembly limits and intact fuel assembly characteristics. The amendment also incorporates editorial and administrative changes in the CoC.

No other changes to the NAC-MPC cask system design were requested in this application. The NRC staff performed a detailed safety evaluation of the proposed CoC amendment request and found that an acceptable safety margin is maintained. In addition, the NRC staff has determined that there is still reasonable assurance that public health and safety and the environment will be adequately protected.

This direct final rule revises the NAC-MPC cask design listing in § 72.214 by adding Amendment No. 3 to CoC No. 1025. The amended TS are identified in the NRC staff's SER for Amendment No. 3.

The amended NAC-MPC cask system, when used in accordance with the conditions specified in the CoC, the TS, and NRC regulations, will meet the requirements of part 72; thus, adequate protection of public health and safety will continue to be ensured.

Certificate No. 1025 is revised by adding the effective date of Amendment No. 3.

This rule is limited to the changes contained in Amendment No. 3 to CoC No. 1025 and does not include other aspects of the NAC-MPC cask system design. The NRC is using the “direct final rule procedure” to issue this amendment because it represents a limited and routine change to an existing CoC that is expected to be noncontroversial. Adequate protection of public health and safety continues to be ensured. The amendment to the rule will become effective on October 1, 2003. However, if the NRC receives significant adverse comments by August 18, 2003, then the NRC will publish a document that withdraws this action and will address the comments received in response to the proposed amendments published elsewhere in this issue of the Federal Register . A significant adverse comment is a comment where the commenter explains why the rule would be inappropriate, including challenges to the rule's underlying premise or approach, or would be ineffective or unacceptable without a change. A comment is adverse and significant if:

(1) The comment opposes the rule and provides a reason sufficient to require a substantive response in a notice-and-comment process. For example, in a substantive response:

(a) The comment causes the NRC staff to reevaluate (or reconsider) its position or conduct additional analysis;

(b) The comment raises an issue serious enough to warrant a substantive response to clarify or complete the record; or

(c) The comment raises a relevant issue that was not previously addressed or considered by the NRC staff.

(2) The comment proposes a change or an addition to the rule, and it is apparent that the rule would be ineffective or unacceptable without incorporation of the change or addition.

(3) The comment causes the NRC staff to make a change (other than editorial) to the CoC or TS.

These comments will be addressed in a subsequent final rule. The NRC will not initiate a second comment period on this action. However, if the NRC receives significant adverse comments by August 18, 2003, then the NRC will publish a document that withdraws this action and will address the comments received in response to the proposed amendments published elsewhere in this issue of the Federal Register .

The National Technology Transfer Act of 1995 (Pub. L. 104-113) requires that Federal agencies use technical standards that are developed or adopted by voluntary consensus standards bodies unless the use of such a standard is inconsistent with applicable law or otherwise impractical. In this direct final rule, the NRC would revise the NAC-MPC cask system design listed in § 72.214 (List of NRC-approved spent fuel storage cask designs). This action does not constitute the establishment of a standard that establishes generally applicable requirements.

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

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

Under the National Environmental Policy Act of 1969, as amended, and the NRC regulations in subpart A of 10 CFR part 51, the NRC has determined that this rule, if adopted, would not be a major Federal action significantly affecting the quality of the human environment and, therefore, an environmental impact statement is not required. The rule would amend the CoC for the NAC-MPC cask system within the list of approved spent fuel storage casks that power reactor licensees can use to store spent fuel at reactor sites under a general license. The amendment will modify the present cask system design to incorporate changes in support of the Yankee Nuclear Power Station (Yankee Rowe) fuel loading campaign and make corrections to the Connecticut Yankee technical specifications. Specifically, the amendment incorporates fuel enrichment tolerances; incorporates fuel assemblies with up to 20 damaged fuel rods, recaged assemblies, the Yankee Rowe damaged fuel can, and assembly weights up to 432 kg (950 lb); revises the average surface dose rate limits for the concrete cask; incorporates administrative changes in the ASME Code Alternatives; corrects the Connecticut Yankee tables for fuel assembly limits and intact fuel assembly characteristics; and incorporates editorial and administrative changes to the CoC. The environmental assessment and finding of no significant impact on which this determination is based are available for inspection at the NRC Public Document Room, 11555 Rockville Pike, Rockville, MD. Single copies of the environmental assessment and finding of no significant impact are available from Jayne M. McCausland, Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, telephone (301) 415-6219, email jmm2@nrc.gov.

This direct final rule does not contain a new or amended information collection requirement subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq .). Existing requirements were approved by the Office of Management and Budget, Approval Number 3150-0132.

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.

On July 18, 1990 (55 FR 29181), the NRC issued an amendment to 10 CFR part 72 to provide for the storage of spent nuclear fuel under a general license in cask designs approved by the NRC. Any nuclear power reactor licensee can use NRC-approved cask designs to store spent nuclear fuel if it notifies the NRC in advance, spent fuel is stored under the conditions specified in the cask's CoC, and the conditions of the general license are met. A list of NRC-approved cask designs is contained in § 72.214. On March 9, 2000 (65 FR 12444), the NRC issued an amendment to part 72 that approved the NAC-MPC cask design by adding it to the list of NRC-approved cask designs in § 72.214. On April 18, 2002, and as supplemented May 15, 2002, July 17, 2002, October 3, 2002, and January 17, 2003, NAC International, Inc., submitted an application to the NRC to amend CoC No. 1025 to incorporate changes in support of the Yankee Rowe fuel loading campaign and make corrections to the Connecticut Yankee TS. Specifically, the amendment incorporates fuel enrichment tolerances; incorporates fuel assemblies with up to 20 damaged fuel rods, recaged assemblies, the Yankee Rowe damaged fuel can, and assembly weights up to 432 kg (950 lb); revises the average surface dose rate limits for the concrete cask; incorporates administrative changes in the ASME Code Alternatives; corrects the Connecticut Yankee tables for fuel assembly limits and intact fuel assembly characteristics; and incorporates editorial and administrative changes in the CoC.

The alternative to this action is to withhold approval of this amended cask system design and issue an exemption to each general license. This alternative would cost both the NRC and the utilities more time and money because each utility would have to pursue an exemption.

Approval of the direct final rule will eliminate this problem and is consistent with previous NRC actions. Further, the direct final rule will have no adverse effect on public health and safety. This direct final rule has no significant identifiable impact or benefit on other Government agencies. Based on this discussion of the benefits and impacts of the alternatives, the NRC concludes that the requirements of the direct final rule are commensurate with the NRC's responsibilities for public health and safety and the common defense and security. No other available alternative is believed to be as satisfactory, and thus, this action is recommended.

In accordance with the Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b)), the NRC certifies that this rule will not, if issued, have a significant economic impact on a substantial number of small entities. This direct final rule affects only the licensing and operation of nuclear power plants, independent spent fuel storage facilities, and NAC International, Inc. The companies that own these plants do not fall within the scope of the definition of “small entities” set forth in the Regulatory Flexibility Act or the Small Business Size Standards set out in regulations issued by the Small Business Administration at 13 CFR part 121.

The NRC has determined that the backfit rule (10 CFR 50.109 or 10 CFR 72.62) does not apply to this direct final rule because this amendment does not involve any provisions that would impose backfits as defined. Therefore, a backfit analysis is not required.

In accordance with the Small Business Regulatory Enforcement Fairness Act of 1996, the NRC has determined that this action is not a major rule and has verified this determination with the Office of Information and Regulatory Affairs, Office of Management and Budget.

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) by superseding AD 98-22-12, amendment 39-10859 (63 FR 57577, October 28, 1998), which is applicable to certain Boeing Model 767 series airplanes, was published in the Federal Register on January 3, 2003 (68 FR 324). The action proposed to continue to require repetitive detailed inspections to detect cracked, corroded, or stained collar fittings on both inboard trailing edge flaps; and follow-on corrective actions, if necessary. The new action proposed to expand the applicability in the existing AD, and would add repetitive inspections for discrepancies of the collar fittings, torque tube, and splined bushings on both inboard trailing edge flaps; and follow-on and corrective actions, if necessary.

Interested persons have been afforded an opportunity to participate in the making of this amendment. Due consideration has been given to the comments received. One commenter concurs with the contents of the proposed AD.

One commenter asks for credit for accomplishment of the inspections required by paragraphs (c) and (f) of the proposed AD before the effective date of the AD. The commenter states that the information specified in paragraph (f) provides instructions for operators that have done paragraph (c) for an initial inspection and follow-on actions if the corrosion inhibiting compound (CIC) Titanine JC5A has been used, or if the type of CIC that was used is unknown. The commenter states that there are no guidelines for inspection of airplanes on which BMS 3-27 CIC was used. The commenter adds that airplanes on which the inspections were done in accordance with Part 3 of the referenced service bulletin should meet the inspection requirements, provided that BMS 3-27 CIC was used and the repetitive inspections are being done in lieu of the terminating action.

We agree with the commenter for the reasons provided. We have added a new paragraph (g) to this final rule (and reordered subsequent paragraphs accordingly) to give credit for the inspections required by paragraphs (c) and (f) of the final rule done before the effective date of the AD, under the conditions set forth by the commenter.

One commenter asks that paragraph (a)(2) of the proposed AD be changed to add the option of installing a serviceable collar fitting. The commenter states that a serviceable collar fitting is crack- and corrosion-free, and provides the same level of safety as a new collar fitting.

We agree with the commenter as allowing the option of installing a serviceable collar fitting to paragraph (a)(2) of this final rule would be a relieving action for operators. Therefore, paragraph (a)(2) of the final rule has been changed accordingly.

One commenter asks that paragraph (f) of the proposed AD be changed for clarification, or removed from the proposed AD. The commenter states that it is not clear which “inspections” paragraph (f) is referencing, and the commenter reiterates the contents of that paragraph. The commenter does not understand what the inspection required by paragraph (a) of the proposed AD is for, or why Revision 2 of the referenced service bulletin is singled out. Nor does the commenter understand what the most recent inspection is. The commenter asks if the inspection specified is the spline or the collar fitting inspection. The commenter adds that if the inspection is the spline inspection, it will cause an undue burden on the operator because 22 airplanes will be required to have their flaps removed within 90 days.

The same commenter recommends that paragraph (f) be removed from the proposed AD because it appears to be applicable to any airplane on which paragraph (c) of the proposed AD has not been previously complied with, and paragraph (c) requires the spline inspection. The commenter adds that, until the spline inspection is done, the 120-day collar fitting inspections are being done and any discrepancies will be found before failure occurs.

We agree that paragraph (f) of the proposed AD needs clarification; however, we do not agree that it should be removed. We have rewritten paragraph (f) of the final rule for clarity and defined the type of inspection required. Revision 2 of the service bulletin is “singled out” because it recommended using CIC Titanine JC5A, which does not provide adequate corrosion protection for the joints specified, and Revision 3 recommends refinishing those joints with CIC BMS 3-27 or BMS 3-38, which does provide adequate corrosion protection. The definition of “the most recent inspection,” as specified in paragraph (f) of the proposed AD, is the last spline inspection completed as of the effective date of the AD. In addition, we have added sub-paragraphs (f)(1) and (f)(2) to this final rule to add an optional inspection, which would extend the compliance time for the current inspection to 6 years and adds the option of doing either the Part 1 (which is not as extensive as Part 3) or the Part 3 inspection within 3 years after the most recent inspection done in accordance with Revision 2 of the service bulletin, or within 90 days after the effective date of this AD. This change matches the compliance time recommended in Revision 3 of the referenced service bulletin, and also alleviates any undue burden to operators caused by the compliance time specified in the proposed AD.

One commenter estimates the tasks generated by the inspections specified in the proposed AD would require 128 work hours per airplane at an overall cost of $985,600. The commenter states that the proposed AD specifies 2 work hours for the current inspections and 2 work hours for the new inspections. The commenter notes that these estimates are substantially lower than the actual cost impact. The commenter also states that there is no cost specified for the spline rework or replacement.

We agree that access to the area under the inboard trailing edge flaps is not a task normally accomplished during routine maintenance, as the flaps are never removed during such maintenance, so the work hours required for access and close up should be added. We have changed the work hours for the spline inspection specified in the Cost Impact section in this final rule from 2 to 127 work hours (we estimate an additional 125 work hours). We also have reduced the number of airplanes specified in this section as it has changed since issuance of the proposed AD. We do not agree that the work hours for the spline rework or replacement should be added to the final rule as this is an on-condition action that would be done only if discrepancies are found. No change to the final rule is necessary in this regard.

One commenter asks for the following editorial changes to the proposed AD:

• Change the service bulletin reference in paragraph (a)(3) of the proposed AD from “Part 4” to “Figure 4.” The commenter states that Part 4 provides spline rework instructions, and Figure 4 provides instructions for the external corrosion removal for the collar fitting.

We agree with the commenter, as we inadvertently referenced “Part 4” instead of “Figure 4” in paragraph (a)(3) of the proposed AD. We have changed paragraph (a)(3) of this final rule accordingly.

• Change paragraph (a)(4)(ii) of the proposed AD to reference Part 3 of the service bulletin as follows “* * * before further flight, repair the corrosion in accordance with Part 3 and Part 4 of the Accomplishment Instructions of Revision 3 of the service bulletin * * *” The commenter states that Part 3 provides procedures for spline component removal and an inspection required before accomplishing the rework in Part 4 of the service bulletin.

We agree with the commenter that paragraph (a)(4)(ii) of the proposed AD, which would require accomplishment of Part 2 and repair of any corrosion in accordance with Part 4, should be clarified. Part 2 of the service bulletin specifies doing Part 3 and Part 4 if corrosion of the collar fittings and torque tube is found. We have changed paragraph (a)(4)(ii) of this final rule accordingly.

• Change paragraph (d) of the proposed AD to add, “* * * refinish and reassemble the parts in accordance with the service bulletin.”

We agree with the commenter that paragraph (d) of the proposed AD should be changed. We have changed paragraph (d) of this final rule, for clarification and consistency, to state, “* * * refinish and reassemble the parts with liberal coatings of corrosion-inhibiting compound (CIC) BMS 3-27 or BMS 3-38, in accordance with the service bulletin.”

• Change paragraph (h) of the proposed AD to explicitly specify line numbers 704, 719, and 720, and change the end of the last sentence, for clarification, to read, at the time specified in paragraph (g) of this AD.” The commenter states that this change is necessary for clarification of the applicability and compliance time specified in this paragraph. The commenter notes that paragraph (h) of the proposed AD is applicable only to those three airplanes which were assembled with BMS 3-27, not the MIL-G-23827 grease, after the proposed AD was issued. The commenter adds that without this change operators may be confused as to the applicability and the exact compliance time.

We agree with the commenter that paragraph (i) of the final rule (paragraph (h) of the proposed AD) should be changed, for the reasons specified. Paragraph (i) of this final rule has been changed to specify line numbers 704, 719, and 720, and to add, “at the time specified in paragraph (h) of this AD” (paragraph (g) of the proposed AD) at the end of the last sentence, for clarity.

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

There are approximately 691 airplanes of the affected design in the worldwide fleet. The FAA estimates that 293 airplanes of U.S. registry will be affected by this AD.

The actions that are currently required by AD 98-22-12 take approximately 2 work hours per airplane to accomplish, at an average labor rate of $60 per work hour. Based on these figures, the cost impact of the currently required actions is estimated to be $120 per airplane, per inspection cycle.

The new inspections and refinishing that are required by this AD action will take approximately 127 work hours (including access and close up) per airplane to accomplish, at an average labor rate of $60 per work hour. Based on these figures, the cost impact of the inspections and refinishing required by this AD on U.S. operators is estimated to be $2,232,660, or $7,620 per airplane, per cycle.

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

The regulations adopted herein will not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

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

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Aerospatiale Model ATR72 series airplanes was published in the Federal Register on April 11, 2003 (68 FR 17755). That action proposed to require installing brackets and ramps under floor panels between frames 23C and 23D and installing wire bundles on the ramps.

Interested persons have been afforded an opportunity to participate in the making of this amendment. No comments were submitted in response to the proposal or the FAA's determination of the cost to the public.

After careful review of the available data, the FAA has determined that air safety and the public interest require the adoption of the rule as proposed.

On July 10, 2002, the FAA issued a new version of 14 CFR part 39 (67 FR 47997, July 22, 2002), which governs the FAA's airworthiness directives system. The regulation now includes material that relates to altered products, special flight permits, and alternative methods of compliance. However, for clarity and consistency in this final rule, we have retained the language of the NPRM regarding that material.

After the proposed AD was issued, we reviewed the figures we use to calculate the labor rate to do the required actions. To account for various inflationary costs in the airline industry, we find it appropriate to increase the labor rate used in these calculations from $60 to $65 per work hour. The economic impact information below has been revised to reflect this increase in the specified hourly labor rate.

The FAA estimates that 65 Aerospatiale Model ATR 72 series airplanes of U.S. registry will be affected by this AD, that it will take approximately 6 work hours per airplane to accomplish the required actions, and that the average labor rate is $65 per work hour. Required parts will cost approximately $1,844 per airplane. Based on these figures, the cost impact of the AD on U.S. operators is estimated to be $145,210, or $2,234 per airplane.

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

The regulations adopted herein will not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

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

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Aerospatiale Model ATR42-200, -300, -320, and -500 series airplanes; and Model ATR72 series airplanes; was published in the Federal Register on April 1, 2003 (68 FR 15682). That action proposed to require replacement of a certain Automatic Takeoff Power Control System (ATPCS) test selector switch with a different test selector switch.

Interested persons have been afforded an opportunity to participate in the making of this amendment. No comments were submitted in response to the proposal or the FAA's determination of the cost to the public.

The FAA has determined that air safety and the public interest require the adoption of the rule as proposed.

On July 10, 2002, the FAA issued a new version of 14 CFR part 39 (67 FR 47997, July 22, 2002), which governs the FAA's airworthiness directives system. The regulation now includes material that relates to altered products, special flight permits, and alternative methods of compliance. However, for clarity and consistency in this final rule, we have retained the language of the NPRM regarding that material.

After the proposed AD was issued, we reviewed the figures we use to calculate the labor rate to do the required actions. To account for various inflationary costs in the airline industry, we find it appropriate to increase the labor rate used in these calculations from $60 per work hour to $65 per work hour. The economic impact information, below, has been revised to reflect this increase in the specified hourly labor rate.

The FAA estimates that 133 airplanes of U.S. registry will be affected by this AD, that it will take approximately 4 work hours per airplane to accomplish the required replacement, and that the average labor rate is $65 per work hour. Required parts will cost approximately $536 per airplane. Based on these figures, the cost impact of the AD on U.S. operators is estimated to be $105,868, or $796 per airplane.

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

The regulations adopted herein will not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

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

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Bombardier Model CL-600-2B19 series airplanes was published in the Federal Register on August 23, 2001 (66 FR 44326). That action proposed to require the installation of protective tape on the fire and overheat control unit located in the flight compartment.

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

Bombardier Alert Service Bulletin A601R-26-017, Revision “A,” dated September 8, 2000, was cited in the proposed AD as the appropriate source of service information for the proposed actions. One commenter, an operator, requests that the proposed AD be revised to consider accomplishment of the actions specified in the original issue of the service bulletin (dated August 4, 2000) to also be acceptable for compliance with the requirements of the AD. The commenter reports that all of its 97 airplanes have been modified in accordance with the original issue of the service bulletin.

The FAA agrees. Both the original issue and Revision “A” of the service bulletin specify installing protective tape on the external cover of the fire and overheat control unit located in the flight compartment; the original issue of the service bulletin included an action for specifically installing protective tape over the connectors. The connectors were later determined to be adequately sealed to prevent liquid ingress to the control unit; Revision “A” was then issued to remove the action of taping the connectors. However, taping the connectors does not degrade the level of safety, so airplanes modified with the additional protective tape would also be in full compliance with the requirements of this AD. The final rule has been revised to add new paragraph (b), which provides credit for actions done in accordance with the original issue of the service bulletin.

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

On July 10, 2002, the FAA issued a new version of 14 CFR part 39 (67 FR 47997, July 22, 2002), which governs the FAA's airworthiness directives system. The regulation now includes material that relates to altered products, special flight permits, and alternative methods of compliance. However, for clarity and consistency in this final rule, we have retained the language of the proposed AD regarding that material.

The identity of the affected airplanes has been changed in this final rule to more accurately reflect the listing on the type certificate data sheet for affected airplanes.

The FAA estimates that 160 airplanes of U.S. registry will be affected by this AD, that it will take approximately 1 work hour per airplane to accomplish the required actions, and that the average labor rate is $60 per work hour. Based on these figures, the cost impact of this AD on U.S. operators is estimated to be $9,600, or $60 per airplane.

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

The regulations adopted herein will not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

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

(e) This amendment becomes effective on August 22, 2003.

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Bombardier Model DHC-8-102, -103, -106, -201, -202, -301, -311, and -315 airplanes was published in the Federal Register on May 23, 2003 (68 FR 28177). That action proposed to require modification of the No. 3 electrical equipment panel behind the avionics rack, and modification of the No. 2 propeller de-ice timer.

Interested persons have been afforded an opportunity to participate in the making of this amendment. We received no comments on the proposal or on the determination of the cost to the public.

The FAA has determined that air safety and the public interest require the adoption of the rule as proposed.

On July 10, 2002, we issued a new version of 14 CFR part 39 (67 FR 47997, July 22, 2002), which governs the FAA's airworthiness directives system. The regulation now includes material that relates to altered products, special flight permits, and alternative methods of compliance. However, for clarity and consistency in this final rule, we have retained the language of the NPRM regarding that material.

We have reviewed the figures we have used over the past several years to calculate AD costs to operators. To account for various inflationary costs in the airline industry, we find it necessary to increase the labor rate used in these calculations from $60 per work hour to $65 per work hour. The cost impact information, below, reflects this increase in the specified hourly labor rate.

We estimate that 197 airplanes of U.S. registry will be affected by this proposed AD.

It will take about 4 work hours per airplane to modify the No. 3 electrical equipment panel behind the avionics rack, at an average labor rate of $65 per work hour. The cost for required parts will be minimal. Based on these figures, the cost impact of this modification on U.S. operators is estimated to be $51,220, or $260 per airplane.

It will take about 2 work hours per airplane to modify the No. 2 propeller de-ice timer, at an average labor rate of $65 per work hour. The cost for required parts will be minimal. Based on these figures, the cost impact of this modification on U.S. operators is estimated to be $25,610, or $130 per airplane.

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

The regulations adopted herein will not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

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

During post-delivery modifications of certain Boeing Model 767-200 and -300 series airplanes, the manufacturer found that the rudder cables and the First Officer's elevator control cables may come in contact with the video control center (VCC) wires, which could result in possible chafing and subsequent arcing of the wires in the wire bundles and severing of the cables. Severed cables, if combined with an engine-out during takeoff, or a high crosswind during takeoff or landing, could result in reduced controllability of the airplane.

We have reviewed and approved the following Boeing alert service bulletins:

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design that may be registered in the United States at some time in the future, this AD is being issued to prevent chafing of the wire bundles of the VCC against the rudder and/or elevator control cables, which could result in arcing of the wires in the wire bundles and severing of the cables. Severed cables, if combined with an engine-out during takeoff, or a high crosswind during takeoff or landing, could result in reduced controllability of the airplane. This AD requires modification of the wire bundles of the VCC of the passenger address and entertainment system. The actions are required to be accomplished in accordance with the applicable service bulletin described previously, except as discussed below.

Although the service bulletins recommend accomplishing the specified actions at the earliest maintenance opportunity when manpower and materials are available, we have determined that such an imprecise compliance time would not address the identified unsafe condition in a timely manner. In developing an appropriate compliance time for this AD, we considered not only the manufacturer's recommendation, but the degree of urgency associated with addressing the subject unsafe condition, the average utilization of the affected fleet, and the time necessary to perform the modification (2 work hours). In light of all of these factors, we find a 6-month compliance time for completing the required actions to be warranted, in that it represents an appropriate interval of time allowable for affected airplanes to continue to operate without compromising safety.

On July 10, 2002, the FAA issued a new version of 14 CFR part 39 (67 FR 47997, July 22, 2002), which governs the FAA's airworthiness directives system. The regulation now includes material that relates to altered products, special flight permits, and alternative methods of compliance. Because we have now included this material in part 39, we no longer need to include it in each individual AD; however, this AD identifies the office authorized to approve alternative methods of compliance.

We have reviewed the figures we have used over the past several years to calculate AD costs to operators. To account for various inflationary costs in the airline industry, we find it necessary to increase the labor rate used in these calculations from $60 per work hour to $65 per work hour. The cost impact information, below, has been revised to reflect this increase in the specified hourly labor rate.

None of the airplanes affected by this action are on the U.S. Register. All airplanes included in the applicability of this rule currently are operated by non-U.S. operators under foreign registry; therefore, they are not directly affected by this AD action. However, the FAA considers that this rule is necessary to ensure that the unsafe condition is addressed in the event that any of these subject airplanes are imported and placed on the U.S. Register in the future.

Should an affected airplane be imported and placed on the U.S. Register in the future, it would require approximately 2 work hours to accomplish the required modification, at an average labor rate of $65 per work hour. Parts cost would be between $64 and $915 per airplane. Based on these figures, the cost impact of the modification required by this AD would be between $194 and $1,045 per airplane.

Since this AD action does not affect any airplane that is currently on the U.S. register, it has no adverse economic impact and imposes no additional burden on any person. Therefore, prior notice and public procedures hereon are unnecessary and the amendment may be made effective in less than 30 days after publication in the Federal Register .

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

Submit comments using the following format:

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

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

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

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

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this rule must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2002-NM-205-AD.” The postcard will be date stamped and returned to the commenter.

The regulations adopted herein will not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

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

The age and citizenship searching service is a self-supporting operation of the Census Bureau in accordance with Title 31, United States Code, Section 9701. Under this statute, all expenses incurred in the retrieval of personal information from decennial census records and the preparation of census transcripts are covered by fees paid by individuals who request this service. The Age Search census transcript provides proof of age to qualify individuals for social security or other retirements benefits, proof of citizenship to obtain passports, proof of family relationships for rights of inheritance, or to satisfy other situations where a birth certificate is required but not available. Census records also are considered a valuable tool for genealogical research. The 1910 through 2000 censuses in custody of the Census Bureau are confidential and protected from disclosure by Title 13, United States Code.

On September 17, 2001 (66 FR 48013), the Census Bureau published in the Federal Register a notice of proposed rulemaking and request for comment on the subject. The Census Bureau did not receive any public comments.

In order to clarify and update the general rules applying to the Age Search Program, the Census Bureau is making the following four amendments to Title 15, Code of Federal Regulations (CFR), parts 50 and 80:

• Amend Section 50.1 to change the time frame from 120 days to 90 days for submitting any required additional information after completing an initial, unsuccessful search. This change is consistent with current policy on the issue.

• Amend Section 50.5 to update the note following the chart on the fee structure. The Census Bureau has not had a fee increase since 1993.

• Amend Section 80.1 to clarify the procedures for releasing census information. This change is consistent with current policy on the issue.

• Amend Section 80.1 to reflect the current address.

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that this rule would not have a significant economic impact on a substantial number of small entities. The factual basis for this certification was published with the proposed rule. No comments were received regarding the economic impact of this rule. As a result, no final regulatory flexibility analysis was prepared.

This rule has been determined to be not significant for purposes of Executive Order 12866. This rule does not contain policies with federalism implications as that term is defined in Executive Order 13132.

This notice contains a collection of information requirements subject to the Paperwork Reduction Act. The Form BC-600, referenced in the amended language for section 80.1, has been cleared under OMB control number 0607-0117.

A Notice of Proposed Rulemaking was published in the Federal Register (68 FR 1172) on January 9, 2003, which proposed to amend § 101.3(b)(1), Customs Regulations (19 CFR 101.3(b)(1)), to extend the geographical limits of the port of entry of Portland, Maine, to include the City of Auburn in order to provide better service to carriers, importers, and the general public. The proposal was made in order to include the City of Auburn within the port limits to facilitate the clearance of international cargo at the Auburn Intermodal Facility (“AIF”). AIF is a rail/truck intermodal facility with a high cube, doublestack intermodal terminal.

Three comments were received in response to the proposal. AlI three comments strongly supported the inclusion of the City of Auburn in the port of Portland, Maine, for the purposes of international trade facilitation and of expanded economic development in the Auburn area.

According to the comments, the AIF will afford the Bureau of Customs and Border Protection (CBP) great flexibility in protecting our borders against terrorist activities when conducting examinations and clearance of cargo entering the United States. The expansion of the port of Portland will also help to eliminate needless truck traffic on the highway system by allowing examinations and clearance closest to the point of entry. Trucks will no longer need to travel further in bound to be examined. These benefits are in addition to the economic boost which is expected to occur as a result of the port expansion.

CBP believes that the expansion of the port of Portland, Maine, to include the City of Auburn is a positive step in the facilitation of the processing of international cargo. Accordingly, CBP has decided to proceed with the proposed expansion.

The port limits of the port of entry of Portland, Maine, are expanded to include the City of Auburn. The territory included in the port of Portland is as follows:

Portland, Maine and the territory embracing the municipalities of Auburn, South Portland, Falmouth, and Cape Elizabeth, in the State of Maine, and Peak, Long, Cliff, Cushing and Diamond Islands, in the State of Maine.

This change is being made under the authority of 5 U.S.C. 301 and 19 U.S.C. 2, 66 and 1624.

CBP establishes, expands and consolidates CBP ports of entry throughout the United States to accommodate the volume of CBP-related activity in various parts of the country. Although a notice was issued for public comment on this subject matter, because this document relates to agency management and organization, it is not subject to the notice and procedure requirements of 5 U.S.C. 553. Accordingly, this document is not subject to the provisions of the Regulatory Flexibility Act (5 U.S.C.601 et. seq. ). Agency organization matters such as this port expansion are not subject to Executive Order 12866.

The principal author of this document was Janet L. Johnson, Regulations Branch. However, personnel from other offices participated in its development.

As part of its continuing efforts to provide better service to carriers, importers, and the general public, on December 2, 2002, Customs (then under the Department of the Treasury) published a document in the Federal Register (67 FR 71510) that proposed to amend parts 101 and 122 of the Customs Regulations (19 CFR parts 101 and 122) to establish a port of entry at Fargo, North Dakota, to include Hector International Airport, located in the city of Fargo, Cass County, North Dakota, which is currently operated as a user-fee airport, and, accordingly, to remove Hector International Airport as a user-fee airport. As well as including Hector International Airport, the port limits of Fargo were also proposed to include a portion of Clay County in Minnesota. The proposed change of status for Hector International Airport from a user-fee airport to being included within the boundaries of a port of entry would subject the airport to the passenger processing fee provided for at 19 U.S.C. 58c(a)(5)(B).

The proposal to establish Fargo, North Dakota as a port of entry was based on Customs analysis of the following information:

1. Fargo is serviced by three modes of transportation:

(a) rail (the Burlington Northern Santa Fe railroad);

(b) air (at Hector International Airport, two passenger carriers (Northwest and United Express) and five courier-delivery carriers (Air Bourne Express, Corporate Express, DHL, FED EX, and UPS)); and

(c) highway (two U.S. interstate highways: I-29 and I-94);

2. The Fargo, North Dakota area has a population of approximately 175,000, with the potential to increase even further;

3. Regarding the five actual or potential workload criteria:

(a) Hector International Airport had 2,911 international air passengers for FY 2001, an increase of 61% over FY 2000;

(b) Hector International Airport had 151 formal consumption entries for FY 2001, with no single company accounting for more than half of the projected entries; and

(c) Hector International Airport had 814 scheduled international aircraft arrivals for FY 2001, an increase of 65% over FY 2000.

Customs believed that significant benefits would be provided to the North Dakota business community by creating a port of entry at Fargo and that the cost of providing the services of one full-time and one part-time Customs official would be minimal to the Federal Government.

Based on the information above and the level and pace of development in the Fargo area, Customs believed that there was sufficient justification for the establishment of Fargo, North Dakota, as a port of entry on a conditional basis.

In the Notice, Customs stated that if it is decided to create a port of entry at Fargo and to terminate Hector International Airport's designation as a user-fee airport, Customs will notify the airport of that determination in accordance with the provisions of 19 CFR 122.15(c). However, it was also noted that the proposal relied on potential, rather than actual, workload figures. Therefore, even if the proposed port of entry designation were adopted as a final rule, Customs would review the actual workload generated within the new port of entry in one year. If that review indicated that the actual workload was below the port of entry criteria established in T.D. 82-37, as revised by T.D. 86-14, procedures may be instituted to revoke the port of entry status. In such case, the airport could reapply to become a user-fee airport under the provisions of 19 U.S.C. 58b.

The public comment period for the proposed amendments closed January 31, 2003.

On March 1, 2003, the U.S. Customs Service was transferred from the Department of the Treasury to the Department of Homeland Security, and was redesignated as the Bureau of Customs and Border Protection (CBP).

One comment was received that was favorable to the establishment of Fargo as a port of entry.

The commenter requested that, should Customs (now CBP) revoke the port of entry status of Fargo after the one-year conditional status period, Hector International Airport's status should automatically be reverted back to a user-fee airport. The commenter stated that it was concerned that there could be a lapse in Customs services if the reapplication language contained in the Notice was strictly followed. The commenter further stated that Customs and the airport authority could coordinate any transition procedures.

CBP concurs with this comment. Accordingly, the terms and conditions in the Memorandum of Agreement between CBP and the airport authority will provide for the procedure by which the airport may again be designated as a user fee airport, should its status as a port of entry be terminated.

The same commenter stated that the description of the proposed port of entry limits needed to be adjusted to include more of the Fargo-area community in North Dakota and less of the Clay County area in Minnesota. According to the commenter, the revised geographical limits for the new Fargo port of entry would more accurately reflect the area served by Fargo's processing facilities and Customs personnel. Accordingly, the commenter stated that the port of limit boundaries be established as follows:

Eastern boundary —The proposed Eastern boundary of the port of entry in Clay County, Minnesota, needs to be moved west from Clay County highway 11 to a north-south line represented by Clay County Road 78 south of U.S. 10 and Clay County Road 90 north of U.S. 10;

Southern boundary —The proposed Southern boundary of the port of entry in both North Dakota and Minnesota needs to be extended south from U.S. Interstate 94 to an east-west line that is in accordance with 64th Avenue South in Fargo, North Dakota; and

Western boundary —The proposed Western boundary of the port of entry in Cass County, North Dakota, needs to be extended west from U.S. Interstate 29 in Fargo to a north-south line represented by 25th Street south of the intersection of U.S. Interstate 29 and U.S. 10 and 26th Street north of the intersection of U.S. Interstate 29 and U.S. 10 in West Fargo.

CBP concurs with this comment. Accordingly, the description of the geographical limits of the port of entry is revised as stated by the commenter.

After further review and consideration of this matter, CBP has determined that a port of entry will be established at Fargo—with the geographical limits of the port of entry modified as discussed in this document—and that Hector International Airport, because it is within the limits of this port of entry, will no longer be designated as a user-fee airport. This document amends the Customs Regulations to reflect this determination. It is noted that the designation of Fargo as a port of entry is on a conditional basis for one year. If, after a year, it is determined that Fargo does not merit port of entry status, a new document will be prepared for the Federal Register removing Fargo's designation.

The description of the geographical limits of the Fargo port of entry is as follows:

In Cass County, North Dakota:

Northern boundary, Cass County highway 20,

Southern boundary, an east-west line in accordance with 64th Avenue South in Fargo, North Dakota, and

Western boundary, a north-south line represented by 25th Street south of the intersection of U.S. Interstate 29 and U.S. 10 and 26th Street north of the intersection of U.S. Interstate 29 and U.S. 10 in West Fargo.

In Clay County, Minnesota:

Northern boundary, Clay County highway 22.

Southern boundary, an east-west line in accordance with 64th Avenue South in Fargo, Cass County, North Dakota, and

Eastern boundary, a north-south line represented by Clay County Road 78 south of U.S. 10 and Clay County Road 90 north of U.S. 10.

This amendment is promulgated pursuant to Customs authority under 5 U.S.C. 301 and 19 U.S.C. 2, 66, and 1624.

Although Customs solicited public comments, no notice and public procedure was required pursuant to 5 U.S.C. 553 because this matter relates to agency management and organization. Accordingly, this document is not subject to the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). Further, matters involving agency management and organization are not subject to Executive Order 12866.

The principal author of this document was Gregory R. Vilders, Attorney, Office of Regulations and Rulings, Regulations Branch. However, personnel from other offices participated in its development.

In the FR Doc. 03-14547, appearing on page 34533 in the Federal Register of Tuesday, June 10, 2003, the following correction is made:

Alpharma Inc., One Executive Dr., P.O. Box 1399, Fort Lee, NJ 07024, filed a supplement to NADA 141-025 for use of CATTLYST (laidlomycin propionate potassium) Type A medicated articles used to formulate Type C medicated feeds for cattle. The supplemental NADA provides for the establishment of a tolerance for residues of laidlomycin in cattle livers. FDA is also taking this opportunity to codify the previously established ADI for total residues of laidlomycin. The supplemental NADA is approved as of May 12, 2003, and parts 556 and 558 (21 CFR parts 556 and 558) are amended by adding new § 556.346 and by revising § 558.305. The basis of approval is discussed in the freedom of information summary.

In accordance with the freedom of information provisions of 21 CFR part 20 and 21 CFR 514.11(e)(2)(ii), a summary of safety and effectiveness data and information submitted to support approval of this application may be seen in the Dockets Management Branch (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.

The agency has determined under 21 CFR 25.33(a)(1) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

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

(a) Acceptable daily intake (ADI) . The ADI for total residues of laidlomycin is 7.5 micrograms per kilogram of body weight per day.

(b) Tolerance . The tolerance for parent laidlomycin (the marker residue) in the liver (the target tissue) of cattle is 0.2 part per million (ppm).

Pursuant to section 61(a)(12), gross income includes income from the discharge of indebtedness (COD income). Section 108(a)(1), which reflects the amendments enacted in the Bankruptcy Tax Act of 1980, Public Law 96-589, section 2, 94 Stat. 3389 (1980) (1980-2 C.B. 607), however, provides that, where the discharge occurs in a title 11 case, where the taxpayer is insolvent, or where the indebtedness is “qualified farm indebtedness” or “qualified real property business indebtedness,” gross income does not include any amount that otherwise would be includible in gross income by reason of that discharge (in whole or in part) of the indebtedness of the taxpayer.

Although section 108(a) excludes COD income from gross income under those circumstances, section 108(b) requires the reduction of certain tax attributes in an amount that reflects the amount excluded from gross income, thereby generally deferring, rather than permanently eliminating, the inclusion of COD income. Section 108(b)(2) requires the reduction of the following tax attributes of the taxpayer in the following order: (A) Net operating losses; (B) general business credits; (C) minimum tax credits; (D) capital loss carryovers; (E) adjusted basis of property; (F) passive activity losses and credit carryovers; and (G) foreign tax credit carryovers. Section 108(b)(4)(A) provides that the reductions are made after the determination of the tax imposed for the taxable year of the discharge. Section 108(b)(4)(B) provides that the reductions of net operating losses and capital loss carryovers are made first in the loss for the taxable year of the discharge and then in the carryovers to such taxable year in the order of the taxable years from which each such carryover arose. If the excluded COD income exceeds the sum of the taxpayer's tax attributes, the excess is disregarded such that it does not result in income or have other tax consequences. See H.R. Rep. No. 96-833, at 11 (1980).

Instead of reducing tax attributes in the order set forth in section 108(b)(2), a taxpayer may elect under section 108(b)(5) to reduce first the adjusted bases of depreciable property to the extent of the excluded COD income. The amount to which the election applies is limited to the aggregate adjusted basis of the depreciable property held by the taxpayer as of the beginning of the taxable year following the taxable year in which the discharge occurs. If the adjusted bases of depreciable property are insufficient to offset the entire amount of excluded COD income, the taxpayer must then reduce any remaining tax attributes in the order set forth in section 108(b)(2). Congress intended the election under section 108(b)(5) to allow debtors, including debtors in bankruptcy, to account for a debt discharge amount in a manner most favorable to their tax situations. See S. Rep. No. 96-1035, at 10 (1980); H.R. Rep. No. 96-833, at 9 (1980).

Section 1017(a) provides that when any portion of COD income excluded from gross income under section 108(a) is to be applied to reduce basis, then such portion shall be applied to reduce the basis of any property held by the taxpayer at the beginning of the taxable year following the taxable year in which the discharge occurs. Section 1017(b)(1) provides that the amount of reduction under section 1017(a), and the particular properties the bases of which are to be reduced, shall be determined under regulations.

Section 368(a)(1) defines a reorganization to include certain types of asset acquisitions. Under section 361, a corporation that is a party to a reorganization recognizes neither gain nor loss when it exchanges property, in pursuance of the plan of reorganization, solely for stock or securities in another corporation that is a party to the reorganization. If the corporation receives in the exchange not only stock or securities permitted to be received without the recognition of gain, but also other property or money, then the corporation may be required to recognize gain. Under section 362(b), if property is acquired by a corporation in connection with a reorganization, then the basis is the same as it would be in the hands of the transferor, increased by the amount of gain recognized to the transferor on such transfer.

Section 332(a) provides that a corporation recognizes no gain or loss on the receipt of property distributed in complete liquidation of another corporation. Section 337(a) provides that a liquidating corporation recognizes no gain or loss on the distribution to the 80-percent distributee of any property in a complete liquidation to which section 332 applies. Under section 334(b)(1), if property is received by a corporate distributee in a distribution in a complete liquidation to which section 332 applies, the basis of such property in the hands of such distributee is the same as it would be in the hands of the transferor. However, in any case in which gain or loss is recognized by the liquidating corporation with respect to such property, the basis of such property in the hands of such distributee is the fair market value of the property at the time of the distribution.

Section 381 provides that a corporation that acquires the assets of another corporation in a distribution to which section 332 applies or in a transfer to which section 361 applies (but only if the transfer is in connection with certain reorganizations described in sections 368(a)(1)(A), (C), (D), (F), or (G)) shall succeed to, and take into account, as of the close of the day of distribution or transfer, the items described in section 381(c) of the distributor or transferor corporation, subject to certain conditions and limitations. Among those items described in section 381(c) are net operating loss carryovers, capital loss carryovers, general business credits, and minimum tax credits. With respect to net operating loss carryovers and capital loss carryovers, the regulations under section 381 reflect that the acquiring corporation succeeds to only those carryovers that remain after the application of sections 172 and 1212 and their carryforward and carryback provisions. See §§ 1.381(c)(1)-1; 1.381(c)(3)-1. Furthermore, those regulations provide that the acquiring corporation succeeds to only those general business credits that remain unused by the transferor corporation after computing its taxable income for the year of the transfer. See § 1.381(c)(23)-1. Section 381(b)(1) provides that, except in the case of an acquisition in connection with a reorganization described in section 368(a)(1)(F), the taxable year of the distributor or transferor corporation ends on the date of distribution or transfer.

Questions have arisen regarding the application of the attribute reduction rules of sections 108 and 1017 when a transaction described in section 381(a) ends a taxable year in which the transferor excludes COD income from gross income. If section 108(b)(4)(A) and section 1017 were interpreted to require attribute reduction to occur after the close of the taxable year of discharge and after the transfer of assets and carryover of items described in section 381(c), then arguably no attributes described in section 108(b)(2) would be available for reduction.

The IRS and Treasury Department believe that the rule of section 108(b)(4)(A) prescribes an ordering of calculations. First, section 108(b)(4)(A) requires a determination of the taxpayer's tax for the taxable year of discharge in order to identify the amounts, if any, of the tax attributes described in section 108(b)(2) that remain available for reduction. Second, section 108(b)(4)(A) requires the reduction of those attributes. This ordering rule affords the taxpayer the use of certain of its tax attributes described in section 108(b)(2), including any losses carried forward to the taxable year of discharge, for purposes of determining its tax for the taxable year of discharge, before subjecting those attributes to reduction.

Similarly, the IRS and Treasury believe that the rule of section 1017 prescribes an ordering of calculations. The Bankruptcy Tax Act of 1980 reflects that Congress enacted the rule of section 1017 “to avoid interaction between basis reduction and reduction of other attributes.” S. Rep. No. 96-1035, at 14 (1980); H. Rep. No. 96-833, at 11 (1980). Without this rule, a circular calculation could be required. The taxpayer's net operating loss for the year of the discharge of indebtedness might be based in part on the amount of cost recovery deductions allowed to the taxpayer. The amount of cost recovery deductions, however, would depend on the taxpayer's basis in its depreciable or amortizable property at the end of the year. Because net operating losses are reduced by excluded COD income prior to the reduction of asset basis absent an election under section 108(b)(5), the amount of basis required to be reduced would depend on the amount of net operating losses. Reducing the basis of property held by the taxpayer at the beginning of the taxable year following the taxable year in which the discharge occurs avoids this circularity.

The position that sections 108 and 1017 require the reduction of attributes, including the basis of transferred assets, in cases where the debtor's taxable year ends with a transfer of assets in a transaction described in section 381 is consistent with the policies underlying sections 108 and 1017 and the corporate reorganization provisions, including “deferring, but eventually collecting within a reasonable period, tax on ordinary income realized from debt discharge.” S. Rep. No. 96-1035, at 10 (1980). For example, assume that a debt of corporation X is discharged in a title 11 case. X's attributes described in section 108(b)(2) consist solely of basis in property. As part of a plan of reorganization, X transfers all of its assets to a newly formed corporation, Y. Under section 368(a)(3)(C), even though the transaction also qualifies as a reorganization under section 368(a)(1)(F), the transaction is treated as qualifying as a reorganization only under section 368(a)(1)(G). If sections 108 and 1017 were interpreted to not require a reduction of the bases of the property transferred, X would permanently exclude from gross income the COD income, notwithstanding that X underwent nothing more than a mere change in identity, form, or place of organization. Accordingly, consistent with the legislative history of the Bankruptcy Tax Act of 1980, the IRS and Treasury Department believe that the basis reduction rules of sections 108 and 1017 apply to property of a debtor transferred in a transaction described in section 381(a).

The legislative history of the Bankruptcy Tax Act of 1980 reflects that Congress specifically anticipated that amounts that carry over in a transaction described in section 381, including the basis of transferred property, are to be adjusted under the rules of sections 108 and 1017 to account for excluded COD income. See H.R. Rep. No. 96-833, at 32-34 (1980). The legislative history states:

Accordingly, these temporary regulations clarify that, in the case of a transaction described in section 381(a) that ends a year in which the distributor or transferor corporation excludes COD income from gross income under section 108(a), any tax attributes to which the acquiring corporation succeeds and the basis of property acquired by the acquiring corporation in the transaction shall reflect the reductions required by sections 108 and 1017. For this purpose, all attributes listed in section 108(b)(2) of the distributor or transferor corporation immediately prior to the transaction described in section 381(a), including the basis of property, but after the determination of tax for the year of the discharge, are available for reduction under section 108(b)(2).

These temporary regulations also clarify that the tax attributes subject to reduction under section 108(b)(2) that are carryovers to the taxable year of the discharge, or that may be carried back to taxable years preceding the year of the discharge, are first taken into account by the taxpayer for the taxable year of the discharge or the preceding years, as the case may be, before such attributes are reduced pursuant to section 108(b)(2).

These temporary regulations apply to discharges of indebtedness occurring after July 17, 2003.

It has been determined that these temporary regulations are 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 Procedures Act (5 U.S.C. chapter 5) does not apply to these temporary regulations, and, because no preceding notice of proposed rulemaking is required for these temporary regulations, the provisions of the Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply. Pursuant to section 7805(f) of the Internal Revenue Code, these temporary regulations will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.

The principal author of these temporary regulations is Theresa M. Kolish, Office of Associate Chief Counsel (Corporate). However, other personnel from the IRS and Treasury Department participated in their development.

Background

On July 22, 2002, the IRS and the Treasury Department published in the Federal Register (67 FR 47755) a notice of proposed rulemaking (REG-123345-01) relating to the amount treated as a transfer under section 2519 of the Internal Revenue Code when there is a right to recover gift tax under section 2207A(b) and the related gift tax consequences if the right to recover the gift tax is not exercised. Written comments responding to the notice were received. No public hearing was requested or held. This document adopts final regulations with respect to the notice of proposed rulemaking. The principal comments received and revisions in response to those comments are discussed below.

Under the proposed regulations, any delay in the exercise of the right of recovery was treated as an interest-free loan with the resulting Federal tax consequences. One commentator suggested that the regulations be revised to provide a thirty-day safe harbor to ease the administrative burden to taxpayers and to avoid complex loan calculations. Accordingly, the commentator suggested that section 7872 would not apply if the transferor received reimbursement of the amount of gift tax within thirty days after paying the tax.

Whether a transaction involves a below-market loan subject to section 7872 depends on all the facts and circumstances of the particular case. Section 1.7872-5T(b)(14) of the Temporary Income Tax Regulations exempts from the application of section 7872 loans the interest arrangements of which the taxpayer is able to show have no significant effect on any Federal tax liability of the lender or the borrower, as described in § 1.7872-5T(c)(3). Section 1.7872-5T(c)(3) provides that whether a loan is without significant effect is determined according to all of the facts and circumstances. Among the factors to be considered are: (1) Whether items of income and deduction generated by the loan offset each other; (2) the amount of such items; (3) the cost to the taxpayer of complying with the provisions of section 7872 if the section were applied; and (4) any non-tax reasons for deciding to structure the transaction as a below-market loan rather than a loan with interest at a rate equal to or greater than the applicable Federal rate and a payment by the lender to the borrower. The Treasury Department and the IRS believe that, in most cases, a reasonable delay in the exercise of the right of recovery will result in a loan without significant tax effect under the facts and circumstances test in § 1.7872-5T(c)(3). Accordingly, these final regulations do not create an additional safe harbor for a payment received within thirty days of payment of the tax.

The final regulations have been revised to more completely describe the interrelation of section 2207A and section 7872. Specifically, the final regulations provide that a delay in the exercise of the right of recovery (that is, the request for and receipt of the amount of the tax) will be treated as a below-market loan if the loan does not provide for the payment of sufficient interest. Depending on the facts and circumstances as described in § 1.7872-5T(c)(3), a loan arising from the delay may be a loan exempt from the application of section 7872 because it is a loan the interest arrangements of which do not have a significant effect on any Federal tax liability of the lender or the borrower. The estate tax regulations under section 2207A are revised to be consistent with the gift tax regulations.

In response to a comment, the final regulations clarify that the enforceability of the right of recovery is determined under applicable law.

Commentators requested simplification of the method of determining when a right to recovery is no longer enforceable. One commentator suggested adopting a three-year period for determining whether or not the right of recovery is enforceable, and thus whether the gift is complete for gift tax purposes if the right of recovery is not exercised. The final regulations instead provide that the transferor may waive the right of recovery thus causing the gift from the transferor to the donee to be complete upon the later of the date of the waiver or the date of the payment of the Federal gift tax. The Treasury Department and the IRS believe that the waiver allows for the certainty requested by the commentators, and is more efficient for a taxpayer who will not exercise the right of recovery because the gift of the unrecovered tax can be completed simultaneously with the lifetime disposition of the qualifying income interest.

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

The principal author of these regulations is DeAnn K. Malone, Office of the Chief Counsel, IRS. Other personnel from the IRS and Treasury Department participated in their development.

On October 22, 1975, we published a rule in the Federal Register entitled “Jurisdiction and Navigable Waters” that established general duties and jurisdiction regulations in part 2 of Title 33 of the Code of Federal Regulations (33 CFR part 2) (40 FR 49326). Most of those regulations have not changed since 1975.

In an effort to conform the Coast Guard's definitions of jurisdictional terms to existing law, we published a notice of proposed rulemaking (NPRM) on August 14, 2002, entitled “Territorial Seas, Navigable Waters, and Jurisdiction” (67 FR 52906)(USCG-2001-9044, under former DOT RIN 2115-AG13). And on September 18, 2002, we published a correction to that proposed rule noting that we did not intend to omit the contents of a footnote in our proposed revision of 33 CFR part 2 (67 FR 58752). No public hearing was requested and none was held.

A little more than 3 months after we published our NPRM, the Maritime Transportation Security Act of 2002 (MTSA) was enacted (Pub. L. 107-295, 116 Stat. 2064). The MTSA extended the territorial seas jurisdiction from 3 to 12 nautical miles for two domestic statutes by amending section 1 of title XIII of the Act of June 15, 1917, as amended by the Magnuson Act of August 9, 1950 (“Magnuson Act”), 50 U.S.C. 195, and section 4(b) of the Vessel Bridge-to-Bridge Radiotelephone Act (33 U.S.C. 1203(b)).

On the same date the MTSA was enacted, November 25, 2002, the Homeland Security Act of 2002 (HLSA) (Pub. L. 107-296, 116 Stat. 2135) was also enacted. The HLSA established the Department of Homeland Security (DHS) and directed the transfer of the Coast Guard from the Department of Transportation to DHS.

Regulatory amendments reflecting these recent MTSA, non-discretionary changes in jurisdiction and revisions to reflect our move to DHS under the HLSA, concern only interpretations, agency organization, and rules of agency procedure, and thus, under 5 U.S.C. 553(b)(A), are exempt from the rulemaking notice requirement. Therefore, we have included these MTSA and HLSA changes in this final rule. All changes in the rule based on the recent passage of MTSA and HLSA are described below in the Discussion of Comments and Changes section.

This rule changes definitions of jurisdictional terms, primarily in 33 CFR part 2, to reflect current statutes and other legal authorities on which these definitions are based. In the preamble of our NPRM, we discussed various legal authorities on which we based the proposed changes to our jurisdictional regulations (67 FR 52906-52908, August 14, 2002). The Coast Guard uses the definitions for these jurisdictional terms— e.g. , “internal waters,” “inland waters,” “navigable waters,” “territorial sea,” “exclusive economic zone,” “high seas,” and “waters subject to the jurisdiction of the United States”—to enforce treaties, laws, and regulations of the United States.

We received three letters commenting on the proposed rule. And, in response, we have incorporated changes in the final rule. The final rule also reflects changes from the proposed rule based on the November 25, 2002 enactment of the MTSA and HLSA.

One commentator wrote that our proposed definition of “navigable waters” differed from the U.S. Environmental Protection Agency's (EPA's) definition in 40 CFR part 110 (specifically in 40 CFR 110.1) and that with respect to the Federal Water Pollution Control Act Amendments, known as the Clean Water Act, EPA has the primary federal responsibility to define this jurisdictional term. We agree that EPA has the primary federal responsibility to define this term with respect to the Clean Water Act.

After conferring with the EPA, we have decided not to revise the text in 33 CFR 2.05-25, as we proposed. Instead, all we have revised in that section is: (1) The section number itself—to § 2.36—to conform to the renumbering of sections in 33 CFR part 2, and (2) we removed the footnote. As we explained in our September 18, 2002, correction (67 FR 58752), the contents of that footnote have been moved to the note for § 2.5, Specific definitions control. Also, because we had included references to paragraph (b) of our proposed § 2.36 in §§ 2.38, 62.3, 64.06, and 100.05, we have had to change those four references to paragraph (a) to reflect the corresponding § 2.36 language in the final rule.

The EPA, jointly with the Army Corps of Engineers (ACOE), has already issued an “Advanced Notice of Proposed Rulemaking on the Clean Water Act Regulatory Definition of ‘Waters of the United States’ ” (68 FR 1991, January 15, 2003). As we did in our NPRM, the EPA and ACOE's ANPRM discusses the U.S. Supreme Court's decision, Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001)( SWANCC ), interpreting “waters of the United States” and “navigable waters” as used in the Clean Water Act. To ensure that our definitions are consonant with the EPA's and ACOE's, we will await the results of their rulemaking before amending our corresponding definitions in redesignated § 2.36. In the meantime, it should be understood that we are not taking a position in this rulemaking on the definitions of those terms in the SWANCC case.

We received two comments expressing concern that our definition of “high seas” in proposed § 2.32(d) would include the exclusive economic zones of both the United States and other nations and that this might undermine the doctrine that U.S. statutes are presumed not to apply outside of U.S. territory unless Congress expresses a clear statement of extraterritorial application. In response to these comments, the Coast Guard conferred with the Department of State, U.S. Navy, and other federal agencies, and has revised both § 2.32(c) and (d) to read:

We also received a comment that we are not required to include the Great Lakes as a discrete part of our “high seas” definition in § 2.32(a). We agree and have deleted the reference to the Great Lakes in that paragraph dealing with special maritime and territorial jurisdiction under 18 U.S.C. 7.

In conferring with the Department of State about the proposed rule, it was suggested that we insert the word “including” after the “United States” in proposed § 2.30 to match language in the President's Exclusive Economic Zone Proclamation 5030 of March 10, 1983 (97 Stat. 1557) and that we make certain other textual changes. We agree, and have made those revisions. Specifically, we have deleted a reference to the Covenant and the United Nations Trusteeship Agreement, and added reference to Guam, American Samoa, the U.S. Virgin Islands, and any other territory or possession over which the United States exercises sovereignty. Finally, we have clarified the rights of the United States and all other nations in the waters of the exclusive economic zone (EEZ) as stated in Presidential Proclamation 5030.

We have revised 33 CFR 2.22(a)(i) and 26.02, and 46 CFR 7.5 to reflect the MTSA's extension of the application of the Vessel Bridge-to-Bridge Radiotelephone Act, 33 U.S.C. 1201-1208, to all waters of the United States territorial sea described in Presidential Proclamation 5928. Specifically, to reflect MTSA's sec. 321 amendment of 33 U.S.C. 1203(b), we added the Vessel Bridge-to-Bridge Radiotelephone Act to statutes listed in our territorial seas definition in 33 CFR 2.22(a)(1); changed the reference to the territorial sea definition in 33 CFR 26.02 from § 2.22(a)(2) to § 2.22(a)(1); and in 46 CFR 7.5, Rules for establishing boundary lines, we changed the “3 miles” territorial sea reference to “12 nautical miles”.

When we drafted our proposed rule, the Magnuson Act, which amended the Act of June 15, 1917, applied in the United States territorial sea out to a seaward limit of 3 nautical miles. Sec. 104 of the MTSA expanded the Act of June 15, 1917's reach to 12 nautical miles. We added the Act of June 15, 1917, as amended, to 33 CFR 2.22(a)(i), and revised paragraph (c) in 33 CFR 165.9, Geographical application of limited and controlled access areas and regulated navigation areas, to reflect that now both the terms “navigable waters of the United States” in the Ports and Waterways Safety Act, as amended (33 U.S.C. 1221-1232), and “territorial waters of the United States” in the Magnuson Act have the same seaward limit—12 miles.

The authority citations for CFR parts in the final rule differ from those in our proposed rule. These differences reflect recent jurisdictional changes created by the MTSA and organizational changes caused by the HLSA. Also, we have converted the U.S. Code citation for the Ports and Waterways Safety Act, as amended, from “(33 U.S.C. 1221 et seq. )” to the more specific “(33 U.S.C. 1221-1232).” This helps clarify that regulations in 33 CFR part 100, for example, issued under authority of 33 U.S.C. 1233, are not issued under the authority of the PWSA.

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security.

We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary because we are merely conforming our jurisdictional definitions to reflect authority given to the Coast Guard by current statues and Presidential proclamations.

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

We are merely conforming our jurisdictional definitions to statutory authority and presidential proclamations. Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offered to assist small entities in understanding the rule so that they could better evaluate its effects on them and participate in the rulemaking by providing the phone number and address of Alex Weller to address questions concerning provisions of the rulemaking.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

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

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

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

This rule will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

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

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

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

We have analyzed this rule under Commandant Instruction M16475.lD, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(a), of the Instruction, from further environmental documentation. Where a statute does not mandate a change, we will revise the existing language to maintain the status quo for geographical scope. These changes should also be categorically excluded. The Coast Guard believes that merely updating the regulations to reflect movement of the boundary of the territorial sea from 3 nautical miles to 12 nautical miles from shore will not have any impact on the environment. An “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are available in the docket where indicated under ADDRESSES .

In a document published in the Federal Register on February 10, 2003 (68 FR 6679), we proposed to amend the VA adjudication regulations to add cirrhosis of the liver to the list of diseases for which entitlement to service connection is presumed for former POWs under 38 CFR 3.309(c).

We asked interested persons to submit comments on or before April 11, 2003. We received no comments. Based on the rationale set forth in the proposed rule, we are adopting the proposed rule as a final rule without change.

Because this rule solely provides for a new benefit it is not subject to the effective date provisions of 5 U.S.C. 553.

This rule contains no provisions constituting collections of information under the Paperwork Reduction Act (44 U.S.C. 3501-3521).

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

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

The Catalog of Federal Domestic Assistance number is 64.109.

Docket. The EPA has established an official public docket for this action under Docket ID No. OAR-2002-0045. The official public docket consists of the documents specifically referenced in this action, any public comments received, and other information related to this action. Although a part of the official docket, the public docket does not include Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. The official public docket is the collection of materials that is available for public viewing at the Air Docket in the EPA Docket Center, Room 108, 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 Public Reading Room is (202) 566-1744. The telephone number for the Air Docket is (202) 566-1742.

Electronic Access. You may access this Federal Register document electronically through the EPA Internet under the Federal Register listings at http://www/epa.gov/fedrgstr/.

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 http://www.epa.gov.edocket/ to view public comments, access the index listing of the contents of the official public docket, and to access those documents in the public docket that are available electronically. 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 above. Once in the system, select “search,” then key in the appropriate docket identification number.

Background. On February 18, 2003, we published a direct final rule (68 FR 7706) and a parallel proposal (68 FR 7735) amending the NESHAP for chemical recovery combustion sources at kraft, soda, sulfite, and stand-alone semichemical pulp mills (40 CFR part 63, subpart MM). The amendments clarified and consolidated the monitoring and testing requirements and added a site-specific alternative standard for one pulp mill. We stated in the preamble to the direct final rule and parallel proposal that if we received significant adverse comment by March 20, 2003 on one or more distinct provisions in the direct final rule, we would withdraw those provisions. We subsequently received timely adverse comments on seven of the amendments:

• 40 CFR 63.864(a) through (c), related to a site-specific monitoring plan;

• 40 CFR 63.864(d)(1) and (2), related to monitoring specifications for continuous opacity monitoring systems;

• 40 CFR 63.864(e)(1) through (9), related to monitoring specifications for continuous parameter monitoring systems;

• 40 CFR 63.864(f), related to flow monitoring provisions;

• 40 CFR 63.864(h) and (i), related to data availability restrictions;

• 40 CFR 63.864(j)(5), related to requirements for establishing the operating range for monitoring parameters; and

• 40 CFR 63.864(j)(6), related to an operation and maintenance log for the period between the compliance date and performance test date.

We prepared an action withdrawing these amendments, but the Office of the Federal Register was unable to publish it before May 19, 2003 (the direct final rule's effective date). The final rule amends the subpart MM rule by deleting the provisions which were the subject of adverse comment, consistent with our originally stated intention. If we again address these issues related to monitoring, we will do so by acting on the proposed rule (68 FR 7735) after considering the comments received. We will not institute a second comment period.

We are also amending portions of the subpart MM rule added by the direct final rule to make two technical corrections to inadvertent errors in rule language. The first is a correction to a typographical error affecting one term in Equation 1 of 40 CFR 63.865(a)(1). The second is a correction to a cross-referencing error in 40 CFR 63.687(a)(3).

The Administrative Procedure Act, in 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 rule without providing notice and an opportunity for public comment. We have determined that there is good cause for making today's rule final without prior proposal and opportunity for comment. With respect to the amendment deleting the provisions related to monitoring, we are amending the rule to carry out our stated intention of not allowing provisions of the direct final rule to take effect if they were the subject of adverse comment. There has already been notice and opportunity for comment on this action, and, under these circumstances, opportunity for further comment is unnecessary. Moreover, failure to amend the rule by deleting the provisions on which EPA received adverse comment would be contrary to public expectation based on EPA's express promise. There may in fact be detrimental reliance on EPA's promise, further supporting EPA's finding that there is good cause for immediate revision of the rule. The other changes to the rule are minor, noncontroversial technical corrections, which do not substantively change the rule's requirements. Thus, notice and opportunity for public comment on these technical corrections is also unnecessary. We find that this constitutes good cause under 5 U.S.C. 553(b)(B).

Section 553(d) allows an agency, upon a finding of good cause, to make a rule effective immediately. Because today's amendments delete regulatory language that was the subject of adverse comment, do not add any requirements necessitating additional time for compliance, and otherwise do not substantively change the requirements of the rule, we find good cause to make these amendments effective immediately.

Under Executive Order 12866 (58 FR 51736, October 4, 1993), this action is not a “significant regulatory action” and is, therefore, not subject to review by the Office of Management and Budget. Because EPA has made a “good cause” finding that this action is not subject to notice and comment requirements under the Administrative Procedure Act or any other statute, it is not subject to the regulatory flexibility provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), or to sections 202 and 205 of the Unfunded Mandates Reform Act of 1995 (UMRA) (Public Law 104-4). In addition, this action does not significantly or uniquely affect small governments or impose a significant intergovernmental mandate, as described in sections 203 and 204 of the UMRA. This action also does not significantly or uniquely affect the communities of tribal governments, as specified by Executive Order 13084 (63 FR 27655, May 10, 1998). This action will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997) because it is not economically significant.

Section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) of 1995 (Public Law 104-113; 15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory and procurement activities unless to do so would be inconsistent with applicable law or otherwise impractical. The EPA is not proposing/adopting any voluntary consensus standards in this action.

This action does not involve special consideration of environmental justice related issues as required by Executive Order 12898 (59 FR 7629, February 16, 1994). In issuing these amendments, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct, as required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996). The EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of these amendments in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the executive order. These amendments do not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ).

The Congressional Review Act (5 U.S.C. 801 et seq. ), as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that, before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. Section 808 allows the issuing agency to make a rule effective sooner than otherwise provided by the Congressional Review Act if the agency makes a good cause finding that notice and public procedure is impracticable, unnecessary, or contrary to the public interest. This determination must be supported by a brief statement (5 U.S.C. 808(2)). As stated previously, EPA has made such a good cause finding, including the reasons therefor, and established an effective date of July 18, 2003. The EPA will submit a report containing the rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2).

States which have received final authorization from EPA under RCRA section 3006(b), 42 U.S.C. 6926(b), must maintain a hazardous waste program that is equivalent to, consistent with, and no less stringent than the Federal program. As the Federal program changes, States must change their programs and ask EPA to authorize the changes. Changes to State programs may be necessary when Federal or State statutory or regulatory authority is modified or when certain other changes occur. Most commonly, States must change their programs because of changes to EPA's regulations in 40 Code of Federal Regulations (CFR) parts 124, 260 through 266, 268, 270, 273 and 279.

We conclude that Georgia's application to revise its authorized program meets all of the statutory and regulatory requirements established by RCRA. Therefore, we grant Georgia Final authorization to operate its hazardous waste program with the changes described in the authorization application. Georgia has responsibility for permitting Treatment, Storage, and Disposal Facilities (TSDFs) within its borders and for carrying out the aspects of the RCRA program described in its revised program application, subject to the limitations of the Hazardous and Solid Waste Amendments of 1984 (HSWA). New Federal requirements and prohibitions imposed by Federal regulations that EPA promulgates under the authority of HSWA take effect in authorized States before they are authorized for the requirements. Thus, EPA will implement those requirements and prohibitions in Georgia, including issuing permits, until the State is granted authorization to do so.

The effect of this decision is that a facility in Georgia subject to RCRA will now have to comply with the authorized State requirements instead of the equivalent Federal requirements in order to comply with RCRA. Georgia has enforcement responsibilities under its State hazardous waste program for violations of such program, but EPA retains its authority under RCRA sections 3007, 3008, 3013, and 7003, which include, among others, authority to:

• Do inspections, and require monitoring, tests, analyses or reports

• Enforce RCRA requirements and suspend or revoke permits

• Take enforcement actions regardless of whether the State has taken its own actions

This action does not impose additional requirements on the regulated community because the regulations for which Georgia is being authorized by today's action are already effective, and are not changed by today's action.

EPA did not publish a proposal before today's rule because we view this as a routine program change and do not expect comments that oppose this approval. We are providing an opportunity for public comment now. In addition to this rule, in the proposed rules section of today's Federal Register we are publishing a separate document that proposes to authorize the State program changes.

If EPA receives comments that oppose this authorization, we will withdraw this rule by publishing a document in the Federal Register before the rule becomes effective. EPA will base any further decision on the authorization of the State program changes on the proposal mentioned in the previous paragraph. We will then address all public comments in a later final rule. You may not have another opportunity to comment. If you want to comment on this authorization, you must do so at this time.

If we receive comments that oppose only the authorization of a particular change to the State hazardous waste program, we will withdraw that part of this rule but the authorization of the program changes that the comments do not oppose will become effective on the date specified above. The Federal Register withdrawal document will specify which part of the authorization will become effective, and which part is being withdrawn.

Georgia initially received Final authorization on August 7, 1984, effective August 21, 1984 (49 FR 31417), to implement the RCRA hazardous waste management program. We granted authorization for changes to their program on July 7, 1986, effective September 18, 1986 (51 FR 24549), July 28, 1988, effective September 26, 1988 (53 FR 28383), July 24, 1990, effective September 24, 1990 (55 FR 30000), February 12, 1991, effective April 15, 1991 (56 FR 5656), May 11, 1992, effective July 10, 1992 (57 FR 20055), November 25, 1992, effective January 25, 1993 (57 FR 55466), February 26, 1993, effective April 27, 1993 (58 FR 11539), November 16, 1993, effective January 18, 1994 (58 FR 60388), April 26, 1994, effective June 27, 1994 (59 FR 21664), May 10, 1995, effective July 10, 1995 (60 FR 24790), August 30, 1995, effective October 30, 1995 (60 FR 45069), March 7, 1996, effective May 6, 1996 (61 FR 9108), September 18, 1998, effective November 17, 1998 (63 FR 49852), October 14, 1999, effective December 13, 1999 (64 FR 55629), November 28, 2000, effective March 30, 2001 (66 FR 8090), July 16, 2002, effective September 16, 2002 (67 FR 46600), and November 19, 2002, effective January 21, 2003 (67 FR 69690).

On March 31, 2003, Georgia submitted a final complete program revision application, seeking authorization of their changes in accordance with 40 CFR 271.21. Georgia's revision consists of provisions promulgated July 1, 2000 through June 30, 2001, otherwise known as RCRA Cluster XI. The Georgia Board of Natural Resources adopted RCRA Cluster XI rules on January 23, 2002, effective February 25, 2002, and December 4, 2002, effective December 30, 2002. We now make an immediate final decision, subject to receipt of written comments that oppose this action, that Georgia's hazardous waste program revision satisfies all of the requirements necessary to qualify for Final authorization. Therefore, we grant Georgia Final authorization for the following program changes:

There are no State requirements in this program revision considered to be more stringent or broader in scope than the Federal requirements.

Georgia will issue permits for all the provisions for which it is authorized and will administer the permits it issues. EPA will continue to administer any RCRA hazardous waste permits or portions of permits which we issued prior to the effective date of this authorization until they expire or are terminated. We will not issue any more new permits or new portions of permits for the provisions listed in the Table above after the effective date of this authorization. EPA will continue to implement and issue permits for HSWA requirements for which Georgia is not yet authorized.

Codification is the process of placing the State's statutes and regulations that comprise the State's authorized hazardous waste program into the Code of Federal Regulations. We do this by referencing the authorized State rules in 40 CFR part 272. We reserve the amendment of 40 CFR part 272, subpart L for this authorization of Georgia's program changes until a later date.

The Office of Management and Budget has exempted this action from the requirements of Executive Order 12866 (58 FR 51735, October 4, 1993), and therefore this action is not subject to review by OMB. This action authorizes State requirements for the purpose of RCRA 3006 and imposes no additional requirements beyond those imposed by State law. Accordingly, I certify that this action will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). Because this action authorizes pre-existing requirements under State law and does not impose any additional enforceable duty beyond that required by State law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). For the same reason, this action also does not significantly or uniquely affect the communities of Tribal governments, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely authorizes State requirements as part of the State RCRA hazardous waste program without altering the relationship or the distribution of power and responsibilities established by RCRA. This action also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant and it does not make decisions based on environmental health or safety risks. This rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)) because it is not a significant regulatory action under Executive Order 12866.

Under RCRA section 3006(b), EPA grants a State's application for authorization as long as the State meets the criteria required by RCRA. It would thus be inconsistent with applicable law for EPA, when it reviews a State authorization application, to require the use of any particular voluntary consensus standard in place of another standard that otherwise satisfies the requirements of RCRA. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the executive order.

This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ).

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

This is a synopsis of the Commission's Report and Order, MB Docket No. 03-47, adopted July 1, 2003, and released July 3, 2003. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC Information Center, Portals II, 445 12th Street, SW, Room CY-A257, Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Qualex International, Portals II, 445 12th Street, SW, Room CY-B402, Washington, DC, 20554, (202) 863-2893, facsimile (202) 863-2898, or via e-mail qualexint@aol.com.

This is a synopsis of the Commission's Report and Order, MB Docket No. 03-89, adopted July 1, 2003, and released July 3, 2003. The full text of this Commission decision is available for inspection and copying during regular business hours at the FCC's Reference Information Center, Portals II, 445 Twelfth Street, SW., Room CY-A257, Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Qualex International, Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com.

This is a synopsis of the Commission's Report and Order, MB Docket No. 03-79, adopted July 1, 2003, and released July 3, 2003. The full text of this Commission decision is available for inspection and copying during regular business hours at the FCC's Reference Information Center, Portals II, 445 Twelfth Street, SW., Room CY-A257, Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Qualex International, Portals II, 445 Twelfth Street, SW., Room CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com.

This is a synopsis of the Commission's Report and Order, MB Docket No. 03-86, adopted July 1, 2003, and released July 3, 2003. The full text of this Commission decision is available for inspection and copying during normal business hours in the Commission's Reference Center, 445 12th Street, SW, Washington, DC. The complete text of this decision may also be purchased from the Commission's copy contractors, Qualex International, Portals II, 445 12th Street, SW, Room CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com .

Part 73 of Title 47 of the Code of Federal Regulations is amended as follows:

This is a summary of the FCC's Third Report and Order, FCC 03-152, adopted on June 25, 2003, and released on July 7, 2003. The full text of this document is available for inspection and copying during normal business hours in the FCC Reference Center, 445 12th Street, SW., Washington, DC 20554. The complete text may be purchased from the FCC's copy contractor, Qualex International, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. The full text may also be downloaded at: http://www.fcc.gov. Alternative formats are available to persons with disabilities by contacting Brian Millin at (202) 418-7426 or TTY (202) 418-7365 or at bmillin@fcc.gov.

1. In the Third R&O, we revise our service area definition and build out requirement for the Multichannel Video Distribution and Data Service (MVDDS) in the 12.2-12.7 GHz band (12 GHz band). In the Second Further Notice of Proposed Rule Making (Second Further Notice), 68 FR 19486, (April 21, 2003), in this proceeding, we sought further comment on the most appropriate service area definition for the geographic licensing of MVDDS. In this connection, we sought comment on whether use of the DMAs defined by Nielsen Media Research (Nielsen) will facilitate delivery of advanced wireless services, such as video and data broadband services, to a wide range of populations, including those areas that are unserved and underserved. In addition, we sought comment on whether we should modify the MVDDS build out requirement as a means to foster expeditious deployment of advanced wireless services to these communities as well.

2. Upon consideration of the record in this proceeding, including but not limited to the comments filed in response to the Second Further Notice, we adopt DMAs as the service area definition for MVDDS. We also conclude that a five-year substantial service build out requirement is more appropriate for the MVDDS. We believe that these actions will facilitate delivery of advanced wireless services in the 12 GHz band and promote expeditious deployment of such services to a wide range of populations, including unserved and underserved communities.

3. The Final Regulatory Flexibility Analysis, required by section 603 of the Regulatory Flexibility Act, as amended by the Congressional Review Act, Public Law No. 104-121 (1996).

4. The Third R&O contains modified information collection(s) subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. It will be submitted to the Office of Management and Budget (OMB) for review under the PRA. OMB, the general public and other Federal agencies are invited to comment on the modified information collection(s) contained in this proceeding.

5. As required by the Regulatory Flexibility Act (RFA), we incorporated an Initial Regulatory Flexibility Analysis (IRFA) in the Second Further Notice of Proposed Rule Making. In view of the fact that we have adopted a further rule amendment in the Third Report and Order, we have included this Final Regulatory Flexibility Analysis (FRFA). This present FRFA conforms to the RFA.

6. In the Third Report and Order, we revisit the geographic licensing plan adopted in the Second Report and Order, 67 FR 63279, (October 11, 2002), and adopt a revised licensing framework for MVDDS. In the Second Report and Order , the Commission adopted a service area definition for MVDDS on the basis of Component Economic Areas (CEAs). Based on the previously-established record in this proceeding, differing responsive comments to the January 20, 2003 Auction PN received from Northpoint Technology, Ltd. (Northpoint) and MDS America on the issue of service area designations, and on subsequent discussions between Commission staff and Nielsen representatives concerning the use of its DMAs, we revisited the service area designation. We are persuaded to adopt a service area definition for MVDDS on the basis of DMAs instead of CEAs. We believe that licensing MVDDS on the basis of DMAs may place wireless competitors on the same economic footing as cable systems, which generally have a royalty-free statutory copyright license to retransmit local television programming within the DMA of the station being rebroadcast. In addition, we believe that the use of DMAs may be administratively easier for licensees due to the close nexus between the television viewer market areas as determined by the DMA delineation and the proposed use of the service (the delivery of television programming).

7. We also took the opportunity to explore whether the current build out requirement sufficiently promotes expeditious deployment of service. We believe that reducing the build out period from ten years to five years will ensure effective use of the spectrum and a faster deployment of service to the public.

8. We received no comments in response to the IRFA in the Second Further Notice.

9. The RFA directs agencies to provide a description of, and, where feasible an estimate of, the number of small entities that may be affected by the rules adopted herein. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A small business concern is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).

10. Small Multichannel Video Programming Distributors (MVPDs). The SBA has developed a small business size standard for Cable and Other Program Distribution, which includes all such companies generating $12.5 million or less in annual receipts. According to Census Bureau data for 1997, there were a total of 1,311 firms in this category, total, that had operated for the entire year. Of this total, 1,180 firms had annual receipts of under $10 million and an additional 52 firms had receipts of $10 million or more but less than $25 million. Consequently, we estimate that the majority of providers in this service category are small businesses that may be affected by the rules and policies adopted herein. We address below each service individually to provide a more precise estimate of small entities.

11. Cable Services. The Commission has developed, with SBA's approval, a definition of a small cable system operator for the purposes of rate regulation. Under the Commission's rules, a “small cable company” is one serving 400,000 or fewer subscribers nationwide. In 1996, the Commission estimated that 1,439 cable operators qualified as small cable companies. Since then, some of those companies may have grown to serve over 400,000 subscribers, and others may have been involved in transactions that caused them to merge with other cable operators. Consequently, using this definition, we estimate that the decisions and rules may affect fewer than 1,439 small entity cable system operators.

12. The Communications Act defines a small cable system operator as “a cable operator that, directly or through an affiliate, serves in the aggregate less than one percent of all subscribers in the United States and is not affiliated with any entity or entities whose gross annual revenues in the aggregate exceed $250,000,000.” The Commission has determined that there are 61,700,000 subscribers in the United States. Therefore, we deem an operator serving fewer than 617,000 subscribers to be a small operator under the Communications Act definition, if its annual revenues, when combined with the total annual revenues of all of its affiliates, do not exceed $250 million in the aggregate. Based on available data, we find that the number of cable operators serving 617,000 subscribers or less totals approximately 1,450. Although it seems certain that some of these cable system operators are affiliated with entities whose gross annual revenues exceed $250,000,000, we are unable at this time to estimate with greater precision the number of cable system operators that would qualify as small cable operators under the definition in the Communications Act.

13. DBS Service. DBS falls within the SBA definition of Cable and Other Program Distribution (NAICS 513220). As noted, this definition provides that a small entity has $12.5 million or less in annual receipts. The operational licensees of DBS services in the United States are governed by Part 100 of the Commission's Rules. The Commission, however, does not collect annual revenue data for DBS and, therefore, is unable to ascertain the number of small DBS licensees meeting this definition that could be impacted by these rules. DBS service requires a great investment of capital for operation, and we acknowledge that there are entrants in this field that may not yet have generated $11 million in annual receipts, and therefore may be categorized as a small business by the SBA, if independently owned and operated.

14. Auxiliary, Special Broadcast and other program distribution services. This service involves a variety of transmitters, generally used to relay broadcast programming to the public (through translator and booster stations) or within the program distribution chain (from a remote news gathering unit back to the station). The Commission has not developed a definition of small entities applicable to broadcast auxiliary licensees. Therefore, the applicable definition of small entity is the definition under the SBA rules applicable to radio stations (NAICS 513112), and television broadcasting (NAICS 513120). These definitions provide, respectively, that a small entity is one with either $6 million or less in annual receipts or $12 million in annual receipts. The numbers of these stations are very small. The Commission does not collect financial information on these auxiliary broadcast facilities. The Commission, however, continues to believe that most, if not all, of these auxiliary facilities could be classified as small businesses by themselves. We also recognize that most of these types of services are owned by a parent station which, in some cases, would be covered by the revenue definition of small business entity discussed above. These stations would likely have annual revenues that exceed the SBA maximum to be designated as a small business (as noted, either $6 million for a radio station or $12 million for a TV station). Furthermore, they do not meet the SBA's definition of a “small business concern” because they are not independently owned and operated.

15. Private Operational Fixed Service. Incumbent microwave services in the 12.2-12.7 GHz bands include common carrier, private operational fixed (POF), and broadcast auxiliary service (BAS) services. Presently, there are approximately 22,015 common carrier licensees, and approximately 61,670 POF licensees and broadcast auxiliary radio licensees in the microwave service. Inasmuch as the Commission has not yet defined a small business with respect to these incumbent microwave services, we utilized the SBA's definition applicable to cellular and other wireless telecommunications companies (NAICS 513322); i.e. , an entity with no more than 1,500 persons. We estimate, for this purpose, that all of the Fixed Microwave licensees (excluding broadcast auxiliary licensees) would qualify as small entities under the SBA definition for radiotelephone companies.

16. The rules set forth in the Third Report and Order will affect all entities that intend to provide terrestrial MVDDS operations in the 12.2-12.7 GHz band.

17. The Third Report and Order modifies the reporting, recordkeeping or other compliance requirements previously adopted in this proceeding. We are changing the service area designation from CEAs to DMAs, resulting in a change in the number and definition of the service areas. In addition, we are changing the build out period from ten years to five years, resulting in compliance with these rules in half the time. However, we believe that these rule changes will not have a burdensome result, especially in light of our finding that small businesses will benefit from the new service area designation and because the record indicates that interested parties will have no difficulty complying with the new five year build out.

18. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.

19. Regarding our revisiting the service area issue to utilize DMAs in the Third Report and Order in lieu of the CEA service area designation adopted in the Second Report and Order , we do not anticipate any adverse impact on small entities. We believe that the use of DMAs better comports with the proposed service and that this decision will place wireless competitors to cable services on the same economic footing as cable systems, which generally have a royalty-free statutory copyright license to retransmit local TV programming within the DMA of the station being rebroadcast.

20. We also revisited the build out requirement to establish a five-year construction period in the Third Report and Order , in lieu of the ten-year construction period established in the Second Report and Order. We do not anticipate any adverse impact on small entities. We determined that the revised time frame was necessary in order to promote timely service to the public, and that those interested in providing service will have ample time to modify their business plans prior to a competitive bidding procedure.

21. The Commission will send a copy of the Third Report and Order , including this FRFA, in a report to Congress pursuant to the Congressional Review Act. In addition, the Commission will send a copy of the Third Report and Order , including this FRFA, to the Chief Counsel for Advocacy of the Small Business Administration.

22. Pursuant to the authority contained in sections 4(i), 7(a), 301, 303(c), 303(f), 303(g), 303(r), 308, and 309(j) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 157(a), 301, 303(c), 303(f), 303(g), 303(r), 308, 309(j), the Third Report and Order is adopted.

23. Part 101 of the Commission's Rules is amended as specified in rule changes, effective September 16, 2003. This action is taken pursuant to sections 4(i), 303(c), 303(f), 303(g), 303(r), and 309(j) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 303(c), 303(f), 303(g), 303(r) and 309(j).

I. General

Enacted on February 20, 2003, Section 212 of Division B, Title II, of Pub. L. 108-7 (section 212) authorizes a fishing capacity reduction program (program) for that portion of the limited entry trawl fishery under the Pacific Coast Groundfish Fishery Management Plan whose permits, excluding those registered to whiting catcher-processors, are endorsed for trawl gear operation (reduction fishery). The program's objective is to reduce the number of vessels and permits endorsed for the operation of groundfish trawl gear. Vessels that catch and process whiting at sea are ineligible to participate. The program also involves corollary fishing capacity reduction in the California, Oregon, and Washington fisheries for coastal Dungeness crab and pink shrimp (fee-share fisheries). Sections 1111 and 1112 of the Merchant Marine Act, 1936 (46 App. U.S.C. 1279f and 1279g) (Title XI) authorize loans for financing the cost of fishing capacity reduction programs (reduction loans).

The program has two appropriations. A $10 million appropriation, authorized by section 501(b) of Division N, Title V, of Public Law 108-7, directly funds part of the program's cost. The second, a $0.5 million appropriation, included in Pub. L. 107-206, funds the Federal Credit Reform Act cost of authorizing a $36 million reduction loan.

Section 212 supersedes some of the provisions of both the fishing capacity reduction framework regulations (50 CFR 600.1000 et seq. ) and the Magnuson-Stevens Act fishing capacity reduction provisions (16 U.S.C. 1861a(b)-(e)).

When fishing capacity reduction is undertaken pursuant to the Magnuson-Stevens Act provisions, NMFS implements each reduction program by adding an implementing section to the framework regulations. Section 212, however, renders some of the Magnuson-Stevens Act provisions and the framework regulations inapplicable. Among other things, the groundfish program applies to more than one fishery. Section 212 also requires NMFS to implement the groundfish program by publishing a notification and an invitation to bid in the Federal Register rather than by promulgating additional regulations. In addition, section 212 supersedes one provision of Title XI, by extending the reduction loan's term to 30 years.

The amount paid to harvesters in exchange for relinquishing their fishery privileges (reduction cost) may equal, but may not exceed, $46 million. A $10 million appropriation will fund part of the reduction, and future harvesters will finance any remainder.

NMFS received comments from nine entities. Comments from both individuals and organizations represent the views of many parties. Most of the comments supported fishing capacity reduction in the reduction fishery, although some comments disagreed with some aspects of the proposed notice.

Comment 1: Three comments suggested that NMFS offer flat permit-relinquishment payments to groundfish reduction permit owners who own no reduction vessel.

Response: This was not specifically contemplated in the statute and therefore NMFS does not have the authority to implement such a payment scheme.

Comment 2: Three comments suggested that NMFS allow entities that own reduction vessels to be co-bidders with other entities that own groundfish reduction permits but not reduction vessels.

Response: NMFS agrees and has expanded the definition of bidder to allow co-bidder participation. A bid can include multiple parties owning or holding the different reduction components required for a bid.

Comment 3: One comment requested that NMFS change “Dungeness crab” to “ocean Dungeness crab” to ensure that Dungeness crab inside Puget Sound is excluded from this program.

Response: NMFS agrees that Puget Sound Dungeness crab should be excluded as a fee-share fishery and has added the term “coastal” to clarify the Dungeness crab eligible for this program. This term is intended to encompass California, Oregon, and Washington state's description of Dungeness crab fisheries and permit systems outside of Puget Sound.

Comment 4: Two comments requested that NMFS remove the provisions requiring relinquishment of fee-share reduction permits not registered to reduction vessels.

Response: NMFS agrees and has clarified the language to require that only fee-share permits registered to a reduction vessel be relinquished.

Comment 5: Two comments state that NMFS' request for information regarding catch history as a requirement of the bid is unnecessary because such information on how fishermen got their permits is irrelevant.

Response: NMFS agrees and has made the appropriate revisions.

Comment 6: One comment suggested clarifying that relinquishing Federal permits other than the groundfish reduction permit is restricted to Federal permits registered to the reduction vessel.

Response: NMFS agrees and has made the appropriate revision.

Comment 7: One comment suggests that bid scoring should include the average landings values of only those fee-share fisheries that match the bidder's fee-share reduction permits.

Response: NMFS agrees and has clarified that such values should correspond to the bidder's fee-share reduction permits.

Comment 8: Two comments requested that NMFS allow bidders to document alternative landings values higher than those in the official fish-ticket databases.

Response: In order to provide a fair opportunity for all bidders to document their landings, NMFS determined the best evidence of landings is the official fish-ticket databases.

Comment 9: One comment suggested that in situations involving bids with identical scores, where accepting both would exceed funding levels, NMFS should accept the bid with the lowest value first rather than the bid first received.

Response: NMFS agrees that the process for accepting bids with identical scores should be revised. However, to be consistent with the purposes of the Program, where there is not sufficient reduction funding to accept all bids, NMFS will accept the bid that removes the greatest amount of capacity without exceeding funding limits. If both bids remove the same amount of capacity, the bid received first will be accepted.

Comment 10: One comment suggested that NMFS delay notifying bidders that bids have been accepted until after a successful referendum.

Response: NMFS agrees and will notify accepted bidders after the referendum.

Comment 11: One comment suggested that NMFS clarify that the loan sub-amount calculation's dividend is derived from the bid-scoring period landing values of the accepted bidders.

Response: NMFS agrees and has changed the notice accordingly.

Comment 12: One comment suggests that NMFS establish a specific time for every accepted bidder to stop fishing, as opposed to the proposed notice and addenda provisions that each accepted bidder must stop fishing upon receipt of NMFS' request for payment instructions. The suggestion is that fishing cease 30 days after the certification of referendum results.

Response: NMFS agrees that this provision should be modified so that all accepted bidders will cease fishing at the same time. The provision has been revised so that the bidder must have stopped fishing and must have retrieved all fishing gear previously deployed from the reduction vessel 30 days after the publication of the reduction payment tender notice.

Comment 13: Two comments suggest that NMFS revise the notice and addenda language which holds accepted bidders accountable for the actions of new owners to whom accepted bidders may, after buyback, transfer reduction vessels.

Response: NMFS agrees that accepted bidders cannot be held responsible for the future actions of unrelated third parties to whom they transfer these vessels. Any violations by the new owners will be addressed under existing statutory authority.

Comment 14: One comment questioned if “inside waters” fishing count for bid scoring purposes.

Response: All landings, including in inside waters, associated with the management of federal groundfish and with state coastal fisheries for pink shrimp and Dungeness crab will be used for bid scoring purposes.

Comment 15: One commenter questioned if accepted bidders may fish a reduction vessel in “inside waters” or sell the vessel to Mexico or Alaska.

Response: A reduction vessel may not be fished anywhere. It may not be sold into any foreign registry or operation but can be sold to an Alaska resident, although it cannot fish there or anywhere else.

Comment 16: One comment asked NMFS to establish the “basic trawl permit price without a past harvest”.

Response: Congress established a bidding formula, which requires past harvest revenues.

Comment 17: One comment asked if NMFS buys back only his permit, if he could fish his reduction vessel in inside waters.

Response: This capacity reduction program compensates fishermen for relinquishing not only the reduction permits but the fishery endorsement of the reduction vessel. Therefore, the reduction vessel cannot fish anywhere. If the reduction vessel is a state registered vessel, it must be scrapped.

Comment 18: One comment asked what to do with a reduction vessel.

Response: The owner of a reduction vessel may do whatever he chooses with a reduction vessel as long as he does not fish with the reduction vessel or move it into a foreign registry or operation, except for non-Federally registered vessels which must be scrapped.

Comment 19: One comment suggested that a reduction vessel be saleable into a foreign fishery because this is most beneficial to the buyback.

Response: The authorizing statute prohibits such a sale.

Comment 20: One comment asked if a reduction vessel can be used for tendering and for the definition of “fishing”.

Response: The definition of “fishing” is contained in the Magnuson-Stevens Act and would preclude a reduction vessel from tendering.

Comment 21: One comment asked if income from NMFS fisheries research charters can be included in landings for bid scoring.

Response: Yes, but only the income from the sale of the groundfish recorded on fish tickets.

Comment 22: One comment asked what happens to fish in deployed gear at the time of tender, when fishing must cease.

Response: Any fish caught within the 30 day time period may be legally retained and sold. After that date, the gear should have been pulled up and no longer fishing.

Comment 23: One comment implies that coastal Dungeness crab and pink shrimp gear should be included in the capacity reduction program.

Response: No statutory authority exists to buy back fishing gear.

Comment 24: One comment implies that accepted bidders should be prevented from using their reduction payments to buy existing coastal Dungeness crab or pink shrimp permits and crab or shrimp gear and leasing them to vessels already in these fisheries.

Response: No statutory authority exists to make this change.

Comment 25: One comment implies that the existence of latent permits in coastal Dungeness crab and pink shrimp fisheries exacerbates problems described in comments (23) and (24).

Response: Latent permits in these fisheries is an issue that should be addressed by state fisheries managers.

Comment 26: One comment implies that accepted bidders should, themselves, be prevented from ever fishing again.

Response: No statutory authority exists to make this change.

Comment 27: One comment suggested that all reduction vessels should be scrapped.

Response: The authorizing statute allows for retention of the reduction vessel as long as the fishery endorsement is cancelled. This affords more capacity removal from the targeted fisheries at less cost.

Comment 28: One comment stated that neither the notice nor its addenda indicate whether a reduction vessel which has a multi-year NMFS trawl-survey charter can continue with the charter after the buyback.

Response: The vessel's fishery endorsement will have been withdrawn and therefore the vessel can no longer fish. However, NMFS will work internally to ensure that any fishermen who is bought out will not be subject to a Governmental action for breach of contract based on inability to fish due to the buyback.

Comment 29: One comment stated that NMFS lacks legal authority regarding the coastal Dungeness crab and pink shrimp fisheries noting that they are managed by the respective states.

Response: NMFS acknowledges that these are state-managed fisheries and will work with the states to implement this voluntary program as directed by the authorizing legislation to revoke the fee-share fishery reduction permits. Nevertheless, this does not affect fee payment and collection.

Comment 30: One comment questioned NMFS' legal authority regarding processors of trawl groundfish noting that there are no Federal requirements for permits or reporting groundfish landings.

Response: The Fishery Management Plan for Pacific Coast Groundfish incorporates by reference state requirements to record landings on state fish tickets.

Comment 31: One comment stated that Congress intended for NMFS to follow existing practices for fee collection.

Response: The authorizing legislation provides an option for the U.S. may enter into agreements with California, Oregon, and Washington to collect the fees that repay the reduction loan. Unless and until NMFS arranges to do so, however, fish sellers will pay the fees and fish buyers will collect the fees in accordance with the framework regulations.

Comment 32: One comment states that the volume and size of fish buyers dictates special circumstances to avoid an administrative nightmare for NMFS.

Response: NMFS believes that the fee collection system currently in place should be adequate.

Comment 33: One comment strongly suggests that NMFS enter into fee collection arrangements with the States.

Response: Because of specific statutory time constraints, NMFS must defer this matter's resolution until after the buyback, at which time we will explore optional state fee collection.

Comment 34: One comment states that the program's Environmental Assessment and Regulatory Impact Review (EA/RIR) does not estimate how many small businesses may be required to participate in the fee collection process.

Response: Section 3.6 or the EA/RIR discusses the processing sector by reviewing data on the 1,780 purchasers of fish from West coast harvesters during 2000. Fish buyers are categorized according to “large” and “small” buyers based on the amount of fish purchased. However, available analyses on the diversity and size of the processing sector as well as state participation in the fee collection process precludes NMFS from developing definitive estimates of processor involvement. According to SBA (See Section 6.6), a “large” processor is a processor with more than 500 employees. NMFS does not have complete data on processing employment by processing site or by company. (Some companies control several sites). However, based on available descriptions of companies and ownership, NMFS believes that almost all of the processors on the West Coast would be considered “small” under the SBA definition. Sections 3.6 and 6.6 of the EA/RIR will be revised accordingly.

Comment 35: One comment questioned the analysis undertaken in Section 4.2 of the EA/RIR to show the remaining fishermen the benefit of the program will outweigh the program costs passed on to them.

Response: The program is statutorily mandated but participation is voluntary. It is difficult to quantify the effects of a capacity reduction program before it occurs due to many unknown variables. However, the success of a fishing capacity reduction program depends upon certain assumptions such as the number of fish after a reduction remaining constant, preventing new capacity from replacing retired capacity, and fish prices remaining constant. If these assumptions are true then revenue for the remaining participants after fee payment would likely increase. A majority of those voting in the referendum would need to support it in order for the industry fee system to be approved.

Comment 36: One comment asserted that the analysis in Section 4.8 of the EA/RIR repeats an untrue assumption that removing permits from the coastal Dungeness crab and pink shrimp fisheries will benefit fishermen by increasing access to a greater portion of management quotas and trip limits.

Response: The appropriate sections of the EA/RIR will be clarified to reflect that trip limits and quotas are not used in the management of coastal Dungeness Crab and Pink Shrimp. However, NMFS maintains that in general terms, these fisheries would benefit because fewer fishermen would remain fishing for the same amount of fish. In addition, if the Buyback Program provides conservation benefits to the groundfish fish stocks, current groundfish bycatch restrictions on the non-groundfish fisheries, particularly the Pink Shrimp fisheries may be relaxed. However, the commenter raises valid issues in noting that benefits to non-groundfish fee share fisheries may be limited by the extent that latent capacity is activated, purchased capacity is replace through the issuance of new state permits, or effort is increased as the result of buyback program. The Commenter estimates that at least 100 of the the Oregon Dungeness Crab fishery permits are latent permits. As described in the EA/RIR, the Oregon Pink shrimp fishery has a requirement that if the number of active permits falls below 150, a lottery is to be held to return the number of issued permits to 150. Currently, there are 186 Oregon permits issued. Therefore, depending on the state fishery, the benefits will be hard to assess until it is known what permits are to be purchased and how the States are to respond to the statutory language that states: “It is the sense of Congress that the States of Washington, Oregon, and California should revoke all relinquishment permits in each of the fee-share fisheries immediately after the reduction payment, and otherwise to implement appropriate State fisheries management and conservation provisions in each of the fee-share fisheries that establishes a program that meets the requirements of 16 U.S.C. 141861a(b)(1)(B) as if it were applicable to fee-share fisheries.”

The following sections of this final notice revise the proposed notice.

(1) The term co-bidder has been added to include third parties who own and/or hold reduction components and will participate in the bidding with the qualifying bidder.

(2) Bid-scoring includes the average landings values of only those fee-share fisheries that match the bidder's fee-share reduction permits included in the bid.

(3) For identical bid scores where there is not sufficient reduction funding to accept both, NMFS will accept the bid that removes the greatest amount of capacity without exceeding funding limits or if both bids remove identical amounts of capacity, the first received.

(4) Notification of accepted bidders will occur after the referendum.

(5) Accepted bidders must have stopped fishing and must have retrieved all fishing gear previously deployed from the reduction vessel 30 days after NMFS publishes the reduction payment tender notice in the Federal Register .

NMFS will mail to each “permit owner” (as 50 CFR 660.302 defines the term “permit owner”) of a groundfish permit endorsed for trawl gear operation (other than those issued to whiting catcher-processors) an advance notice that NMFS will formally invite bids for capacity reduction by mailing them a bidding package. Such notice and the bidding package will be mailed to the permit owner at the owner's permit address of record.

The bidding package will contain, among other things, an invitation to bid and a bidding document. The invitation to bid will specify the terms and conditions under which bids are made and accepted. If the Secretary formally accepts a bid, the bidding document, in conjunction with the invitation to bid, will constitute a reduction contract between the bidder and the United States.

No bidder may bid before receiving the bidding package. Bidders must submit bids on provided forms and in strict conformance with the requirements of the invitation to bid. NMFS will reject any nonconforming bids.

The invitation to bid and bidding document will be similar to the pro forma invitation to bid and bidding document ( see addenda to this notification). What follows is a general summary of the relevant provisions.

To submit a bid, bidders must mail or otherwise deliver their bids to NMFS at the address specified in the invitation to bid. Each bidder is responsible for ensuring that NMFS receives his or her bid before the specified bid closing date. NMFS will reject any bid that arrives after the bid closing date; such a bid will be deemed unresponsive to the invitation to bid. All terms and conditions of the invitation to bid or the bidding document are final at the time NMFS mails the bidding package. Thereafter, NMFS will not alter or negotiate any term or condition.

Each bid must specify:

(a) The exact bid price (also referenced as Reduction Payment),

(b) The reduction vessel the bidder proposes to remove from fishing (reduction vessel),

(c) The groundfish reduction permit,

(d) Any other Federal permits registered to or used on the reduction vessel,

(e) All California, Oregon, or Washington issued permits for coastal Dungeness crab or pink shrimp registered to or used on the reduction vessel (fee-share reduction permits).

Parties other than the qualifying groundfish permit owner who hold or own the other different components required for a bid may be co-bidders. Between them, bidders or co-bidders must own or hold all required bid components. The groundfish reduction permit must be registered for use on the reduction vessel. The bidder must also include in the bid all Federal fishery licenses, fishery permits, area and species endorsements, and any other fishing privileges issued to a reduction vessel or to the bidder co-bidder on the basis of its operation or ownership of the reduction vessel.

By completing and submitting a bidding document to NMFS, each bidder makes an irrevocable offer to the United States. No bidder, once having submitted a bid to NMFS, is entitled to withdraw or in any way amend the bid.

Each bidder must offer to relinquish all of his or her Federal permits and any state permits for pink shrimp or coastal Dungeness crab. Additionally, each person submitting a bid must offer to relinquish the reduction vessel's legal authority to participate in any fishery, by offering to permanently:

(a) Allow imposition of title restrictions that remove the reduction vessel's fisheries endorsement,

(b) Relinquish eligibility for any present or future U.S. Government approval under section (9)(c)(2) of the Shipping Act, 1916 (46 U.S.C. App. 808(c)(2)) for placement of the reduction vessel under foreign registry or operation under the authority of a foreign country, and

(c) Relinquish any other present or future reduction vessel fishing privilege or fishery eligibility claim of any kind, including any based on the reduction vessel's catch history.

If a reduction vessel is registered only under state jurisdiction ( i.e. , it is not Federally documented), it must be scrapped.

After bidding, the bidder must continue to hold all reduction permits and own the reduction vessel until: NMFS notifies the bidder that NMFS rejects the bid, the bid expires without NMFS having accepted or rejected it, NMFS notifies the bidder that a reduction contract between the bidder and the United States no longer exists, or NMFS tenders reduction payment to the bidder and the bidder relinquishes all reduction permits and the reduction vessel's fishing privileges.

NMFS will determine which bids it accepts by using a reverse auction. Upon receipt of each bid, NMFS will determine a bid score by dividing each bid amount by the average annual total ex-vessel dollar value of the Pacific groundfish, coastal Dungeness crab, and pink shrimp landed by the bidder's reduction vessel that corresponds to the bidder's fee-share reduction permits. NMFS will average the three highest total annual revenues from groundfish, coastal Dungeness crab, and pink shrimp during 1998, 1999, 2000, or 2001.

NMFS will accept the responsive bid with the lowest bid score and then successively accept each additional responsive bid with the next lowest bid score until either there are no more bids to accept or acceptance of the bid with the next lowest bid score would cause the reduction cost to exceed the maximum reduction cost. If any two or more bid scores are exactly the same and there is not sufficient reduction funding to accept both, NMFS will accept the bid that removes the greatest amount of capacity, or in the event more that one such bid removes the same amount of capacity, the bid it received first.

NMFS will accept or reject each bid but will notify bidders accordingly only after a successful referendum occurs. NMFS' acceptance of a bid offer will form a fully binding reduction contract between the bidder (and any co-bidders) and the United States. Each party's obligation to perform in accordance with the terms and conditions of any reduction contract will, however, be subject to a successful fee referendum.

After bids are formally accepted, NMFS will establish up to seven reduction loan sub-amounts, one for the reduction fishery and one for each of the fee share fisheries. A reduction sub-amount is a fishery's share of the reduction loan and is in proportion to the fishery's share of the total ex-vessel dollar value of the groundfish, coastal Dungeness crab, and pink shrimp which all reduction vessels landed during the four-year period from 1998 through 2001. Post-reduction fees from each of these fisheries will repay its respective reduction loan sub-amount.

Specifically, NMFS will calculate each reduction loan sub-amount as follows. NMFS will separately add the total ex-vessel values of the accepted bidders landings, for the four-year period from 1998 through 2001, for the reduction fishery ( i.e. , groundfish trawl fishery) and the fee-share fisheries (the three coastal Dungeness crab fisheries and the three pink shrimp fisheries). Then NMFS will divide each of the seven totals by the aggregate value of all of the landings from all seven fisheries to derive seven quotients. NMFS will then multiply the reduction loan amount by each of the quotients to determine the loan sub-amount that each of these fisheries must repay.

NMFS will conduct the referendum as soon as practicable. The referendum's sole purpose will be to determine whether the voters who cast referendum ballots authorize the fee required to repay the reduction loan.

NMFS will mail referendum information, voting instructions, and a referendum ballot(s) to the permit owner of each groundfish permit in the reduction fishery and to the person who is the holder of record of each state-issued pink shrimp or coastal Dungeness crab permit (collectively, eligible voters). NMFS will include information about the following bid acceptance results:

(a) The program's reduction cost,

(b) The seven reduction loan sub-amounts,

(c) The number of permits that will be relinquished,

(e) The number of reduction vessels, and

(f) The total ex-vessel dollar values of reduction vessel landings in the reduction fishery and in each of the six fee-share fisheries, during each year from 1998 through 2001.

NMFS will mail eligible voters a separate referendum ballot for each groundfish permit they own and every pink shrimp or coastal Dungeness crab permit they hold. In other words, eligible voters will have one ballot for every such permit they hold.

Immediately after the deadline for NMFS' receipt of ballots, NMFS will tally votes, fishery by fishery, and multiply each tally by the quotients used in calculating the reduction loan sub-amounts. The products of this multiplication will be the vote tallies for the respective fisheries weighted in proportion to each fishery's reduction loan sub-amount.

If the weighted total of approving votes is greater than the weighted total of disapproving votes, the referendum is successful. The referendum is unsuccessful if the weighted total of disapproving votes is the same as or exceeds the weighted total of approving votes. NMFS will mail each eligible voter a notice about the referendum's outcome. If the referendum is successful, NMFS will mail to each bidder a bid acceptance or rejection notice.

If the referendum is unsuccessful, the fee will not be approved; and NMFS will mail a notice to each bidder that neither the bidder nor the United States has any further obligation under any reduction contract.

If the referendum is successful, NMFS will request, from each accepted bidder, specific and written payment instructions for disbursing the reduction payment. Within thirty days after the publication in the Federal Register of the reduction payment tender notice (which notifies the bidder that NMFS intends to pay the bidder and needs payment instructions), the bidder must have stopped fishing and must retrieve all fishing gear previously deployed from the reduction vessel. The bidder must also certify that they have complied with the requirements of the reduction contract.

NMFS will:

(a) Revoke all groundfish permits and all other federal reduction permits,

(b) Notify California, Oregon, and Washington that accepted bidders have relinquished their fee-share reduction permits,

(c) Request the Secretary under whom the U.S. Coast Guard operates to revoke the fisheries endorsements of all Federally-documented reduction vessels, and

(d) Request the Secretary under whom the U.S. Maritime Administration operates to make all Federally-documented reduction vessels permanently ineligible for any present or future U.S. Government approval under section (9)(c)(2) of the Shipping Act, 1916 (46 U.S.C. App. 808(c)(2)) for placement of a reduction vessel under foreign registry or operation under the authority of a foreign country.

These reduction vessel revocations and restrictions run with the vessels' titles and apply to all subsequent owners.

The bidder must immediately scrap any state-registered reduction vessel and allow NMFS to observe and certify the scrapping.

After receiving a bidder's payment instructions and certification of compliance, NMFS will disburse the reduction payment unless NMFS has reason to believe that the bidder has not performed in accordance with his or her reduction contract duties and obligations. NMFS will disburse reduction payments only to accepted bidders, unless they explicitly instruct NMFS to do otherwise. If a reduction vessel needs to be scrapped, NMFS will withhold funds sufficient to cover the cost of such scrapping until its completion.

The following table outlines, in chronological order, the program's process:

The reduction loan's repayment maturity will be 30 years. Its principal amount will be the total of all reduction payments made under this program, less $10 million. NMFS will determine the reduction loan's interest rate in accordance with the framework regulations at 50 CFR 600.1012.

Section 212 provides that the United States may enter into agreements with California, Oregon, and Washington to collect the fees that repay the reduction loan. Unless and until NMFS arranges to do so, however, fish sellers will pay the fees and fish buyers will collect, deposit, disburse, record, and report on the fees in accordance with the applicable portions of the framework regulations and the Magnuson-Stevens Act.

NMFS will establish any fee rates necessary for fish sellers to repay the reduction loan sub-amount applicable to the reduction fishery and to each of the six fee-share fisheries. NMFS will undertake a separate rulemaking to do this. The fee rates may not exceed five percent of the delivery value of fee fish from each of these fisheries, but will be less if NMFS determines that smaller percentages are sufficient to amortize the respective reduction loan sub-amounts over the 30-year reduction loan's term.

The addenda to this notification are sample pro forma invitation to bid and bidding document.

The Assistant Administrator for Fisheries, NMFS, determined that this action is consistent with Public Law 107-206, Public Law 108-7, the Magnuson-Stevens Fishery Conservation and Management Act, and other applicable laws.

In compliance with the National Environmental Policy Act, NMFS prepared an environmental assessment for this action. The assessment discusses the program's impact on the natural and human environment. NMFS will send the assessment to anyone who requests NMFS to do so ( see ADDRESSES ).

The Office of Management and Budget has determined that this notice is significant under Executive Order 12866. NMFS has prepared a Regulatory Impact Review (RIR) for this action ( see ADDRESSES ).

NMFS believes any Federalism implications arising from this notice are highly unlikely, however, consultations with the States of Washington, Oregon, and California are ongoing.

This notice contains collection-of-information requirements subject to the Paperwork Reduction Act (PRA). The Office of Management and Budget (OMB) has approved these information collections under OMB control number 0648-0376. NMFS estimates that the public reporting burden for these requirements will average 4 hours for submitting a bid, 4 hours for voting in a referendum, and 1 hour for advice (if any) about a conflict on a vessel ownership or permit claim. Persons affected by this action would also be subject to other collection-of-information requirements referred to in this action and also approved under 0648-0376. These requirements and their associated response times are 10 minutes for completing and filing a fish ticket, 2 hours for submitting a monthly fish buyer report, 4 hours for submitting an annual fish buyer report, and 2 hours for making a fish buyer/fish seller report when one party fails to either pay or collect the fee.

These response estimates include the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the information collection. Send comments regarding this burden estimate, or any other aspect of this data collection, including suggestions for reducing the burden, to both NMFS and OMB ( see ADDRESSES ).

Notwithstanding any other provision of law, no person is required to respond to, and no person is subject to a penalty for failure to comply with, an information collection subject to the requirements of the PRA unless that information collection displays a currently valid OMB control number.

NMFS has determined that this notice will not significantly affect the coastal zone of any state with an approved coastal zone management program. This determination has been submitted for review by the States of Washington, Oregon, and California.

This action is authorized by regulations implementing the Pacific Coast Groundfish Fishery Management Plan (FMP), which governs the groundfish fishery off Washington, Oregon, and California. On March 7, 2003 (68 FR 11182), the levels of allowable biological catch (ABC), the optimum yield (OY), and the commercial OY (the OY minus the tribal allocation) for U.S. harvests of whiting were announced in the Federal Register . For 2003, the whiting OY is 148,200 mt (mt) and the commercial OY is 121,200 mt. Regulations at 50 CFR 660.323(a)(4) divide the commercial OY into separate allocations for the catcher/processor, mothership, and shore-based sectors of the whiting fishery. On June 16, 2003, the whiting sector allocations which were originally published on March 7, 2003 (68 FR 11182), were corrected (68 FR 35575). The 2003 allocations are 41,208 mt (34 percent) for the catcher/processor sector; 29,088 mt (24 percent) for the mothership sector; and 50,904 mt (42 percent) for the shore-based sector. When each sector's allocation is reached, the primary season for that sector is ended.

The shore-based sector is composed of vessels that harvest whiting for delivery to land-based processors. The regulations at 50 CFR 660.323(a)(3)(i) describe the primary season for the shore-based sector as the period when the large-scale target fishery is conducted (when trip limits under § 660.323(b) are not in effect). Before and after the primary seasons, per-trip limits are in effect for whiting.

The best available information on July 11, 2003, indicated that 34,314 mt had been taken through July 5, 2003, and that the 50,904 mt shore-based allocation would be reached by 12 noon, l.t., July 14, 2002. This Federal Register action announces the date that the primary season for the shore-based sector ends and that per-trip limits are reinstated. A 10,000-lb (4,536-kg) trip limit will be in place after the primary season unless otherwise announced in the Federal Register . Per-trip limits are intended to accommodate small bait and fresh fish markets, and bycatch in other fisheries. To minimize incidental catch of chinook salmon by vessels fishing shoreward of the 100-fm (183-m) contour in the Eureka, CA area, at any time during a fishing trip, a limit of 10,000 lb (4,536 kg) of whiting is in effect year round, except when landings of whiting are prohibited.

For the reasons stated above and in accordance with the regulations at 50 CFR 660.323(a)(4)(iii)(C), NMFS herein announces:

Effective 12 noon, l.t., July 14, 2003, no more than 10,000 lb (4,536 kg) of whiting may be taken and retained, possessed, or landed by a catcher vessel participating in the shore-based sector of the whiting fishery, unless otherwise announced in the Federal Register . If a vessel fishes shoreward of the 100-fm (183-m) contour in the Eureka, CA area (43° N. lat. - 40°30′ N. lat.) at any time during a fishing trip, the 10,000-lb (4,536-kg) trip limit applies, as announced in the annual management measures at paragraph IV, B(3)(c)(ii), except when the whiting fishery is closed.

This action is authorized by the regulations implementing the FMP. The determination to take this action is based on the most recent data available. The Assistant Administrator for fisheries, NMFS, finds good cause to waive the requirement to provide prior notice and opportunity for comment on this action pursuant to 5 U.S.C. 553(b)(B) because providing prior notice and opportunity would be impracticable. It would be impracticable because, if this closure were delayed in order to provide notice and comment, the fishery would be expected to greatly exceed the sector allocation. A delay to provide a cooling off period also would be expected to cause the fishery to exceed its allocation. Therefore, good cause also exists to waive the 30-day delay in effectiveness requirement of 5 U.S.C. 553(d)(3). The aggregate data upon which the determination is based are available for public inspection at the Office of the Regional Administrator (see ADDRESSES ) during business hours. This action is taken under the authority of 50 CFR 660.323(a)(4)(iii)(C) and is exempt from review under E.O. 12866.