Section 18(j)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1828(j)(1) (“FDI Act”) provides that “Sections 371c and 371c-1 of [title 12] shall apply with respect to every nonmember insured bank in the same manner and to the same extent as if the nonmember insured bank were a member bank.” Sections 371c and 371c-1 of title 12 (12 U.S.C. 371c, 371c-1) are respectively sections 23A and 23B of the Federal Reserve Act (FRA). They establish restrictions and limitations with respect to transactions between member banks and their affiliates. The purpose of those restrictions is to protect member banks from suffering losses when entering into transactions with affiliates.

Section 23A (1) establishes limits on the amount of “covered transactions” between a member bank and its affiliates (any one affiliate and in the aggregate as to all affiliates); (2) requires that all covered transactions between a member bank and its affiliates be on terms and conditions that are consistent with safe and sound banking practices; (3) prohibits the purchase of low quality assets from an affiliate; and (4) requires that extensions of credit by a member bank to an affiliate, and guarantees on behalf of affiliates, be secured by statutorily defined amounts of collateral. Section 23B (1) requires that transactions (covered transactions as well as other identified transactions such as the sale of assets to an affiliate) between a member bank and its affiliates be on market terms (on terms and under circumstances that are substantially the same, or at least as favorable to the bank, as those prevailing at the time for comparable transactions with nonaffiliates); (2) prohibits purchases of assets from an affiliate as fiduciary unless one of several exceptions are met; (3) prohibits purchases of securities during the existence of an underwriting or selling syndicate if the principal underwriter of the securities is an affiliate; and (4) prohibits any advertisements or agreements by a member bank suggesting that the bank is responsible for the obligations of an affiliate.

The FDIC interprets and enforces the restrictions and requirements of sections 23A and 23B of the FRA as to FDIC insured State banks that are not members of the Federal Reserve System (insured State nonmember banks) and has done so for many years. Until recently neither the FRB nor the FDIC had adopted, or proposed, a regulation on the restrictions of sections 23A or 23B as applicable to the depository institutions over which each is given responsibility under the FRA and FDI Act respectively. Both agencies relied, rather, upon the language of the FRA and careful coordination of their interpretations of the statutory restrictions. On May 11, 2001, the FRB published a proposed regulation (Regulation W) designed to implement sections 23A and 23B of the FRA if that proposal were adopted in final. (66 FR 24186). The FDIC filed a formal comment on the proposal. On December 12, 2002, the FRB published Regulation W as a final rule. (67 FR 76560). It became effective on April 1, 2003, and is codified at 12 CFR 223. The preamble accompanying Regulation W as adopted in final form indicated that member banks would be given certain time periods to bring outstanding transactions into compliance with the new regulation.

Regulation W defines terms; restates the statutory prohibitions found in section 23A and 23B; establishes a number of exemptions to those restrictions; explains how to value credit transactions and asset purchases for purposes of complying with the limits on covered transactions; sets out rules on when covered transactions arise for purposes of Regulation W; sets out rules with respect to derivative transactions and how section 23A and 23B apply to foreign branches; defines the term “financial subsidiary” for purposes of Regulation W; and sets out the standards under which the FRB will grant requests for exemptions on a case-by-case basis.

In keeping with section 18(j)(1) of the FDI Act, the FDIC is proposing to add a new part to title 12 of the CFR. The purpose of this new part is to make clear that insured State nonmember banks must comply with the restrictions and limitations contained in Regulation W in order to comply with sections 23A and 23B of the FRA and section 18(j)(1) of the FDI Act. As previously stated, section 18(j)(1) of the FDI Act provides that sections 23A and 23B shall apply to insured State nonmember banks “in the same manner and to the same extent” as if the nonmember banks are member banks. This requirement in the FDI Act means that the substantive requirements and restrictions set out in Regulation W apply equally to insured State nonmember banks. The FDIC has taken those requirements and restrictions into consideration in interpreting and applying sections 23A and 23B to insured State nonmember banks since the adoption of Regulation W. The FDIC is now proposing to add part 324, which will expressly incorporate through cross reference the substantive provisions of Regulation W. The part also identifies the FDIC as the appropriate agency for State nonmember banks in the administration and interpretation of those requirements and in granting exemption requests.

Proposed part 324 is divided into six sections. Section 324.1 sets out the authority under which the FDIC is proposing to act and describes the purpose and scope of the regulation. Section 324.2 provides that the restrictions and limitations of Regulation W apply to insured State nonmember banks and contains an exemption for certain subsidiary relationships that were entered into prior to the date on which the FDIC's proposed part was published for public comment. Section 324.3 informs insured State banks that they are to follow the FDIC's procedures set forth in part 303 of the FDIC's regulations when requesting a hearing or making any filing under part 324. Section 324.4 makes it clear that “member bank” should be read as “insured State nonmember bank”, “Board” should be read as “FDIC” and “appropriate Federal banking agency” should be understood to mean “FDIC” wherever those terms appear in Regulation W. Section 324.4 also contains a definition of “State nonmember bank”. Section 324.5 provides that insured State nonmember banks may obtain an exemption from the restrictions and limitations of this part concerning section 23A if the FDIC determines that such an exemption is in the public interest and is consistent with the purposes of section 23A. Procedures for filing exemption requests are proposed in this section and would, if adopted, be added to part 303 of FDIC's regulations (Filing Procedures) as new § 303.251. Finally, § 324.6 provides that determinations that a shareholder or company exercises a controlling influence over another company will only be made after notice and opportunity for hearing. Hearings would be conducted in accordance with the proposed amendments to part 303 that are set out as part of this rulemaking. Proposed part 324, and the accompanying proposed amendments to part 303, are discussed in more detail below.

The FDIC derives the authority from section 9 (Tenth) of the FDI Act (12 U.S.C. 1819 (Tenth)) to adopt rules implementing sections 23A and 23B of the FRA as made applicable to insured State nonmember banks. Section 9 (Tenth) of the FDI Act authorizes the FDIC to issue rules and regulations “to carry out the provisions of this chapter or of any other law which it has the responsibility of administering or enforcing”.

The FDIC has the responsibility of administering and enforcing section 18(j)(1) of the FDI Act as to state nonmember banks. The language in section 9 (Tenth) of the FDI Act limits the FDIC's authority to adopt regulations governing a particular area only if “authority to issue such rules and regulations has been expressly and exclusively granted to any other regulatory agency”. Nothing in the text of section 23A or section 23B or the legislative history of those sections indicates that the FRB has the “exclusive” rulemaking authority with respect to those sections as they apply to institutions other than member banks. 1

The text of sections 23A and 23B itself bear out the proposition that the FDIC is free to adopt regulations in this area. Sections 23A and 23B do not parcel out responsibility between the FRB and the appropriate Federal banking agencies as is the case with sections 22(g) and 22(h) of the FRA, both of which are also made applicable to insured State nonmember banks by section 18(j) of the FDI Act “in the same manner and to the same extent” as though they were member banks. Section 23A and 23B's silence with respect to what role the other Federal banking agencies are to play shows that the FRA does not operate as a constraint on the authority the FDIC derives from its own statute to establish rules implementing section 23A and 23B and the FDIC's ability to make decisions in applying those sections to insured State nonmember banks. The only restraint placed on the FDIC by the FDI Act is that all of the restrictions and limitations of section 23A and 23B be applied “in the same manner and to the same extent” as those restrictions and limitations are applied to member banks. As discussed below, the FDIC will in fact be applying Regulation W and section 23A and 23B to State nonmember banks in the same way as those provisions apply to member banks.

General Requirements —Paragraph (a) of § 324.2 of the proposal cross references Regulation W and restates the requirement found in section 18(j)(1) of the FDI Act that sections 23A and 23B of the FRA apply to insured State nonmember banks as though they were member banks. The purpose of paragraph (a) is to clarify that insured State nonmember banks must comply with the substantive provisions of Regulation W in order to comply with section 18(j)(1) of the FDI Act and part 324. The effect going forward of the cross reference in § 324.2(a) to Regulation W is that State nonmember banks will automatically be subject to any changes made to Regulation W by the FRB without the need for the FDIC to take any action to amend its own regulation.

Exception to General Requirements —The FDIC is proposing to adopt a regulatory exemption to the general rule set out in paragraph (a) of § 324.2 of the proposal that insured State nonmember banks are subject to the restrictions and requirements of Regulation W. 2 Paragraph (b) of § 324.2 would exempt from the restrictions of part 324 certain subsidiary relationships that were established prior to the date on which the FDIC's proposal is published for comment. If a subsidiary relationship predates that date and that subsidiary relationship was not considered by the FDIC to be subject to section 23A and 23B prior to December 12, 2002 ( i.e. , the subsidiary was not considered to be an affiliate for purposes of section 23A and 23B as it was interpreted and applied by the FDIC) but is subject to section 23A and 23B after that date (is considered an affiliate relationship under Regulation W) the subsidiary will not be treated as an affiliate for purposes of part 324. Under the exemption, the bank's investment in the company, and its other covered transactions, if any, with the company, will not count toward the quantitative amount limitations that would otherwise apply under part 324 and outstanding transactions with the company do not need to be brought into compliance with part 324. It also means that, going forward, the bank is not subject to the restrictions of part 324 whenever it deals with that subsidiary company, e.g. , any future extensions of credit to, or investments in, the subsidiary will not count toward the limits on covered transactions with affiliates to which the bank is subject. The exemption only applies, however, for so long as the subsidiary's activities are limited to those that were approved by the FDIC by regulation or order, or which are covered by an exception in section 24 of the FDI Act (12 U.S.C. 1831a) (“section 24”), and were conducted as of the date on which the FDIC's proposal is published for comment. If, for example, the subsidiary changes its line of business in such a way that under Regulation W a newly established subsidiary of the bank doing the same thing would be considered an affiliate, the subsidiary will be treated as an affiliate from that point forward. The effect of the loss of the exemption is that, going forward, covered transactions between the bank and the subsidiary will be subject to part 324. Although the exemption would no longer apply, the outstanding investment in the subsidiary, any outstanding extensions of credit to the subsidiary and any other prior transactions with the subsidiary would not be affected by the loss of the exemption.

The exemption provided for under the proposal is intended to cover several categories of subsidiaries. The first category is those subsidiaries that, prior to the date on which the FDIC's proposal was issued for comment, were established after the FDIC issued an approval order under section 24 of the FDI Act and 12 CFR 362 (“section 24 subsidiaries”). Such subsidiaries are by definition engaged in activities that are not permissible for a subsidiary of a national bank. The exemption is not limited, however, to State nonmember banks that applied for and obtained consent to establish a subsidiary under 12 CFR 362. It also covers section 24 subsidiaries that were established prior to the date on which the FDIC's proposal was published for comment that were (1) established after filing a notice under part 362, 3 or (2) established pursuant to a provision of part 362 that permits State nonmember banks to establish certain subsidiaries without filing notice or making application to the FDIC. 4 Finally, the exemption also is intended to cover subsidiaries established prior to the relevant date pursuant to a statutory exception in section 24 of the FDI Act which is restated in 12 CFR 362.

As proposed, the subsidiary relationship exemption may be over inclusive to the extent that some of the section 24 subsidiaries described above fall within an exception to the definition of financial subsidiary found in Regulation W and thus are not considered to be affiliates. As it may be possible to construe the exceptions to the definition of financial subsidiary found in Regulation W narrowly, the FDIC has opted to draft the proposed exemption broadly so as to avoid any undue confusion or ambiguity as to how insured State nonmember banks with existing section 24 subsidiaries are affected by the adoption of FRB Regulation W.

The FDIC intends to limit the exemption to the types of section 24 subsidiaries described above. Comment is invited on whether the regulatory text is sufficiently clear as to its scope or has broader effect than intended. In addition, comment is requested on whether the FDIC should consider narrowing the scope of the exemption or making it broader.

It has been the FDIC's practice to include in section 24 approval orders conditions on the manner and extent to which an insured State nonmember bank may interact with its subsidiary that engages in activities that are not permissible for a subsidiary of a national bank. 5 Those conditions are very similar but not identical to the restrictions found in section 23A and 23B and Regulation W. In addition, the FDIC's regulations which provide that a bank may simply file a notice before establishing a certain type of subsidiary require in most instances that a bank must abide by certain affiliate transaction restrictions when interacting with the subsidiary if a bank wants to take advantage of the notice procedure. The affiliate transaction restrictions that apply in the case of a notice are the same restrictions which have been imposed by the FDIC by order on a case-by-case basis. Banks that are eligible for the subsidiary relationship exemption but which are subject by order or regulation to conditions placing restrictions on the bank's transactions with its subsidiary would still be subject to those conditions ( i.e. , the proposed exemption would not supercede or invalidate those conditions).

As indicated above, the FDIC may, by regulation or order, exempt transactions or relationships from the requirements and restrictions of sections 23A and 23B of the FRA if the FDIC finds that the exemption is in the public interest and consistent with the purposes of the FRA. The proposed subsidiary relationship exemption should not have an adverse impact on the public interest or be inconsistent with the purposes of section 23A and 23B as most banks that have subsidiaries that are eligible for the exemption are already subject to affiliate transaction conditions very similar to those found in Regulation. The exemption would not affect those conditions. The majority of the section 24 subsidiaries which have been approved by the FDIC involved either real estate subsidiaries or subsidiaries that invest in equity securities. 6 The majority of the real estate subsidiaries are subject to affiliate transaction restrictions similar to those found in Regulation W and many of those that are not subject to such restrictions are approvals to hold certain real estate investments pending their liquidation. The FDIC carefully reviewed the requests for consent to engage in equity securities investments through a subsidiary. Although many of the equity securities applications were not made subject to affiliate transaction restrictions, the applications that were approved were made subject to whatever conditions the Board found necessary in its best judgment to protect the deposit insurance funds from risk given the facts and circumstances of each application. (Section 24 requires the FDIC to determine that the conduct of business by subsidiaries such as these does not present a significant risk before the FDIC may give its consent to acquisition or establishment of the subsidiary.) The majority of the equity subsidiaries that were approved involved small investments (less than 10% of tier one capital) and in many cases the equities in which those subsidiaries sought consent to invest were bank holding companies and other similar firms. Most of the approvals were conditioned in such a way as to limit lending to the subsidiaries and to limit the amount of the investments that the subsidiaries may in turn make. Given the Board's initial review and determination and the conditions to which the approvals are subject, the FDIC does not believe that grandfathering these subsidiaries will be contrary to the public interest. What is more, the FDIC notes that these equity investment securities are in many ways similar to private equity funds (the vehicle through which financial holding companies may invest in equity securities) which are provided special treatment under Regulation W.

Section 324.2(b) of the proposal does not exempt transactions entered into by a State nonmember bank prior to the publication date of the proposal from compliance with Regulation W and part 324. All transactions with affiliates, regardless of when entered into, are governed by Regulation W and the phase-in periods adopted by the FRB in the case of member banks. Transactions entered into after December 12, 2002, but before April 1, 2003, by member banks with their affiliates were required to comply with Regulation W as of April 1, 2003. Transactions entered into prior to December 12, 2002, were required to comply with Regulation W no later than July 1, 2003. State nonmember banks that entered into transactions with affiliates that would have been required to be in compliance with Regulation W by either April 1, 2003, or July 1, 2003, if entered into by a member bank and which are not in compliance at this time will be cited for a violation of section 23A and 23B and section 18(j)(1) of the FDI Act as appropriate. Comment is invited as to whether the FDIC should consider adopting some other treatment in part 324. For example, should the FDIC grant an additional compliance period or perhaps grandfather pre-existing transactions?

Section 324.3 informs insured State nonmember banks that all filings, submissions, requests for hearings and other requests made under this part are to be made in accordance with the procedures set out in 12 CFR 303. The intent of the provision is to eliminate any confusion that might arise as to the procedures to be followed by insured State nonmember banks (procedures found in Regulation W or elsewhere in FRB regulations or procedures found in the FDIC's regulations which might differ from those used by the FRB). This rulemaking would add a new § 303.251 to 12 CFR 303 that would set out the applicable procedures for submissions, filings, and requests for hearing that are made under §§ 324.5 and 324.6 of the proposal. The proposed procedures are discussed in more detail below.

Section 324.4 of the proposal substitutes appropriate terminology for that found in Regulation W to make it clear that, for the purposes of compliance with section 18(j)(1) of the FDI Act and this part, “member bank” should be understood to mean “insured State nonmember bank”; “Board” should be understood to mean “FDIC”; and “appropriate Federal banking agency” should be understood to mean “FDIC” wherever those words or phrases are used in Regulation W. The section also defines “State nonmember bank” by cross referencing the definition found in section 3 of the FDI Act (12 U.S.C. 1813(e)).

Sections 324.2(a), 324.3 and 324.4 together accomplish two important things. They make clear that (1) the FDIC, as the Federal supervisor of insured State nonmember banks, is the appropriate party to whom insured State nonmember banks must look for guidance in interpreting the requirements of sections 23A and 23B of the FRA as they apply to insured State nonmember banks through section 18(j) of the FDI Act, and (2) it is the FDIC which exercises discretion in applying the restrictions and limitations found in Regulation W in those instances in which Regulation W provides for relief, calls for determinations, or provides for the exercise of discretion by the FRB. In short, by adopting the cross reference to Regulation W the FDIC is satisfying its obligation to ensure that insured State nonmember banks are subject to sections 23A and 23B as though they were member banks. It is only appropriate, and is in fact necessary to the effective accomplishment of the FDIC's charge to oversee the safety and soundness of insured State nonmember banks, for the FDIC to exercise the authority to make decisions with respect to particular insured State nonmember banks and their transactions with affiliates in the context of the overall facts and circumstances affecting those banks. The FDIC is the supervisor of these particular institutions and the Federal supervisory agency that is in the best position to evaluate the need for relief.

As indicated above, part 324 makes it clear that the reference to the “appropriate Federal banking agency” as found in Regulation W means the FDIC. References to the FDIC in FDIC's regulations will normally be understood to refer to the FDIC's Board of Directors unless the Board of Directors has delegated the matter to some other individual within the agency. Regulation W contains several provisions that permit the “appropriate Federal Banking agency” to make certain decisions. For example, section 223.15(b)(3) of Regulation W provides that the appropriate Federal banking agency may set the amount by which a bank's share of a participation in a loan originated by an affiliate which is now a problem loan and which is being renewed (or for which additional funds are extended) may exceed 5% of the bank's original exposure without the renewal constituting a purchase of a low quality asset. Insured State nonmember banks should note that it is the FDIC's present intent that the authority to make determinations under Regulation W that are to be made by the “appropriate Federal banking agency” will be delegated to the Director of the Division of Supervision and Consumer Protection and the Director's designee.

Section 223.43 of Regulation W (12 CFR 223.43) provides that the FRB may, by regulation or order, at its discretion, exempt transactions or relationships from the requirements of section 23A if the FRB determines that the exemption is in the public interest and is consistent with the purposes of section 23A. FDIC's proposed § 324.5 provides that insured State nonmember banks may request an exemption from the requirements and restrictions of section of 23A, as implemented by Regulation W, by filing a written request with the FDIC. The FDIC may, in its discretion, grant an exemption if the FDIC determines that it is in the public interest to do so and the FDIC determines that granting the exemption is consistent with the purposes of section 23A. This provision is similar in purpose to §§ 324.2, 324.3 and 324.4 in that it makes clear that it is the FDIC which is the appropriate agency to grant relief in the case of an insured State nonmember bank.

Exemptions from the restrictions of Regulation W are available for insured State nonmember banks under the same standards that apply to member banks, i.e. , if the exemption is in the public interest and it is consistent with the purposes of section 23A. Exemptions are thus available to member and nonmember banks “in the same manner” (after filing a request for an exemption) and “to the same extent” (after the bank's request is evaluated based upon the same standards). The only difference is that it is the FDIC which, based on its unique supervisory perspective and familiarity with the institution in question, evaluates whether those standards are met and whether it is appropriate to grant an exemption.

Past practice has been for insured State nonmember banks to apply to the FRB to obtain exemptions from the restrictions of section 23A. Usually the FRB consults with the FDIC prior to granting exemptions. Absent unusual circumstances, if the FDIC objects to the exemption request, it is not granted. Rather than continue the practice of allowing insured State nonmember banks to file exemption requests with the FRB, the FDIC is proposing to instruct insured State nonmember banks to file all exemption requests with the FDIC. Since FDIC is the primary Federal banking supervisor of insured State nonmember banks and is more familiar with the condition and overall management of those banks than the FRB, it is more appropriate for the FDIC to review and act on exemption requests from insured State nonmember banks. It is not only more appropriate to do so, but the FDIC expects that following this new procedure will result in more efficiency in the review of the requests which will in turn benefit banks. We anticipate that individual reviews will take less time even though it is the FDIC's intent to continue to coordinate with the FRB to ensure that the standards under which exemption requests are evaluated are consistently applied by the FDIC and the FRB. If adopted, the regulation would not have any effect on exemptions previously granted by the FRB. Those exemptions will continue to be valid and there would be no need for an insured State nonmember bank to seek an order from the FDIC affirming the prior exemption granted by the FRB.

Procedures for filing exemption requests are proposed for comment and are discussed below under the heading “Section 303.251 Affiliate Transactions”. If adopted, those procedures would be set out in a new § 303.251.

Section 23A of the FRA requires a shareholder or a company to be given notice and opportunity for a hearing before the shareholder or company is determined to directly or indirectly exercise a controlling influence over the management or policies of another company. The impact of a determination that such influence is found to exist is that the shareholder or company is considered to control the other company, thus making the companies affiliates for the purposes of section 23A.

Section 324.6 of the proposed regulation restates the statutory obligation for opportunity for a hearing prior to the control determination being made. It also makes it clear that the FDIC and not the FRB is the agency that affords the opportunity for a hearing and makes the final determination on the control issue when an insured State nonmember bank is involved. (See, Roque De La Feunte II v. FDIC, 332 F.3d 1208 (9th Cir. 2003) (FDIC has the authority and obligation to afford opportunity for hearing and to conduct a control hearing). The standard under the proposal for determining if control exists is whether the shareholder or company has a controlling influence over the management or policies of the other company. This standard is identical to that found in section 23A of the FRA and is the same standard in FRB Regulation W. 7

If a hearing is requested by an insured State nonmember bank, or one of its shareholders, the hearing will be conducted in accordance with the procedures set out in 12 CFR 303. (See discussion below under the heading “Section 303.251 Affiliate transactions” for information regarding the hearing procedures that are proposed for comment.)

FDIC is proposing to amend part 303 governing filing procedures and certain hearings. Under the proposal, a new section would be added to subpart M— “Other Filings” that would (1) set out the procedures for filing a request for an exemption from section 23A, and (2) set out the procedures governing hearings to determine whether or not a shareholder or company exercises a controlling influence over another company.

Exemption requests —As proposed in §303.251(a), the procedures governing requests for an exemption from the restrictions of section 23A would require the requesting bank to file a letter with the appropriate FDIC office that (1) describes in detail the relationship or transaction for which the bank is seeking an exemption, (2) identifies the requirements or restrictions from which the bank is seeking relief, and (3) sets out an explanation of why the exemption is in the public interest and is consistent with the purposes of section 23A. The FDIC may request any additional information that is, in its opinion, necessary to properly evaluate the request. Banks that file exemption requests will receive written notification of the FDIC's decision. The proposed exemption procedures are substantially the same as those adopted by the FRB in Regulation W for member banks with the exception that, unlike member banks, State nonmember banks would file requests with an FDIC regional office rather than with the agency's General Counsel. At the present time it is anticipated that the FDIC's Board of Directors will retain the authority to grant exemptions and will not delegate that responsibility.

Controlling influence hearing requests —Procedures governing requests for hearings and the actual conduct of hearings to determine control are set out in proposed § 303.251(b). Under the proposed procedures the FDIC is required to provide a shareholder or company written notice of an opportunity for hearing before the agency makes a determination that there is an affiliation based on the ability to exercise a controlling influence over the management or policies of another company. A company or shareholder that wants a hearing must respond to that effect no later than 10 days after receiving the written notice of opportunity for hearing by filing a request for a hearing with the “appropriate FDIC office” as that term is defined in 12 CFR 303. Which FDIC office is the “appropriate FDIC office” is dependent upon whether the institution that is the subject of a filing is not part of a group of related institutions. If that is the case, the appropriate regional office for that institution, and any individual associated with the institution, is the FDIC region in which the institution is located. (See § 303.2(g)(1) of current part 303). If the institution that is the subject of a filing is part of a group of related institutions, the appropriate FDIC regional office for that institution, and any individual associated with that institution, is the FDIC region in which the group's major policy and decision makers are located (or any other region the FDIC designates on a case-by-case basis). (See § 303.2(g)(2) of current part 303).

Requests for a control hearing will be acknowledged in writing. The date and time for hearings will be set by the FDIC solely in its discretion (“such time as FDIC determines to be reasonable”). In setting the date for the hearing the FDIC will take care to consider the convenience of the participants in addition to other factors such as the complexity of the issues and the potential effects of the timing of the hearing on associated matters such as a pending examination. The presiding officer will be the Director of the Division of Supervision and Consumer Protection or the Director's designee. The presiding officer is responsible for conducting the hearing, determining any procedural question that is not specifically addressed by § 303.251(b), and rendering a final determination within 20 days of the date on which the hearing record is closed. The participants will be notified in writing of the final disposition which will contain an explanation of the reasons for the final decision.

The final determination may be appealed to the Board of Directors of the FDIC. To do so a request for review must be filed the Executive Secretary of the FDIC within 15 days of the date on which notification of the final decision is received.

The proposal indicates that the procedures currently set out in §§ 303.10(f) through 303.10(i), 303.10(k) and 303.10(m) will govern the conduct of the hearing. Section 303.10 is titled “Hearings and other meetings”. Paragraph (f) governs participation in hearings. Paragraph (g) governs transcripts. Paragraph (h) governs presentations and information that may be submitted. It also identifies federal laws that are not applicable to hearings. Paragraph (i) governs the closing of the hearing record. Paragraph (k) governs the computation of time. Paragraph (m) provides that the Board of Directors may delegate by resolution to the presiding officer the authority to adopt different procedures in individual matters.

In addition to any other comments on the proposal, the FDIC specifically requests comment on the following.

1. Is it advisable for the FDIC to adopt separate rules implementing section 18(j)(1) of the FDI Act and section 23A and 23B of the FRA as they apply to insured State nonmember banks?

2. If the FDIC does adopt separate regulations, should the regulation set out the full text of Regulation W rather than adopt the proposed cross reference? If the FDIC adopted a full text version it would be identical to Regulation W with the exception that “insured State nonmember bank” would be substituted for “member bank'; “FDIC” would be substituted for “Board'; “FDIC” would be substituted for “appropriate Federal banking agency”; the definition of “member bank” would be replaced with a definition of “State nonmember bank” (definition would be the same as currently proposed) and the authority, purpose and scope paragraph as found in Regulation W would be modified to read as those paragraphs are proposed for comment.

3. Should the FDIC continue its past practice of allowing the FRB to act on exemption requests by insured State nonmember banks or adopt the proposed change in practice which would direct insured State nonmember banks to file such requests with the FDIC, which would then grant or deny the request?

4. If the FDIC adopts the practice of acting on exemption requests, are the proposed procedures for exemption requests sufficiently clear? Is the information that is required to be presented in an exemption request burdensome? Should the regulation require that additional, specifically identified information be included in the request? Should the regulation provide specifics on the time in which the FDIC will act on exemption requests?

5. Are the proposed hearing procedures adequate? What additional procedures if any should be included? Should the regulation specify that the hearing will take place no later than a certain specified period of time after the request for hearing is submitted to the FDIC? Is it appropriate to apply the procedures found in §§ 303.10(f) through 303.10(i), 303.10(k) and 303.10(m) to a controlling influence hearing?

6. Should the Board of Directors delegate the authority to grant exemptions under the regulation or retain the authority to grant exemptions at the Board level?

7. Should the Board of Directors delegate the authority to make a final control determination or should that authority be retained only at the Board level?

8. If decision making authority with respect to control determinations is delegated, is it appropriate to allow an appeal of the decision and if so, to whom?

9. Is the FDIC correct in its initial view that the proposed exemption for section 24 subsidiaries that were established prior to the publication of this proposal from part 324 will not adversely impact the public or be inconsistent with the purposes of section 23A and 23B?

10. Should the FDIC draft the subsidiary exemption more narrowly? If so, why? Should the exemption be broader in scope? If so, why?

11. Should the FDIC consider additional exemptions at this time?

12. Should the FDIC consider granting a phase-in period for transactions that were entered into prior to the publication of the proposal? If so, should the phase-in period mirror the phase-in period the FRB adopted for member banks ( i.e., three months from the effective date of the rule) or would some other period be more appropriate?

13. Should the FDIC consider exempting from part 324 transactions that were entered into prior to the publication of the proposal? If so, why? Would such an exemption pose safety and soundness issues?

14. FDIC's view is that insured State branches, agencies, and commercial lending companies of foreign banks are subject to the substantive provisions of Regulation W and this part. Comment is requested on whether the proposed regulation is sufficiently clear in that regard and whether or not the FDIC is justified in its view.

15. Are the proposed amendments to the FDIC's regulations written clearly and in “plain language”? If not, what changes should be made to the proposed language to make it clearer and easier to understand?

In accordance with the Paperwork Reduction Act (44 U.S.C. 3501 et seq. ), the FDIC may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid Office of Management and Budget (OMB) control number. The collection of information contained in this rule has been submitted to OMB for review.

Written comments on the collection of information should be sent to the Joseph F. Lackey, FDIC desk officer: Office of Management and Budget, Office of Information and Regulatory Affairs, New Executive Office Building, Washington, DC 20503. Copies of comments should also be sent to: Thomas Nixon, Legal Division, FDIC, 550 17th Street, NW., Washington, DC 20429, (202) 898-8766. For further information on the Paperwork Reduction Act aspect of this rule, contact Thomas Nixon at the above address.

Comment is solicited on:

1. Whether the collection of information is necessary for the proper performance of FDIC functions, including whether the information will have practical utility;

2. The accuracy of our estimate of burden of the proposed collection of information, including the validity of the methodology and assumptions used;

3. The quality, utility, and clarity of the information to be collected;

4. Ways to minimize the burden of the information collection on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, for example, permitting electronic submission of responses; and

5. Estimates of capital or start-up costs and costs of operation, maintenance, and purchases of services to provide information.

Title of the collection: Transactions with affiliates.

Summary of the collection: As discussed more fully in the preamble, the FDIC's 12 CFR part 324 will make clear that insured State nonmember institutions must conform to the standards of FRB's Regulation W and that the FDIC is responsible for administering Regulation W as it applies to such institutions, including receiving and acting on notices required by Regulation W.

The notices required in this collection are required to evidence compliance with sections 23A and 23B of the Federal Reserve Act (12 U.S.C. 371c and 371c-1) and section 18(j)(1) of the Federal Deposit Insurance Act (“FDI Act”). The respondents for part 324 will be insured State nonmember institutions.

Regulation W established four notices at (12 CFR) sections 223.15(b)(4), 223.31(d)(4), 223.41(d)(2) and 223.43(b). The FDIC will require insured state nonmember institutions to provide the first three of these notices to the FDIC by the part 324's cross-reference to Regulation W. The fourth Regulation W notice (223.43(b)) will not be required through the part 324 cross-reference. Instead, the FDIC equivalent of that notice will be required through 12 CFR 303.251.

The first notice requirement, described in Regulation W's section 223.15(b)(4), is a condition to an exemption for renewals of loan participations involving problem loans. Regulation W requires the participating depository institution to provide its appropriate Federal banking agency with written notice of the renewal or extension of additional credit not later than 20 days after consummation. The FDIC is the appropriate Federal banking agency to which insured State nonmember institutions are to provide this notice. There will be no reporting form associated with this information collection. The FDIC estimates that approximately three insured State nonmember institutions will file this notice annually and that it will take approximately two hours to prepare the notice.

The second notice requirement, described in Regulation W's section 223.31(d)(4), is a condition to an exemption for a depository institution's acquisition of an affiliate that becomes an operating subsidiary of the institution after the acquisition. Regulation W requires the institution to provide its appropriate Federal banking agency and the FRB with written notice of its intention to acquire the company at or before the time that the company becomes an affiliate of the institution. Through part 324's cross-reference, insured State nonmember institutions will provide that notice to the FDIC. There will be no reporting form associated with this information collection. The FDIC estimates that approximately three insured State nonmember institutions will file this notice annually and that it will take approximately six hours to prepare the notice.

The third notice requirement, described in Regulation W's section 223.41(d)(2), is a condition to an exemption for internal corporate reorganization transactions. Regulation W requires the depository institution to provide its appropriate Federal banking agency and the FRB with written notice of the transaction before consummation. Insured State nonmember institutions will provide notice to the FDIC. The notice must describe the primary business activities of the affiliate and indicate the proposed date of the reorganization. There will be no reporting form associated with this information collection. The FDIC estimates that approximately seven insured state nonmember institutions will file this notice annually and that it will take approximately six hours to prepare a notice.

Finally, part 324 will not require insured state nonmember institutions to send a notice to the FDIC through a cross-reference to Regulation W's section 223.43(b). Instead, pursuant to § 303.251, they must submit a request to the appropriate FDIC regional office. The request must describe in detail the transaction or relationship for which the institution seeks exemption; explain why the FDIC should exempt the transaction or relationship; and explain how the exemption would be in the public interest and consistent with the purposes of section 23A. There will be no reporting form associated with this information collection. The FDIC estimates that approximately two insured State nonmember institutions will file these requests annually and that it will take approximately 10 hours to prepare a request.

Burden estimate: The total estimated annual burden for insured State nonmember institutions that must comply with the above-mentioned requirements is 86 hours. Based on a rate of $50 per hour, the total annual cost to the public for these collections of information is estimated to be $4,300.

In accordance with section 3(a) of the Regulatory Flexibility Act (5 U.S.C. 603(a)), the FDIC must publish an initial regulatory flexibility analysis with this rulemaking or certify that the proposed rule, if adopted, will not have a significant economic impact on a substantial number of small entities. For the purposes of the required analysis or certification, financial institutions with total assets of $150 million or less are considered to be “small entities”. For the reasons set out below the FDIC hereby certifies pursuant to 5 U.S.C. 605(b) that the proposed rule, if adopted, will not have a significant economic impact on a substantial number of small entities.

Sections 23A and 23B of the FRA limit transactions between a member bank and its affiliates. The FDIC enforces sections 23A and 23B of the FRA as to insured State nonmember banks under section 18(j)(1) of the FDI Act which provides that insured State nonmember banks are subject to sections 23A and 23B of the FRA as though they were member banks. Section 9 (Tenth) of the FDI Act authorizes the FDIC to issue such regulations as may be necessary to administer and carry out the purposes of those sections. The proposed rule would make clear to insured State nonmember banks that in order to comply with section 18(j)(1) of the FDI Act they must comply with the substantive provisions of FRB Regulation W which was adopted in final by the FRB on December 12, 2002 to implement the requirements and restrictions of sections 23A and 23B of the FRA as they apply to member banks. Regulation W is codified at 12 CFR 223. It appeared in volume 67 of the Federal Register at page 76560 (67 FR 76560). A full description of the reasons why the FRB considered and adopted Regulation W are set out in the Federal Register document which contained Regulation W as originally proposed for comment (66 FR 24186, May 11, 2001) and in Regulation W as adopted in final form. The FRB describes Regulation W as a regulation which, although designed to comprehensively implement sections 23A and 23B of the FRA, is a regulation that in large measure simply codifies the FRB's past practice and interpretations with respect to sections 23A and 23B. The reasons the FDIC is proposing to adopt a cross reference to Regulation W in its regulations and, is further proposing to amend its regulations to make clear that the FDIC is the appropriate agency to grant exemptions from sections 23A and 23B to insured State nonmember banks as well as to make other determinations under Regulation W, are set out more fully under the supplementary information section of this document. The proposed rule would apply to all insured State nonmember banks regardless of their size.

Regulation W largely codifies the application of section 23A and 23B of the FRA as to member and State nonmember banks as interpreted and applied before that rule's adoption. In most instances the differences between what a bank needed to do to comply with section 23A or 23B previously and what is required to be done in order to comply with section 23A or 23B post Regulation W are minimal. In many instances Regulation W actually grants relief from restrictions contained in the statute. Regulation W does contain some new notice requirements and sets out specifics as to filing requirements if a bank wishes to obtain an exemption from section 23A as to a particular transaction or relationship. Those requirements are discussed above under the heading “Paperwork Reduction Act”. Of the requirements discussed under that heading, the requirements necessary to obtain an exemption are the most onerous. Based on FDIC's experience as to the number and size of State nonmember banks that have sought such exemptions in the past, we anticipate very few such requests and the institutions most likely to file an exemption request can be expected to be larger than $150 million in total assets. In 2003 only three insured State nonmember banks requested exemptions from section 23A. Only one of the three institutions was under $150 million in total assets. Regulation W also requires a notice in connection with corporate reorganizations that are exempted from some of the restrictions of section 23A and 23B without need of a case-by-case determination. Again based on our past experience we anticipate that banks that will take advantage of this exemption are likely to be larger than $150 million in total assets. Over the years, exemption requests have typically involved reorganization transactions and as stated above, banks that file exemption requests are more likely to be banks in excess of $150 million in total assets. Although we cannot come to the same conclusion with respect to the final two categories of notices described under the Paperwork Reduction Act heading, those notice requirements are minimal in terms of the information required to be filed. Banks will not require the services of attorneys, consultants, appraisers, accountants or other professionals to prepare and submit the notices nor do these notices require the use of sophisticated computer programs, statistical analysis, or other complex tracking or recordkeeping systems. While some aspects of Regulation W may require tracking or other compliance systems in order for a bank to comply with the requirements of the rule or to take advantage of certain exemptions contained in the rule, those systems as well as any burden arising out of FDIC's proposed rule would be present for State nonmember banks regardless of whether the FDIC adopts the proposal or not. The impact of the proposed rule is largely procedural in that its purpose is to clarify for State nonmember banks that it is the FDIC that administers the requirements of Regulation W as to insured state nonmember banks. The rule does not impose any new or different substantive requirement. In short, proposed part 324 does not itself impose any burden on small institutions that is not already imposed under Regulation W.

The FDIC has determined that this proposed rule will not affect family well-being within the meaning of section 654 of the Treasury and General Government Appropriations Act, 1999, Public Law 105-277, 112 Stat. 2681 (1998).

The Board of Directors of the Federal Deposit Insurance Corporation hereby proposes to add a new part 324 to title 12 of the Code of Federal Regulations and amend part 303 of title 12 of the Code of Federal Regulations as follows:

1. The authority citation for part 324 reads as follows:

2. New part 324 is added to read as follows:

Comments Invited

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

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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2002-NM-251-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2002-NM-251-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

The Civil Aviation Authority—the Netherlands (CAA-NL), which is the airworthiness authority for the Netherlands, notified the FAA that an unsafe condition may exist on certain Fokker Model F.28 Mark 0070 series airplanes. The CAA-NL advises that an operator reported an occurrence of a short circuit between two cables attached to a contactor in the electrical power center (EPC) while an airplane was on the ground and powered by external power only. The short circuit occurred due to incorrect installation of the wires on the contactor, which left minimal clearance between the cable terminals. The operator also discovered the same condition on another airplane. This condition, if not corrected, could result in a short circuit in the EPC, possibly leading to a fire in the main cabin and damage to the airplane or injury to passengers and flightcrew.

Fokker Services B.V. has issued Service Bulletin SBF100-24-035, dated May 27, 2002, which describes procedures for inspection of cables installed on certain contactors in the EPC for proper installation of wires, and reinstallation of wires, if necessary. Accomplishment of the actions specified in the service bulletin is intended to adequately address the identified unsafe condition. The CAA-NL classified this service bulletin as mandatory and issued Dutch airworthiness directive 2002-112, dated July 31, 2002, to ensure the continued airworthiness of these airplanes in the Netherlands.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would require accomplishment of the actions specified in the service bulletin described previously, except as discussed below.

Operators should note that, although the referenced service bulletin and the Dutch Airworthiness Directive include instructions for reporting the results of all inspections to Fokker Services. B.V., this proposed AD would not require those actions.

Although the Dutch Airworthiness Directive and the referenced service bulletin do not specify the type of inspection for the affected cables, this proposed AD describes the inspection as a “general visual inspection.” Note 1 of this proposed AD has been included to define this type of inspection.

The FAA estimates that 2 airplanes of U.S. registry would be affected by this proposed AD, that it would take approximately 2 work hours per airplane to accomplish the proposed inspection, and that the average labor rate is $65 per work hour. Based on these figures, the cost impact of the proposed AD on U.S. operators is estimated to be $260, or $130 per airplane.

The cost impact figure discussed above is based on assumptions that no operator has yet accomplished any of the proposed 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 proposed herein would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this proposal would not have federalism implications under Executive Order 13132.

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

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

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

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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2003-NM-162-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2003-NM-162-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

On November 26, 2001, the FAA issued AD 2001-24-10, amendment 39-12527 (66 FR 63159, December 5, 2001), applicable to certain Fokker Model F.28 Mark 0100 series airplanes. That AD requires repetitive inspections of certain main landing gear (MLG) main fittings to detect forging defects, and rework of the main fittings if necessary. The requirements of that AD are intended to detect forging defects of the MLG main fittings, which could lead to cracking and result in significant structural damage to the airplane and possible injury to the occupants.

Since the issuance of that AD, the airplane manufacturer has advised us that additional airplanes (Model F.28 Mark 0070 series airplanes) may be equipped with the same Messier-Dowty MLG units that are subject to the identified unsafe condition.

Also, the preamble to AD 2001-24-10 specified that we considered the requirements “interim action” and that the manufacturer was developing rework procedures to address the unsafe condition. The manufacturer now has developed such rework procedures, and we have determined that further rulemaking is indeed necessary; this proposed AD follows from that determination.

Fokker Services B.V. has issued Service Bulletin SBF100-32-134, dated March 24, 2003. Part 1 of the service bulletin describes procedures for removing the MLGs from the airplane; doing a detailed inspection of the MLG pintle pins, side stay attachment pins, and MLG retract actuator attachment bolts; and installing MLGs with main fittings that were reworked.

Part 2 of Fokker Services B.V. Service Bulletin SBF100-32-134 describes procedures for doing eddy current and etch penetrant inspections on MLG main fittings and identifying MLGs that have been inspected. For discrepancies ( e.g. , cracking or detected flaws of up to 50% of the calibration amplitude of the eddy current flaw detector) found during the inspections, Part 2 also includes procedures for reworking certain discrepancies and contacting the part manufacturer for discrepancies that are outside the permitted rework areas, or that cannot be removed within the limits specified in the service bulletin.

Both Parts 1 and 2 of Service Bulletin SBF100-32-134 refer to Messier-Dowty Ltd. Service Bulletin F100-32-102, including Appendices A, B, and C, dated February 24, 2003, as an additional source of information for reworking the main fittings of the MLGs, doing the eddy current and etch penetrant inspections, and identifying MLGs that have been inspected.

The Civil Aviation Authority—The Netherlands (CAA-NL), which is the airworthiness authority for the Netherlands, classified Fokker Service Bulletin SBF100-32-134 and Messier-Dowty Ltd. Service Bulletin F100-32-102 as mandatory and issued Dutch airworthiness directive 2003-040, dated March 31, 2003, to ensure the continued airworthiness of these airplanes in the Netherlands.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would supersede AD 2001-24-10 to continue to require repetitive inspections of certain MLG main fittings to detect forging defects, and rework of the main fittings if necessary. The proposed AD also would require either replacement of the MLG with a MLG that has main fittings that have been inspected and reworked, or various one-time inspections of the main fittings, and rework if necessary. Either of these actions would constitute terminating action for the repetitive inspections. This action would also revise the applicability by adding airplanes. The actions would be required to be accomplished in accordance with the service bulletins described previously, except as discussed below.

The Dutch airworthiness directive and Fokker Service Bulletin SBF100-32-134 recommend that the actions which terminate the repetitive inspections be accomplished prior to or during the next scheduled overhaul of the affected MLG main fitting. Because overhaul schedules vary among operators, this proposed AD would require accomplishment of the terminating actions prior to the accumulation of 16,000 total landings on a new MLG. This compliance time represents the life limit for the MLG main fitting.

Operators should note that, although the Dutch airworthiness directive describes procedures for reporting inspection results to Messier-Dowty and Fokker B.V. Services, this proposed AD would not require those actions.

Although Fokker Service Bulletin SBF100-32-134 and Messier-Dowty Ltd. Service Bulletin F100-32-102 both specify that the parts manufacturer may be contacted for disposition of certain discrepancies, this proposed AD would require the repair of those conditions to be accomplished in accordance with a method approved by either the FAA or CAA-NL (or its delegated agent). In light of the type of repair that would be required to address the identified unsafe condition, and in consonance with existing bilateral airworthiness agreements, the FAA has determined that, for this AD, a repair approved by either the FAA or CAA-NL (or its delegated agent) would be acceptable for compliance with this AD.

AD 2001-24-10 included a reporting requirement to enable the manufacturer to obtain better insight into the nature, cause, and extent of the cracking, and to develop final action to address the unsafe condition. This proposed AD includes such final action; therefore, the reporting requirement is not included in the requirements of this proposed 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 (AMOC). Because we have now included this material in part 39, only the office authorized to approve AMOCs is identified in each individual AD. Therefore, paragraph (g) and Note 1 of AD 2001-24-10 are not included in this proposed AD.

There are approximately 70 airplanes of U.S. registry that would be affected by this proposed AD.

The repetitive inspections currently required by AD 2001-24-10 take approximately 2 work hours per airplane to accomplish, at an average labor rate of $65 per work hour. Based on these figures, the cost impact of the currently required actions on U.S. operators is estimated to be $9,100, or $130 per airplane, per inspection cycle.

Should an operator rework a MLG per Part 1 of Fokker Service Bulletin SBF100-32-134, it would take approximately 44 work hours per airplane at an average labor rate of $65 per work hour. Based on these figures, the cost impact of the proposed modification is estimated to be $2,860 per airplane.

Should an operator do the inspections specified in Messier-Dowty Service Bulletin F100-32-102, it would take approximately 2 work hours per airplane at an average labor rate of $65 per work hour. Based on these figures, the cost impact of the proposed inspections is estimated to be $130 per airplane.

The cost impact figures discussed above are based on assumptions that no operator has yet accomplished any of the current or proposed 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 proposed herein would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this proposal would not have federalism implications under Executive Order 13132.

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

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

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

• 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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2002-NM-343-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2002-NM-343-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

The Civil Aviation Authority (CAA), which is the airworthiness authority for the United Kingdom, notified the FAA that an unsafe condition may exist on certain BAE Systems (Operations) Limited Model BAe 146 and Avro 146-RJ series airplanes equipped with Pacific Scientific engine fire extinguisher bottles. The CAA advises that an operator has reported that it is possible to incorrectly wire the left-hand engine fire extinguisher circuits on each engine. If left undetected, such incorrect wiring could result in the inability of the left-hand fire extinguisher on one or more engines to discharge, and consequent inability to control or suppress an engine fire.

BAE Systems (Operations) Limited has issued Inspection Service Bulletin 26-065, dated September 16, 2002. This service bulletin describes procedures for visually inspecting the wiring installation for Pacific Scientific engine fire extinguisher bottles. The procedures for the visual inspection include a one-time test of the wiring for the indicating system of the engine fire extinguishing system, and related investigative/corrective actions. The related investigative action is a function test of the left-hand fire extinguishing and cartridge firing unit system. The function test is necessary only if each engine does not pass the wiring test for the indicating system. The function test includes examining the wiring installation to determine if the correct wires are connected to the firing cartridge, testing correct loop resistance, and testing for correct voltage. The corrective actions include disconnecting and reconnecting the wiring for the left-hand engine fire extinguishing and cartridge firing unit system per the applicable BAE Systems (Operations) Limited wiring manual and Drawing 2 of the service bulletin. Accomplishment of the actions specified in the service bulletin is intended to adequately address the identified unsafe condition. The CAA classified this service bulletin as mandatory and issued British airworthiness directive 003-09-2002 to ensure the continued airworthiness of these airplanes in the United Kingdom.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would require accomplishment of the actions specified in the service bulletin described previously, except as discussed below.

The effectivity of the service bulletin states that airplanes with BAE Systems (Operations) Limited Modification HCM01582B installed are exempt from the inspection/test if BAE Systems (Operations) Limited Service Bulletin 26-060 (Inspection for Cross Connection of Wiring on Pacific Scientific Fire Extinguishers) has been accomplished on each engine. This information is not included in the applicability of this proposed AD, but it is included in paragraph (b) of this proposed AD.

The service bulletin specifies to submit certain information to the manufacturer. This proposed AD does not include such a requirement.

The British airworthiness directive requires a test of the left-hand fire extinguisher bottle wiring on all four engines. The Accomplishment Instructions of the service bulletin specify that the fire bottle wiring test includes a visual inspection of the wiring. This proposed AD specifies that both a detailed inspection of the fire extinguisher bottle wiring and a test of the left-hand engine fire extinguishing system will be required.

The FAA estimates that 54 airplanes of U.S. registry would be affected by this proposed AD, that it would take approximately 3 work hours per airplane to accomplish the proposed actions, and that the average labor rate is $65 per work hour. Based on these figures, the cost impact of the proposed AD on U.S. operators is estimated to be $10,530, or $195 per airplane.

The cost impact figure discussed above is based on assumptions that no operator has yet accomplished any of the proposed 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 proposed herein would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this proposal would not have federalism implications under Executive Order 13132.

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

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

Comments Invited

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

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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2003-NM-149-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2003-NM-149-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

Transport Canada Civil Aviation (TCCA), which is the airworthiness authority for Canada, notified the FAA that an unsafe condition may exist on certain Bombardier Model CL-600-2B19 (Regional Jet Series 100 & 440) airplanes. TCCA advises that the results of a stress analysis revealed that certain main fittings of the main landing gears (MLG) are susceptible to premature cracking, starting in the radius of the upper lug. This condition, if not corrected, could result in failure of the main fittings of the MLGs and consequent collapse of the MLGs during landing.

Bombardier has issued Alert Service Bulletin A601R-32-088, including Appendices A, B, and C, dated February 20, 2003, which describes, among other actions, the following procedures:

• Performing repetitive detailed inspections on the main fittings of the MLGs to detect discrepancies ( e.g. , linear paint cracks or lack of paint (paint peeling), any other paint damage, adhesion, paint bulging, or corrosion), and related investigative/corrective actions if necessary. The related investigative actions include either an eddy current or fluorescent penetrant inspection of the main fittings of the MLGs for discrepancies. The corrective action includes replacing the MLGs or main fittings of the MLGs with new parts and repainting, repairing, and/or reworking any paint damage; as applicable.

• Performing repetitive eddy current inspections on the main fittings of the MLGs to detect cracks, and replacement of the main fittings of the MLGs with new or serviceable fittings if necessary.

• Servicing the shock strut of the MLGs.

• Inspecting the shock strut of the MLGs for nitrogen pressure, visible chrome dimension, and oil leakage, and servicing the affected shock strut of the MLGs if necessary.

Accomplishment of the actions specified in the service bulletin is intended to adequately address the identified unsafe condition. TCCA classified this service bulletin as mandatory and issued Canadian airworthiness directive CF-2003-09, effective June 6, 2003, to ensure the continued airworthiness of these airplanes in Canada.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would require accomplishment of the actions specified in the service bulletin described previously, except as discussed below.

Operators should note that, although the Accomplishment Instructions of the referenced service bulletin describe procedures for submitting a comment sheet related to service bulletin quality and a sheet recording compliance to the airplane manufacturer bulletin, this proposed AD would not require those actions. The FAA does not need this information from operators.

The FAA estimates that 288 airplanes of U.S. registry would be affected by this proposed AD, that it would take approximately 4 work hours per airplane to accomplish the proposed actions, and that the average labor rate is $65 per work hour. Based on these figures, the cost impact of the proposed AD on U.S. operators is estimated to be $74,880, or $260 per airplane.

The cost impact figure discussed above is based on assumptions that no operator has yet accomplished any of the proposed 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. Manufacturer warranty remedies may be available for certain labor costs associated with this proposed AD. As a result, the costs attributable to the proposed AD may be less than stated above.

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

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

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

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

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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2002-NM-301-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2002-NM-301-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

The Direction G en erale de l'Aviation Civile (DGAC), which is the airworthiness authority for France, notified the FAA that an unsafe condition may exist on certain Aerospatiale Model ATR42-500 and ATR72-212A series airplanes. The DGAC advises that rudder operation difficulties occurred on a Model ATR42-500 series airplane while the airplane was on the ground. Investigation revealed interference between the rudder and the upper closing rib of the vertical fin. This interference was subsequently attributed to failure of parts of the upper closing rib of the vertical fin due to fatigue cracking induced by installation stress. This condition, if not corrected, could result in a rudder jam and consequent reduced controllability of the airplane.

The subject area on certain Model ATR72-212A series airplanes is almost identical to that on the affected Model ATR42-500 series airplanes. Therefore, those Model ATR72-212A series airplanes may be subject to the unsafe condition revealed on the Model ATR42-500 series airplanes.

Aerospatiale has issued Avions de Transport Regional Service Bulletin ATR42-55-0011, dated September 26, 2002 (for Model ATR42-500 series airplanes); and Avions de Transport Regional Service Bulletin ATR72-55-1003, Revision 1, dated November 13, 2002 (for Model ATR72-212A series airplanes). These service bulletins describe procedures for repetitive detailed visual inspections for cracking of the upper closing rib of the vertical fin, and related investigative actions.

The related investigative actions involve measuring the planarity of the upper closing rib and measuring the gap between the rudder horn and the upper closing rib of the vertical fin. If any crack, wave, or anomaly is found, or if any measurement is outside the limits specified in the service bulletin, the service bulletin specifies further actions, which include:

• Removing the fairing of the vertical fin.

• Performing an internal detailed visual inspection of the fin tip closure rib in the area of the fairing, to detect and determine the extent of any cracking.

• Performing a measurement of the fin tip closure rib position.

• Performing an additional measurement of the planarity of the fin tip closure rib.

• Contacting the manufacturer for repair information.

Accomplishment of the actions specified in the applicable service bulletin is intended to adequately address the identified unsafe condition.

The DGAC classified these service bulletins as mandatory and issued French airworthiness directive 2002-506(B) R1, dated December 24, 2002, to ensure the continued airworthiness of these airplanes in France.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would require accomplishment of the actions specified in the service bulletin described previously, except as discussed below.

Although the service bulletins specify that operators may contact the manufacturer for disposition of certain repair conditions, this proposed AD would require operators to repair those conditions per a method approved by either the FAA or the DGAC (or its delegated agent). In light of the type of repair that would be required to address the unsafe condition, and consistent with existing bilateral airworthiness agreements, we have determined that, for this proposed AD, a repair approved by either the FAA or the DGAC would be acceptable for compliance with this proposed AD.

Operators should note that, although the Accomplishment Instructions of the referenced service bulletins describe procedures for submitting inspection results to the manufacturer, this proposed AD would not require that action.

We consider this proposed AD interim action. If final action is later identified, we may consider further rulemaking then.

The FAA estimates that 2 Model ATR42-500 series airplanes of U.S. registry would be affected by this proposed AD, that it would take approximately 2 work hours per airplane to accomplish the proposed actions, and that the average labor rate is $65 per work hour. Based on these figures, the cost impact of the proposed AD on U.S. operators is estimated to be $260, or $130 per airplane.

Currently, there are no affected Model ATR72-212A series airplanes on the U.S. Register. However, if an affected airplane is imported and placed on the U.S. Register in the future, it would be subject to the same per-airplane cost specified above for the Model ATR42-500 series airplanes.

The cost impact figures discussed above are based on assumptions that no operator has yet accomplished any of the proposed 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 proposed herein would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this proposal would not have federalism implications under Executive Order 13132.

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

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

Comments Invited

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

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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2003-NM-171-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2003-NM-171-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

The Civil Aviation Authority (CAA), which is the airworthiness authority for the United Kingdom, notified the FAA that an unsafe condition may exist on certain BAE Systems (Operations) Limited Model BAe 146 series airplanes. The CAA advises that it received reports of in-line splices in the auxiliary power unit (APU) feeder cables being damaged by overheating. The CAA considers that splices in the integrated drive generator (IDG) feeder cables could also be subject to overheating. Poor joint splicing of electrical cables can lead to overheating that involves conductor melting. These failures can result in open APU generator or IDG circuits, followed by the associated generator tripping off-line. Overheating of the in-line splices of the APU or IDG feeder cables, if not corrected, can lead to smoke, fumes, and possible fire in the flight deck and cabin.

BAE Systems (Operations) Limited has issued Inspection Service Bulletin ISB.24-139, dated April 2, 2003, which describes procedures for repetitive detailed inspections for heat damage to any in-line splice in the APU and IDG feeder cable circuits, and corrective action if necessary. The service bulletin refers to additional service bulletins for corrective and terminating actions, as follows:

• BAE Systems (Operations) Limited Modification Service Bulletin SB.24-82-36097A&B, Revision No. 2, dated September 23, 1992, which describes procedures for modification of the APU feeders involving installation of an improved splice, and installation of continuous size 6 cables without splices.

• BAE Systems (Operations) Limited Modification Service Bulletin SB.24-85-01253A, Revision No. 1, dated March 15, 1991, which describes procedures for modification of the IDG feeders involving installation of an improved splice.

• BAE Systems (Operations) Limited Modification Service Bulletin SB.24-98-01253B, dated October 30, 1992, which describes procedures for modification of the IDG feeders involving installation of continuous size 6 cables without splices.

• BAE Systems (Operations) Limited Modification Service Bulletin SB.24-92-01203C, Revision 1, dated August 27, 2002, which describes procedures for modification of the IDG feeders involving installation of size 4 cables that have terminal blocks instead of splices.

Per BAE Systems (Operations) Limited Inspection Service Bulletin ISB.24-139, dated April 2, 2003, accomplishment of any of the modifications described previously eliminates the need for the repetitive inspections of the APU or IDG feeders, as applicable.

Accomplishment of the actions specified in the service bulletins is intended to adequately address the identified unsafe condition. The CAA classified BAE Systems (Operations) Limited Inspection Service Bulletin ISB.24-139, dated April 2, 2003, as mandatory and issued British airworthiness directive 005-04-2003 to ensure the continued airworthiness of these airplanes in the United Kingdom.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would require accomplishment of the actions specified in BAE Systems (Operations) Limited Inspection Service Bulletin ISB.24-139, dated April 2, 2003, except as discussed below under “Difference Between Proposed Rule and Certain Referenced Service Bulletin.”

This proposed AD also would provide for optional terminating action for the repetitive inspections. Consistent with the findings of the CAA, the proposed AD would allow repetitive inspections to continue in lieu of the terminating action. In making this determination, we considered that long-term continued operational safety in this case will be adequately ensured by repetitive inspections of in-line splices in the APU and IDG feeder cables to detect heat damage before it represents a hazard to the airplane.

Operators should note that, although the Accomplishment Instructions of BAE Systems (Operations) Limited Inspection Service Bulletin ISB.24-139, dated April 2, 2003, describes procedures for reporting inspection findings to the airplane manufacturer, this proposed AD would not require that action.

The FAA estimates that 17 airplanes of U.S. registry would be affected by this proposed AD, that it would take approximately 6 work hours per airplane to accomplish the proposed inspections, and that the average labor rate is $65 per work hour. Based on these figures, the cost impact of the proposed AD on U.S. operators is estimated to be $6,630, or $390 per airplane, per inspection cycle.

The optional terminating action, if done, would take approximately between 5 and 30 work hours per airplane, at an average labor rate of $65 per work hour. Required parts would cost approximately between $744 and $1,379 per airplane. Based on these figures, we estimate the cost of the optional terminating action to be between $1,069 and $2,847 per airplane.

The cost impact figures discussed above are based on assumptions that no operator has yet accomplished any of the proposed 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 proposed herein would not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this proposal would not have federalism implications under Executive Order 13132.

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

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

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

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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2003-NM-121-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2003-NM-121-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

The Luftfahrt-Bundesamt (LBA), which is the airworthiness authority for Germany, notified the FAA that an unsafe condition may exist on all Dornier Model 328-300 series airplanes. The LBA advises that there may be insufficient clearance between the bottom of the trailing edges of the ground spoilers and the upper surfaces of the wing flaps, which places higher loads on support arms #3 and #8 of the ground spoiler assemblies. Higher loads may result in premature cracking of the support arms. This condition, if not corrected, could result in loss of function of the affected ground spoiler assemblies, and consequent reduced controllability of the airplane.

Dornier has issued Service Bulletin SB-328J-57-180, Revision 1, dated March 10, 2003, which describes procedures for a visual inspection, contour inspection, and clearance inspection of the ground spoilers and the flap of each wing for discrepancies, and the following related investigative and corrective actions:

• A visual inspection of the flap protection strip for chafing marks, reporting inspection results to the manufacturer, and inspecting the bottom surface of the ground spoiler and the mating upper surface of the flap of each wing for surface damage (chafing marks or paint damage), and repair if necessary.

• A contour inspection of the ground spoiler and the flap of each wing to determine if they are within the tolerances specified in Table 1 of the service bulletin, adjusting the ground spoiler actuator if out of tolerance, and repeating the inspection one time if the ground spoiler actuator is adjusted.

• A clearance inspection between the bottom of the trailing edge of the ground spoiler and the upper surface of the flap of each wing. If there is a notable deflection (spring back effect) between the ground spoiler and the surface, the service bulletin recommends writing down and reporting the results of the clearance and contour inspections to the manufacturer. If there is no notable deflection (spring back effect) between the ground spoiler and the surface, the service bulletin recommends adjusting the ground spoiler actuator and repeating the contour inspection one time.

Accomplishment of the actions specified in the service bulletin is intended to adequately address the identified unsafe condition. The LBA classified this service bulletin as mandatory and issued German airworthiness directive 2003-120/2, dated July 24, 2003, to ensure the continued airworthiness of these airplanes in Germany.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would require accomplishment of the actions specified in the service bulletin described previously, except as discussed below.

Operators should note that the service bulletin recommends doing the specified actions “as soon as possible, or at the latest, at the next A-Check or equivalent.” The German airworthiness directive recommends doing the actions “as soon as possible, but not later than the next A-Check.” Because “A-Check” schedules vary among operators, this proposed AD would require accomplishment of the actions within 400 flight cycles after the effective date of this proposed AD. We find that a compliance time of within 400 flight cycles after the effective date of this AD is appropriate for affected airplanes to continue to operate without compromising safety.

Whereas the service bulletin specifies a visual inspection of the flap protection strip for chafing marks, this proposed AD requires a general visual inspection. A note has been added to define that inspection.

The service bulletin also specifies to submit information to the manufacturer, however, this proposed AD does not include such a requirement.

We estimate that 48 airplanes of U.S. registry would be affected by this proposed AD, that it would take approximately 2 work hours per airplane to accomplish the proposed actions, and that the average labor rate is $65 per work hour. Based on these figures, the cost impact of the proposed AD on U.S. operators is estimated to be $6,240, or $130 per airplane.

The cost impact figure discussed above is based on assumptions that no operator has yet accomplished any of the proposed 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 proposed herein would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this proposal would not have federalism implications under Executive Order 13132.

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

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

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

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 proposed 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 proposed rule. All comments submitted will be available, both before and after the closing date for comments, in the Rules Docket for examination by interested persons. A report summarizing each FAA-public contact concerned with the substance of this proposal will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this action must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2002-NM-224-AD.” The postcard will be date stamped and returned to the commenter.

Any person may obtain a copy of this NPRM by submitting a request to the FAA, Transport Airplane Directorate, ANM-114, Attention: Rules Docket No. 2002-NM-224-AD, 1601 Lind Avenue, SW., Renton, Washington 98055-4056.

The Direction Générale de l'Aviation Civile (DGAC), which is the airworthiness authority for France, notified the FAA that an unsafe condition may exist on certain Airbus Model A320-211, -212, -214, -232 and -233 series airplanes and Model A321-211, -231 and -232 series airplanes. The DGAC advises that an Airbus quality check revealed that, due to a process discrepancy during production, certain floor structural crossbeams were manufactured that were not of nominal thickness and were installed in certain airplanes before the discrepancy was discovered. This condition, if not corrected, could result in reduced structural integrity of the floor in the event of rapid depressurization or rapid vertical acceleration.

Airbus has issued Service Bulletin A320-53A1162, including Appendix 01 and Appendix 02, dated June 25, 2002, which describes procedures for a one-time ultrasonic inspection of certain floor crossbeams for nominal thickness. Airbus has also issued Service Bulletin A320-53A1163, dated June 25, 2002, which describes procedures for reinforcement of crossbeams found not at nominal thickness. Accomplishment of the actions specified in the service bulletins is intended to adequately address the identified unsafe condition. The DGAC classified these service bulletins as mandatory and issued French airworthiness directive 2002-418(B), on August 7, 2002, to ensure the continued airworthiness of these airplanes in France.

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

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design registered in the United States, the proposed AD would require accomplishment of the actions specified in the applicable service bulletins described previously, except as described below.

Operators should note that, although Airbus Service Bulletin A320-53A1162, including Appendix 01 and Appendix 02, dated June 25, 2002, describes procedures for submitting inspection results to the manufacturer, this proposed AD would not require that action.

The FAA estimates that 25 airplanes of U.S. registry would be affected by this proposed AD.

The ultrasonic inspection required by this proposed AD would take approximately 1 work hour per airplane to accomplish at an average labor rate of $65 per work hour. Based on these figures, the cost impact of this AD on U.S. operators is estimated to be $1,625, or $65 per airplane.

The cost impact figures discussed above are based on assumptions that no operator has yet accomplished any of the proposed 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 proposed herein would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this proposal would not have federalism implications under Executive Order 13132.

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

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

The Federal Food, Drug, and Cosmetic Act (the act) (21 U.S.C. 301 et seq .), as amended by the Medical Device Amendments of 1976 (the 1976 amendments) (Public Law 94-295), the Safe Medical Devices Act of 1990 (SMDA) (Public Law 101-629), the Food and Drug Administration Modernization Act (FDAMA) (Public Law 105-115), and the Medical Devices User Fee and Modernization Act (MDUFMA) (Public Law 107-250) established a comprehensive system for regulating medical devices intended for human use. Section 513 of the act (21 U.S.C. 360c) established three categories (classes) of devices, depending on the regulatory controls needed to provide reasonable assurance of their safety and effectiveness. The three categories of devices are class I (general controls), class II (special controls), and class III (premarket approval).

Under section 513 of the act, devices that were in commercial distribution before May 28, 1976 (the date of enactment of the amendments), generally referred to as preamendments devices, are classified after FDA has taken the following steps: (1) Received a recommendation from a device classification panel (an FDA advisory committee); (2) published the panel's recommendation for comment, along with a proposed regulation classifying the device; and (3) published a final regulation classifying the device. FDA has classified most preamendments devices under these procedures.

Devices that were not in commercial distribution before May 28, 1976, generally referred to as postamendments devices, are classified automatically by statute (section 513(f) of the act) into class III without any FDA rulemaking process. Those devices remain in class III and require premarket approval until FDA performs the following tasks: (1) Reclassifies the device into class I or II; (2) issues an order classifying the device into class I or II in accordance with new section 513(f)(2) of the act, as amended by the FDAMA; or (3) issues an order finding the device to be substantially equivalent, in accordance with section 513(i) of the act, to a legally marketed device that does not require premarket approval. The agency determines whether new devices are substantially equivalent to previously marketed devices by means of premarket notification procedures in section 510(k) of the act (21 U.S.C. 360(k)) and 21 CFR part 807 of the regulations.

A preamendments device that has been classified into class III may be marketed, by means of premarket notification procedures, without submission of a premarket approval application (PMA) until FDA issues a final regulation under section 515(b) of the act (21 U.S.C. 360e(b)) requiring premarket approval.

FDAMA added a new section 510(m) to the act (21 U.S.C. 360(m)). New section 510(m) of the act provides that FDA may exempt a class II device from the premarket notification requirements under section 510(k) of the act, if the agency determines that premarket notification is not necessary to assure the safety and effectiveness of the device. FDA has determined that premarket notification is not necessary to assure the safety and effectiveness of external penile rigidity devices.

External penile rigidity devices are preamendments devices. These devices were not classified with the gastroenterology and urology devices that were classified in 1983. FDA has reviewed marketing submissions for these devices through the 510(k) process. Based on the premarket notifications (510(k)) reviews, the agency believes that the labeling of these devices adequately informs users and practitioners about the safe and effective use of the devices.

Consistent with the act and the regulations, FDA consulted with the Gastroenterology-Urology Advisory Panel (the Panel), an FDA advisory committee, regarding the classification of these devices. During a public meeting on August 7, 1997, the Panel discussed the history, composition, and usage of external penile rigidity devices. The Panel recommended classifying external penile rigidity devices into class II with labeling recommendations as special controls (Ref. 1).

In the Federal Register of January 4, 1999 (64 FR 62), FDA issued a proposed rule to classify external penile rigidity devices into class II. The January 4, 1999, proposal provided the regulatory history of external penile rigidity devices as well as the recommendation of the Panel that these devices be classified into class II (special controls). Specifically, the Panel recommended that FDA classify the devices into class II because it concluded that special controls, in addition to general controls, would provide reasonable assurance of the safety and effectiveness of the devices, and that there was sufficient information to establish special controls to provide that assurance. FDA agreed with the Panel's recommended classification.

The January 4, 1999, proposed rule provided an opportunity for interested persons to submit comments. The 90-day comment period ended on April 15, 1999. FDA received no comments.

FDA has decided to repropose the classification of this device to modify the description of external penile rigidity devices to clarify its intended use. In addition, FDA, on its own initiative, is proposing to exempt these devices from premarket notification requirements. The agency believes that premarket notification is not necessary to assure the safety and effectiveness of the device for the following reasons: (1) FDA received no adverse event reports regarding the use of external penile rigidity devices from 1997 to the present and (2) FDA conducted a scientific literature review from 1996 to June 2003, which continued to show that the devices are safe and effective when used properly. FDA also believes that a special controls guidance document with labeling recommendations addressing proper usage, along with the general controls, would provide reasonable assurance of the safety and effectiveness of the devices.

There are a number of factors FDA may consider to determine whether a 510(k) is necessary to provide reasonable assurance of the safety and effectiveness of a class II device. These factors are discussed in a guidance document the agency issued on February 19, 1998, entitled “Procedures for Class II Device Exemptions From Premarket Notification, Guidance for Industry and CDRH Staff.” You may obtain that guidance through the Internet on FDA's Center for Devices and Radiological Health (CDRH) home page at http://www.fda.gov/cdrh or by fax through CDRH Facts-on-Demand at 1-800-899-0381 or 301-827-0111. Specify “159” when prompted for the document shelf number.

The Panel made the following device identification recommendation: Penile rigidity devices are generic external devices that include constriction rings, vacuum pumps, and penile splints for the management of erectile dysfunction. These devices fit on, over, or around the penis to support, promote, or maintain sufficient penile rigidity for sexual intercourse.

The Panel unanimously recommended that FDA classify external penile rigidity devices into class II (special controls). The Panel believed that special controls regarding labeling recommendations would provide reasonable assurance of the safety and effectiveness of the device type. The Panel advised that the labeling provide the following information: (1) The identified risks to health of this device type; (2) relevant contraindications, warnings, and precautions; (3) possible methods of resolution of the problems/risks associated with the use of the devices; and (4) device-specific information. Device-specific information (64 FR 62) contains warnings and precautions, including, but not limited to, the following:

The user should apply the minimum amount of vacuum pressure necessary to achieve an erection. Misuse of a vacuum pump may aggravate already existing medical conditions such as Peyronie's disease, priaprism, and urethral strictures.

The user should restrict use of the device to 30 minutes and should not fall asleep wearing the constriction ring. Prolonged use of the constriction ring without removal may cause permanent injury to the penis.

Frequent use of constrictions rings may result in bruising at the base of the penis. The user should not use constrictions rings if there is decreased ability to sense pain in the penis, because pain may occur as a warning sign that the device may be causing injury.

The user should consult a physician if any injuries occur to either the user or the user's partner.

The Panel recommended that external penile rigidity devices be classified into class II. The Panel believed that special controls regarding labeling recommendations, in addition to general controls, would provide reasonable assurance of the safety and effectiveness of the devices, and that there is sufficient information to establish special controls to provide such assurance.

The Panel based its recommendation on the Panel members' knowledge and clinical experience, as well as published literature on external penile rigidity devices (Refs. 2 through 4).

The Panel identified pain and/or discomfort, bruising, hemorrhage and/or hematoma formation, penile injury and penile gangrene (if blood flow is restricted too long) as risks and possible side effects associated with the use of these external penile rigidity devices. After considering the Panel's deliberations, as well as the published literature and medical device reports, FDA evaluated the risks to health associated with the use of external penile rigidity devices. FDA categorized the following as risks to health: (1) Tissue injury or trauma; (2) aggravation of existing medical conditions, such as Peyronie's disease, priaprism, and urethral strictures; and (3) infection/adverse tissue reactions.

Tissue injury and trauma are risks to health associated with the use of external penile rigidity devices. Prolonged use of constriction bands over 30 minutes without removal may cause permanent injury to the penis because of restricted blood flow. Frequent use of constriction rings also may result in bruising at the base of the penis. Misuse of a vacuum pump may bruise or rupture the blood vessels either immediately below the surface of the skin or within the deep structures of the penis or scrotum, resulting in hemorrhage and/or hematoma formation. Misuse of a penile splint may cause vaginal trauma to the user's partner.

We encourage you to participate in this rulemaking by submitting comments and related material. If you do so, please include your name and address, identify the docket number for this rulemaking [CGD07-04-037], indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related material in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying. If you would like to know they reached us, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them.

We do not now plan to hold a public meeting. But you may submit a request for a meeting by writing to the Bridge Branch at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the Federal Register.

The existing regulations of the Hobe Sound Bridge (SR 708), mile 996.0, at Hobe Sound, published in 33 CFR 117.5 require the draw to open on signal.

On June 18, 2002, the Town of Jupiter Island requested that the Coast Guard review the existing regulations governing the operation of the Hobe Sound Bridge, because the Town contended that those regulations were not meeting the needs of vehicle and vessel traffic.

On August 28, 2002, the Coast Guard issued a test deviation published in the Federal Register (67 FR 55115). This test deviation was effective from November 1, 2002, until January 27, 2003. The test deviation allowed a change to the current bridge regulations by allowing the bridge to open on the hour, 20 minutes after the hour, and 40 minutes after the hour from 7 a.m. to 6 p.m. daily. We received 67 comments in reference to this deviation. Sixty comments were for the 20 minute schedule; three comments requested that the schedule be changed to an hour and half-hour; two comments were against the proposed schedule; and one of those requested that, if it were to be made permanent, it be limited to the winter season. One comment requested a permanent exemption from the regulations for all commercial vessels and one comment suggested enforcement of current regulations.

The Coast Guard proposes to make the 20-minute schedule published in the test deviation permanent, based on prior bridge logs, which indicated that the bridge opened two to three times an hour, and comments received from the public during the test deviation period. This proposed schedule may benefit both vessel and vehicle traffic by allowing for the opportunity to plan trips in conjunction with the 20-minute scheduled bridge openings. The hour and half schedule suggested by three comments appears to place additional unnecessary restrictions on navigation. The need for a seasonal summer and winter schedule does not appear to have any additional benefits for either vehicle or vessel traffic in this area as the prior traffic counts did not significantly differ between the summer and winter seasons. However, we may request additional traffic counts based on comments related to this NPRM. One comment requested an exemption for commercial vessels. However, with the exception of tugs and tugs with tows and Public Vessels of the United States, the Coast Guard does not normally exempt classes of vessels from regulations governing bridge operations.

This proposed rule would require the Hobe Sound Bridge (SR 708), mile 996.0, at Hobe Sound to open on signal; except that, from 7 a.m. to 6 p.m., the draw need open only on the hour, 20 minutes after the hour, and 40 minutes after the hour.

This proposed 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 (DHS).

We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. This proposed rule would modify the existing bridge schedule to allow for efficient vehicle traffic flow and provide scheduled openings for vessel traffic.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. This proposed rule would affect the following entities, some of which may be small entities: the owners or operators of vessels needing to transit the Intracoastal Waterway in the vicinity of Hobe Sound Bridge, persons intending to drive over the bridge and nearby business owners. The proposed rule offers frequent, scheduled openings for vessel traffic, 3 times per hour from 7 a.m. to 6 p.m., and will meet the reasonable needs of navigation throughout the affected times. Vehicle traffic and small business owners in the area will benefit from the increased traffic flow that regularly scheduled openings will offer this area.

If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES ) explaining why you think it qualifies and how and to what degree this proposed rule would economically affect it.

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

This proposed rule would call 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 proposed 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 proposed rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

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

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

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

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

We have analyzed this proposed rule under Commandant Instruction M16475.1D, 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 proposed rule is categorically excluded, under figure 2-1, paragraph (32)(e) of the Instruction, from further environmental documentation. Under figure 2-1, paragraph (32)(e) of the Instruction, an “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are not required for this proposed rule.

For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 117 as follows:

The public hearing will provide interested parties the opportunity to present data, views, or arguments concerning the Supplemental Proposal. The EPA may ask clarifying questions during the oral presentations, but will not respond to the presentations at that time. Written statements and supporting information submitted during the comment period will be considered with the same weight as any oral comments and supporting information presented at the public hearing. Written comments must be postmarked by the last day of the comment period, as specified in the Supplemental Proposal.

The public hearing will be held in Denver, Colorado. The hearing is scheduled for March 31, 2004. Persons wishing to present oral testimony on the Supplemental Proposal may do so. The meeting facilities and their phone numbers are provided above under ADDRESSES .

If you would like to present oral testimony at the hearing, please notify Ms. Kelly Hayes at (919) 541-5578 no later than March 26, 2004. She will provide you with a specific time and date to speak.

The public hearing will begin each day at 8 a.m. and continue into the evening until 9 p.m., or later if necessary, depending on the number of speakers. The EPA is scheduling lunch breaks from 12:30 until 2 p.m. and dinner breaks from 6 to 7:30 p.m.

Oral testimony will be limited to a total of 10 minutes per commenter to address the Supplemental Proposal. We will not be providing equipment for commenters to show overhead slides or make computerized slide presentations unless we receive special requests in advance. Commenters should notify Ms. Kelly Hayes if they will need specific equipment. The EPA encourages commenters to provide written versions of their oral testimonies either electronically on computer disk or CD ROM or in paper copy.

The hearing schedules, including lists of speakers, will be posted on EPA's Web pages for the rulemakings at http://www.epa.gov/mercury prior to the hearing. Verbatim transcripts of the hearing and written statements will be included in the rulemaking docket.

Due to the many requests we have received from both the public and members of Congress to extend the public comment period for the January 30, 2004, Proposed Utility Mercury Reduction Rule to reduce air emissions of mercury and nickel, EPA is extending the public comment period by 30 days. Therefore, the public comment period will end on April 30, 2004, rather than March 30, 2004.

The EPA has established the official public docket for the Supplemental Proposal and the Utility Mercury Reductions Rule under Docket ID No. OAR-2002-0056. The EPA has also developed Web sites for these rulemakings at the addresses given above. Please refer to the Supplemental Proposal for details on accessing information related to that action.

The Environmental Protection Agency (EPA), Region 2, announces its intent to delete the Hooker-102nd Street Superfund Site (Site) from the National Priorities List (NPL) and requests public comment on this deletion. The EPA maintains the NPL as a list of sites that appear to present a significant risk to public health, or the environment. As described in § 300.425(e)(3) of the NCP, a site deleted from the NPL remains eligible for Fund-financed remedial actions, if conditions at the site warrant such action.

The EPA will accept comments concerning the deletion of this Site from the NPL for thirty (30) days after publication of this document in the Federal Register .

Section II of this document explains the criteria for deleting sites from the NPL Section III discusses procedures that the EPA is using for this action. Section IV discusses how the Site meets the NPL deletion criteria.

Section 300.425(e) of the NCP provides that sites may be deleted from the NPL where no further response is appropriate. In making this determination, the EPA, in consultation with the NYSDEC, will consider whether any of the following criteria has been met:

The following procedures apply to the deletion of this Site:

1. The EPA, Region 2, issued a Record of Decision (ROD) for the Site on September 26, 1990, which selected the remedy for the Site. The ROD was amended on June 9, 1995.

2. Responsible parties implemented the remedy selected in the amended ROD as described in a Final Closeout Report dated September 8, 2003.

3. The EPA, Region 2, recommends deletion and has prepared the relevant documents.

4. The State of New York, through the NYSDEC, concurred with the proposed deletion of the Site in a letter dated September 29, 2003.

5. A notice has been published in a local newspaper, and in addition, a notice has been distributed to appropriate Federal, State or local officials, and other interested parties announcing a thirty-day public comment period which starts on the date of publication of this notice in the Federal Register and a newspaper of record.

6. The EPA has made available the relevant documents to this decision at the addresses listed above.

7. Upon completion of the thirty-day public comment period, the EPA will evaluate all comments received before issuing a final decision on deletion. The EPA, Region 2, will prepare a Responsiveness Summary, if appropriate, which will address significant comments received during the public comment period. The Responsiveness Summary will be made available to the public at the information repositories.

8. If, after consideration of the comments received, the EPA decides to proceed with the deletion, the EPA will place a Notice of Deletion in the Federal Register . Deletion does not occur until the final Notice of Deletion is published in the Federal Register . Generally, the NPL will reflect deletions in the next final update following the final Notice publication.

Deletion of a site from the NPL does not, by itself, alter, or revoke any individual's rights or obligation. Deletion of a site from the NPL does not alter the EPA's right to take appropriate enforcement actions. The NPL is primarily for informational purposes and to assist EPA management.

The following summary provides a brief description and history of the Site and the Agency's rationale for recommending deletion of the Site from the NPL.

The Site consists of two land parcels totaling 22.1 acres. The Occidental Chemical Corporation (OCC), formerly the Hooker Chemical and Plastics Corporation, owns 15.6 acres, and the remaining 6.5 acres are owned by the Olin Chemical Corporation (Olin). The Site is located on Buffalo Avenue in Niagara Falls, Niagara County, New York. It borders on the Niagara River, and lies less than one-quarter of a mile south of the Love Canal Superfund Site. It is separated from the Love Canal Site by the LaSalle Expressway, Buffalo Avenue and Frontier Avenue.

Since the mid-1940s, the Site was used as an industrial waste landfill. In the early 1970s, landfilling operations at the Site were stopped. OCC and Olin remain as the current owners of the Site. During the period of active waste disposal at the Site, OCC and Olin deposited at least 159,000 tons of wastes, in both liquid and solid forms, into the landfill. These deposits included approximately 4,600 tons of benzene, chlorobenzene, chlorophenols, and hexachlorocyclohexanes, all of which are hazardous substances.

In 1979, the U.S. Department of Justice, on behalf of the EPA, filed a lawsuit against OCC and Olin, two potentially responsible parties (PRPs) for the Site's contamination, in order to put an end to the continuing discharges and to clean up Site contamination. The PRPs, with EPA and NYSDEC guidance, agreed to conduct a study into the nature and extent of Site contamination and to recommend alternatives for the cleanup of the Site.

The investigation included the landfill residues, contaminated fill in an area outside the landfill, shallow ground water, bedrock ground water, liquid waste, soil, river sediments, and storm drains. The investigation was completed in 1990.

In September 1990, the EPA selected a remedy which included the installation of a synthetic-lined cap; consolidation of contaminated soils beneath the cap; surrounding the waste mass with a slurry wall; dredging and incineration of highly contaminated sediments; dredging, dewatering, and consolidation, beneath the cap, of the remaining contaminated sediments; recovery and treatment of ground water; incineration of any recovered NAPL (non-aqueous phase liquids); monitoring; and restricting access to the Site by the installation of additional security fencing.

In September 1991, the EPA issued the PRPs an Administrative Order to conduct the remedial design and the remedial action. The two PRPs agreed to comply with the Order. Design of the EPA-selected remedy was begun in October 1991. The Intermediate Engineering Report (IER) was approved by the EPA on August 31, 1993. However, certain concerns raised by the federal and state natural resource trustees caused the EPA to reexamine the remedial design as proposed in the IER. As a result of the reexamination, the September 1990 ROD was amended in June 1995. The amendment eliminated the incineration contingency whereby all highly contaminated sediments in an embayment area in the Niagara River adjacent to the landfill would have had to be excavated and incinerated were they to remain outside the final positioning of the slurry wall. The slurry wall was in fact redesigned so as to be positioned to run as close to the shoreline as was practical and still contain any migration of the NAPL plumes. Remedial action activity began in April 1996. The construction of the slurry wall was completed in 1996 along with excavation of contaminated sediments from the embayment and consolidation of these sediments into the landfill. The installation of the permanent cap over the landfill was completed during the 1997 construction season.

The remedy for the Site was completed in March 1999 when the forcemain system for pumping leachate from the landfill to the Love Canal Treatment Facility became operational. A Preliminary Closeout Report (PCOR) was approved by the EPA on September 2, 1999. The PCOR documented the fact that all construction activities identified as necessary remedial actions for the Site pursuant to the ROD, as amended, had been completed. The forcemain system continues to pump sufficient leachate from the landfill so as to maintain an inward gradient across the slurry wall. The leachate pumping system reached the steady-state phase in November 2000.

An Operation and Maintenance (O&M) Manual was developed and implemented. Annual reports are provided to the EPA and the NYSDEC and both the EPA and the NYSDEC believe that the reports for 2001 and 2002 confirm that the remedy for the Site has been successfully implemented.

A Consent Decree between EPA and the State of New York and OCC and Olin was approved and entered by a federal court on October 1, 1999. Under the terms of the Consent Decree, the PRPs agreed to implement the long-term O&M for the Site and reimbursed to the EPA $6,800,000 of its past costs plus interest. Additionally, OCC and Olin implemented institutional controls in the form of deed notifications that the Site property was subject to the terms of the Consent Decree, and use restrictions that run with the land that prohibit future uses of the property such as groundwater extraction or excavation that could adversely affect the remedy for the Site. These institutional controls are recorded in the property records of Niagara County.

The Site no longer poses a significant threat to human health or the environment. However, hazardous substances remain at the Site above levels that would allow for unlimited use with unrestricted exposure. Pursuant to Section 121(c) of CERCLA, the EPA and/or the State will review Site remedies no less often than every five years. The first Five-Year Review for this Site was signed by the EPA on August 15, 2001, and concluded that the response actions implemented at the Site are in accordance with the remedy selected by the EPA and that the remedy continues to be protective of human health and the environment. The next Five-Year Review will be completed before August 2006.

Public participation activities for this Site have been satisfied as required in CERCLA Section 113(k), 42 U.S.C. 9613(k), and Section 117, 42 U.S.C. 9617. The ROD was subject to a public review process. All other documents and information which the EPA relied on, or considered in recommending this deletion are available for the public to review at the information repositories.

One of the three criteria for site deletion is when “responsible parties or other persons have implemented all appropriate response actions required” (40 CFR 300.425(e)(1)(i)). The EPA, with the concurrence of the State of New York, through the NYSDEC, believes that this criterion for deletion has been met. Consequently, the EPA is proposing deletion of this Site from the NPL.

EPA, Region 2, announces its intent to delete the Niagara County Refuse Superfund Site (Site) from the National Priorities List (NPL) and requests public comment on this action. EPA maintains the NPL as the list of sites that appear to present a significant risk to public health, welfare, or the environment. Sites on the NPL may be the subject of remedial actions financed by the Hazardous Substances Superfund Response Trust Fund (Fund). As described in § 300.425(e)(3) of the NCP, any site deleted from the NPL remains eligible for Fund-financed remedial actions, if conditions at the site warrant such action.

EPA will accept comments concerning the deletion of the Site from the NPL for thirty (30) days after publication of this document in the Federal Register .

Section II of this document explains the criteria for deleting sites from the NPL. Section III discusses procedures that the EPA is using for this action. Section IV discusses how the Site meets the NPL deletion criteria.

Section 300.425 (e) of the NCP provides that sites may be deleted from the NPL where no further response is appropriate. In making this determination, EPA, in consultation with the State, shall consider whether any of the following criteria has been met:

(i) Responsible parties or other persons have implemented all appropriate response actions required;

(ii) All appropriate Fund-financed responses under CERCLA have been implemented, and no further response action by responsible parties is appropriate; or,

(iii) A remedial investigation has shown that the release poses no significant threat to public health or to the environment and, therefore, taking remedial measures is not appropriate.

The following procedures apply to the deletion of this Site:

1. EPA, Region 2, issued a Record of Decision (ROD) for the Site on September 24, 1993, which selected the remedy for the Site.

2. Responsible parties implemented the remedy selected in the ROD as described in a Final Close Out Report dated August 14, 2003.

3. EPA, Region 2, recommends deletion and has prepared the relevant documents.

4. The State of New York, through the NYSDEC, concurred with the proposed deletion of the Site in a letter dated September 29, 2003.

5. A notice has been published in a local newspaper, and in addition, a notice has been distributed to appropriate Federal, State and local officials, and other interested parties announcing a 30-day public comment period which starts on the date of publication of this notice in the Federal Register and a newspaper of record.

6. The EPA has made available the relevant documents to this decision at the addresses listed above.

7. Upon completion of the thirty (30) day public comment period, EPA will evaluate all comments received before issuing a final decision on deletion. The EPA, Region 2, will prepare a Responsiveness Summary, if appropriate, which will address significant comments received during the public comment period. The Responsiveness Summary will be made available to the public at the information repositories.

If, after consideration of the comments it receives, EPA decides to proceed with the deletion, EPA will place a Notice of Deletion in the Federal Register . Deletion does not occur until the final Notice of Deletion is published in the Federal Register . Generally, the NPL will reflect deletions in the next final update following the final notice publication.

The following summary provides a brief description and history of the Niagara County Refuse Superfund Site and provides the Agency's rationale for recommending deletion of the Site from the NPL.

The Niagara County Refuse site is a former municipal landfill, comprised of approximately 65 acres, located along the eastern border of the Town of Wheatfield, New York and the western border of the City of North Tonawanda. The southern edge of the Site lies approximately 500 feet north of the Niagara River.

During the landfill's operational period (1968-1976), the Niagara County Refuse Disposal District (NCRDD) accepted municipal refuse and industrial wastes, which are commingled throughout the landfill. More than 100 waste generators or transporters are thought to have used the Site. Disposed materials included heat-treatment salts, plating-tank sludge, tetrachloroethylene, PVC skins and emulsion, thiazole polymer blends, polyvinyl alcohol, phenolic resins, and brine sludge containing mercury.

Beginning in 1980, the Site became the focus of several investigations by EPA, NYSDEC, and the United States Geological Survey (USGS) resulting in the Site being placed on the National Priorities List (NPL) in September 1983.

In March 1989, a group of fourteen potentially responsible parties (PRPs) entered into an administrative consent order with EPA to perform a Remedial Investigation/Feasibility Study (RI/FS). In February 1995, a group of twelve PRPs entered into a judicial consent decree with the United States on behalf of EPA to conduct the remedial design, remedial construction, operation, maintenance, and monitoring for the Site. EPA signed a Record of Decision (ROD) for the Site on September 24, 1993, selecting the remedy for the Site as follows:

On-site construction at the Site commenced in November 1998, continuing unabated through the next two construction seasons and in September 2000, EPA conducted a final inspection with NYSDEC and the PRPs. In December 2000, EPA issued its approval of the Remedial Action Report. The ecological assessment recognized that there were valuable wetlands and uplands located on the Site. A restoration plan was developed and implemented to account for the wetland losses incurred by the capping, and 0.17 acres of wetland were created as part of the work done at the Site. The success of the restoration effort is described in the Site Annual Monitoring Reports. Additionally, institutional controls, consisting of recording the Consent Decree and placing restrictive covenants on the real property at the Site, have been implemented by Niagara County and the Town of Wheatfield.

An Operation, Maintenance, and Monitoring (OM&M) Manual was developed and implemented. Financial assurance for OM&M activities has been provided by the PRPs in the form of demand notes as required by the Consent Decree. Annual reports are provided to EPA and NYSDEC and both EPA and NYSDEC believe that the reports for 2001 and 2002 confirm that the remedy for the Site has been successfully implemented.

The Site has been cleaned and environmentally valuable lands restored. The Site no longer poses an unacceptable risk to human health or the environment. However, hazardous substances remain at the Site above levels that would allow for unlimited use with unrestricted exposure. Pursuant to section 121(c) of CERCLA, EPA and/or the State will review site remedies no less often than every five years. The EPA, Region 2, conducted a Five-Year Review of the Site in November 2003. The Five-Year Review concluded that the contamination at the Niagara County Refuse site is under control and there is no exposure to human or environmental receptors from Site-related contaminants due to permanent measures in place at the Site.

Public participation activities for this Site have been satisfied as required in CERCLA section 113(k), 42 U.S.C. 9613(k), and section 117, 42 U.S.C. 9617. The ROD was subject to a public review process. All other documents and information which EPA relied on or considered in recommending this deletion are available for the public to review at the information respositories.

One of the three criteria for site deletion is when “responsible parties or other persons have implemented all appropriate response actions required” (40 CFR 300.425(e)(1)(i)). EPA, with the concurrence of the State of New York, through the NYSDEC, believes that this criterion for deletion has been met. Subsequently, EPA is proposing deletion of this Site from the NPL.

EPA Region II announces its intent to delete the Love Canal Superfund site, located in the City of Niagara Falls, Niagara County, New York from the NPL and requests public comment on this action. The NPL is Appendix B of the NCP, which EPA promulgated, pursuant to Section 105 of CERCLA. EPA identifies sites that appear to present a significant risk to public health or the environment and maintains the NPL as the list of those sites. Sites on the NPL can have remedial actions financed by the Hazardous Substances Superfund Response Trust Fund (Fund). As described in 40 CFR 300.425(e)(3) of the NCP, a site deleted from the NPL remains eligible for remedial actions, if conditions at the site warrant such action.

The Site is located in the southeast corner of the City of Niagara Falls, approximately 1/4 mile north of the Niagara River in Niagara County, New York.

EPA will accept comments concerning the deletion of this Site from the NPL for thirty days after publication of this notice in the Federal Register .

The NCP establishes the criteria that the Agency uses to delete sites from the NPL. In accordance with 40 CFR 300.425(e), sites may be deleted from the NPL where no further response is appropriate. In making this determination, EPA, in consultation with the State of New York, shall consider whether any of the following criteria have been met:

(i) Responsible or other parties have implemented all appropriate response actions required; or,

(ii) All appropriate Fund-financed responses under CERCLA have been implemented, and no further response actions by responsible parties is appropriate; or,

(iii) The remedial investigation has shown that the release poses no significant threat to public health or the environment and, therefore, implementing remedial measures is not appropriate. 40 CFR 300.425(e)(1).

The following procedures are being used for the intended deletion of the Site:

(1) EPA Region II issued the following decision documents: a Decision memorandum in July 1982; three Records of Decision (RODs) in March 1985, September 1987 and September 1988; three Explanations of Significant Differences (ESDs) in June 1989, November 1996 and December 1998; and, a ROD Amendment in May 1991, all of which describe the selected remedies at the Site.

(2) EPA, NYSDEC and the Potentially Responsible Party (PRP) designed and constructed the various remedies at the Site. EPA and NYSDEC monitored the design and construction activities. EPA prepared a Final Closeout Report (available upon request), which describes the remedial activities that were implemented and which finds that all areas of concern described in the NPL listing and the various decision documents have been adequately addressed.

(3) EPA Region II recommends deletion and has made all relevant documents available in the Regional office and local information repository.

(4) The State of New York, through the NYSDEC, has concurred with the deletion decision in a letter dated September 30, 2003.

(5) Concurrent with the publication of this Notice of Intent to Delete, a notice has been published in two local newspapers and has been distributed to appropriate Federal, State and local officials and any other interested parties, announcing a thirty (30)-day public comment period on the deletion package.

The NCP provides that EPA shall not delete a site from the NPL until the public has been afforded an opportunity to comment on the proposed deletion. EPA Region II will accept and evaluate public comments before making a final decision to delete. If a decision is made to delete this Site, the decision will be made in a final Notice of Deletion in the Federal Register . Deletion of a site from the NPL does not affect responsible party liability or impede Agency efforts to recover costs associated with response efforts. The NPL is designed primarily for informational purposes and to assist Agency management.

Between 1942 and 1952, the Hooker Chemicals & Plastics Corporation (now Occidental Chemical Corporation (OCC)) disposed of approximately 22,000 tons of drummed and liquid chemical wastes, including polycyclic aromatic hydrocarbons, halogenated organics, pesticides, chlorobenzenes and dioxin into the abandoned Love Canal Landfill (LCL).

Problems with odors and residues in the basements and backyards of properties abutting the LCL were first reported in the 1970's. Also, during the 1970's, unusually high precipitation in the region caused the water table within the LCL to rise, which allowed contaminants to spread laterally in surficial soils and along utility bedding, eventually seeping into the basements of nearby homes. Dioxin and other contaminants also migrated from the LCL to the sanitary and storm sewers which extended outside the LCL boundaries, some with outfalls into nearby creeks which are tributaries to the Niagara River. In 1978, the New York State Department of Health (NYSDOH) identified more than 80 chemicals in the LCL and adjacent soils.

In August 1978, President Carter issued the first of two Emergency Declarations at the Site which provided Federal funding for remedial work to contain the chemical wastes at the Site and for the relocation of the residents in the homes (239 properties) directly adjacent to the LCL; these homes were subsequently identified as Ring I and Ring II.

In May 1980, President Carter issued the second Declaration of Emergency at the Site. This emergency declaration established the Emergency Declaration Area (EDA), the approximately 350-acre neighborhood surrounding the Site, and authorized $20 million of Federal funds for the purchase of homes. The Federal Emergency Management Agency (FEMA) disbursed these funds and, together with NYSDEC, relocated approximately 950 families, of the more than 1,050 families affected, from a 10-square-block area surrounding the LCL.

In 1981, EPA proposed the addition of the Site to the NPL, making it available for funding under CERCLA. The Site was added to the NPL in 1983.

In May 1982, EPA's Office of Research and Development issued the Environmental Monitoring at Love Canal Study (May 1982) (EMS) which evaluated the nature and extent of contamination throughout the EDA, including air, soils, surface water, sediments and biota sampling.

In July 1982, the EPA Region 2 Regional Administrator issued a Decision Memorandum: Cooperative Agreement with the State of New York for Love Canal. This memorandum was a precursor to the Superfund ROD and documented the work that had been performed by NYSDEC, approved additional Federal funding, and identified a phased approach for conducting eight additional tasks which included the following:

• Undertake Site containment via an expanded leachate collection system and/or other containment option.

• Investigate/remediate contamination in the north end storm and sanitary sewer system.

• Investigate/remediate contamination in Black and Bergholtz creeks.

• Investigate/remediate contamination in the south end storm sewers.

• Investigate/remediate contamination in the western sanitary sewers and lift stations.

• Develop long-term monitoring to ensure the effectiveness of the cleanup activities.

• Investigate/remediate 102nd Street outfall.

• Prepare summary document with conclusions.

By June 1983, the Rings I and II homes, adjacent to the LCL, as well as the 99th Street School, had been demolished.

In August 1983, in order to address concerns raised by the Office of Technology Assessment and the public regarding the 1982 EMS, EPA established the multi-agency Love Canal Technical Review Committee (TRC) to act as a management group to provide interagency coordination and oversight for further remedial and habitability activities for the Site. The TRC was comprised of senior-level representatives from EPA, U.S. Department of Health and Human Services/Centers for Disease Control, NYSDOH and NYSDEC. The principal task of the TRC was to determine the habitability of the EDA surrounding the Site.

The efforts of the TRC led to the development of the Love Canal Emergency Declaration Area Habitability Study (LCHS). A draft Habitability Criteria document was developed, pursuant to recommendations of an independent panel, and was released for peer review. The final habitability criteria were established after this extensive peer review process of the draft habitability criteria. The development of the five-volume LCHS was based upon the final habitability criteria.

In October 1983, EPA issued the Environmental Information Document—Site Investigations and Remedial Action Alternatives—Love Canal which evaluated contamination in the creeks and sewers surrounding the LCL and provided treatment alternatives for their remediation.

In 1984, NYSDEC installed a 40-acre cap over the LCL, consisting of a high-density polyethylene liner, which was then covered by 18 inches of clean soil and seeded for grass. In addition, NYSDEC performed high-pressure cleaning of the leachate collection system in February 1983 to improve its performance. The permanent leachate treatment plant began operation in December 1979. Modifications were made to the leachate treatment plant in December 1984.

In March 1985, EPA issued the Love Canal Sewer and Creek Remedial Alternative Evaluation and Risk Assessment, which evaluated risks posed by contamination in the creeks and sewers, further evaluated alternatives for remediating the creeks and presented a proposed remedial action plan.

In May 1985, EPA issued a ROD selecting a remedy to remediate the sewers and the creeks in the EDA. This ROD called for:

• Hydraulically cleaning the sewers;

• dredging and hydraulically cleaning the Black Creek culverts;

• removing Black and Bergholtz Creek sediments with dioxin concentrations exceeding one part per billion (ppb);

• construction of an on-site interim storage facility for the creek and sewer sediments; and,

• remediation of the 102nd Street outfall area (which was subsequently addressed under the remedial action for the 102nd Street Landfill Superfund site).

In August 1985, EPA issued the Long-Term Monitoring Program Design for the Love Canal Remedial Project which evaluated contamination in the area groundwater and effectiveness of the barrier drain and cap system. Hundreds of groundwater monitoring wells were installed between 1985 and 1987.

In 1986, the Superfund Amendments and Reauthorization Act (SARA) was enacted; Section 312 of SARA included specific provisions to address the significant program aspects of the Site. These included:

• Completion of a study of the habitability of the EDA, i.e., the LCHS.

• Acquisition of those properties within the EDA which were not eligible for government acquisition under the FEMA acquisition program.

• Maintenance of property acquired under the FEMA and EPA's SARA acquisition programs.

• Provision of technical assistance to the Love Canal Area Revitalization Agency (LCARA) to facilitate their efforts to revitalize the EDA. LCARA was a New York State Agency that was designated as the lead agency in the rehabilitation effort of the Love Canal EDA.

During 1986 and 1987, the remediation of the contaminated sewers was performed; this included the clean-out of 68,000 linear feet of storm and sanitary sewers. An on-site facility was constructed to dewater sewer contaminants. This remedial action conformed with the 1985 ROD, requiring the removal of dioxin-contaminated sediments from the creeks and sewers. Additional sewer cleanup was performed pursuant to the 1987 ROD (discussed below); the 1987 ROD also documented earlier elements of the sewer cleanup.

From 1987 until 1989, Black and Bergholtz Creeks were dredged of approximately 14,000 cubic yards of sediments. Clean riprap was placed in the creek beds, and the banks were replanted with grass. This remedial action conformed with the 1985 ROD, requiring the removal of dioxin-contaminated sediments from the creeks and sewers.

In June 1987, EPA issued the Alternatives for Destruction/Disposal of Love Canal Creek and Sewer Sediments report which provided various alternatives for the ultimate disposal of the sediments, described below in more detail.

In 1987, EPA entered into the first of two cooperative agreements with LCARA to implement the mandates of Section 312 of SARA/CERCLA. This first agreement dealt with EDA property acquisition. Under EPA's and other acquisition programs, including FEMA's, LCARA purchased over 600 properties in the EDA.

In October 1987, EPA issued a second ROD selecting a remedy to address the destruction and disposal of the dioxin-contaminated sediments from the sewers and creeks. The ROD called for:

• construction of an on-site facility to dewater the sewer and creek sediments and to contain the dewatered sediments;

• construction of a separate on-site facility to treat the dewatered sediments through high temperature thermal destruction;

• on-site thermal treatment of the residuals stored at the Site from the leachate treatment facility and other associated Love Canal waste materials; and,

• on-site disposal of any nonhazardous residuals from the thermal treatment or incineration process.

From 1987 until 1988, the LCHS sampling and evaluation were performed to evaluate air and soil contamination in the EDA and other comparison neighborhoods, using specific habitability criteria, as discussed above. Volume I—Final Report of the LCHS, Introduction and Decision-Making Documentation was issued in May 1988. The subsequent four volumes of data documentation were issued later. Volumes II and III presented the results of the assessment for the Love Canal indicator chemicals for air and soil. Volume IV presented the assessment of the dioxin soil assessment. Volume V summarizes the subsequent peer review of Volumes II-IV and the response to that peer review.

In September 1988, using the results of the LCHS, the New York State Commissioner of Health issued a Decision on Habitability, which identified appropriate land uses for the seven designated areas of the EDA. Areas 1-3 were declared not suitable for residential use, i.e., uninhabitable, but were suitable for commercial/industrial use. Areas 4-7 were deemed habitable, i.e., suitable for residential use.

In March 1988, EPA issued the 93rd St. School Remedial Investigation and Feasibility Study which evaluated the nature and extent of contamination at the 93rd St. School and provided alternatives for the remediation of the contamination.

In September 1988, EPA issued a third ROD which selected a remedy for contaminated soils at the 93rd Street School. The selected remedy included the following actions:

• excavation of approximately 7,500 cubic yards of contaminated soil adjacent to the school;

• on-site solidification and stabilization of the contaminated soils; and,

• return of the stabilized soils to the excavated area.

Prior to 1989, EPA, through its cooperative agreement with NYSDEC, provided funds for the maintenance of the abandoned properties in the EDA. Subsequently, in 1989, NYSDEC passed the responsibility for home maintenance to LCARA. At this time, EPA then entered into a second cooperative agreement with LCARA to implement the maintenance and technical assistance (MATA) mandates of Section 312 of CERCLA. Under this MATA agreement, EPA provided LCARA with funding to maintain improved and unimproved properties in the EDA and also to demolish EDA homes that had deteriorated to the extent that they presented safety concerns or a net loss to the overall value of the property. Over 250 homes were demolished under the MATA program.

EPA's technical assistance has supported LCARA's efforts to revitalize the EDA (EPA did not provide Federal funds for the actual repair or reconstruction of buildings within the EDA). LCARA sold approximately 260 homes in the EDA areas designated for residential use and prepared a master plan for the areas designated for commercial/industrial use.

In 1989, EPA issued an ESD to the 1985 and 1987 RODs, which specified that creek sediments were to be dewatered at creek side, placed in polyethylene bags and then transported to and stored at OCC's Resource Conservation and Recovery Act-permitted storage buildings at its Niagara Falls Main Plant, rather than at the Site, pending high temperature thermal destruction at OCC's Niagara Falls Main Plant. In addition, other Love Canal wastes, including the sewer sediments and other remedial wastes originally targeted for thermal treatment at the Site, were also to be thermally treated at OCC's Niagara Falls Main Plant rather than at the Site. OCC, the United States and the State of New York entered into an agreement, i.e., a partial consent decree, filed in U.S. District Court, to implement this modification to the 1985 and 1987 RODs.

In May 1991, EPA issued an amendment to the 1988 ROD for the 93rd Street School, which modified the selected remedy and called for excavation and off-site disposal of the contaminated soils, rather than disposal at the 93rd Street School site.

In September 1992, the contaminated soils at the 93rd Street School were excavated; these materials were used for alternate grading material for the 102nd Street Landfill Superfund site Remedial Action, i.e., subgrade material for the capping remedy.

In November 1996, EPA issued a second ESD for the 1987 ROD. This ESD authorized thermal treatment and/or land disposal of the stored Love Canal waste materials at an off-site commercial incinerator and landfill rather than at OCC's Niagara Falls Main Plant.

In February 1998, OCC began shipping the bagged Love Canal wastes from its storage facilities for disposal (thermal destruction or landfilling).

In December 1998, EPA issued a third ESD which provided notice that EPA granted a treatability variance to OCC to eliminate the requirement that the stored Love Canal waste materials containing dioxin at concentrations between 1 and 10 ppb be incinerated. As a result of this variance, these materials could be disposed at a commercial hazardous waste landfill without treatment.

In August 1999, this remedial action was completed and the remaining bags of wastes were shipped off-site for disposal. A total of 10,262 bags were land disposed in a Subtitle C facility and 5,234 bags were incinerated, with the resulting residues being landfilled at Subtitle C facilities.

LCARA completed its charge to revitalize the EDA and, in 2003, was subsequently dissolved by an act of the State legislature. At the present time, all residential and commercial properties in Areas 4-7 have been rehabilitated, sold by LCARA and restored to active use. LCARA rehabilitated and sold approximately 260 homes in the areas identified for residential use and prepared a master plan for the areas designated for commercial/industrial use. Certain parcels in EDA Areas 2-3 remain vacant, and these vacant properties are properly zoned and have deed restrictions which comply with the original Decision on Habitability, limiting use to commercial/industrial purposes only, unless remediated. These parcels were subsequently sold to real estate developers.

EPA, NYSDEC and the PRP used engineering consultants and contractors to perform the remedial design and/or construction for the Site. EPA and NYSDEC also performed oversight for activities conducted by the PRPs and their contractors, as well as EPA and NYSDEC contractors.

In 1982, EPA established a Public Information Office in downtown Niagara Falls to handle the Site, as well as other EPA Superfund sites in the Niagara Falls and Buffalo, New York area. All decisions made about the Site were conducted in a public forum, especially during the development of the LCHS, which included the monthly TRC meetings, as well as expert panel meetings, which were all open to the public. Residents of the EDA were informed of each meeting and were encouraged to attend. All associated minutes, reports and other documents generated during the more than 70 TRC meetings, as well as each expert panel meeting, et al., were made available to the public for review at the EPA offices in Niagara Falls. The final TRC meeting was held in 1991.

Institutional controls are in place in both the containment area of the Site and the EDA. New York State (NYS) has a permanent easement on the Site property, providing for the exclusive use and occupancy of the Site property. By Consent Decree, NYS granted OCC exclusive use and occupancy of the Site property for the purpose of providing continued O&M for the Site remedy. OCC retains exclusive use and occupancy, as long as the Consent Decree is in effect. The institutional controls on the vacant parcels in the non-habitable sections of the EDA (Areas 1-3) are maintained by zoning and deed restrictions. The deeds for these properties require that NYSDEC be notified both when these properties are sold and when these properties are being considered for any other use than commercial and/or light industrial. The deeds also state that all identified use limitations and restrictions of the property shall run with the land and bind the current owner and any successors in perpetuity or until such time as NYSDEC shall determine that such institutional controls are no longer necessary for the protection of public health and the environment. The deed also identifies that some soil remediation is required prior to any potential residential use.

Under the direction of NYSDEC, OCC, through its contractor Miller Springs Remediation Management, performs O&M of the Site remedy and maintains day-to-day operations at the Site, as identified in two separate consent decrees with NYS and the United States, respectively. The continued effectiveness of the remedy is monitored, pursuant to both consent decrees, as well as through the performance of EPA's five-year reviews.

A five-year review of Site remedies was completed on September 30, 2003. The five-year review ensures that the implemented remedies protect human health and the environment and that they function as intended by the decision documents.

EPA, in consultation with the State of New York, through the NYSDEC, has determined that all appropriate response actions, under CERCLA, have been implemented at the Site and no further response actions, other than monitoring, operation, maintenance and compliance with institutional controls, are necessary.

Hazardous substances remain at the Site above levels that would be allowed for unlimited use without restrictions. It is the policy of EPA to conduct five-year reviews of pre-SARA remedies which leave hazardous substances on-site. EPA completed a five-year review of this Site on September 30, 2003. The next five-year review should be completed by EPA and/or NYSDEC before September 30, 2008.

This is a summary of the Commission's Notice of Proposed Rule Making , ET Docket No. 03-104 and ET Docket No. 04-37, FCC 04-29, adopted February 12, 2004, and released February 23, 2004. The full text of this document is available for inspection and copying during normal business hours in the FCC Reference Center (Room CY-A257), 445 12th Street, SW., Washington, DC 20554. The complete text of this document also may be purchased from the Commission's copy contractor, Qualex International, 445 12th Street, SW., Room, CY-B402, Washington, DC 20554. The full text may also be downloaded at: www.fcc.gov . Alternate formats are available to persons with disabilities by contacting Brian Millin at (202) 418-7426 or TTY (202) 418-7365.

Pursuant to §§ 1.415 and 1.419 of the Commission's rules, 47 CFR 1.415, 1.419, interested parties may file comments on or before May 3, 2004, and reply comments on or before June 1, 2004. Comments may be filed using the Commission's Electronic Comment Filing System (ECFS) or by filing paper copies. See Electronic Filing of Documents in Rulemaking Proceedings, 63 FR 24121, May 1, 1998. Comments filed through the ECFS can be sent as an electronic file via the Internet to http://www.fcc.gov/e-file/ecfs.html . Generally, only one copy of an electronic submission must be filed. If multiple docket or rulemaking numbers appear in the caption of this proceeding, however, commenters must transmit one electronic copy of the comments to each docket or rulemaking number referenced in the caption. In completing the transmittal screen, commenters should include their full name, U.S. Postal Service mailing address, and the applicable docket or rulemaking number. Parties may also submit an electronic comment by Internet e-mail. To get filing instructions for e-mail comments, commenters should send an e-mail to ecfs@fcc.gov , and should include the following words in the body of the message, “get form <your e-mail address>.” A sample form and directions will be sent in reply. Parties who choose to file by paper must file an original and four copies of each filing. If more than one docket or rulemaking number appears in the caption of this proceeding, commenters must submit two additional copies for each additional docket or rulemaking number.

All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission. Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail (although we continue to experience delays in receiving U.S. Postal Service mail). The Commission's contractor, Natek, Inc., will receive hand-delivered or messenger-delivered paper filings for the Commission's Secretary at 236 Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes must be disposed of before entering the building. Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743. U.S. Postal Service first-class mail, Express mail, and Priority Mail should be addressed to 445 12th Street, SW., Washington, DC 20554.

1. The Notice of Proposed Rulemaking (“NPRM”) proposes to amend part 15 of the Commission's rules to adopt new requirements and measurement guidelines for a new type of carrier current system that provides access to broadband services using electric utility companies' power lines. Because power lines reach virtually every home and community in the country, we believe that these new systems, known as Access broadband over power line or Access BPL, could play an important role in providing additional competition in the offering of broadband services to the American home and consumers, and in bringing Internet and high-speed broadband access to rural and underserved areas. At the same time, we are cognizant that the possibility of widespread operation of Access BPL raises interference concerns and that we must protect licensed radio services from any harmful interference that might occur. In this regard, we are proposing to require that BPL systems and devices incorporate capabilities to mitigate harmful interference should it occur. We are also proposing to adopt administrative requirements to aid in the identification and resolution of harmful interference from Access BPL systems. Finally, we are proposing to clarify certain measurement guidelines for all types of carrier current systems that use electric wiring and electrical outlets within homes and buildings to transfer information between computers and other electronic devices. With these proposals, we take an important step towards promoting the deployment of new broadband networks that are expected to enhance the economic, educational and social well-being of all Americans. Specifically, we believe that the proposed changes will remove regulatory uncertainties and facilitate the introduction and use of this promising new technology.

2. Traditionally, various low-power, unlicensed devices or systems have used the alternating current (AC) power lines to carry information by coupling radio frequency (RF) energy to the AC electrical wiring. These unlicensed devices include AM radio systems on school campuses and devices intended for the home, such as intercom systems and remote controls for electrical appliances and lamps. Until recently, carrier current devices have operated generally on frequencies below 2 MHz with relatively limited communications capabilities. Because of the inherent impedance and attenuation variations of power lines and noise from devices such as dimmer switches, motorized electrical appliances, and computers switching on and off, reliable high-speed communications over power lines have been difficult to achieve. However, the availability of faster digital processing capabilities and the development of sophisticated modulation schemes have produced new designs that can overcome these technical obstacles. These new designs have led to the development of new BPL systems that use spread spectrum or multiple carrier techniques and that incorporate adaptive algorithms to counter the noise in the line.

3. The new low-power, unlicensed BPL systems couple RF energy onto the existing electric power lines to provide high-speed communications capabilities. BPL systems may operate either inside a building (“In-House BPL”) or over utility poles and medium voltage electric power lines (“Access BPL”). In-House BPL systems use the electrical outlets available within a building to transfer information between computers and between other home electronic devices, eliminating the need to install new wires between devices. Using this technology, consumers can readily implement home networks. Access BPL systems can be used to provide high speed Internet and other broadband services to homes and businesses. In addition, electric utility companies can use Access BPL systems to monitor, and thereby more effectively manage their electric power distribution operations. Given that Access BPL capability can be made available in conjunction with the delivery of electric power, it may provide an effective means for “last-mile” delivery of broadband services and may offer a competitive alternative to digital subscriber line (DSL), cable modem services and other high-speed Internet technologies.

4. Most Access BPL systems today operate on frequencies up to 50 MHz with very low power signals spread over a broad range of frequencies. These frequencies are also used by licensed radio services that must be protected from harmful interference as BPL systems operate on an unlicensed basis under part 15 of the Commission's rules. In the radio spectrum below 50 MHz, incumbent authorized operations include fixed, land mobile, aeronautical mobile, maritime mobile, radiolocation, broadcast radio, amateur radio terrestrial and satellite, and radio-astronomy. Users of this spectrum also include, for example, public safety and Federal government agencies.

5. Carrier current devices, including BPL equipment, are subject to the Commission's existing part 15 rules for low-power, unlicensed equipment that operates on a non-interference basis. At the present time, the part 15 rules provide specific radiated and conducted emission limits for carrier current systems operating below 30 MHz. The radiated emission limits apply from 9 kHz and vary with frequency. There is no limit on conducted emissions for carrier current systems that contain their fundamental emission within the standard AM broadcast band of 535 to 1705 kHz and are intended to be received using standard AM broadcast receivers. All other carrier current systems operating below 30 MHz are subject to a conducted emission limit only within the AM broadcast band. Carrier current devices that do not operate at frequencies below 30 MHz are subject to the general conducted limits below 30 MHz.

6. In April 2003, the Commission issued a Notice of Inquiry (Inquiry), 68 FR 28182, May 23, 2003, on BPL technologies and systems. The Inquiry was issued to solicit comments to assist the Commission in reviewing its part 15 rules to facilitate the deployment of Access BPL while ensuring that licensed services continue to be protected. In the Inquiry , the Commission encouraged continued deployment of Access BPL systems that comply with the existing rules.

7. In the Inquiry , the Commission asked for comments on the characteristics of BPL technology, the status of deployment of BPL and any standards work related to BPL. The Commission also asked for comments on the probable interference environment and propagation patterns of BPL and the mitigation techniques used by BPL to avoid interference. The Commission further asked whether it would be possible to develop a standardized measurement method for testing BPL, and if so, how to develop it. It requested input on whether there are any international standards that should be investigated for possible adoption in order to facilitate the development of BPL products for a global marketplace. In addition, the Commission sought comments on issues related to the authorization of BPL and the types of components of Access BPL that would be subject to equipment authorization. Finally, the Commission sought input on whether power line carrier systems currently deployed by the utility companies to control and monitor the electrical system would be replaced in the future with the new high speed BPL equipment and on any associated issues with the coexistence of the older control systems with the new BPL systems. (See paragraphs 9 through 29 of the NPRM for full discussion).

8. As indicated in the Notice of Inquiry and supported by the responsive comments, we believe that Access BPL offers the promise of a new method for delivery of broadband services to residential, institutional, and commercial users. Because power lines reach virtually every home, school, and business in the United States, Access BPL technology could play an important role in providing high-speed Internet and broadband services to rural and remote areas of the country. Thus, significant areas of the country still lack broadband access and many others lack competition for such services, and we believe that Access BPL could serve as a means to reach those areas. Since Access BPL uses the same power lines that carry electricity virtually everywhere, much of the infrastructure needed to operate this technology is already in place, so that major savings in deployment costs and capital may be realized in its deployment. Access BPL could also serve to provide new competition to existing broadband services, such as cable and DSL. In addition, Access BPL may allow electric utilities to improve the safety and efficiency of the electric power distribution system and also further our national homeland security by protecting this vital element of the U.S. critical infrastructure. Moreover, Access BPL is being developed worldwide, and encouraging the deployment of the technology in the United States will support globalization of products and services, promote continued U.S. leadership in broadband technology, and bring important benefits to the American public.

9. We recognize the significant concerns of existing radio users regarding the potential for harmful interference from Access BPL operations. After careful consideration, however, we believe that these interference concerns can be adequately addressed. We believe that Access BPL systems can operate successfully under the non-interference requirements of the part 15 rules. Under these rules, operators of Access BPL systems will be responsible for eliminating any harmful interference that may occur. Furthermore, we believe that the current part 15 emission limits for carrier current systems in conjunction with certain additional requirements specific to Access BPL operations will be adequate to ensure that existing radio operations are protected against harmful interference from such operations. We therefore are proposing changes to our part 15 rules that we believe will facilitate the deployment of Access BPL technology while protecting licensed users of the spectrum. Specifically, we are proposing to: (1) Define Access BPL for purposes of our rules; (2) maintain the existing part 15 emission limits for Access BPL; (3) require that Access BPL devices employ adaptive interference mitigation techniques; (4) require that Access BPL providers maintain a database of installation locations and technical information; and (5) adopt specific measurement guidelines for both Access BPL and other carrier current systems to ensure that measurements are made in a consistent manner and provide for repeatable results in determining compliance with our rules.

10. We propose to define Access BPL as a carrier current system operating on any electric power transmission lines owned, operated or controlled by an electrical power provider, as follows:

Access Broadband over power line (Access BPL): A carrier current system that transmits radio frequency energy by conduction over electric power lines owned, operated, or controlled by an electric service provider. The electric power lines may be aerial (overhead) or underground.

11. Existing spectrum users are concerned that emissions from Access BPL systems and devices could adversely affect their operations. BPL proponents, on the other hand, suggest that any impact from Access BPL would be minimal and some argue that emission levels higher than the current part 15 limits would be acceptable and allow more cost-effective system implementations. At this time, the Commission believe that we should proceed cautiously. We recognize that unlicensed operations in the HF band presents a number of unique challenges given the propagation characteristics of this range of frequencies and the diversity of licensed users. Accordingly, in order to better ensure protection of existing radio services, we are proposing to continue to apply the existing part 15 emission limits for carrier current systems to Access BPL systems. While we agree that there is some potential for Access BPL to cause harmful interference to radio services, we also tentatively conclude that the likelihood of such harmful interference is low under the current limits and that where such interference does occur, there are remedies that the Access BPL operator can employ to eliminate such interference. On balance, we believe that the benefits of Access BPL for bringing broadband services to the public are sufficiently important and significant as to outweigh the potential for increased harmful interference that may arise. Furthermore, we are proposing to subject Access BPL operations to the existing part 15 radiated emission limits for carrier current systems. In addition, we are proposing that Access BPL devices include technical capabilities and administrative procedures to ensure that the potential for harmful interference is minimized and that any instances of harmful interference are quickly resolved.

12. To ensure that any effect of the power line is taken into consideration when testing for compliance with our part 15 rules, we are proposing to modify the measurement procedures for Access BPL systems, as set forth in Appendix C of the NPRM, to specify that emission measurements be made at several specific distances from the Access BPL equipment source, and that measurements be taken parallel to the power line to find the maximum emissions from the BPL system. We seek comment on our proposed measurement guidelines.

13. With regard to potential interference to the non-amateur radio services, such as public safety, maritime and other operations, we believe that the risk of harmful interference from Access BPL operations is low. In general, we believe that a properly designed and operated BPL system will pose little interference hazard to non-amateur services such as aeronautical, maritime and public safety. However, we recognize in our analysis that public safety systems merit particular attention because of the often critical nature of their communications. In analyzing the potential for harmful interference to public safety systems we took into account the fact that low-level part 15 signals from Access BPL devices attenuate rapidly as the distance from the device increases; and that most public safety systems are designed so that mobile and portable units receive a signal level significantly above the noise floor. From an interference analysis standpoint, this latter characteristic distinguishes public safety systems from amateur radio stations using high-sensitivity receivers to receive signals from transmitters often thousands of miles away. However, it is foreseeable that under certain rare circumstances a public safety unit could: (a) operate in close proximity to an Access BPL device; (b) be tuned to a frequency radiated by the Access BPL device; and (c) be receiving a weak signal from a distant, or obstructed, public safety base station. In general, potential harmful interference under these conditions would be limited to public safety units operating on systems using low-band VHF channels (25-50 MHz). Therefore, it appears that the interference protections we propose herein—and the strict “no interference” restriction inherent in the part 15 rules—will be adequate to foreclose such rare instances of harmful interference to public safety systems. While we tentatively conclude that the measures proposed herein are adequate, we request comment on whether any additional measures are needed to protect particular operations, such as public safety. For example, should we require Access BPL system to coordinate with public safety agencies that use the HF band for state-wide public safety communications?

14. We are proposing to maintain the existing part 15 radiated emission limits for Access BPL systems and devices. In addition, we are proposing to exempt Access BPL systems from the existing conducted emission limits of § 15.107(c). Because Access BPL systems are installed on power lines that can carry 1,000 volts to 40,000 volts, conducted emission measurements are very difficult to measure, and present safety hazards in connecting test equipment to these lines. We do not believe that this exemption would have any impact on interference potential since Access BPL would still be required to comply with our radiated emissions rules. We seek comment on these proposals. We further seek comment on whether Access BPL would in some instances operate in the AM broadcast band (from 535 to 1705 kHz), and whether specific conducted requirements are needed in such situations.

15. To further address the interference concerns raised in the Inquiry, we are proposing certain additional technical and administrative requirements for Access BPL. First, we are proposing to require that Access BPL systems and devices incorporate capabilities that would allow the operator to modify system performance to mitigate or avoid harmful interference to radio services. Such adaptive interference mitigation techniques would include, for example, the capability to reduce power levels on a dynamic or remote controlled basis, and the ability to include or exclude specific operating frequencies or bands. This capability would allow operators to avoid localized and site-specific harmful interference.

16. We believe that this requirement is reasonable and practicable for Access BPL operators and equipment manufacturers to implement. We observe that a number of Access BPL devices currently employ OFDM modulation techniques, which facilitate the ability to dynamically select the specific frequencies used to provide service and to avoid use of specific frequencies where operation might result in harmful interference. In this regard, we note that PowerWAN states that “notching” of specific frequency is technically feasible. Ambient indicates that its equipment will be able to notch out individual frequencies “on the fly,” in response to short term changes in the RF environment. Main.Net states that it already has the capability to remotely control the operating frequencies and power of their installations.

17. Second, we propose to require that Access BPL devices incorporate a shut-down feature that would deactivate units found to cause harmful interference, and thereby allow speedy implementation of interference mitigation measures. It is our understanding that most Access BPL devices already possess this capability. We seek comment on these proposals and invite suggestions for alternative approaches. In particular, we request comment on whether we should have specific requirements regarding the above mitigation approaches. For example, should we require that each Access BPL device be capable of operating across a minimum range frequencies and have the capability to remotely exclude a specific percentage of frequencies within this range. We also seek comment on the cost and effectiveness of these or alternative approaches. To the extent possible, we encourage potential BPL providers and BPL equipment manufacturers to work with amateurs and other existing licensed services to develop such appropriate mitigation requirements. We seek comment on the appropriate period of time that we should allow for BPL systems to come into compliance with any new requirements that we may adopt pursuant to this rule making proceeding. We further seek comment on whether Access BPL systems currently deployed should be required to be brought into compliance with the new rules, and if so, what period of time should be afforded for them to come into compliance.

18. Finally, we propose to subject Access BPL systems to a notification requirement similar to the notification requirements in our rules for power line carrier (PLC) systems. Under this requirement, an Access BPL system operator would submit information on its system to an industry-operated entity. The objective of the proposed notification would be to establish a publicly accessible database for Access BPL information to ensure that the location of Access BPL systems and their operating characteristics are identified if harmful interference occurs and to facilitate interference mitigation and avoidance measures. We propose that this notification includes information on the location of the installation, the type of modulation used and the frequency bands of operation. We seek input on these proposals. We also request comment and suggestions on the appropriate industry-operated entity that we should select to receive the notifications and maintain the Access BPL data base. We also seek comment on other approaches for making this information available. For example, would it more reasonable to allow each Access BPL operator to maintain a database of its own rather than require a more centralized data base? Commenting parties are requested to submit information on the benefits of such approaches. We further seek input on any resulting burdens that the proposed notification requirement may place on entities operating Access BPL systems, and any impact of a notification system on the availability of customer data as well as how any concerns regarding the proprietary nature of that data can be addressed.

19. Equipment Authorization. We propose to retain the Verification procedure for Access BPL. Consistent with the objective that our regulatory requirements keep pace with technology development, we recognize that we must balance administrative burdens and the need to ensure compliance with our rules. We agree with commenting parties such as Phonex Broadband Corporation (Phonex) and UPLC that the authorization procedure for BPL should be the same as for all unintentional radiators, including traditional types of carrier current systems. Low-speed carrier current systems, which for a number of years have been operating inside buildings, have rarely been a source of harmful interference to radio communications, and the use of the verification procedure has been adequate to ensure that such systems comply with the rules. We seek comment on this proposal.

20. Access BPL Measurement Guidelines. Because Access BPL is a new implementation of carrier current techniques, there are no existing measurement guidelines for this type of equipment. We tentatively propose that Access BPL systems, including all BPL electronic devices, e.g. , couplers, injectors, extractors, repeaters, boosters, concentrators installed on the electric utility overhead or underground medium voltage lines etc., be measured in-situ to demonstrate compliance with our part 15 rules, at a minimum of three overhead and three underground representative locations, using the measurement guidelines in Appendix C of the NPRM. Consistent with existing FCC measurement procedures, measurements below 30 MHz must be performed with a magnetic loop antenna, while those above 30 MHz are performed using an electric field sensing antenna. For Access BPL in underground installations, the proposed guidelines employ the common principle of measuring radiated fields along a number of radials at a specified distance from the periphery of the pad-mounted above-ground transformer where the Access BPL equipment is located, to find the maximum emissions. For Access BPL installed on overhead lines, in order to take into account the effect of the long power line associated with the Access BPL equipment, our proposed guidelines specify measurements at fixed horizontal distances from the power line where the Access BPL source is installed. Thus, rather than finding the maximum emissions across a number of radials,—as currently performed for other part 15 emitters—the receive antenna is moved down-line, parallel to the power line, starting from the Access BPL equipment location, to find the maximum emissions. Down-line distances used in this sequence of measurements are specified in terms of wavelength of the Access BPL mid-band frequency. We seek comment on these guidelines.

21. In addition, we specifically solicit comments on the height of receive antennas used for radiated emissions measurements for Access BPL systems operating on overhead power lines and on the possible use of correction factors to account for antenna height. The proposed guidelines in Appendix C of the NPRM recommend a fixed loop antenna height at 1 meter and scanning the height of electric field sensing antennas from 1 to 4 meters. While these recommendations correspond to standard practice for other types of devices (especially when measured on a test site), these heights may not capture the maximum emissions from an overhead power line. In Appendix C of the NPRM, we address this issue by specifying that distance extrapolation for emission measurements on overhead lines be based on slant-range distance from the Access BPL location on the pole to the measuring antenna, rather than on horizontal distance.

22. However, this technique does not account for field strength reductions caused by ground effects. We seek comment on the following:

(a) Is it necessary to require that emission measurements be conducted at antenna heights greater than those proposed in Appendix C of the NPRM?

(b) Is it practical and safe to make in-situ emission measurements at antenna heights up to the height of an overhead medium voltage power line (typically 11 meters) when operating 10 meters from the power line? As an alternative to requiring higher antenna heights, should we specify that measurements that are performed at heights significantly lower than the power line be subjected to a correction factor to estimate the maximum field strength that would have been observed at a higher measurement height? How should such a correction factor be determined?

23. Measurement Guidelines for Other Carrier Current Systems. In the Inquiry, the Commission observed that the International Electrotechnical Commission (IEC), International Special Committee on Radio Interference (CISPR) Subcommittee I on Interference Relating To Multimedia Equipment, Working Group 3 on Emission from Information Technology Equipment is developing conducted emission limits for new BPL technologies. We note however that this international work on a standardized measurement method for In-House BPL is still under way, including work on the definition of a line impedance stabilization network (LISN), associated injection methods, and conducted emission limits for systems using the power line port as a communication port. We tentatively propose in the interim, pending the completion of such work, to retain the three-installation radiated emissions method for In-House BPL and traditional CCS, using the measurement guidelines in Appendix C of the NPRM, which clarify principles used regarding in-situ test buildings, device installation location within a building, measurement distances from the building, measurement of emissions from overhead power feed lines to the building, and device operation. We seek comment on the measurement guidelines of Appendix C of the NPRM, for In-House BPL and CCS.

24. In conclusion, we believe that Access BPL has the potential to offer a number of significant benefits, such as (1) increasing the availability of broadband services to homes and businesses; (2) improving the competitiveness of the broadband services market; (3) improving the quality and reliability of electric power delivery; and, (4) advancing homeland security. We believe that our proposals contained herein to adopt new part 15 technical and administrative rules for Access BPL will help promote and foster the development of this new technology with its concomitant benefits while at the same time ensuring that existing licensed operations are protected from harmful interference. We further believe that our proposed measurement guidelines for Access BPL and CCS will ensure that emission measurements for determining the compliance of these systems with FCC requirements are made in a consistent manner, and with repeatable results. We request comments on these conclusions and on all aspects of the proposals herein.

25. As required by the Regulatory Flexibility Act of 1980 as amended, 1 the Commission has prepared this present Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on small entities by the policies and rules proposed in this Notice of Proposed Rulemaking (“NPRM”). Written public comments are requested on this IRFA. Comments must be identified as responses to the IRFA and must be filed by the deadlines for comments provided in paragraph 53 of the NPRM. The Commission will send a copy of this NPRM, including the IRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA). 2 In addition, the NPRM and IFRA (or summaries thereof) will be published in the Federal Register . 3

26. A number of parties are currently operating Access BPL under our part 15 rules. Access BPL systems are new types of carrier current system that operate on an unlicensed basis under part 15. Access BPL systems use existing electrical power lines as a transmission medium to provide high-speed communications capabilities by coupling RF energy onto the power line. Because power lines reach virtually every community in the country, we believe that Access BPL could play an important role in providing additional competition in the offering of broadband infrastructure to the American home and consumers. In addition, BPL could bring Internet and high-speed broadband access to rural and underserved areas, which often are difficult to serve due to the high costs associated with upgrading existing infrastructure and interconnecting communication nodes with new technologies. We propose to amend part 15 of our rules to adopt new requirements and measurement guidelines for Access broadband over power line (BPL). Specifically, we propose new part 15 requirements for Access BPL to promote its growth while continuing to protect licensed spectrum users. We further propose to adopt new measurement guidelines for Access BPL, both in aerial (overhead) and underground configurations. For In-House BPL and traditional CCS, we propose to clarify the measurement guidelines to ensure that measurements are made in a consistent manner and provide for repeatable results in determining compliance with our rules. These actions will remove regulatory uncertainties, promote the deployment of BPL to bring the necessary competition in the provisioning of broadband applications to the American public as well as new high speed broadband access to underserved areas of the country, while ensuring that licensed users continue to be protected from harmful interference.

27. This action is taken pursuant to sections 1, 4, 301, 302(a), 303, 307, 309, 316, 332, 334, and 336 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154, 301, 302(a), 303, 307, 309, 316, 332, 334, and 336.

28. 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 proposed rules, if adopted. 4 The RFA defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small business concern” under Section 3 of the Small Business Act. 5 Under the Small Business Act, a “small business concern” is one that: (1) Is independently owned and operated; (2) is not dominant in its field of operations; and (3) meets may additional criteria established by the Small Business Administration (SBA). 6

29. A small organization is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.”  7 Nationwide, as of 1992, there were approximately 275,801 small organizations. 8 The term “small governmental jurisdiction” is defined as “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.”  9 As of 1997, there were approximately 87,453 governmental jurisdictions in the United States. 10 This number includes 39,044 counties, municipal governments, and townships, of which 27,546 have populations of fewer than 50,000 and 11,498 counties, municipal governments, and townships have populations of 50,000 or more. Thus, we estimate that the number of small governmental jurisdictions is approximately 75,955 or fewer.

30. The proposed rules pertain to manufacturers of unlicensed communications devices. The appropriate small business size standard is that which the SBA has established for radio and television broadcasting and wireless communications equipment manufacturing. This category encompasses entities that primarily manufacture radio, television, and wireless communications equipment. 11 Under this standard, firms are considered small if they have 750 or fewer employees. 12 Census Bureau data for 1997 indicate that, for that year, there were a total of 1,215 establishments  13 in this category. 14 Of those, there were 1,150 that had employment under 500, and an additional 37 that had employment of 500 to 999. The percentage of wireless equipment manufacturers in this category is approximately 61.35%, 15 so the Commission estimates that the number of wireless equipment manufacturers with employment under 500 was actually closer to 706, with and additional 23 establishments having employment of between 500 and 999. Given the above, the Commission estimates that the great majority of wireless communications equipment manufacturers are small businesses. We do not believe this action would have a negative impact on small entities that manufacture unlicensed BPL devices. Indeed, we believe the actions should benefit small entities because it should make available increased business opportunities to small entities. We request comment on these assessments.

31. Part 15 carrier current devices are already required to be authorized under the verification procedure as a prerequisite to marketing and importation. The reporting and recordkeeping requirements associated with the equipment authorization procedures would not be changed by the proposals contained in this Notice.

32. We propose to adopt new requirements for Access BPL to ensure protection of licensed spectrum users from harmful interference. These requirements include the proposed technical requirement for adaptive interference mitigation capabilities and the proposed notification of Access BPL systems in a database similar to the one required for existing Power Line Carrier systems. Although these proposals do somewhat increase the reporting and record keeping requirements for Access BPL systems, the benefit of ensuring protection to critical systems operated by law enforcement groups, government users and emergency operations outweighs this small cost that will permit the growth of Access BPL in the shared spectrum.

33. 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. 16

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket No. 04-34, adopted March 3, 2004, and released March 5, 2004. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC Reference Information Center (Room CY-A257), 445 12th Street, SW., Washington, DC. The complete text of this decision may also be purchased from the Commission's copy contractor, Qualex International, Portals, II, 445 12th Street, SW, Room CY-B402, Washington, DC 20054, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com.

Provisions of the Regulatory Flexibility Act of 1980 do not apply to this proceeding.

Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1204(b) for rules governing permissible ex parte contacts. For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR part 73 as follows:

Public Comments Solicited

We intend for any final action resulting from this reopened proposal to be as accurate and effective as possible. Therefore, we are soliciting comments or suggestions from the public, other concerned governmental agencies, the scientific community, industry, landowners, or any other interested party regarding the revisions to the proposed rule, the draft economic analysis, and the draft environmental assessment. In addition, we are requesting any further comments regarding our August 21, 2002, proposed rule (67 FR 54261), pertaining to the designation of critical habitat in the remainder of the Topeka shiner's range, which includes portions of Iowa, Kansas (not including Fort Riley), Minnesota, Nebraska, and South Dakota. We particularly seek comments concerning:

(1) The reasons why any habitat should or should not be determined to be critical habitat as provided by section 4 of the Act, including whether the benefits of designation will outweigh any threats to the species resulting from designation;

(2) Specific information on the amount and distribution of Topeka shiner and its habitat, and which habitat is essential to the conservation of this species and why;

(3) Land use designations and current or planned activities in the subject areas and their possible impacts on proposed critical habitat;

(4) Any foreseeable economic or other impacts resulting from the proposed designation of critical habitat, in particular, any impacts on small entities or families;

(5) Whether our approach to critical habitat designation could be improved or modified in any way to provide for greater public participation and understanding, or to assist us in accommodating public concern and comments;

(6) Whether the economic analysis identifies all State and local costs. If not, what other costs are overlooked;

(7) Whether the economic analysis makes appropriate assumptions regarding current practices and likely regulatory changes imposed as a result of the designation of critical habitat;

(8) Whether the economic analysis appropriately identifies land and water use regulatory controls that will likely result from the designation;

(9) Whether the economic analysis appropriately identifies all costs that could result from the designation;

(10) Whether the economic analysis correctly assesses the effect on regional costs associated with land use controls that derive from the designation;

(11) Whether the designation will result in disproportionate economic impacts to specific areas that should be evaluated for possible exclusion from the final designation;

(12) The economic analysis should identify all costs related to the designation of critical habitat for the Topeka shiner which was intended to take place at the time the species was listed. As a result, the assumption is the economic analysis should be consistent with the Service's listing regulations. Does this analysis achieve that consistency?

(13) Whether our characterization of existing regulatory protections in the listing document is consistent with the costs of the regulation imposed as a result of this critical habitat determination.

All previous comments and information submitted during the initial comment period need not be resubmitted. Refer to the ADDRESSES section for information on how to submit written comments and information. Please submit electronic comments in an ASCII file format and avoid the use of special characters and encryption. Please also include “Attn: RIN 1018-AI20” and your name and return address in your e-mail message. If you do not receive a confirmation from the system that we have received your e-mail message, please contact us directly at our Kansas Ecological Services Field Office (see ADDRESSES section and FOR FURTHER INFORMATION CONTACT ).

Our practice is to make comments that we receive on this rulemaking, including names and home addresses of respondents, available for public review during regular business hours. Individual respondents may request that we withhold their home address from the rulemaking record, which we will honor to the extent allowable by law. In some circumstances, we would withhold from the rulemaking record a respondent's identity, as allowable by law. If you wish for us to withhold your name and/or address, you must state this request prominently at the beginning of your comment. However, we will not consider anonymous comments. We will make all submissions from organizations or businesses, including the individuals identifying themselves as representatives or officials of organizations or businesses, available for public inspection in their entirety.

In 30 years of implementing the Act, the Service has found that the designation of statutory critical habitat provides little additional protection to most listed species, while consuming significant amounts of available conservation resources. The Service's present system for designating critical habitat has evolved since its original statutory prescription into a process that provides little real conservation benefit, is driven by litigation and the courts rather than biology, limits our ability to fully evaluate the science involved, consumes enormous agency resources, and imposes huge social and economic costs. The Service believes that additional agency discretion would allow our focus to return to those actions that provide the greatest benefit to the species most in need of protection.

While attention to and protection of habitat is paramount to successful conservation actions, we have consistently found that, in most circumstances, the designation of critical habitat is of little additional value for most listed species, yet it consumes large amounts of conservation resources. Sidle (1987) stated, “Because the Act can protect species with and without critical habitat designation, critical habitat designation may be redundant to the other consultation requirements of section 7.” Currently, only 306 species or 25 percent of the 1,211 listed species in the U.S. under the jurisdiction of the Service have designated critical habitat. We address the habitat needs of all 1,211 listed species through conservation mechanisms such as listing, section 7 consultations, the section 4 recovery planning process, the section 9 protective prohibitions of unauthorized take, section 6 funding to the States, and the section 10 incidental take permit process. The Service believes that it is these measures that may make the difference between extinction and survival for many species.

We have been inundated with lawsuits for our failure to designate critical habitat, and we face a growing number of lawsuits challenging critical habitat determinations once they are made. These lawsuits have subjected the Service to an ever-increasing series of court orders and court-approved settlement agreements, compliance with which now consumes nearly the entire listing program budget. This leaves the Service with little ability to prioritize its activities to direct scarce listing resources to the listing program actions with the most biologically urgent species conservation needs.

The consequence of the critical habitat litigation activity is that limited listing funds are used to defend active lawsuits, to respond to Notices of Intent (NOIs) to sue relative to critical habitat, and to comply with the growing number of adverse court orders. As a result, listing petition responses, the Service's own proposals to list critically imperiled species, and final listing determinations on existing proposals are all significantly delayed.

The accelerated schedules of court ordered designations have left the Service with almost no ability to provide for adequate public participation or to ensure a defect-free rulemaking process before making decisions on listing and critical habitat proposals due to the risks associated with noncompliance with judicially-imposed deadlines. This in turn fosters a second round of litigation in which those who fear adverse impacts from critical habitat designations challenge those designations. The cycle of litigation appears endless, is very expensive, and in the final analysis provides relatively little additional protection to listed species.

The costs resulting from the designation include legal costs, the cost of preparation and publication of the designation, the analysis of the economic effects and the cost of requesting and responding to public comment, and in some cases the costs of compliance with NEPA all are part of the cost of critical habitat designation. None of these costs result in any benefit to the species that is not already afforded by the protections of the Act enumerated earlier, and they directly reduce the funds available for direct and tangible conservation actions.

The Topeka shiner is a small, stout minnow. It has a dorsal (back) side that is olive-green, a distinct dark stripe preceding the dorsal fin, and a dusky stripe running along the entire longitudinal length of the lateral line. The Topeka shiner is found in small-to mid-size prairie streams of the central prairie regions of the United States with relatively high water quality and cool to moderate temperatures. Many of these streams exhibit perennial flow, although some become intermittent during summer or periods of prolonged drought. The Topeka shiner's historic range includes portions of Iowa, Kansas, Minnesota, Missouri, Nebraska, and South Dakota. The species continues to exist in these States, but in most areas, its range is greatly reduced.

We published a final rule in the Federal Register on December 15, 1998, designating the Topeka shiner as an endangered species; we also determined that designation of critical habitat for the species was not prudent (63 FR 69008). In an April 4, 2001, court settlement of the case, Biodiversity Legal Foundation et al. v. Ralph Morgenweck et al. (C00-D-1180), we agreed to reconsider our prudency determination and, if prudent, to propose critical habitat for the shiner by August 13, 2002, and to finalize our designation of critical habitat by August 13, 2003. On August 21, 2002, we published a proposed rule in the Federal Register (67 FR 54261) for the designation of Topeka shiner critical habitat. The proposed designation included 3,766 kilometers (km) (2,340 miles (mi)) of stream in the States of Iowa, Kansas, Minnesota, Nebraska, and South Dakota as critical habitat. We also proposed not to include Topeka shiner habitat in the State of Missouri and on the Fort Riley Military Installation, Kansas, under the authority of section 3(5)(A) of the Act. Following publication of the proposed rule, we opened a 60-day public comment period. We also held one public meeting in each of the six affected States during September 2002. Due to budgetary constraints, we did not finalize the designation of critical habitat by August 13, 2003. We petitioned the court to extend this deadline until July 17, 2004, and, in an order dated February 10, 2004, the court granted us this extension.

In the August 2002 proposed rule for designation of critical habitat for the Topeka shiner, we indicated our intention not to include critical habitat in Missouri and on Ft. Riley, Kansas, in the critical habitat designation. This was based upon our interpretation of the definition of critical habitat found in section 3(5)(A) of the Act. Section 3(5)(A)(i) of the Act, as amended (16 U.S.C. 1531 et seq. ), defines critical habitat as areas on which are found those physical or biological features (I) essential to the conservation of the species and (II) which may require special management considerations or protection. In order to give meaning to the last clause of the definition, we have considered that if an area was already adequately managed, there would be no requirement for special management considerations or protection. A management plan is considered adequate when it meets the following three criteria: (1) The plan provides a conservation benefit to the species ( i.e. , the plan must maintain or provide for an increase in the species' population, or the enhancement or restoration of its habitat within the area covered by the plan); (2) the plan provides assurances that it will be implemented ( i.e. , those responsible for implementing the management plan are capable of accomplishing the objectives, have an implementation schedule, and/or adequate funding for the management plan); and (3) the plan provides assurances the management plan will be effective ( i.e. , it identifies biological goals, has provisions for reporting progress, and is of a duration sufficient to implement the plan and achieve the plan's goals and objectives).

Subsequent to publication of the proposed rule, two issues arose. The first issue is a January 2003 court ruling on a separate case not pertaining to the Topeka shiner ( Center for Biological Diversity v. Norton, Civ. No. 01-409 TUC DCB, D. Ariz., Jan. 13, 2003). In that ruling, a Federal District Court in Arizona disagreed with our application of the definition of critical habitat as it pertains to section 3(5)(A) of the Act. The court stated that “whether habitat does or does not require special management is not determinative on whether the habitat is ‘critical’ to a threatened or endangered species.” The court affirmed the Secretary's authority to exclude areas from critical habitat designation pursuant to section 4(b)(2) of the Act.

The second issue is that section 318 of the National Defense Authorization Act for Fiscal Year 2004 (Pub. L. 108-136, adopted November 24, 2003) amended the Endangered Species Act by adding new language to section 4(a)(3), which prohibits the Service from designating as critical habitat any lands or other geographical areas owned or controlled by the Department of Defense, or designated for its use, that are subject to an Integrated Natural Resources Management Plan (INRMP) prepared under section 101 of the Sikes Act (16 U.S.C. 670a), if the Secretary of the Interior determines in writing that such plan provides a benefit to the species for which critical habitat is proposed for designation. The Sikes Act Improvement Act of 1997 requires each military installation that includes land and water suitable for the conservation and management of natural resources to complete an INRMP. An INRMP integrates implementation of the military mission of the installation with stewardship of the natural resources found there. Each INRMP includes an assessment of the ecological needs on the installation, including needs to provide for the conservation of listed species; a statement of goals and priorities; a detailed description of management actions to be implemented to provide for these ecological needs; and a monitoring and adaptive management plan. The Service consults with the military on the development and implementation of INRMPs for installations with listed species.

Because of the court's decision and the amendment to the Act, we decided to clarify the basis for proposed exclusions to critical habitat for the Topeka shiner. In the following paragraphs we address our consideration of Fort Riley, Kansas under section 4(a)(3), followed by our clarification of the basis for our proposed exclusion of the State of Missouri. In addition, we are proposing to designate one additional stream segment in South Dakota as critical habitat, based on information received since the proposed rule was published in 2002.

We previously proposed not to include stream segments on the Fort Riley Military Installation, Kansas, in critical habitat, on the basis of our interpretation of section 3(5)(A) of the Act. Because of the court's decision and the amendment to the Act, we know clarify the basis for not proposing stream segments on Fort Riley. Section 4(a)(3) of the Act now allows the Secretary of the Department of the Interior to exempt defense sites from critical habitat designations if an adequate INRMP is in place. The law says the Secretary “shall not designate as critical habitat any lands or other geographical areas owned or controlled by the Department of Defense * * * that are subject to an integrated natural resources management plan * * * if the secretary determines in writing that such a plan provides a benefit to the species for which critical habitat is proposed for designation.”

We consider an INRMP adequate under section 4(a)(3) for military installations when it meets the same three criteria we consider under section 3(5)(A) of the Act: (1) The plan provides a conservation benefit to the species ( i.e. , the plan must maintain or provide for an increase in the species' population, or the enhancement or restoration of its habitat within the area covered by the plan); (2) the plan provides assurances that it will be implemented ( i.e. , those responsible for implementing the management plan are capable of accomplishing the objectives, have an implementation schedule, and/or adequate funding for the management plan); and (3) the plan provides assurances the management plan will be effective ( i.e. , it identifies biological goals, has provisions for reporting progress, and is of a duration sufficient to implement the plan and achieve the plan's goals and objectives).

The Topeka shiner has been a focal species for planning and conservation efforts on Fort Riley since the early 1990s, with numerous stream surveys occurring from this time to the present. Fort Riley initiated development of management guidelines for the species in 1994. The first Endangered Species Management Plan for Topeka Shiner on Fort Riley was formalized in 1997. This management plan was revised and incorporated into Fort Riley's INRMP 2001-2005, which was formalized July 30, 2001 (Keating, Ft. Riley Natural Resources Division, pers. comm. 2002). This management plan outlines and describes conservation goals; management prescriptions and actions; a monitoring plan; estimates of time, cost, and personnel needed; a checklist of tasks; and an annual report (Department of the Army 2001).

We evaluated the Fort Riley Endangered Species Management Plan for Topeka Shiner and the Fort's associated Topeka shiner conservation actions that have been completed, ongoing, or planned, against our three criteria used to determine whether the requirements of section 4(a)(3) are being satisfied. This management plan provides conservation benefits to the species; the plan provides assurances that conservation efforts will be implemented; and the plan and efforts of the Army will be effective since they include biological goals, restoration objectives, and monitoring consistent with the draft Recovery Plan.

The primary benefit of proposing critical habitat is to identify lands essential to the conservation of the species, which, if designated as critical habitat, would require consultation with the Service to ensure that activities would not adversely modify critical habitat. As previously discussed, Fort Riley has a completed final INRMP that provides for sufficient conservation management and protection for the Topeka shiner. Moreover, this INRMP has already undergone section 7 consultation with the Service prior to its final approval. Further, activities authorized, funded, or carried out by the military or Federal agencies in these areas that may affect the Topeka shiner will still require consultation under section 7 of the Act, based on the requirement that Federal agencies ensure that such activities not jeopardize the continued existence of listed species. This requirement applies even without critical habitat designation on these lands.

Based on the foregoing discussion, we believe that the requirements of section 4(a)(3) of the Act are satisfied in relation to Topeka shiner habitat on Fort Riley. We, therefore, do not include these stream segments in the proposed critical habitat for Topeka shiner.

We previously proposed not to include stream segments in the State of Missouri in proposed critical habitat, based on our interpretation of section 3(5)(A) of the Act. We determined that adequate special management or protection would be provided by a legally operative plan that addresses the maintenance and improvement of essential habitat elements and that provides for the long-term conservation of the species. We further determined that a plan is adequate when it meets the three criteria listed in a previous paragraph of this preamble.

In the proposed rule for designation of critical habitat for the Topeka shiner, we evaluated Missouri's State Action Plan for the Topeka Shiner (Action Plan) and associated Topeka shiner conservation actions that have been completed, ongoing, or planned in Missouri against the three criteria to determine whether lands require “special management considerations or protections.” The Action Plan clearly provides conservation benefits to the species; the Action Plan provides assurances that conservation efforts will be implemented because MDC has authority to implement the plan, has put in place the funding and staffing necessary to implement the Plan, and has completed or begun work on many significant elements of the Plan; and the Action Plan and efforts of MDC will be effective because they include biological goals, restoration objectives, and monitoring consistent with a Service preliminary draft Recovery Plan. We continue to believe that the Missouri Action Plan provides for special management of the Topeka shiner under the definition of critical habitat in section 3(5)(A) of the Act. However, as a consequence of the court's decision in Center for Biological Diversity v. Norton , we now propose the previously-excluded segments in Missouri, and also clarify the basis for proposing to exclude these areas from the critical habitat designation for Topeka shiner.

The 12 stream segments, representing 148 km (92 mi) of stream, described below, constitute our best assessment of areas in Missouri needed for the conservation of the Topeka shiner, based on the best scientific and commercial information available. These areas are: (1) Currently considered occupied by the Topeka shiner or provide critical links or corridors between occupied habitats and/or potentially occupied habitats; (2) provide all or some of the primary constituent elements essential to the conservation of the species as described in our proposed rule; and (3) may require special management considerations or protection. A more detailed description of the stream segments follows (see “Proposed Regulation Promulgation” section of this document for legal descriptions and maps of these stream segments).

1. Sugar Creek Complex (three stream segments), Daviess and Harrison Counties, Missouri. The stream segments proposed in this complex provide the primary constituent elements necessary for designation as critical habitat, including natural stream morphology and in-stream habitat. Stream habitat within this complex can be characterized as moderate in quality, with the watershed draining a mosaic of cropland and pastureland. This complex includes portions of the mainstem of Sugar Creek, Tombstone Creek, and an unnamed tributary to Sugar Creek. A downstream portion of Sugar Creek has been severely altered by channelization, and does not provide the primary constituent elements.

2. Moniteau Creek Complex (four stream segments), Cooper and Moniteau Counties, Missouri. Stream habitat within this complex can be characterized as moderate to good in quality, with the watershed draining a mosaic of cropland, woodlands, and pastureland. Riparian areas are mostly wooded and appear stable. This complex includes portions of Moniteau Creek, an unnamed tributary to Moniteau Creek, Smiley Creek, and Pisgah Creek.

3. Bonne Femme Creek Complex (five stream segments), Boone County, Missouri. The Bonne Femme Creek complex is comprised of four tributary streams, including Turkey Creek, Bass Creek, and two unnamed tributary streams to Bass Creek, as well as a portion of mainstem Bonne Femme Creek. Extensive watershed modification is occurring throughout this basin as the growth of Columbia, Missouri, rapidly spreads through this watershed from the north. There have been no documented collections of Topeka shiners from the streams of the Bonne Femme Creek watershed since 1997. However, it has yet to be determined if the species has been completely eliminated from the watershed or is still present in very reduced numbers. The stream segments in this complex provide the primary constituent elements, including natural stream morphology and in-stream habitat.

Section 4(b)(2) of the Act requires that we take into consideration the economic impact, the impact on national security, and any other relevant impact, of specifying any particular area as critical habitat. We may exclude areas from critical habitat designation if we determine that the benefits of such exclusion outweigh the benefits of including the areas within critical habitat, unless we determine, based on the best scientific and commercial data available, that the failure to designate such areas as critical habitat will result in the extinction of the species. For the areas of Missouri that were not included in the proposed designation pursuant to the definition of critical habitat, we believe that the benefits of excluding those areas from the final designation outweigh the benefits of including them. If we determine that the benefits of exclusion are greater than those of designation, critical habitat will be excluded from the final designation pursuant to section 4(b)(2).

For our evaluation of potential critical habitat sites in Missouri, we have conducted an analysis of the economic impacts and other relevant impacts of designating critical habitat. Economic factors include: (1) Costs to us and Federal action agencies from increased workload to conduct consultations under section 7 of the Act and technical assistance associated with critical habitat; (2) costs of modifying projects, activities, or land uses resulting from consultations involving critical habitat; (3) costs of delays from increased consultations involving critical habitat; (4) costs of reduced property values or income resulting from increased regulation of critical habitat designation; (5) potential offsetting economic benefits associated with critical habitat, including educational benefits.

Other relevant impacts include: (1) The willingness of landowners and land managers to work with natural resource agencies and participate in voluntary conservation activities that directly benefit the Topeka shiner and other threatened or endangered species, including such cooperative partnerships as Safe Harbor Agreements; (2) the implementation of various cooperative conservation measures agreed to through various State and local partnerships, such as those outlined in Missouri's State Action Plan or through similar collaborative efforts; (3) management or regulatory flexibility, such as the establishment of nonessential experimental populations under section 10(j) of the Act, to recover Topeka shiners through reintroductions; and (4) opportunities and interest of landowners to participate in various incentive and assistance programs offered by the Service and other Federal, State, and local agencies that restore habitats and improve water quality in watersheds containing Topeka shiners.

Benefits of designating critical habitat include: (1) Focusing conservation activities for listed species by identifying areas essential to conserve the species; (2) increasing awareness by the public and land management agencies of the importance of these areas for conservation of the species; and (3) assisting Federal, State, and local agencies in prioritizing landowner incentive programs, developing agreements with private landowners, and implementing other conservation and land management programs.

We are herein providing notice of availability of an analysis of the economic impacts of designating these areas as critical habitat, along with an opportunity for the public to formally comment on this analysis. This economic analysis along with the analysis of other relevant beneficial and detrimental impacts will serve as the basis of our analysis under section 4(b)(2), and our determination of any exclusions from critical habitat finalized in our future final rule. The final rule will contain our analysis of economic factors and other relevant impacts of designating critical habitat in Missouri, and our consideration of comments received during the public comment period. As a result, we may identify certain areas that will be excluded from the final critical habitat designation, and if so, the final critical habitat determination may exclude or reduce in extent the areas described in this proposal.

In Missouri, the Topeka shiner historically occurred in small, headwater streams in northern portions of the State, within the Missouri/Grand River Watershed. The Topeka shiner has been a focal species for planning and conservation efforts in the State since the mid-1990s. In 1995, the Missouri Department of Conservation (MDC) established a 5-member Topeka Shiner Working Group, and a 16-member Advisory Group to direct, implement, and facilitate Topeka shiner recovery actions in Missouri. In 1996, the MDC, with approval of the Conservation Commission of Missouri (Conservation Commission), listed the Topeka shiner as an endangered species under the State's Wildlife Code (Conservation Commission 2001).

In 1999, the Conservation Commission established the Private Lands Services Division within the MDC. Eighty-three MDC staff were redirected to private land conservation throughout the State, including a minimum of 16 Private Lands Services personnel with responsibility for the counties with Topeka shiner habitat. Duties of personnel within this division include the facilitation of conservation efforts on private property throughout Missouri for all federally listed species, including the Topeka shiner. Additionally, there are at least 86 fisheries, forestry, natural history, protection, and wildlife staff delivering services to private landowners as a routine aspect of their job within the Missouri/Grand River Watershed.

In January 1999, MDC adopted and approved an Action Plan for the Topeka shiner in Missouri (MDC 1999). The Action Plan identifies comprehensive conservation measures and programs necessary to achieve recovery of the Topeka shiner in Missouri. Implementation of recovery efforts for the Topeka shiner in Missouri, as outlined in this plan, is ongoing. The current status of tasks in the Action Plan is described in Table 1 below:

Assurances that the Action Plan will be implemented and conservation of the Topeka shiner will be achieved in Missouri is demonstrated by the following actions. Between January 1999 and December 31, 2003, at least $351,100 was spent on recovery actions for the Topeka shiner in Missouri, and that total is likely to increase to at least $600,000 within the next 10 years. Eighty percent ( i.e. , 12 of 15) of the priority 1 tasks ( i.e. , those actions deemed necessary to prevent extinction of the species) identified and outlined in the implementation schedule of a Service preliminary draft Recovery Plan have either been completed or are currently being implemented (this includes 20 percent of tasks that are 100 percent completed, 47 percent of tasks that are 50 percent or greater completed, and 33 percent of tasks that are 25 percent or less completed) by the MDC in cooperation with us, the Topeka Shiner Recovery Team, and other Federal, State, and private entities. The Private Land Services Division within MDC greatly facilitates the implementation of recovery actions on private property where the species currently exists or where the species may be reintroduced. The planned expansion of our Partners for Fish and Wildlife Program within Topeka shiner-occupied habitat will benefit an additional 10-15 landowners at an estimated cost of $100,000 within the next 5 years (Kelly Srigley Werner, Missouri Private Lands Coordinator, pers. comm.). MDC Fisheries and Natural History Division staffs have committed to help coordinate and implement Topeka shiner recovery efforts between the MDC and Federal, State, and private entities, and MDC's Topeka Shiner Recovery Coordinator. The MDC is actively participating in the Topeka Shiner Recovery Team. MDC's revisions to the Action Plan, scheduled for completion in 2004, will focus on incorporating any of the recovery actions outlined in a Service preliminary draft Recovery Plan that are currently not addressed. The scientific soundness of the MDC's Action Plan was further validated by us and the Recovery Team when the Action Plan's monitoring protocol and recommendations for reducing and eliminating threats to the Topeka shiner were incorporated, in part, into a Service preliminary draft Recovery Plan. In addition, the MDC, in implementing the Action Plan, has established cooperative working relationships with private landowners. These relationships have allowed for the implementation of conservation programs for the benefit of the Topeka shiner.

We provide the following preliminary 4(b)(2) analysis of the benefits of inclusion and the benefits of exclusion in assessing the potential exclusion of critical habitat in Missouri.

Federal actions that adversely affect critical habitat must undergo consultation under section 7 of the Act. Consultations on Federal actions involving critical habitat ensure that habitat needed for the survival and recovery of a species is not destroyed or adversely modified. However, if adequate protections are provided in another manner ( e.g., implementation of MDC's State Action Plan), there is no benefit due to designation of critical habitat.

Other possible benefits of critical habitat include educating the public regarding the conservation value of an area, focusing conservation activities on these essential areas, and assisting other parties in conservation and land management programs. In Missouri, the educational benefits that may be afforded by a critical habitat designation are already provided through implementation of the Action Plan.

The benefits of excluding Missouri from designated critical habitat would include: Maintenance of effective working partnerships to promote the conservation of the Topeka shiner and its habitat; establishment of new partnerships; providing benefits from the Action Plan to the Topeka shiner and its habitat which exceed those that would be provided by the designation of critical habitat; avoiding added administrative costs to the Service, Federal agencies, and applicants; and future regulatory flexibility for the Service and landowners by maintaining the ability to reintroduce the shiner to formerly occupied streams in Missouri by experimental populations under section 10(j) of the Act.

Recovery of listed species is often achieved through partnerships and voluntary actions. Through the Action Plan, the MDC has gained the cooperation of landowners and has been successful in developing voluntary conservation partnerships with these landowners. Cooperators, with the assistance of MDC, are implementing conservation measures for the Topeka shiner and its habitat in accordance with management objectives outlined in the Action Plan. These actions range from allowing access to private lands for surveys and site visits to rehabilitation of habitat and implementation of measures to control erosion and sedimentation. The partners have committed to conservation measures benefiting the Topeka shiner that are greater than the benefits of designating critical habitat. It is likely that many current and potential partners will not assume the cost and work associated with implementing voluntary management and protection if critical habitat is designated regardless of their desire to contribute to the conservation of the species. The MDC has advised us that the support of voluntary conservation actions of private landowners that benefit Topeka shiner recovery in the State could be withdrawn if critical habitat is designated.

In the draft Economic Analysis of Critical Habitat Designation for the Topeka Shiner, Industrial Economics, Inc. (2003) determined that two of the three proposed areas in Missouri (Bon Femme and Moniteau Creeks) would have significantly higher costs for consultation under section 7 of the Act than most areas proposed as Topeka shiner critical habitat. This is despite the fact that minimal project modifications requiring consultation under section 7 of the Act are projected for activities conducted within these two watersheds. Consequently, Industrial Economics, Inc. estimates that consultations conducted within these two watersheds would be administratively and economically burdensome to local communities (Jessica Sargent-Michaud, Industrial Economics, Inc., pers. comm.).

In summary, we view the continued implementation of the Action Plan and the cooperative conservation partnerships with landowners to be essential for the conservation of the Topeka shiner in Missouri. We believe that the benefits of including critical habitat in Missouri are small due to the successful implementation of conservation actions, as identified in the Action Plan, through multiple partnerships. We believe the benefits of excluding Missouri areas from critical habitat greatly exceed the limited benefits of including them. Furthermore, we believe that exclusion from critical habitat in this State will not result in the extinction of the Topeka shiner. In accordance with 4(b)(2) of the Act, we believe that the benefits of excluding critical habitat in Missouri outweigh the benefits of designating critical habitat, and are proposing to exclude areas in Missouri containing primary constituent elements from the critical habitat designation.

In making our final decision with regard to areas in Missouri containing primary constituent elements, we will consider several factors, including the benefits provided to the Topeka shiner from the Missouri Action Plan for the Topeka Shiner, as described in the August 2002 proposal. You may request a copy of the Action Plan by contacting the Field Supervisor, U.S. Fish and Wildlife Service, 101 Park DeVille Dr., Suite A, Columbia, MO 65203.

In our proposal to designate critical habitat for Topeka shiner published on August 21, 2002 (67 FR 54262), we proposed to designate 40 stream segments in South Dakota totaling 1,475 km (917 mi) of stream channel. In the Big Sioux River basin of South Dakota and Minnesota, we also proposed off-channel/side-channel pool habitat for designation. After the publication of the August 2002 proposal, we received information on additional Topeka shiner habitat in South Dakota. In examining this information, we concluded that habitat within Stray Horse Creek, Hamlin County, South Dakota, contains the necessary elements for proposal as critical habitat. We are proposing one additional 24-km (15-mi) long stream segment in South Dakota, based on information received since the proposed rule was published in 2002 (see “Proposed Regulation Promulgation” section of this document for legal description and map of this stream segment). Off-channel and side-channel habitat, as well as main-channel habitat, also is proposed for this additional stream.

1. Stray Horse Creek (one stream segment), Big Sioux River Watershed, Hamlin County, South Dakota. The stream reach proposed for designation runs upstream from the confluence with the Big Sioux River, including adjacent off-channel pool habitat.

We are giving consideration to exempting South Dakota from critical habitat designation under section 4(b)(2) of the Act. Since the listing of the Topeka shiner in 1998, additional surveys conducted for this species in South Dakota have located extensive occupied habitat that was unknown at the time of listing. These demonstrate that the entire historical range of the Topeka shiner continues to be occupied in South Dakota. Furthermore, these surveys have considerably increased the known number of occupied streams in South Dakota. South Dakota has also completed a State Management Plan for the Topeka shiner. We will continue to evaluate whether listing of areas in South Dakota as critical habitat will appreciably benefit the Topeka shiner beyond the protection already afforded the species under the Act and that afforded by the State Management Plan.

We are giving consideration to exempting Kansas from critical habitat designation under section 4(b)(2) of the Act. The Topeka shiner is a State-listed threatened species in Kansas under the Kansas Nongame and Endangered Species Conservation Act. The State has also designated its own critical habitat for the Topeka shiner. We will continue to evaluate whether listing of areas in Kansas as critical habitat will appreciably benefit the Topeka shiner beyond the protection already afforded the species under the Act and State laws and regulations.

The majority of stream segments containing primary constituent elements in Missouri and South Dakota are in private ownership and are primarily used for grazing and crop production. Additionally, a portion of the Charles Green State Wildlife Management Area, owned by the State of Missouri and managed by the MDC, is within the Bonne Femme Creek Complex of Missouri.

The draft economic analysis estimates the foreseeable economic impacts of the critical habitat designation on government agencies and private businesses and individuals. The Service will make its final decisions about exclusions based on economic impact, when it has obtained public comments on the economic analysis and produced an addendum to the economic analysis containing its final conclusions. The Service is interested in comments from the public on the draft economic analysis, on whether any of the areas identified in the economic analysis as having economic effects should be excluded for economic reasons, and whether those or any other areas should be excluded for other reasons.

The Act requires us to designate critical habitat on the basis of the best scientific and commercial information available, and to consider the economic and other relevant impacts of designating these areas as critical habitat. We may exclude areas from critical habitat upon a determination that the benefits of such exclusions outweigh the benefits of designating these areas as critical habitat. We cannot exclude areas from critical habitat when the exclusion will result in the extinction of the species. The draft economic analysis serves as the basis of our economic analysis under section 4(b)(2), and of any recommended exclusions made in this document for Missouri. Since the economic analysis supplement will not be completed until after we receive comments from the public on the draft economic analysis, we cannot identify final exclusions from critical habitat designation under section 4(b)(2) in this document. However, we have identified and recommended areas in Missouri that we believe, at this time, qualify for exclusion under section 4(b)(2). Upon completion of the economic analysis supplement, we will analyze the supplement, public comments on the draft economic analysis, and this proposal, and the benefits of designating areas as critical habitat in Missouri. At that time, we will make a final determination whether certain areas containing primary constituent elements should be excluded from the final critical habitat designation, provided these exclusions will not result in the extinction of the species. As a result, the final critical habitat determination may differ from the proposal.

The Act provides for one or more public hearings or meetings on critical habitat proposals, if requested. Previously, following the publication of the initial proposed rule on August 21, 2002 (67 FR 54261), we held six public meetings across the species' range concerning the designation of critical habitat for the Topeka shiner. Due to the reopening of the comment period, and the changes herein to the proposed designation of critical, we have scheduled an additional public meeting.

The public meeting will be held at Boonville High School, 1690 Ashley Rd., Boonville, Missouri, on April 13, 2004, from 7 p.m. to 9 p.m.

The primary author of this proposed rule is Vernon Tabor, Kansas Ecological Services Field Office (see ADDRESSES ).

The authority for this action is the Endangered Species Act of 1973, as amended (16 U.S.C. 1531 et seq. ).

For the reasons stated in the preamble, we propose to amend the proposed amendments to part 17, subchapter B of chapter I, title 50 of the Code of Federal Regulations, as published in the Federal Register of August 21, 2002, starting on page 54262, as follows: