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

Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501), the collections of information in this rule have been approved by the OMB under control number 0563-0053 through February 28, 2005.

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

It has been determined under section 1(a) of Executive Order 13132, Federalism, that this rule does not have sufficient implications to warrant consultation with the States. The provisions contained in this rule will not have a substantial direct effect on States, or on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

FCIC certifies that this regulation will not have a significant economic impact on a substantial number of small entities. Program requirements for the Federal crop insurance program are the same for all producers regardless of the size of their farming operation. For instance, all producers are required to submit an application and acreage report to establish their insurance guarantees and compute premium amounts, or notice of loss and production information to determine an indemnity payment in the event of an insured cause of crop loss. Whether a producer has 10 acres or 1000 acres, there is no difference in the kind of information collected. To ensure crop insurance is available to small entities, the Federal Crop Insurance Act authorizes FCIC to waive collection of administrative fees from limited resource farmers. FCIC believes this waiver helps to ensure small entities are given the same opportunities to manage their risks through the use of crop insurance. A Regulatory Flexibility Analysis has not been prepared since this regulation does not have an impact on small entities and therefore, this regulation is exempt from the provisions of the Regulatory Flexibility Act (5 U.S.C. 605).

This program is listed in the Catalog of Federal Domestic Assistance under No. 10.450.

This program is not subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. See the Notice related to 7 CFR part 3015, subpart V, published at 48 FR 29115, June 24, 1983.

This rule has been reviewed in accordance with Executive Order 12988 on civil justice reform. The provisions of this rule will not have a retroactive effect. The provisions of this rule will preempt State and local laws to the extent such State and local laws are inconsistent herewith. With respect to any direct action taken by FCIC under the terms of the crop insurance policy, the administrative appeal provisions published at 7 CFR part 11 and 7 CFR part 400, subpart J for the informal administrative review process of good farming practices, as applicable, must be exhausted before any action against FCIC for judicial review may be brought.

This action is not expected to have a significant impact on the quality of the human environment, health, and safety. Therefore, neither an Environmental Assessment nor an Environmental Impact Statement is needed.

On July 30, 2003, FCIC published a notice of proposed rulemaking in the Federal Register at 68 FR 44668-44672 to amend the Common Crop Insurance Regulations; Blueberry Crop Insurance Provisions, to convert the blueberry pilot program to a permanent program, effective for the 2005 and succeeding crop years for all states and counties with blueberry crop insurance.

Following publication of the proposed rule on July 30, 2003, the public was afforded 60 days to submit written comments and opinions. FCIC received 61 comments from reinsured companies, a trade organization, a producer, and FCIC Regional Offices. The comments received from the proposed rule are addressed in this final rule and FCIC's responses are as follows:

Comment: Two commenters asked about FCIC's plans for expansion of the blueberry program due to the change in status from a pilot to a permanent program. One commenter specifically noted that pilot program coverage is generally limited with respect to the areas where insurance is offered.

Response: Pilot programs are eligible for expansion when they are converted to a permanent program. FCIC expanded the blueberry program to additional states and counties for the 2004 crop year based on expansion requests and supporting data. FCIC will continue to review county expansion requests and such expansion may be approved if sufficient actuarial data exists.

Comment: One commenter expressed concern that the formula used to establish coverage under this plan allows and even stimulates cheating by farmers and will not be subject to close enough scrutiny to keep farmers honest. They further maintain the program design may allow insureds to cheat and that FCIC's saying there is a “guarantee” in farming is ridiculous.

Response: FCIC disagrees with the commenter. A producer's blueberry production guarantee is based on a producer's individual yields and is established in a manner consistent with other actual production history crop programs. While there is always opportunity to falsify production records, commit fraud, etc., the risk is no greater than with these other crop programs. The Risk Management Agency's (RMA) underwriting and loss adjustment standards are designed to mitigate waste, fraud, and abuse. Further, insurance providers are supposed to monitor their policies and report to RMA any suspected fraud, waste, or abuse. RMA's Compliance Division is also responsible for investigating waste, fraud, and abuse. When waste, fraud, or abuse is found, individuals are prosecuted to the maximum extent under the law.

Comment: One commenter recommended modifying a current Special Provisions statement that attaches to section 10(d) (previously section 10(c)(3)) of the Blueberry Crop Insurance Provisions. These provisions address the quality adjustment of mature blueberries, harvested or unharvested, that are damaged by an insurable cause of loss to the extent they can not be sold as fresh or processed blueberries. The Special Provisions statement specifies the percent of damage required before the value of blueberries is reduced through a formula. The commenter took exception with the percent of damage threshold currently shown on the Special Provisions for their area. They believe it is too low, and should be increased for the next crop year.

Response: The percent of damage threshold for mature damaged blueberries is contained in the Special Provisions rather than the Crop Provisions to address different blueberry types and variable marketability of damaged blueberries in different parts of the country. RMA's Regional Offices (RO) establish the threshold percentage for their region based on marketability and type of mature damaged blueberries. If data is available demonstrating the percentage threshold needs to be changed for a county or group of counties, the applicable RO has the authority to change it.

Comment: One commenter expressed concern with the adequacy of the definition “unsound blueberries.” They believe the determinations of undersized, immature, mechanically damaged blueberries, etc. may be left up solely to the buyer or processor. What may be unsound berries due to size at one processor may be acceptable at another processor. The definition does not establish a minimum standard by which all production is measured, such as U.S. No. 1 or U.S. No. 1 processing. Furthermore, they believe a change in the definition of “unsound blueberries” could also affect the definitions of “blueberry production” and “dry line.”

Response: FCIC agrees with the commenter and has removed the definitions “blueberry production,” “dry line,” “mechanical damage,” and “unsound blueberries.” FCIC has added the definitions of “damaged blueberries” and “mature blueberry production” and has incorporated part of the definition of “unsound blueberries” into the definition of “damaged blueberries.” The definitions of both “mature blueberry production” and “damaged blueberries” incorporates the United States Standards for Grades of Blueberries, U.S. No.1, or such other grading standards contained in the Special Provisions. This permits FCIC to distinguish between the handling of the blueberries appraised and harvested in section 10(c) from those appraised and harvested in section 10(d). The modification also makes it no longer necessary to define “dry-line.” The additional provisions provide uniform guidelines for determining quality adjustment.

Comment: One commenter took exception with defects listed in the definition of “unsound blueberries” that specifically include “undersized” and “mechanically damaged.” The commenter pointed out other perennial policies such as apples and plums do not insure against damage due solely to the fruit being undersized. They also questioned what criteria would be used in determining acceptable size when appraising the field. Furthermore, they noted no other policy provisions cover man-made damage due to a cause such as mechanical damage. The stated intent of the Federal Crop Insurance Act is to compensate producers for natural disasters.

Response: FCIC agrees with the commenter and has removed the definitions “unsound blueberries” and “mechanical damage”, and removed the related definition “blueberry production.” FCIC has also addressed the commenter's concerns by adding definitions of “damaged blueberries” and “mature blueberry production.” As stated above, the definitions incorporate the United States Standards for Grades of Blueberries, U.S. No. 1, or other appropriate grading standards used in determining blueberry production. Further, the definition of “damaged blueberries” makes it clear that such damage must be due to an insurable cause of loss.

Comment: One commenter suggested RMA define the terms “marketable” and “damage.”

Response: FCIC agrees with the commenter and has addressed the commenter's concern by adding new definitions for “damaged blueberries.” However, FCIC has removed the term “marketable” from the policy and replaced it with the term “mature” and has defined that term. As stated above, this was necessary to distinguish between the treatment of blueberries appraised and harvested under section 10(c) from those damaged blueberries appraised and harvested under section 10(d).

Comment: One commenter asked for clarification that section 3(d) meant one coverage level per county when, for example, a producer has blueberry insurance in two counties.

Response: The Basic Provisions make it clear that coverage levels are selected on a county basis and that different coverage levels can be selected for different counties.

Comment: Two commenters recommended that section 3(d), which requires the producer or agent to provide notification when it is evident a cause of loss that could or would reduce the yield of the insured crop is known prior to the request to increase coverage, be removed from these Crop Provisions until this issue is addressed in the Basic Provisions, because of the applicability to all crops.

Response: FCIC agrees with the commenter. If FCIC is to adopt this change, the most appropriate place would be the Basic Provisions, because it would apply to all crops.

Comment: Two commenters recommended the burden in section 3(d) be on FCIC, not on the producer, agent, or company as to when a cause of loss that could or would reduce the yield of the insured crop is evident prior to the time the increase is requested.

Response: As stated above, FCIC has decided not to adopt this change in this rule.

Comment: Three commenters recommended changes in section 7(a)(1) that specify the number of days the company has to inspect the acreage and notify the insured they are denying coverage before the coverage automatically attaches. The previous time frame was 10 days and the proposed rule calls for 20 days. Two commenters stated their preference is for 30 days, pointing out this would allow sufficient time for inspections and would be consistent with the nursery policy and other perennial crop policies such as Florida Fruit Trees. The third commenter suggested going back to 10 days because this is consistent with other perennial fruit crop policies with a similar insurance attachment such as apples, cranberries, etc. They further noted extending the available time period upon which an insurance provider may inspect acreage to deny coverage on new applications without making the same changes in similar perennial fruit policies creates administrative conflicts for delivery and service systems.

Response: FCIC disagrees with the commenters and believes a 20-day time frame is the most appropriate deadline to allow for inspection and possible denial of coverage. Prior to publishing the proposed rule, producers and company personnel agreed 10 days was not an adequate amount of time to conduct an inspection. Further, producers believed 30 days was too long to wait for confirmation of coverage. They agreed 20 days was an acceptable compromise. As the other perennial fruit policies such as apples, cranberries etc ., are revised, FCIC will evaluate whether a change to a 20-day time frame for inspection and possible denial of insurance is appropriate. Therefore, no change has been made.

Comment: One commenter suggested rearranging the language in section 7(a)(2) from “For each crop year subsequent to the year of application, that the policy * * *” to “For each subsequent crop year that * * *” They believe this would make the language clearer.

Response: FCIC agrees and has revised the provision.

Comment: Two commenters recommended revising section 8(a)(2) to clarify fire is an insured cause of loss only when due to natural causes, consistent with the Federal Crop Insurance Act and the Crop Insurance Handbook. The language in the Proposed Rule reads, “Fire, unless weeds and other forms of undergrowth have not been controlled * * * etc. ”

Response: The suggested change is not required and could lead to confusion regarding whether the other causes of loss must also be due to natural causes. FCIC clarified this issue in the Basic Provisions, which now require causes of loss be due to naturally occurring events.

Comment: One commenter recommended removing the text after “mechanical damage” in section 8(b)(4). The text reads “Mechanical damage in excess of that normally experienced for mechanically harvested blueberries for the current crop year.”

Response: FCIC agrees with the commenter and has removed the text after the words “mechanical damage,” which remains as an excluded cause of loss in section 8(b)(4). FCIC does not have the authority to pay losses due to mechanical damage.

Comment: One commenter questioned why sections 9(a)(1) through (3) require notification “within” the specified time period, while the provisions in sections 9(a)(4) and (5) require notification “at least 15 days” before the specified action.

Response: The difference between sections 9(a)(1) through (3) and 9(a)(4) and (5) is that sections 9(a)(1) through (3) deal with notice after a potential loss has occurred and immediate notice is required. Sections 9(a)(4) and (5) are intended to provide greater flexibility by providing the last day that such notice must be provided to allow sufficient time for an inspection. To make the provisions clearer, FCIC has modified the provisions under both section 9(a)(2) and 9(a)(3). The 24-hour notification provisions are now contained in sections 9(a)(2)(i) through (iv). Sections 9(a)(4) and (5), are renumbered as sections 9(a)(3) and (4), and contain reporting requirements of “at least” 15 days notice.

Comment: One commenter questioned the meaning of the provisions in section 9(a)(1), which provide the insured must notify us “Within 3 days of the date harvest should have started if the crop will not be harvested.” They asked if this meant 3 days before or three days after the date harvest should have started.

Response: The provisions were intended to provide a window for the producer to report, either three days before, or not later than three days after harvest should have begun. The window gives the producer time to make a decision as to whether or not to harvest the crop and the company sufficient time to conduct needed appraisals.

Comment: One commenter asserted that the “within 24 hours” of “any cause of loss” notification requirement contained in section 9(a)(2) and (3) may be difficult for an insured to meet. They noted some causes of loss might not be so time-specific that the insured can identify the surrounding 24-hour period.

Response: The 24-hour time frame is required so the company can inspect the crop and is due, in part, to the perishable nature of the crop. FCIC agrees that producers may have difficulty identifying the 24-hour period after some causes of loss such as drought. However, FCIC believes in most cases the insured knows when a cause of loss occurred and should be able to meet the deadline. In those cases, such as drought, establishing a different time frame would not eliminate the problem and reasonableness of the notice must be taken into consideration.

Comment: One commenter suggested section 9(a)(2) is unclear, and even misleading. They believe it could be read in such a way that the 24-hour notification could relate to both the occurrence of a cause of loss and to when the blueberries are mature and ready for harvest. They noted maturity does not occur for all blueberries at the same time, and questioned why notification would be necessary to the company, so they could inspect the acreage, if there is no damage.

Response: FCIC has revised the provision to require 24-hour notice if a cause of loss occurs when blueberries are mature and ready for harvest. If no cause of loss has occurred, notice is not required.

Comment: One commenter questioned whether section 9(a)(2) should also contain the language “* * * and you do not intend to complete harvest on the crop * * *” that is contained in section 9(a)(3).

Response: FCIC determined that the 24-hour notice is required if a cause of loss occurs during harvest regardless of whether the producer intends to harvest the crop. Therefore, FCIC has removed the language regarding the intent to complete harvest from the new combined section 9(a)(2).

Comment: One commenter noted that in looking at section 9(a)(1) through (5), all but one ends with the phrase “so we can inspect the insured acreage,” or “so we can inspect the insured production.” They suggested that FCIC consider incorporating a phrase of this nature in 9(a) rather than repeating the concept in 9(a)(1) through (5).

Response: After FCIC has combined and redrafted this section to remove ambiguity, it determined that the reference to the ability to inspect the acreage is no longer necessary. The provision now clearly and cleanly states when notice is required.

Comment: One commenter questioned what the premium rate impact would be, in order to cover the additional amount of indemnities that will be incurred for allowances for quality adjustment. They noted quality adjustment would be for all causes of loss. Since the blueberries will be codified as a permanent program, quality adjustment will apply to all currently insured areas and to any expansion counties.

Response: When quality adjustment provisions were added to the program for the 2001 crop year, they applied to mature blueberries damaged by hail and freeze, and premium rates were increased to cover those perils. This rule adds quality provisions for all insured causes of loss and for all States and counties where the blueberry program is offered. To the extent that the risk of loss is increased by this change, premium rates will be adjusted to reflect this additional risk.

Comment: One commenter noted the 2004 crop year Special Provisions specify a threshold of 20 percent damage due to hail or freeze to mature blueberries as the basis for determining whether quality adjustment applies. The commenter believes this percentage needs to be increased because quality adjustment may now result from additional perils, including (as proposed) “mechanical damage.”

Response: FCIC agrees with the commenter that the percentage shown on the Special Provisions needs to be reviewed. For crop year 2005, FCIC will examine the effect of adding these additional causes of loss for quality adjustment to determine the new thresholds. In any case, if additional risk results from these added perils, premium will be adjusted to cover these risks. In addition, as stated above, FCIC has clarified that mechanical damage is an uninsured cause of loss. FCIC has also clarified the criteria for determining damage or loss by providing grade standards.

Comment: One commenter expressed concern that as written in the proposed rule, section 10(c)(3) appears to give the insured wiggle room to argue that because they are a fresh blueberry producer who could not sell their production as fresh, no production should be counted, even though the production might have been sold for processing.

Response: FCIC agrees the proposed rule language contained in section 10(c)(3) could have been misinterpreted and perhaps allowed for not counting fresh production sold as processing. Consequently, the provisions have been modified and renumbered as sections 10(d)(1) and (2). The revised provisions now set two standards, one for damaged blueberries where the percent of damaged blueberries exceeds the amount stated on the Special Provisions and one where the percent of damaged blueberries does not exceed the amount stated on the Special Provisions. Where the percent of damaged blueberries exceeds the amount stated on the Special Provisions, no blueberries from the acreage will count as production to count unless sold. If sold, production to count will be determined by dividing the price received for the damaged blueberries by the applicable price election and multiply the resulting factor by the pounds sold. Typically there is little or no juice market, or other processing market, for damaged blueberries that would normally be sold as fresh blueberries. However, if a processing market is found and damaged blueberries are harvested and sold, production to count will be based on value as determined above. Where the percent of damaged blueberries does not exceed the amount stated on the Special Provisions, all mature (undamaged) blueberries will be counted as production to count.

Comment: One commenter noted a discrepancy between the provisions contained in section 10(c)(3) and 10(c)(3)(ii). Language contained in 10(c)(3) states in part “* * * damaged by an insurable cause of loss * * * to the extent the blueberries cannot be sold as fresh or processed blueberries * * *,” while section 10(c)(3)(ii) references damaged blueberries that are sold. The commenter maintains it could be argued that section10(c)(3)(ii) would never apply because of provisions contained in section 10(c)(3) regarding blueberries that cannot be sold as fresh or processing due to the percent of damage.

Response: FCIC has revised the proposed provisions contained in section 10(c)(3) and renumbered them as section 10(d) and 10(d)(1) and (2). As stated above, the revised provisions now clearly differentiate between the treatments of damaged blueberries where the percent of damaged blueberries does not exceed the amount stated on the Special Provisions and where the percent of damaged blueberries does exceed the amount stated on the Special Provisions. Further, the provisions are clarified to include the effect if damaged blueberries are sold.

Comment: One commenter expressed concern about the addition of quality adjustment for all causes of loss shown in section 8 of these Crop Provisions. They noted some crops such as apples provide for a quality feature for limited perils such as hail and freeze, which are readily identifiable. They questioned, for instance, whether an adjuster could readily identify damage due to adverse weather such as excessive heat and sunburn that may cause the blueberries to color poorly or cause other forms of damage that might be difficult for the adjuster to determine, yet would not be accepted, based on quality, by the processor or buyer.

Response: FCIC has examined this issue and consulted with producers and their trade associations. To provide adequate protection, FCIC has decided to cover all perils. However, to assist loss adjusters, FCIC has incorporated grading standards that are used to determine whether production has been damaged.

In addition to the changes described above, FCIC has made the following changes:

1. Modified the provisions in section 2 by making it clear that the enterprise, whole-farm, and optional unit provisions in the Basic Provisions are not applicable. This does not eliminate the applicability of other optional units.

2. Added the word “percentage” after price election in the first line of section 3, to allow producers to select different price elections, if different price elections were offered for different types. Clarifies that it is the percentage of the price election that must be the same.

3. Added provisions to section 6(a)(2)(i), to allow insurance of cultivars which were initially experimental, but have since become commercially acceptable and available.

4. Added provisions to section 6(b) that allow the flexibility to specify other types of blueberries that need pruning every other year, if necessary, in the Special Provisions.

5. Added provisions to section 7(a)(3) “ * * * unless specified otherwise in the Special Provisions.” This allows the calendar date for the end of the insurance period to be tailored through a Special Provisions statement for areas where a statewide date may be inappropriate for a specific type or county.

6. Modified the provisions in section 7(a)(4) to clarify that coverage may not begin for a crop year if we cancel or terminate a policy after insurance has attached but on or before the cancellation and termination dates, and no premium, administrative fee, or indemnity will be due.

7. Deleted in provisions in section 7(b)(2) “* * * and the acreage was insured by you the previous year. * * * ” These provisions created confusion and could have the effect of obligating a new insured who relinquishes interest in an acreage shortly after insurance attaches (cancelled lease beginning the new calendar year) to pay premium but not be able to claim an indemnity on the acreage since an insurable interest no longer exists.

8. Added a new provision, 7(b)(3), to clarify the effect of relinquishing an insurable share after the acreage reporting date. Since this issue is not clearly addressed in section 7 of the Basic Provisions, these provisions are added to clarify that premium is still owed if an insurable share is relinquished after the acreage reporting date.

9. Deleted section 12 because blueberries are no longer a pilot program, so written agreements are available if permitted by the policy.

Good cause is shown to make this rule effective less than 30 days after publication in the Federal Register . Good cause to make a rule effective less than 30 days after publication in the Federal Register exists when the 30-day delay in the effective date is impracticable, unnecessary, or contrary to the public interest.

With respect to the provisions of this rule, it would be contrary to public interest to delay implementation because public interest is served by improving the insurance product as follows: (1) Added provisions to eliminate any lapse in insurance coverage between crop years, therefore, providing continuous coverage for insureds and providing an improved risk management product that prevents the need for ad hoc disaster payments; (2) added provisions to specify that if the insured policy is canceled or terminated for any crop year after insurance attached for that crop year, but on or before the cancellation and termination dates, whichever is later, then insurance will not be considered to have attached. This modifies the cancellation and termination provisions to coincide with continuous coverage, providing the greatest flexibility to insured producers to make insurance decisions prior to the next crop year, and providing an improved risk management product; (3) added provisions to clarify that an insurance provider may not cancel an insured's policy when an insured cause of loss has occurred after insurance attached, but prior to the cancellation and termination date, to protect insureds against companies canceling policies simply because a loss has occurred; (4) added quality adjustment provisions for determining production to count for mature blueberries, harvested or unharvested, that have been damaged to the extent the blueberries cannot be sold for fresh or processing, which provides improved risk management protection for insured producers; (5) provided simplification and clarity to the blueberry crop insurance program.

If FCIC is required to delay the implementation of this rule 30 days after the date it is published, the provisions of this rule could not be implemented until the 2006 crop year. This would mean the affected producers would be without the benefits described above for an additional year.

For the reasons stated above, good cause exists to make these policy changes effective less than 30 days after publication in the Federal Register .

This rule has been determined to be non-significant for the purposes of Executive Order 12866 and, therefore, it has not been reviewed by the Office of Management and Budget (OMB).

Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), the collection of information in this rule have been approved by the OMB under control number 0563-0053 through February 28, 2005.

In an effort to comply with GPEA, FCIC requires all insurance companies delivering the crop insurance program to make available all insurance documents electronically and to transact business with insureds electronically. Further, to the maximum extent practicable, FCIC transacts its business with the insurance companies electronically.

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

It has been determined under section 1(a) of Executive Order 13132, Federalism, that this rule does not have sufficient implications to warrant consultation with the States. The provisions contained in this rule will not have a substantial direct effect on States, or on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

FCIC certifies this regulation will not have a significant economic impact on a substantial number of small entities. Program requirements for the Federal crop insurance program are the same for all producers regardless of the size of their farming operation. For instance, all producers are required to submit an application and acreage report to establish their insurance guarantees, and compute premium amounts, or a notice of loss and production information to determine an indemnity payment in the event of an insured cause of crop loss. Whether a producer has 10 acres or 1000 acres, there is no difference in the kind of information collected. To ensure crop insurance is available to small entities, the Federal Crop Insurance Act authorizes FCIC to waive collection of administrative fees from limited resource farmers. FCIC believes this waiver helps to ensure small entities are given the same opportunities to manage their risks through the use of crop insurance. A Regulatory Flexibility Analysis has not been prepared since this regulation does not have an impact on small entities and therefore, this regulation is exempt from the provisions of the Regulatory Flexibility Act (5 U.S.C. 605).

This program is listed in the Catalog of Federal Domestic Assistance under No. 10.450.

This program is not subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. See the Notice related to 7 CFR part 3015, subpart V, published at 48 FR 29115, June 24, 1983.

This rule has been reviewed in accordance with Executive Order 12988 on civil justice reform. The provisions of this rule will not have a retroactive effect. The provisions of this rule will preempt State and local laws to the extent such State and local laws are inconsistent herewith. With respect to any direct action taken by FCIC under the terms of the crop insurance policy, the administrative appeal provisions published at 7 CFR part 11 and 7 CFR part 400, subpart J for the informal administrative review process of good farming practices, as applicable, must be exhausted before any action against FCIC for judicial review may be brought.

This action is not expected to have a significant impact on the quality of the human environment, health, and safety. Therefore, neither an Environmental Assessment nor an Environmental Impact Statement is needed.

On March 10, 2004, FCIC published a notice of proposed rulemaking in the Federal Register at 69 FR 11342-11346 to add to the Common Crop Insurance Regulations (7 CFR part 457) a new section, 7 CFR 457.167, Pecan Revenue Crop Insurance Provisions. FCIC intends to convert the pecan revenue pilot crop insurance program to a permanent crop insurance program beginning with the 2005 crop year. These provisions will replace and supersede the current unpublished provisions that insure pecans under a pilot program. The Pecan Revenue Crop Provisions will be effective for those insured whose first year of the two-year coverage module is 2005. If an insured's first year of the two-year coverage module is 2004 under the pilot program, the pilot policy will still be effective for the 2005 crop year. As with any policy changes, the new Crop Provisions would be applicable for the 2006 crop year if the policy remains in force and coverage will begin the day immediately following the end of the insurance period for the previous two-year coverage module.

Following publication of the proposed rule, the public was afforded 30 days to submit written comments, data and opinions. The comments received from the proposed rule are addressed in this final rule and FCIC's responses are as follows:

Comment: A commenter questioned why the definition of “acreage” had been removed from the Crop Provisions and wondered if the definition would be in the Basic Provisions and would it provide the clarification that only “the area occupied by the insured crop * * *.” is counted for perennial crop purposes.

Response: Acreage for pecans are determined the same as all other crops, so a separate definition is not required.

Comment: A commenter suggested revising the definition of “average gross sales per acre” as the phrase “during a crop year” was not clear. It was also suggested the term “gross sales” be added in the definition as it is the basis for the average gross sales per acre.

Response: The definition of “average gross sales per acre” has been revised to add an example to clarify the crop year referred to and a separate definition of gross sales has been added for further clarification.

Comment: One comment suggested removing the phrase “(in-shell basis)” from the definition of “approved average revenue per acre” as it is already contained in another definition. It was also suggested to remove the last phrase “ * * * will be used to determine your total average gross sales per acre” and the word “have” contained in the last sentence be replaced to “provide” as it is in the current Crop Provisions.

Response: FCIC agrees and has made the changes accordingly.

Comment: A commenter questioned if the change in the beginning and end dates for the definition of “crop year” means it is not necessary to refer to when the trees “normally” bloom.

Response: Since blooming normally occurs between April and August, it is no longer necessary to refer to the crop year in which the tree “normally” blooms.

Comment: A comment asked if the term “mature” should be added back to the definition of “harvest” as it is not considered harvested if the pecans are collected before they are ready.

Response: FCIC agrees and has made the change accordingly.

Comment: A commenter had questions regarding the definition of “market price.” The commenter asked who determines whether the actual price received and the average price per pound are inconsistent with AMS prices, and how much difference is to be considered. The commenter also asked if the AMS price is representative of the area and what date is used for appraisals and how is the value calculated when there might be two appraisals when pecan acreage is harvested more than once.

Response: In an effort to avoid the difficulty in determining whether prices are inconsistent, FCIC has revised the definition to specify the market price is the greater of: (1) The average price per pound offered by buyers in the area; (2) the actual price received for any sold production; or (3) the average of the AMS prices published during that week for similar quality pecans. The AMS prices may be obtained daily and a weekly report is also available. The AMS prices are identified by area and also contain the quality by pecan variety for specific areas. The AMS prices may be found at www.ams.usda.gov/marketnews.htm. If multiple appraisals occur in the same week, the same average AMS price would be applicable. However, if appraisals occur in different weeks, different AMS prices would be used to value the production. Section 13(d) has been revised to take into consideration the different prices that may be applicable.

Comment: One commenter asked why the reference to “pecans (in-shell basis)” was removed from the definition of “pound” and whether references to pounds of pecans always mean in-shell or not shelled nuts.

Response: FCIC has revised the definition of “pound” to include that it is specifically on an “in-shell” basis.

Comment: A commenter suggested in the definition of “scion” to change “plant” to “pecan variety” and to remove the word “stock” and replace it with “tree or branch” as in the “top work” definition.

Response: There is duplication within the definitions of “scion” and “top work” so FCIC has revised the definition of “scion” to remove the duplication.

Comment: A commenter asked if removing the phrase “terms and conditions” (which is understood to refer to the policy provisions) from the definition of “two-year coverage module” means it is the insured who must meet all requirements in order for coverage to remain the same both years of the coverage module.

Response: Like other FCIC crop insurance programs, the insured must meet all terms and conditions of the insurance policy in order for coverage to remain in effect. However, FCIC has replaced the removed phrase to avoid any ambiguity with respect to when the terms of the policy can be revised in the second year of a two-year module.

Comment: Two commenters asked if the final rule is effective for the 2005 crop year, will the changes apply to insureds whose first year of coverage is 2004 and the second year of coverage is 2005 or will the changes be effective for the 2006 crop year for these insureds.

Response: If the Pecan Revenue Crop Provisions is effective for the 2005 crop year, it will be applicable for those insureds whose first year of a two-year coverage module is 2005. If an insured's first year of the two-year coverage module is 2004 (under the pilot program phase), then the pilot policy will still be effective for the 2005 crop year. Like any other amendment to the policy, the new Crop Provisions would be applicable for the 2006 crop year if the policy remained in force.

Comment: Section 2—Eighteen commenters requested consideration in allowing additional basic units by share or lease agreement. The commenters stated in many cases growers may have several different lease agreements and the orchards could be located in several different areas. Each orchard has different soil characteristics, age of the pecan trees, or access to water and is subject to different perils. As growers are required to market these blocks separately and maintain separate records, no additional burden would be placed on the grower. Some of the commenters suggested for program consistency of the crop insurance program, optional unit division should be allowed on a noncontiguous land basis as provided in other tree crops such as apples, almonds, and walnuts.

Response: FCIC has revised section 2 to allow coverage by enterprise unit or basic unit. An enterprise unit will consist of all insurable acreage in the county. A basic unit as defined in the Basic Provisions will allow units by share. The insured can only select one unit structure and it will be effective for both years of the two-year coverage module. Pecan insurance is a history-based individual program where both price and yield come from the producer. Currently there are only two other history-based individual programs available (adjusted gross revenue and avocado), one of which does not offer any unit division. At this time, too little data is available to fully assess the impact of smaller units on history-based revenue products. Given the uncertain risk, the optional unit provisions contained in the Basic Provisions are not applicable.

Comment: Two comments suggested the percent of coverage under the Catastrophic Risk Protection Endorsement (CAT) be contained in the Crop Provisions rather than shown in the Special Provisions.

Response: It would not be practical to put the percent of coverage for CAT in the Crop Provisions. Should legislation revise the CAT level of coverage, the Special Provisions could be quickly and easily updated. If the percentage amount were contained in these Crop Provisions, FCIC would have to make changes through a regulatory process causing unnecessary time delays in implementation. No change has been made.

Comment: A commenter questioned if the provisions contained in the Basic Provisions (section 3(g)(2)) regarding the High-Risk Land Exclusion Option was applicable to pecans. As section 3 of the Crop Provision replaces all of section 3 of the Basic Provisions the commenter asked if the provision should be reinstated in the Crop Provisions.

Response: FCIC agrees with the comments and has amended section 3 of the Pecan Revenue Crop Provisions to include the high-risk land provisions like those contained in the Basic Provisions.

Comment: Sixteen commenters noted the sequential thinning limitation of 12.5 percent contained in section 3(d)(1) is not appropriate for most pecan growers. Thinning trees in a pecan orchard increases sunlight penetration, which improves crop quality, quantity, and size as well as reducing disease pressure. The commenters stated no other tree crop is subjected to such a reduction in the insurance guarantee, and the sequential thinning reduction of 30 percent the first year after thinning and a 15 percent reduction the second year after thinning is penalizing pecan growers for following proven extension recommendations. The commenters stated the penalty is arbitrary and capricious because there is no published data to support the provisions regarding sequential thinning. All of the commenters stated the provision should be eliminated.

Response: FCIC recognizes thinning trees in a pecan orchard is beneficial for future production. However, amounts of insurance are based on the production capability of the acreage in the current crop year, not future crop years. A review of publications from Agricultural Research Service and Cooperative Extension Service indicates thinning does result in reduced pecan production for some period of time. Therefore, provisions must be included to adjust production to the expected capability of the acreage. However, FCIC has amended section 3(d)(1) to state if more than 12.5 percent of the total acres are sequentially thinned, the average gross sales for those acres thinned will be multiplied by a factor of .80 for only the first year after thinning unless specified otherwise in the Special Provisions.

Comment: Nine comments received stated the 12.5 percent threshold for adding acreage contained in section 3(d)(2) is not practical. Some of the commenters indicated growers would only add acreage when it is significant enough to justify expansion. All of the commenters thought the pecan pilot program had exemplary experience throughout the pilot phase and should have the same considerations as other California tree programs that allow a 70 percent increase in added acreage. A few of the commenters stated very few pecan orchards would ever have a historical dollar amount as low as the dollar span contained in the actuarial documents. The 12.5 percent threshold for added land then becomes a greater penalty if the sales records for the added acreage are not provided and a growers' own production history would be diluted when their approved average revenue combined with the history from the added acreage. Some of the commenters suggested growers be allowed to add up to 500 acres per county at the same approved average revenue as the existing units, and for acreage greater than the 500 acre limit, the lowest available dollar span provided in the actuarial documents should apply to such acreage over 500 acres.

Response: FCIC disagrees with the commenters. Pecans cannot be compared to programs that are available in California because they are a different plan of insurance. Most California perennial crop programs are actual production history (APH) plans of insurance while the pecan revenue program is a revenue plan of insurance. A review of FCIC's acreage data for the three states providing pecan revenue coverage show that pecan insured's annual average was approximately 201 acres of pecans for the years 1999 through 2003. For the 2003 crop year, approximately one third of the orchards insured in Georgia consisted of approximately 30 acres. Allowing an insured the ability to add 500 acres with no change in the average gross revenue is not reasonable and would cause excessive risk to the program. FCIC has determined that given the risks, recalculation of the approved average revenue when acreage is increased by more than 12.5 percent is appropriate. No change has been made.

Comment: One comment asked if, according to section 3(e), can the reduction in insurable acreage due to removal of a contiguous block of trees be done at any time during the two-year coverage module, or only if reported by the annual acreage reporting date.

Response: Section 3(e) has been revised to clarify that removal of a continuous block of trees must be reported at any time including within the two-year coverage module. Further, section 6 has been revised to clarify that failure to report removal of trees will result in a reduction in the insured acreage any time the circumstances become known.

Comment: For section 3(f), a commenter thought the provision should be written to make it clear that if gross sales for any year were not reported that both years would be assigned an amount if either year were missing. It should be clear or an insured could report gross sales for the year with high yields and not report the year with lower yields if it fell below the assigned amount of 75 percent of the approved average revenue.

Response: FCIC agrees assigning 75 percent of the approved average revenue for the year gross sales amounts are not reported may encourage an insured to not report the low yields. FCIC has revised section 3(f) to state if gross sales amounts are not reported, an amount would be assigned for the missing year. The assigned amount will be the lowest dollar span provided in the actuarial documents.

Comment: Two commenters stated section 3(g) indicates hail and fire coverage may be excluded if additional coverage is selected. Additional coverage could include the 50 percent, 55 percent, and 60 percent coverage levels that do not qualify the insured to exclude these perils. The provision needs to be amended to indicate these perils can only be excluded at 65 percent coverage level and at 100 percent price or an equivalent coverage.

Response: FCIC disagrees with the commenters. The Basic Provisions define additional coverage as a level of coverage greater than 65 percent coverage level.

Comment: Two commenters thought there seemed to be a conflict between sections 4(a), (d), and 5(e) where the cancellation date is listed as January 31 of the second crop year of each two-year coverage module. Section 4(a) states that coverage terms may change between any two-year coverage module and section 4(d) states that any policy changes will be provided not later than 30 days prior to the cancellation date. One of the commenters suggested changing the word “between” in section 4(a) to “for.”

Response: FCIC has made the revision as suggested for section 4(a). FCIC agrees there may be some ambiguity regarding when changes can be made to the policy and when they will be provided to the insured. As stated above, FCIC has replaced language in the definition of “two-year coverage module” stating that the same terms and conditions will apply to each year of the module unless Congress or the producer do something to require a policy change. If the producer does something under the policy to affect coverage, sections 4(a), (d), and 5(a) would not be applicable. Further, producers cannot change their coverage in the middle of the module. However, if Congress makes a change prior to the second year of the module, the producer will need to receive notice of such changes prior to the cancellation date. FCIC has revised the provisions to specify that such changes will be provided 30 days prior to the termination date.

Comment: Two comments received expressed concern with section 4(b) in which RMA's Web site is provided. The commenters thought it might lead to policyholders contacting RMA rather than their agents. In addition, the language states any policy changes will be available on RMA's Web site not later than the contract change date but there are instances where the policy changes may not be available on the contract change date, for instance, if a final rule is published on the actual contract change date, the new documents may not be on the Web site for a few days.

Response: Policy changes posted on RMA's Web site are intended to provide alternative methods for producers to access policy changes by the contract change date. Should any producers contact RMA with questions regarding their insurance coverage, they generally are advised to contact their crop insurance agent for assistance. If policy changes are not available by the contract change date, they are not effective for the crop year. Rules are filed and available for public inspection with the Federal Register several days prior to the date of publication. Therefore, there is no reason why the policy changes would not be posted on RMA's Web site by the contract change date. No changes will be made to section 4(b).

Comment: One commenter suggested revising section 5(a) to include language contained in the Basic Provisions section 2(a) to clarify it is a continuous policy “until canceled by you in accordance with the terms of the policy or terminated by operation of the terms of the policy or by us.”

Response: FCIC agrees and section 5(a) has been revised accordingly.

Comment: One comment stated the language contained in section 6(b) seemed to indicate that the acreage would no longer be reduced as it was in the pilot phase, only the insurance guarantee would be reduced. If that is the intent, the commenter asked why refer to reducing the insurance guarantee rather than one of the defined terms for the basis of the insurance.

Response: Section 6(a)(1) requires the insured to report the number of acres that are affected by the specified circumstances. Some of those circumstances may result in a reduction in insured acreage, others may only affect the gross sales. Therefore, section 6 has been revised to separate out those that affect acreage from those that affect gross sales and require the applicable adjustment to the insured acreage or amount of insurance per acre. Further, section 6(c) now makes it clear that either the insured acreage or amount of insurance per acre may be adjusted if the applicable circumstances are not reported.

Comment: Five commenters stated the requirement of a written agreement to insure pecan trees that have been hedged is improper. Hedging is a common recommended practice in the southwest region and is used to increase sunlight penetration, increase yields, and can aid in control of alternate bearing years.

Response: Section 8(f) of the Crop Provisions states hedging may be insurable if allowed by the Special Provisions or by written agreement. Some southwestern county actuarial documents have incorporated statements to insure hedged trees and in those counties a written agreement will not be required. However, the practice is not common everywhere and FCIC has not determined the effect of hedging trees in all areas where pecans are produced. As additional data is collected and FCIC regional offices review the data, more counties may include a Special Provision statement to allow insurance on hedged trees. No change has been made.

Comment: Three commenters expressed concern in the omission of a provision in the pilot policy that was not in the proposed rule and questioned if the intent was to insure pecans that are direct marketed to consumers. The commenter stated loss adjusters must appraise each grove before harvest and provide a price from three buyers. Appraisals could be inaccurate due to the lack of grading and pricing standards used in the industry, and insuring direct marketed pecans will increase administrative expenses since multiple appraisals will have to be made each time the trees are shook in order for there to be acceptable records of production to count. The commenters asked FCIC to reinstate the provision specifying pecans that are direct marketed to consumers is not insured unless allowed by the Special Provisions or by written agreement.

Response: FCIC did not intend to insure pecans directly marketed to consumers unless allowed by the Special Provisions or written agreement. FCIC agrees that the burden and costs are much higher due to the multiple harvesting of pecans and has added the provisions back to section 8(f).

Comment: One comment suggested rewording section 8(e) to “that are improved pecan varieties” since the definition includes “a distinguishable planting pattern.”

Response: FCIC has removed the definitions of “improved pecan varieties” and “unimproved pecan varieties” since FCIC insured both improved and unimproved varieties in the pilot program, it has elected to continue to insure all pecan varieties.

Comment: One comment questioned why the new provision in section 8(e) requires “ * * * an orchard that consists of a minimum of one (1) contiguous acre, unless allowed by written agreement.” The commenter asked why the provision was added and how the size was determined. The commenter asked if small orchards (less than one acre) considered to be at greater risk, or if they involve proportionately greater administrative expense than larger orchards. They asked how that compares to the increased expense involved in the written agreement process if those pecan producers still want coverage.

Response: Pecan orchards are susceptible to a number of risks if good farming practices are not carried out. FCIC believes pecan orchards must be of some size for good farming practices to be carried out. Requiring orchards be at least one acre in size should minimize the chance of insuring orchards where recommended farming practices are not utilized and the risks would be greater. FCIC believes there are few orchards less than an acre in size and very few written agreements will be requested.

Comment: Eight comments disagreed with the provision contained in section 9(a) that required a written agreement to insure acreage in which more than 10 percent of the total acreage is unimproved pecan varieties. All of the commenters stated many of the seedlings produce the same quality and quantity as improved varieties, with some areas having a higher value than the improved varieties in Georgia. Commenters stated as seedling pecans constitute a significant part of the acreage in many regions, all varieties should be allowed to be insured as all levels of protection are either based on county averages or proven yields. All of the commenters stated that while in the pilot phase, the pecan program was not limited to improved varieties and it should be up to each individual region to determine what, if any, type or variety should not be insured. Many of the comments stated the requirement for a written agreement is ill advised, cumbersome, difficult to manage and too much extra work for the producers, agents, and FCIC.

Response: FCIC agrees and has removed section 9(a) and all references to unimproved and improved varieties. All pecans will now be insurable.

Comment: Two comments were received regarding the requirement contained in section 10(a)(1) that notification of acceptance or rejection of an application would be made within 30 days after the sales closing date. One commenter thought 30 days did not provide sufficient time to complete and review the required inspection. One commenter stated that the 30 day requirement was reasonable and much more to their satisfaction than the previous 10 day requirement.

Response: Under the pilot program, a crop inspection and acceptance or rejection of the application had to be completed within 10 days. FCIC recognized insurance providers needed additional time to inspect the acreage and determined that 30 days provides a good balance between the needs of producers to know whether they have coverage and time for the required inspections. No changes will be made.

Comment: One commenter agreed with section 10(b)(1) to allow coverage on acreage acquired up to the acreage reporting date. The commenter recommended the acreage reporting date be March 31 which would allow for the many orchards that change ownership in February or March to be handled in accordance with these provisions.

Response: Acreage report dates are being adjusted and will be set on a regional basis determined by the growing season. For the 2005 crop year, the acreage reporting date will be March 1.

Comment: One comment asked if section 10(b)(2) meant if the insurable share is relinquished between the first and second years of the two-year coverage module, whether the insured should report zero acres on the acreage report for the second year. If so, there seems to be a loophole in requirement that pecans be insured both years of the two-year coverage module.

Response: This provision does not provide a loophole because it is only applicable if the producer no longer has an insurable interest in the orchard. In those cases, the producer should not be required to pay premium on acreage when the producer no longer has an insurable interest and cannot receive an indemnity. If the producer continues to have an interest in the pecans, coverage cannot be canceled during the two-year coverage module.

Comment: Section 10 of the proposed rule revised the dates for when coverage begins and the end of the insurance period. Nine commenters suggested the sales closing date, acreage reporting date and production reporting dates be changed to dates other than currently in effect. Four of the comments indicated an acreage reporting date and production reporting date of April 1 would be consistent with a grower's schedule. This change would allow a grower the time to know which groves he will have for the coming year and harvesting and sales of the crop would be complete. Five of the commenters stated the southwestern growers do not start harvest until November or December and a sales closing date of February or March would be better suited for the southwestern growers. Three southwestern growers stated that some growers enter into pools and do not receive a final price until July or August. FCIC must consider the appropriateness of all growing areas when establishing crop insurance reporting dates.

Response: FCIC recognizes the required dates in the pilot program were not suitable for all regions. Program dates contained in the Crop Provisions have been changed and are no longer the same as those in the pilot program. All other reporting and program date requirements are contained in the actuarial documents and will be revised as appropriate for the growing area.

Comment: One comment suggested that section 10(b)(2)(i) be revised to “A transfer of right to an indemnity” rather than “A transfer of coverage and right to an indemnity.”

Response: FCIC agrees with the comment and the provision has been revised accordingly.

Comment: Two commenters recommended revising section 11 to clarify fire is an insured cause of loss only when due to natural causes, consistent with the Federal Crop Insurance Act and the Crop Insurance Handbook.

Response: This change is not necessary because the Act requires all causes of loss to be natural causes, not just fire. Specifically referring to natural disasters with respect to fire but not the other causes could create the impression that such other causes of loss could be caused by something other than natural causes. No change will be made.

Comment: In response to the provision contained in section 11(a)(8), one comment questioned how likely plant disease or insects would cause a failure of the irrigation water supply. It was suggested the language contained in the pilot policy would be sufficient rather than specifying “11(a)(1) through (7).”

Response: While it is highly unlikely that plant disease or insects would cause failure of the irrigation water supply, such coverage is provided in most other policies, and should be provided here to protect any possibility. Further, the proposed language would not eliminate this coverage. The specific reference to paragraphs (1) through (7) is needed to ensure that coverage is limited to those perils included in this policy and not those that may be included in other policies that may be different. No change will be made.

Comment: Two comments indicated the provision in section 12(b) requires appraisals be made when determining production to count for production sold by direct marketing. Pecan trees are harvested three times and the provision entails making three appraisals for each orchard, which is very expensive from an administrative standpoint. Both commenters asked if there were any other types of records that would be acceptable and could alleviate the need to do an appraisal on all of the direct marketing situations regardless of whether or not the acreage is in a loss situation.

Response: As stated above, FCIC revised section 8 of these Crop Provisions to reinsert the pilot language specifying that production that is to be sold via direct marketing will only be insurable if provided in the Special Provisions or by written agreement. Therefore, the burdens are no different than existed in the pilot program. Further, because of the impossibility to verify production sold through direct marketing, appraisals must be conducted on direct marketed acreage. The provision contained in section 12(b) has been revised to clarify it only applies if the Special Provisions or a written agreement authorizes direct marketing.

Comment: One commenter wrote that section 12(d) specifies the insured must not sell, destroy or dispose of the damaged crop until after written consent has been given. They asked if pecans are selling for less than the market price, it is assumed there is damage. Since there is not a standard grading process, the commenter asks how an insurance provider determine what, if any, damage exists to give consent.

Response: Damage cannot be presumed from low market prices. The producer must still establish that any price decline was unavoidable and not caused by the actions of the producer or a third party (such as bioterrorism). Since the market price is determined on the date of the appraisal, the insurance provider should be able to determine whether an indemnified loss has occurred and whether to give consent to sell, destroy, or dispose of the crop.

Comment: One comment asked if section 13(d)(1)(i) should refer to “amount of insurance per acre” rather than “insurance guarantee” since it is not defined in the Crop Provisions.

Response: FCIC agrees with the comment and has revised the provision to specify “amount of insurance per acre.”

Comment: A commenter suggested the example in section 13 be moved to the end of the section as some of the information comes from section 13(d).

Response: FCIC agrees with the suggestion and has revised section 13 so that the example of indemnity is contained at the end of the section and expanded the example to include sold and appraised production.

Comment: Nine commenters suggested additional pecan growers would benefit if the pecan crop insurance program were to be offered in other pecan producing states and counties. The commenters requested consideration is given to expand the availability of pecan crop insurance as it becomes a permanent insurance program.

Response: The criteria considered for crop program expansion does not change regardless of whether the pecan revenue program is a pilot or permanent program. FCIC expanded the pecan revenue program for the 2004 crop year based on expansion requests and supporting data. FCIC will continue to review county expansion requests on the merit of supporting data.

Comment: A commenter asked if section 18 of the Basic Provisions would be applicable and mean written agreements may be requested for organically certified pecans.

Response: To be consistent with other Crop Provisions, an organic practice premium rate factor will be in the actuarial documents and if qualified, organic acreage of pecans will be insured.

Comment: A commenter asked if section 36 “Substitution of Yields” of the Basic Provisions applies to pecans.

Response: Substitution of yield provisions are applicable for actual production history plans of insurance. Pecans are insured under a revenue plan of insurance and section 36 of the Basic Provisions is not applicable. A new section 15 has been added for clarity.

Comment: One comment asked if the Pecan Disclaimer would still be required as part of the policy. If it is useful in making sure an insured understands the difference between the pecan policy and other multiple peril crop insurance policies, it should be updated according to these Crop Provisions.

Response: The Pecan Disclaimer is no longer required.

In addition to the changes described above, FCIC has made the following changes:

1. Modified the definition of “approved average revenue per acre” to clarify that if four years of gross sales records are not provided, the approved average revenue will be the average of two years of gross sales records and two years of the lowest available dollar span amount provided in the actuarial documents. If no gross sales records are provided, the approved average revenue will still be the lowest available dollar span amount provided in the actuarial documents.

2. Added a definition for “enterprise unit” to specify all insurable acreage in the county will be considered as an “enterprise unit.” This change is to clarify the revisions in section 2 that will allow both “enterprise units” and “basic units.”

3. Revised section 7 to remove references to CAT. The Catastrophic Risk Protection Endorsement states that no premium is due for CAT policies and when administrative fees must be paid, but to prevent any ambiguity the phrase “as applicable” has been added.

4. Revised section 10 to add a provision as section 10(a)(2) to clarify for each two-year coverage module following application of the first two-year module, the policy will remain continuously in force and coverage begins the day immediately following the end of the insurance period for the prior two-year coverage module. Section 10(a)(2) has been renumbered as section 10(a)(3).

5. Added a new section 7(b)(3) to clarify when insurable pecan acreage is relinquished after the acreage reporting date, coverage will be provided for insurable causes of loss that occurs before the date the share was relinquished, and the premium earned for such acreage will be due for that crop year.

6. Amended section 11 to add a new section 11(b) to clarify if damage occurs before the beginning of the crop year, coverage is only provided if the crop was insured the previous crop year. The proposed section 11(b) has been renumbered as section 11(c).

7. Removed the phrase “as determined by us” from sections 13(d)(1)(v), 13(d)(2)(i), and 13(d)(2)(ii). This change is necessary due to the revisions in the definition of “market price.”

8. Added a new section 16 (Written Agreement) clarifying that producers must have at least two years of production and gross sales records in counties with actuarial documents and at least four years of production and gross sales records in counties without actuarial documents to qualify for a written agreement.

Good cause is shown to make this rule effective less than 30 days after publication in the Federal Register . Good cause to make the rule effective upon less than 30 days after publication exists when the 30-day delay in the effective date is impracticable, unnecessary, or contrary to the public interest.

It is in the public interest to implement changes in this rule because it will provide improved insurance benefits for pecan producers. These changes include: Converts the pecan revenue insurance program from a pilot phase to a permanent program. This will allow the program to be expanded into areas where coverage was not previously provided; Increases insurance flexibility by providing additional insurance units for producers who lease multiple pecan orchards or have a share in the crop; Moves the contract change date to a later date to provide a greater amount of time between the contract change date and the sales closing date. This will allow producers more time to make insurance decisions; Changes the limitation on the amount of trees that can be thinned in an orchard. Tree thinning is a recommended practice that will increase the pecan production one year after thinning; Allows hail and fire coverage to be excluded as causes of loss if additional coverage levels are selected; and Provides clarification of what actions may cause changes in the amount of pecan revenue insurance.

If FCIC is required to delay the implementation of this rule 30 days after the date it is published, the provisions of this rule could not be implemented until the next crop year. This would mean the affected producers would be without the benefits described above for at least an additional year and those producers currently insured under the pilot insurance program, coverage would be delayed until the 2007 crop year because pecan coverage is provided under a two-year insurance module.

For the reasons stated above, good cause exists to make these policy changes effective less than 30 days after the publication in the Federal Register .

14. Late and Prevented Planting

The late and prevented planting provisions of the Basic Provisions are not applicable.

15. Substitution of Yields

The substitution of yield provisions of the Basic Provisions are not applicable.

16. Written Agreements

Not withstanding the provisions of section 18 of the Basic Provisions, for counties with actuarial documents for pecans, you must have at least two years of production and gross sales records and for counties without actuarial documents, you must have at least four years of production and gross sales records to qualify for a written agreement.

This rule allows honey stored in CCC-approved, 5-gallon plastic containers to be eligible for MAL's and LDP's. This change will make CCC regulations more consistent with marketing practices in the honey industry, especially regarding producers of relatively small quantities of honey. Most honey marketed in the U.S. is stored in metal drums or plastic storage units called Intermediate Bulk Containers (IBC's), and the majority of commercially exported and imported honey is stored in steel drums. However, producers of smaller quantities of honey, who normally market through local channels like farmer markets or local groceries, often store it in smaller plastic containers, which are significantly less expensive than metal drums or IBC's. Producers who use these smaller plastic containers are currently not eligible for honey MAL's and LDP's. CCC has determined that storing honey in 5-gallon plastic containers is a normal marketing practice, and their use does not increase the risk to the honey loan collateral. Thus, this rule provides that honey stored in CCC-approved, 5-gallon plastic containers is eligible for MAL's and LDP's, and requests public comment on this change.

Section 1601(c) of the Farm Security and Rural Investment Act of 2002 (2002 Act) provides that the regulations needed to implement Title I of the 2002 Act, including those involved here, may be promulgated without regard to the notice and comment provisions of 5 U.S.C. 553 or the Statement of Policy of the Secretary of Agriculture effective July 24, 1971, (36 FR 13804) relating to notices of proposed rulemaking and public participation in rulemaking. Because this rule involves technical storage and packaging requirements, it was determined to be in the public's interest to solicit comments on the rule. The rule is effective upon publication in order to benefit producers in 2004, and because the rule is consistent with commercial storage practices used, under limited circumstances, for years.

This rule is issued in conformance with Executive Order 12866, was determined to be not significant and has not been reviewed by the Office of Management Budget.

It has been determined that the Regulatory Flexibility Act is not applicable to this rule because the Farm Service Agency (FSA) is not required to publish a notice proposed rulemaking for the subject matter of this rule.

The environmental impacts of this rule have been considered in accordance with the provisions of the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et seq. , the regulations of the Council on Environmental Quality (40 CFR parts 1500-1508), and the FSA regulations for compliance with NEPA, 7 CFR part 799. FSA concluded that the rule requires no further environmental review because it is categorically excluded. No extraordinary circumstances or other unforeseeable factors exist which would require preparation of an environmental assessment or environmental impact statement.

This rule has been reviewed in accordance with Executive Order 12988. This rule preempts State laws that are inconsistent with it. Before any legal action may be brought regarding a determination under this rule, the administrative appeal provisions set forth at 7 CFR parts 11 and 780 must be exhausted.

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

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

Section 1601(c) of the 2002 Act provides that the promulgation of regulations and the administration of Title I of the 2002 Act shall be made without regard to chapter 5 of title 44 of the United States Code (the Paperwork Reduction Act). Accordingly, these regulations and the forms and other information collection activities needed to administer the program authorized by these regulations are not subject to review by OMB under the Paperwork Reduction Act.

This rule does not have sufficient Federalism implications to warrant the preparation of a Federalism Assessment. This rule will not have a substantial direct effect on States or their political subdivisions or on the distribution of power and responsibilities among the various levels of government.

FSA is committed to compliance with the Government Paperwork Elimination Act (GPEA) and the Freedom to E-File Act, which require Government agencies in general and FSA in particular to provide the public the option of submitting information or transacting business electronically to the maximum extent possible. The forms and other information collection activities required for participation in the program are available electronically for downloading or electronic submission through the USDA eForms Web site at http://forms.sc.egov.usda.gov/eforms.

The title and number of the Federal assistance program found in the Catalog of Federal Domestic Assistance to which this final rule applies are Commodity Loans and Loan Deficiency Payments, 10.051.

In the FR Doc. 04-17153, appearing on page 44927, in the Federal Register of July 28, 2004, the following corrections are made:

In the Federal Register of October 26, 1989 (54 FR 43766), FDA published a final rule which, among other things, amended its menstrual tampon labeling regulation to standardize the existing absorbency terms (junior, regular, super, and super plus) corresponding to the following four absorbency ranges: Less than 6, 6 to 9, 9 to 12, and 12 to 15 g of fluid. FDA announced the availability of the term for 15 to 18 g absorbency tampons (“ultra”) in the Federal Register of October 18, 2000 (65 FR 62317). When commenting on that proposed rule, manufacturers argued that women should use the least absorbent tampon necessary and that the amount of their menstrual flow, not the age or size of a woman, should determine the absorbency of the tampon she should use. FDA is also aware of literature suggesting that, to minimize the risk of TSS, the lowest absorbency of tampon that is effective should be chosen.

In the Federal Register of October 18, 2000, FDA published a proposed rule to amend its tampon labeling regulation to change the current term for tampons that absorb 6 g and under of fluid. FDA proposed this change because it believes that changing the standard term for this absorbency range from “junior” to “light” will improve consumer understanding of tampons across brands, and it will make it easier for women to adhere to advice in the tampon labeling about reducing the risk of TSS. The 90-day comment period closed on January 16, 2001. The agency received comments from two tampon manufacturers.

(Comment 1) Both companies supported FDA's proposal to change the absorbency term for tampons that absorb 0 to 6 g of fluid from “junior” to “light”. They agreed with the agency's position that this change will reduce the mistaken impression held by many women that the term “junior” means the tampons are intended only for younger or teenage women, rather than referring to the amount of menstrual flow.

Comments from both manufacturers noted that the proposed effective date of 90 days after publication of the final rule in the Federal Register would not allow sufficient time for manufacturers to deplete their inventories of existing packaging materials or revise labeling and artwork on retail packages. Both companies recommended the agency allow a 24-month period following publication of the final rule in the Federal Register during which tampons that absorb 6 g or less of fluid could be sold with either a “junior” or a “light” designation. One company recommended that only those tampons which have a valid date code within 24 months of publication of the final rule in the Federal Register be allowed to carry the “junior” designation.

(Response) Based on available information regarding labeling of these devices, FDA has concluded that 18 months after publication of the final rule should be sufficient for manufacturers to implement the “light” absorbency designation on their product package labeling.

(Comment 2) Comments from the manufacturers also suggested that the change to “light absorbency” in the U.S. tampon labeling regulation will result in inconsistency with current Canadian tampon labeling requirements. Both companies recommended agency harmonization with the Canadian requirements so that the same tampon absorbency terms are acceptable in both the United States and Canada.

(Response) The agency intends to work with the Canadian device authorities to harmonize required absorbency terms for tampons.

The agency has determined under 21 CFR 25.30(h) and (k) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

FDA has examined the impacts of the final rule under Executive Order 12866, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1501 et seq. ). Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). The agency believes that this final rule is consistent with the regulatory philosophy and principles identified in the Executive order. In addition, the final rule is not a significant regulatory action as defined by the Executive order and so is not subject to review under the Executive order.

The Regulatory Flexibility Act requires agencies to analyze regulatory options that would minimize any significant impact of a rule on small entities. Any small entity that decided to enter the market for this product would incur no additional costs because of this rule, as that entity would already be required to identify the absorbency ranges of its tampons. Because this rule imposes minimal costs, the agency certifies that the final rule will not have a significant economic impact on a substantial number of small entities.

Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires that agencies prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. The current threshold after adjustment for inflation is $110 million. FDA does not expect this final rule to result in any 1-year expenditure that would meet or exceed this amount.

The purpose of this final rule is to amend the menstrual tampon labeling regulation changing the current absorbency term “junior” to “light” to improve consumer understanding of tampon absorbency rates. All manufacturers of menstrual tampons with an absorbency range of less than or equal to 6 g will have to change their package labels and any other labeling using the term “junior” in reference to these products. This is a minor label change because it only requires changing one word on the labeling and will not affect label formatting or the space requirements. Manufacturers should incur minor or no incremental costs as a result of this rule because they will have 18 months in which to implement the changes and the change can be incorporated when new labels are ordered. The 18-month implementation period should also allow manufacturers to deplete their current label inventory.

The Small Business Administration (SBA) classifies a medical device entity as “small” if it has fewer than 500 employees. There are about 10 domestic manufacturers that will be affected by this rule, 5 of which meet SBA's definition of a small entity. Frequent relabeling is a cost of doing business in the consumer health products market. Some companies will be able to incorporate this labeling change at no additional cost when making other voluntary label changes. The incremental cost of a minor label change such as this is between $600 and $3,000, depending on the type of packaging and printing method. A manufacturer will incur this cost for each individual package size it markets that contains tampons with an absorbency rate of 6 g or less. The incremental cost to relabel is less than 1 percent of the small entities' product revenues. Therefore, the final rule will not have a significant economic impact on small entities.

FDA has analyzed this final rule in accordance with the principles set forth in Executive Order 13132. FDA has determined that the rule does not contain policies that have substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. Accordingly, the agency has concluded that the rule does not contain policies that have federalism implications as defined in the Executive order and, consequently, a federalism summary impact statement is not required.

This final rule does not contain information collection provisions that are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). This rule requires tampon manufacturers to provide specific wording supplied by FDA on their labeling. Such information is not included in the definition of “collection of information” under the Paperwork Reduction Act regulation (5 CFR 1320.3(c)(3)).

We did not publish a notice of proposed rulemaking (NPRM) for these regulations. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. Publishing an NPRM would be contrary to public safety interests. The organizers of the event were not able to provide necessary information prior to the event and with sufficient time remaining to publish an NPRM. As the event will be held on Sunday, August 29, 2004, there is not sufficient time to allow for a notice and comment period prior to its occurrence. Additionally, numerous spectator craft and participant craft will be in close proximity to each other around the staging area, parade area and arena marine basin, compromising the safety of all vessels in the heavily congested area. For these safety reasons, it is in the public interest to have these regulations in effect during the event. Advance notifications will be made via marine information broadcasts.

For the same reasons, the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register .

The 2004 MTV Video Music Awards will be held in Miami at the American Airlines Arena. A boat parade of award recipients will precede the award ceremony. The boat parade will be a nighttime parade of approximately 20 vessels. The vessels range in length from 20 to 100 feet. Approximately 200 spectator craft are expected to view the parade from the waterway. The parade will form in the staging area at the Coast Guard base then proceed south into the Port of Miami, Main Channel, then west into the Miami Harbor turning basin, then west into the American Airlines Arena marina basin. The regulated area includes the staging area, parade route and arena marine basin.

These special local regulations prohibit non-participant vessels from entering the regulated areas, which include the staging area, parade route and arena marine basin.

The staging area encompasses all waters surrounding the Coast Guard base in Miami Beach. No anchoring or entry will be permitted in the staging area.

The parade area begins at the southerly end of the staging area, then south to the Main Channel, then west into the Miami Harbor turning basin in a box formed by the following coordinates:

The regulated area at the American Airlines Arena will consist of an area marked off by buoys at the following positions:

These regulations prohibit non-participating vessels from entering the area, unless authorized by the Coast Guard Patrol Commander.

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS). These regulations will have a minimal impact on non-participant and non-spectator vessels due to the normally low volume of vessel traffic on the regulated waterways when the regulation is effective. Moreover, this rule is only in effect for 8 hours. Also, it regulates only the waters immediately surrounding the parade vessels, and it moves with the parade vessels. Therefore, it should have a minimal impact on non-participant and non-spectator vessels.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule may affect the following entities, some of which may be small entities: The owners or operators of vessels intending to transit or anchor in a portion of the regulated area from 3 p.m. to 11 p.m. on August 29, 2004. This rule will not have a significant economic impact on a substantial number of small entities for the following reasons. This rule is for a highly publicized event and will only be in effect for 8 hours when vessel traffic normally is minimal. Any traffic that needs to pass through the regulated area will be allowed to pass with the permission of the Coast Guard Patrol Commander once the parade participants have moved further along the parade route.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offer to assist small entities in understanding the rule so that they can better evaluate its effects on them and participate in the rulemaking process. Small entities may contact the person listed under the FOR FURTHER INFORMATION CONTACT section for assistance in understanding and participating in this rulemaking. Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

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

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

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

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

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

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

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

The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g., specifications of materials, performance, design or operation; test methods; sampling procedures; and related management system practices) that are developed or adopted by voluntary consensus standards bodies.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this 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 rule is categorically excluded, under figure 2-1, paragraph 34(h), of the Instruction, from further environmental documentation. Under figure 2-1, paragraph (34)(h), of the Instruction, an “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are not required for this rule.

On July 8, 2003 (68 FR 40520), EPA published a final rulemaking notice (FRN) for the Commonwealth of Virginia. The FRN approved Virginia's NO X Budget Trading Program, with the exception of its NO X allowance banking provisions, which EPA conditionally approved. EPA's rationale for approving Virginia's NO X Budget Trading Program while conditionally approving the program's allowance banking provisions were provided in the November 12, 2002 (67 FR 68542) notice of proposed rulemaking (NPR), and discussed in detail in EPA's response to public comments in the FRN and will not be restated here. The terms of the conditional approval required that Virginia revise its banking provisions by changing the flow control start date from 2006 to 2005, and submit the change as a SIP revision within one year from August 7, 2003, the effective date of the conditional approval.

On June 23, 2004, the Virginia Department of Environmental Quality (VADEQ) submitted a formal revision to its SIP. The SIP revision pertained to Virginia's banking provision at 9 VAC 5-140-550, and changed the flow control start date from 2006 to 2005. Virginia's NO X Budget Trading Program was implemented in 2004, therefore flow control will start in the second year of the program, which is consistent with the other states subject to the NO X SIP Call. Virginia has therefore satisfied the terms of the conditional approval.

In 1995, Virginia adopted legislation that provides, subject to certain conditions, for an environmental assessment (audit) “privilege” for voluntary compliance evaluations performed by a regulated entity. The legislation further addresses the relative burden of proof for parties either asserting the privilege or seeking disclosure of documents for which the privilege is claimed. Virginia's legislation also provides, subject to certain conditions, for a penalty waiver for violations of environmental laws when a regulated entity discovers such violations pursuant to a voluntary compliance evaluation and voluntarily discloses such violations to the Commonwealth and takes prompt and appropriate measures to remedy the violations. Virginia's Voluntary Environmental Assessment Privilege Law, Va. Code Sec. 10.1-1198, provides a privilege that protects from disclosure documents and information about the content of those documents that are the product of a voluntary environmental assessment. The Privilege Law does not extend to documents or information (1) that are generated or developed before the commencement of a voluntary environmental assessment; (2) that are prepared independently of the assessment process; (3) that demonstrate a clear, imminent and substantial danger to the public health or environment; or (4) that are required by law.

On January 12, 1998, the Commonwealth of Virginia Office of the Attorney General provided a legal opinion that states that the Privilege law,Va. Code Sec. 10.1-1198, precludes granting a privilege to documents and information “required by law,” including documents and information “required by Federal law to maintain program delegation, authorization or approval,” since Virginia must “enforce Federally authorized environmental programs in a manner that is no less stringent than their Federal counterparts. * * *” The opinion concludes that “[r]egarding § 10.1-1198, therefore, documents or other information needed for civil or criminal enforcement under one of these programs could not be privileged because such documents and information are essential to pursuing enforcement in a manner required by Federal law to maintain program delegation, authorization or approval.”

Virginia's Immunity law, Va. Code Sec. 10.1-1199, provides that “[t]o the extent consistent with requirements imposed by Federal law,” any person making a voluntary disclosure of information to a state agency regarding a violation of an environmental statute, regulation, permit, or administrative order is granted immunity from administrative or civil penalty. The Attorney General's January 12, 1998 opinion states that the quoted language renders this statute inapplicable to enforcement of any Federally authorized programs, since “no immunity could be afforded from administrative, civil, or criminal penalties because granting such immunity would not be consistent with Federal law, which is one of the criteria for immunity.”

Therefore, EPA has determined that Virginia's Privilege and Immunity statutes will not preclude the Commonwealth from enforcing its [*] program consistent with the Federal requirements. In any event, because EPA has also determined that a state audit privilege and immunity law can affect only state enforcement and cannot have any impact on Federal enforcement authorities, EPA may at any time invoke its authority under the Clean Air Act, including, for example, sections 113, 167, 205, 211 or 213, to enforce the requirements or prohibitions of the state plan, independently of any state enforcement effort. In addition, citizen enforcement under section 304 of the Clean Air Act is likewise unaffected by this, or any, state audit privilege or immunity law.

EPA is converting its conditional approval of the Commonwealth of Virginia SIP pertaining to its allowance banking provisions at 9 VAC 5-140-550 to a full approval. The SIP revision submitted submitted by the State changes the flow control start date from 2006 to 2005. Virginia has therefore corrected the deficiency identified by EPA in its NO X Budget Trading Program, and has satisfied all the terms of the conditional approval.

EPA is publishing this rule without prior proposal because the Agency views this as a noncontroversial amendment and anticipates no adverse comment. However, in the “Proposed Rules” section of today's Federal Register , EPA is publishing a separate document that will serve as the proposal to convert the conditional approval to a full approval if adverse comments are filed. This rule will be effective on October 25, 2004 without further notice unless EPA receives adverse comment by September 24, 2004. If EPA receives adverse comment, EPA will publish a timely withdrawal in the Federal Register informing the public that the rule will not take effect. EPA will address all public comments in a subsequent final rule based on the proposed rule. EPA will not institute a second comment period on this action. Any parties interested in commenting must do so at this time.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). This action merely approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). Because this rule approves pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). This rule also does not have tribal implications because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action also does not have Federalism implications because it does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action merely approves a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it is not economically significant.

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

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 25, 2004. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action approving the allowance banking provisions in Virginia's NO X Budget Trading Program may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

Entities potentially regulated by this regulation are public water systems that are classified as community water systems (CWSs). A community water system (CWS) means a public water system which serves at least 15 service connections used by year-round residents or regularly serves at least 25 year-round residents. Categories and entities potentially regulated by this action include the following:

This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be regulated by this action. This table lists the types of entities that EPA is now aware could potentially be regulated by this action. Other types of entities not listed in the table could also be regulated. To determine whether your facility is regulated by this action, you should carefully examine the applicability criteria in § 141.66 of title 40 of the Code of Federal Regulations. If you have questions regarding the applicability of this action to a particular entity, consult the person listed in the preceding FOR FURTHER INFORMATION CONTACT section.

The Safe Drinking Water Act (SDWA), as amended in 1996, requires EPA to promulgate national primary drinking water regulations (NPDWRs) that specify maximum contaminant levels (MCLs) or treatment techniques for drinking water contaminants (SDWA section 1412 (42 U.S.C. 300g-1)). NPDWRs apply to public water systems pursuant to SDWA section 1401 (42 U.S.C. 300f(1)(A)). According to SDWA section 1401(1)(D), NPDWRs include “criteria and procedures to assure a supply of drinking water which dependably complies with such maximum contaminant levels; including accepted methods for quality control and testing procedures.” In addition, SDWA section 1445(a) authorizes the Administrator to establish regulations for monitoring to assist in determining whether persons are acting in compliance with the requirements of the SDWA. EPA's promulgation of analytical methods is authorized under these sections of the SDWA, as well as the general rulemaking authority in SDWA section 1450(a), (42 U.S.C. 300j-9(a)). The action proposed herein would affect CWSs. CWSs are a subset of public water systems. (40 CFR 141.2)

On December 7, 2000 (65 FR 76708), EPA published a final radionuclides rule in the Federal Register that included monitoring requirements and a MCL of 30 micrograms per liter (30 μg/L) for uranium that took effect in December 2003. In the preamble to the December 2000 rule, EPA noted that several commenters asked EPA to consider the approval of compliance monitoring methods that use an inductively coupled plasma mass spectrometry (ICP-MS) technology. (65 FR 76724) These commenters suggested that ICP-MS analytical methods could be more cost-effective, less labor-intensive or more sensitive than some of the technologies approved in the December 2000 rule. In response to these comments, EPA stated that the Agency was reviewing ICP-MS technology for possible proposal in a future rulemaking.

EPA proposed the approval of three methods that use ICP-MS technology for compliance determinations of uranium in drinking water in the Federal Register on June 2, 2004 (69 FR 31068). Specifically, EPA proposed the approval of ICP-MS methods published by EPA, ASTM International, and the Standard Methods (SM) Committee (EPA 200.8, ASTM D5673-03, and SM 3125). The proposed approval of the three ICP-MS methods did not, and does not, affect approval of the 15 methods already specified at 40 CFR 141.25(a) for compliance determinations of uranium.

EPA has completed its review of the comments received on the June 2, 2004, proposal and is today approving the three ICP-MS methods described above. The methods are very similar and are published by EPA, American Society for Testing and Materials International (ASTM), and the Standard Methods (SM) Committee. The methods are EPA 200.8, ASTM D5673-03, and SM 3125.

EPA is taking final action to approve the use of three additional analytical methods for compliance determinations of uranium in drinking water. These methods use an ICP-MS technology that has gained wide acceptance in the analytical community. Method EPA 200.8 was published by EPA in 1994; method ASTM D5673-03 was published by ASTM International in 2003; and SM 3125 was published by the Standard Methods Committee in 1998. In today's action, EPA is approving the use of these ICP-MS methods for compliance determinations of uranium in drinking water.

This rule will be effective on August 25, 2004. Making this rule effective immediately is in the public interest. Because use of EPA-approved analytical methods is required, approval of these relatively inexpensive methods is expected to garner considerable cost savings. It is EPA's expectation that reducing the burdens on community water systems will encourage compliance with testing requirements themselves. Hence, today's rule expanding the limited number of available test methods for compliance determinations of uranium in drinking water should provide considerable relief to community water systems and EPA finds that it has good cause to make this rule effective immediately.

EPA reviewed ICP-MS methods published by EPA, ASTM International, and the Standard Methods Committee. In each of these methods, sample material in solution is introduced by pneumatic nebulization into a radiofrequency plasma where energy transfer processes cause desolvation, atomization, and ionization. The ions are extracted from the plasma through a differentially pumped vacuum interface and separated on the basis of their mass-to-charge ratio by a quadrupole mass spectrometer having a minimum resolution capability of one atomic mass unit peak width at five percent peak height. The ions transmitted through the quadrupole are detected by an electron multiplier or Faraday detector and the ion information processed by a data handling system. The sensitivity of each ICP-MS method for compliance determinations of uranium in drinking water is acceptable and is sensitive enough to detect at less than one part per billion (1 ug/L). The uranium MCL is 30 ug/L.

EPA reviewed each of these methods for performance and applicability to compliance determinations of uranium in drinking water. Three of these methods, EPA 200.8, ASTM D5673-03, and SM 3125, have acceptable performance and are otherwise suitable for compliance determinations of uranium in drinking water. Method EPA 200.8 was published by EPA in 1994; method ASTM D5673-03 was published by ASTM International in 2003; and SM 3125 was published by the Standard Methods Committee in 1998. In today's action, EPA is approving the use of these ICP-MS methods for compliance determinations of uranium in drinking water. EPA is taking this action in response to stakeholder requests.

EPA is not, in today's action, approving the use of these methods for any other purposes. EPA notes that EPA 200.8 was approved for compliance determinations of several regulated metals in drinking water on December 5, 1994. (59 FR 62456) EPA also recognizes that the other two ICP-MS methods approved through today's action for determination of uranium may also be applicable to monitoring for other drinking water contaminants. Although the analytical scope of ASTM D5673-03 and SM 3125 extends beyond uranium, these two methods were not published until 2003 and 1998, respectively. In a later rulemaking, EPA may consider extending the use of ASTM D5673-03 and SM 3125 to compliance determinations of other regulated metals.

Like fluorometric and laser phosphorimetry methods, ICP-MS measures uranium mass only; therefore, all caveats discussed in the December 2000 Radionuclides Rule on using mass methods to determine contributions to gross alpha also apply. (65 FR 76724)

Today's final rule does not affect approval of the 15 methods already specified at 40 CFR 141.25(a) for compliance determinations of uranium.

EPA received a somewhat ambiguous letter during the public comment period of the proposed rule (69 FR 31068) that was published in the Federal Register on June 2, 2004. The Agency has withdrawn the direct final rule because of this letter. The commenter did not explicitly object to the approval of any of the three ICP-MS methods; however, he did seek clarification regarding the relationship of certain laboratory certification measures to these analytical methods. Specifically, the commenter noted that “in the “Manual for the Certification of Laboratories Analyzing Drinking Water” all methods for uranium are addressed in the Radiochemistry chapter even though not all the methods are radiochemical based, e.g. , fluorometric and laser phosphorimetry. Unfortunately, the final and proposed actions don't address if the Radiochemistry chapter should also be applied to the ICP-MS determination of uranium.”

While the Agency does not believe the comment is directly relevant to the merits of the ICP-MS method itself, the Agency chooses to address it. The cited laboratory certification document is an EPA publication that States may use as a reference in developing programs for the certification of laboratories to conduct compliance monitoring under the Safe Drinking Water Act. The Agency believes that it is likely that States will apply the Radiochemistry chapter to the use of the ICP-MS methods approved in today's final rule, though that decision rests with the States.

The commenter also cited an alternate test procedures (ATP) Protocol for Organic and Inorganic Analytes. This protocol (EPA 821-B-98-002) was published by EPA in March 1999. The commenter stated that he believes that it is “unclear from the final and proposed actions if any of the indicated methods are being designated as the reference method for ATP purposes.”

The ATP protocol applies only to the comparison of alternate test procedures for the determination of chemicals. This protocol does not apply to comparison of alternate test procedures for the determination of radionuclides, and EPA has not developed a protocol for radionuclides.

Under Executive Order 12866, [58 FR 51735 (October 4, 1993)] the Agency must determine whether the regulatory action is “significant” and therefore subject to OMB review and the requirements of the Executive Order. The Order defines “significant regulatory action” as one that is likely to result in a rule that may:

(1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities;

(2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or

(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.

It has been determined that this rule is not a “significant regulatory action” under the terms of Executive Order 12866 and is therefore not subject to OMB review.

This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. This action does not impose any new requirements; rather, it approves three additional voluntary analytical methods for compliance determinations of uranium in drinking water.

Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information.

An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

The Regulatory Flexibility Act (RFA) generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small government jurisdictions.

The RFA provides default definitions for each type of small entity. Small entities are defined as: (1) A small business as defined by the Small Business Administration's (SBA) regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any “not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” However, the RFA also authorizes an agency to use alternative definitions for each category of small entity, “which are appropriate to the activities of the agency” after proposing the alternative definition(s) in the Federal Register and taking comment. 5 U.S.C. secs. 601(3)-(5). In addition, to establish an alternative small business definition, agencies must consult with the Small Business Administration's (SBA's) Chief Counsel for Advocacy.

For purposes of assessing the impacts of today's rule on small entities, EPA considered small entities to be public water systems serving 10,000 or fewer persons. This is the cut-off level specified by Congress in the 1996 Amendments to the Safe Drinking Water Act for small system flexibility provisions. In accordance with the RFA requirements, EPA proposed using this alternative definition in the Federal Register (63 FR 7620, February 13, 1998), requested public comment, consulted with the Small Business Administration (SBA), and finalized the alternative definition for all future drinking water regulations in the Consumer Confidence Reports regulation (63 FR 44511, August 19, 1998). As stated in that Final Rule, the alternative definition would be applied to this regulation as well.

This final rule imposes no cost on any entities over and above those imposed by the final Radionuclides Rule. (65 FR 76708) This action merely allows three additional analytical methods for compliance determinations of uranium in drinking water. The use of these methods is voluntary because drinking water systems can continue to use the existing approved methods.

After considering the economic impacts of today's final rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. The small entities directly regulated by this final rule are public water systems serving 10,000 or fewer persons. We have determined that no number of small entities will be impacted by this voluntary action because drinking water systems can continue to use the existing approved methods.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub. L. 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, and tribal governments, in the aggregate, or to the private sector, of $100 million or more in any one year. Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost-effective or least burdensome alternative that achieves the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent with applicable law. Moreover, section 205 allows EPA to adopt an alternative other than the least costly, most cost-effective or least burdensome alternative if the Administrator publishes with the final rule an explanation why that alternative was not adopted. Before EPA establishes any regulatory requirements that may significantly or uniquely affect small governments, including tribal governments, it must have developed under section 203 of the UMRA a small government agency plan. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates, and informing, educating, and advising small governments on compliance with the regulatory requirements.

Today's rule contains no Federal mandates (under the regulatory provision of Title II of the UMRA) for State, local, or tribal governments or the private sector. The rule imposes no enforceable duty on any State, local, or tribal governments or the private sector. It merely provides drinking water utilities with three additional voluntary analytical methods to use to meet existing monitoring requirements. Thus, today's rule is not subject to the requirements of sections 202 and 205 of the UMRA.

EPA has determined that this final rule contains no regulatory requirements that might significantly or uniquely affect small governments. The adoption and use of these methods is voluntary because drinking water systems can continue to use the existing approved methods. Thus, today's rule is not subject to the requirements of section 203 of the UMRA.

Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.”

This final rule does not have Federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. There is no cost to State and local governments, and the final rule does not preempt State law. This final rule imposes no cost on any State, or local governments. This final rule merely provides for the voluntary use of three additional analytical methods for compliance determinations of uranium in drinking water. Thus, Executive Order 13132 does not apply to this final rule.

Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, (November 9, 2000), requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that have “substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes.”

This final rule does not have tribal implications. It will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in Executive Order 13175. There is no cost to tribal governments, and the final rule does not preempt tribal law. This final rule imposes no additional cost on any tribal government. This final rule merely provides for the voluntary use of three additional analytical methods for compliance determinations of uranium in drinking water. Thus, Executive Order 13175 does not apply to this rule.

Executive Order 13045: “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885 April 23, 1997) applies to any rule that: (1) Is determined to be “economically significant” as defined under Executive Order 12866, and (2) concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the Agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the Agency.

EPA interprets Executive Order 13045 as applying only to those regulatory actions that are based on health or safety risks, such that the analysis required under section 5-501 of the Order has the potential to influence the regulation. This rule is not subject to Executive Order 13045 because it does not establish an environmental standard intended to mitigate health or safety risks. This final rule merely provides for the voluntary use of three additional analytical methods for compliance determinations of uranium in drinking water.

This rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)) because it is not a significant regulatory action under Executive Order 12866.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Pub. L. 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

This rulemaking involves technical standards. In addition to approving EPA 200.8, EPA has decided to approve two voluntary consensus methods (ASTM International D5673-03, and the Standard Methods (SM) Committee 3125) for compliance determinations of uranium in drinking water. Approval of these methods is in accordance with the goals of the NTTAA. EPA believes that ICP-MS analytical methods could be more cost-effective, less labor-intensive or more sensitive than some of the technologies previously approved in the December 2000 Radionuclides Rule. (65 FR 76708) This rule does not withdraw approval of any previously approved monitoring methods for uranium. Copies of both voluntary consensus methods are available for viewing at the docket facility identified in ADDRESSES section.

The Congressional Review Act, 5 U.S.C. 801 et seq. , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . A Major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2). This rule will be effective August 25, 2004.

EPA published the direct final rule and companion proposed rule for approval of the use of three additional analytical methods for compliance determinations of uranium in drinking water in the Federal Register on June 2, 2004 (69 FR 31008 and 31068). In the companion proposal, EPA proposed the approval of three methods that use an inductively coupled plasma mass spectrometry (ICP-MS) technology. Specifically, EPA proposed the approval of ICP-MS methods published by EPA, ASTM International, and the Standard Methods Committee (EPA 200.8, ASTM D5673-03, and SM 3125) for compliance determinations of uranium in drinking water. The proposed approval of the three ICP-MS methods did not affect approval of the 15 methods currently specified at 40 CFR 141.25(a) for compliance determinations of uranium.

In the companion proposed rule (69 FR 31068) section of the June 2, 2004, EPA invited comment on the substance of the direct final rule and stated that if adverse comments were received by July 2, 2004, the direct final rule would not become effective and a notice would be published in the Federal Register to withdraw the direct final rule before the August 31, 2004, effective date. The EPA subsequently received comment on the proposed rule.

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to:

• Crop production (NAICS 111), e.g., agricultural workers; greenhouse, nursery, and floriculture workers; farmers.

• Animal production (NAICS 112), e.g., cattle ranchers and farmers, dairy cattle farmers, livestock farmers.

• Food manufacturing (NAICS 311), e.g., agricultural workers; farmers; greenhouse, nursery, and floriculture workers; ranchers; pesticide applicators.

• Pesticide manufacturing (NAICS 32532), e.g., agricultural workers; commercial applicators; farmers; greenhouse, nursery, and floriculture workers; residential users.

This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT .

In addition to using EDOCKET ( http://www.epa.gov/edocket/ ), you may access this Federal Register document electronically through the EPA Internet under the “ Federal Register ” listings at http://www.epa.gov/fedrgstr/ . A frequently updated electronic version of 40 CFR part 180 is available on E-CFR Beta Site Two at http://www.gpoaccess.gov/ecfr/ . To access the OPPTS Harmonized Guidelines referenced in this document, go directly to the guidelines at http://www.epa.gpo/opptsfrs/home/guidelin.htm/ .

In the Federal Register of May 7, 2003 (68 FR 24467) (FRL-7305-1), EPA issued a notice pursuant to section 408(d)(3) of FFDCA, 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 1E6310) by IR-4, Center for Minor Crop Pest Management, Rutgers, The State University of New Jersey, 681 U.S. Highway #1 South, North Brunswick, NJ 08902-3390. That notice included a summary of the petition prepared by IR-4, the registrant. There were no comments received in response to the notice of filing.

The petition requested that 40 CFR 180.191 be amended by establishing a tolerance for residues of the fungicide folpet, N-(trichloromethylthio)phthalimide, in or on U.S. grown hop, dried cones at 120 parts per million (ppm). EPA has previously established a tolerance for folpet on hops in the Federal Register of March 5, 2003 (68 FR 10377) (FRL-7296-2). That tolerance applies to all hops in interstate commerce in the U. S. no matter what country the hops originate from. Nonetheless, because at the time that tolerance was established there was no registration under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), 7 U.S.C. 136 et seq ., for use of folpet on hops, that fact was noted, as is EPA's general practice, in the tolerance regulation. A FIFRA registration has since been applied for and EPA plans to approve that registration simultaneous with promulgation of this final rule. This final rule amends the folpet tolerance to delete the statement regarding the lack of a FIFRA registration. Further, this action re-examines the safety determination for folpet because the prior action assumed that folpet would not be used on hops in the United States.

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish or amend a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”

EPA performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. For further discussion of the regulatory requirements of section 408 of FFDCA and a complete description of the risk assessment process, see the final rule on Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997) (FRL-5754-7).

Consistent with section 408(b)(2)(D) of FFDCA, EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure, consistent with section 408(b)(2) of FFDCA, for a tolerance for residues of folpet on hop, dried cones at 120 ppm. EPA's assessment of exposures and risks associated with establishing the tolerance follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The nature of the toxic effects caused by folpet as well as the no observed adverse effect level (NOAEL) and the lowest observed adverse effect level (LOAEL) from the toxicity studies reviewed are discussed in the March 5, 2003 Federal Register document (OPP-2003-0075). There have been no changes in the toxicological profile since the March 5, 2003 Federal Register document (OPP-2003-0075) and, therefore, the Agency will not repeat the entire table in this final rule but refers to the original document.

The dose at which no adverse effects are observed (the NOAEL) from the toxicology study identified as appropriate for use in risk assessment is used to estimate the toxicological level of concern (LOC). However, the LOAEL is sometimes used for risk assessment if no NOAEL was achieved in the toxicology study selected. An uncertainty factor (UF) is applied to reflect uncertainties inherent in the extrapolation from laboratory animal data to humans and in the variations in sensitivity among members of the human population as well as other unknowns. An UF of 100 is routinely used, 10X to account for interspecies differences and 10X for intraspecies differences.

Three other types of safety factors (SF) or UFs may be used: “Traditional UFs;” the “special FQPA safety factor;” and the “default FQPA safety factor.” By the term “traditional uncertainty factor,” EPA is referring to those additional UFs used prior to FQPA passage to account for database deficiencies. These traditional UFs have been incorporated by the FQPA into the additional safety factor for the protection of infants and children. The term “special FQPA safety factor” refers to those safety factors that are deemed necessary for the protection of infants and children primarily as a result of the FQPA. The “default FQPA safety factor” is the additional 10X SF that is mandated by the statute unless it is decided that there are reliable data to choose a different additional factor (potentially a traditional UF or a special FQPA SF).

For dietary risk assessment (other than cancer) the Agency uses the UF to calculate an acute or chronic reference dose (acute RfD or chronic RfD) where the RfD is equal to the NOAEL divided by an UF of 100 to account for interspecies and intraspecies differences and any traditional UF factors deemed appropriate (RfD = NOAEL/UF). Where a special FQPA SF or the default FQPA SF is used, this additional factor is applied to the RfD by dividing the RfD by such additional factor. The acute or chronic population adjusted dose (aPAD or cPAD) is a modification of the RfD to accommodate this type of safety factor.

For non-dietary risk assessments (other than cancer) the UF is used to determine the LOC. For example, when 100 is the appropriate UF (10X to account for interspecies differences and 10X for intraspecies differences) the LOC is 100. To estimate risk, a ratio of the NOAEL to exposures (margin of exposure (MOE) = NOAEL/exposure) is calculated and compared to the LOC.

The linear default risk methodology (Q*) is the primary method currently used by the Agency to quantify carcinogenic risk. The Q* approach assumes that any amount of exposure will lead to some degree of cancer risk. A Q* is calculated and used to estimate risk which represents a probability of occurrence of additional cancer cases (e.g., risk). An example of how such a probability risk is expressed would be to describe the risk as one in one hundred thousand (1 X 10 - 5 ), one in a million (1 X 10 - 6 ), or one in ten million (1 X 10 - 7 ). Under certain specific circumstances, MOE calculations will be used for the carcinogenic risk assessment. In this non-linear approach, a “point of departure” is identified below which carcinogenic effects are not expected. The point of departure is typically a NOAEL based on an endpoint related to cancer effects though it may be a different value derived from the dose response curve. To estimate risk, a ratio of the point of departure to exposure (MOE cancer = point of departure/exposures) is calculated.

A summary of the toxicological endpoints for folpet used for human risk assessment is shown in Table 1 of this unit:

1. Dietary exposure from food and feed uses . Tolerances have been established (40 CFR 180.191) for residues of folpet, in or on a variety of raw agricultural commodities. Risk assessments were conducted by EPA to assess dietary exposures from folpet in food as follows:

i. Acute exposure . Acute dietary risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure.

In conducting the acute dietary risk assessment EPA used the Dietary Exposure Evaluation Model software with the Food Commodity Intake Database (DEEM-FCID TM ), which incorporates food consumption data as reported by respondents in the (United States Department of Agriculture) (USDA) 1994-1996 and 1998 Nationwide Continuing Surveys of Food Intake by Individuals (CSFII), and accumulated exposure to the chemical for each commodity. The following assumptions were made for the acute exposure assessments: A Tier 3 acute probabilistic dietary exposure analysis was performed. The assumptions for most commodities (apple and apple juice; cranberries; cucumbers; grapes, grape juice, wine, raisins; lettuce; melons; onions; strawberries; and tomatoes) were anticipated residue levels (incorporated into residue distribution files) and the percent crop treated (PCT) estimate for imported crops consumed in the U.S. PCT for imported commodities is estimated at a maximum of 1%, based on information derived through an analysis of import and domestic production data available from the USDA for the years 1995 through 1999, adjusted for the countries in which folpet is registered. For avocados, the assumptions of the acute dietary exposure analysis were anticipated residue levels and 11 PCT (Florida avocado acreage is 11% of the total U.S. avocado acreage as reported by USDA and assuming all the crop in Florida is treated is considered very conservative). For hops, the assumptions of the acute dietary analysis were tolerance level residues (120 ppm) and 100 PCT.

ii. Chronic exposure . In conducting the chronic dietary risk assessment EPA used the DEEM-FCID TM , which incorporates food consumption data as reported by respondents in the USDA 1994-1996 and 1998 Nationwide CSFII, and accumulated exposure to the chemical for each commodity. The following assumptions were made for the chronic exposure assessments: A Tier 3 chronic (non-cancer) dietary exposure analysis was performed. The assumptions for most commodities (apple and apple juice; cranberries; cucumbers; grapes, grape juice, wine, raisins; lettuce; melons; onions; strawberries; and tomatoes) were anticipated residue levels (incorporated into residue distribution files) and the PCT estimate for imported crops consumed in the U.S. (which is a maximum of 1%, based on information derived through an analysis of import and domestic production data available from the USDA for the years 1995 through 1999, adjusted for the countries in which folpet is registered). For avocados, the assumptions of the chronic dietary exposure analysis were anticipated residue levels and 11 PCT (because Florida avocado acreage is 11% of the total U.S. avocado acreage as reported by USDA). For hops, the assumptions of the chronic dietary analysis were tolerance level residues (120 ppm) and 100 PCT.

iii. Cancer . A Tier 3 chronic dietary exposure analysis was performed. The assumptions for most commodities (apple and apple juice; cranberries; cucumbers; grapes, grape juice, wine, raisins; lettuce; melons; onions; strawberries; and tomatoes) were anticipated residue levels (incorporated into residue distribution files) and the PCT estimate for imported crops consumed in the U.S. (which is a maximum of 1%, based on information derived through an analysis of import and domestic production data available from the USDA for the years 1995 through 1999, adjusted for the countries in which folpet is registered). For avocados, the assumptions of the chronic dietary exposure analysis were anticipated residue levels and 11 PCT (because Florida avocado acreage is 11% of the total U.S. avocado acreage as reported by USDA). For hops, the assumptions of the chronic dietary analysis were tolerance level residues (120 ppm) and 100 PCT.

iv. Anticipated residue and PCT information. Section 408(b)(2)(E) of FFDCA authorizes EPA to use available data and information on the anticipated residue levels of pesticide residues in food and the actual levels of pesticide chemicals that have been measured in food. If EPA relies on such information, EPA must require that data be provided 5 years after the tolerance is established, modified, or left in effect, demonstrating that the levels in food are not above the levels anticipated. Following the initial data submission, EPA is authorized to require similar data on a time frame it deems appropriate. As required by section 408(b)(2)(E) of FFDCA, EPA will issue a data call-in for information relating to anticipated residues to be submitted no later than 5 years from the date of issuance of this tolerance.

Section 408(b)(2)(F) of FFDCA states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if the Agency can make the following findings: Condition 1, that the data used are reliable and provide a valid basis to show what percentage of the food derived from such crop is likely to contain such pesticide residue; Condition 2, that the exposure estimate does not underestimate exposure for any significant subpopulation group; and Condition 3, if data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area. In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by section 408(b)(2)(F) of FFDCA, EPA may require registrants to submit data on PCT.

The Agency used PCT information as follows. As discussed in the Agency's March 5, 2003 final rule for folpet the only registered use of folpet in the United States is avocados grown in Florida. According to data available from the USDA's National Agricultural Statistics Service, California accounted for 89% of avocado production in the U.S. followed by Florida at nearly 11% and Hawaii at 0.1 %. Therefore, the Agency has assumed that only 11% of the U.S. avocado crop is treated with folpet (100% of the Florida grown avocados). For hops the Agency assumed 100 PCT (U.S. product and imported hops). For all other commodities (i.e., apple, cranberry, cucumber, grape, lettuce, melon, onion, strawberry, and tomato) based upon information derived through an analysis of import and domestic production data available from the USDA for the years 1995 through 1999 and adjusted for the countries in which folpet is registered.

The Agency believes that the three conditions listed Unit III.1.C.iv. have been met. With respect to Condition 1, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. In using these data, the Agency took into account the specific countries where folpet is registered. In the case of avocados, the Agency based it's PCT estimate on the volume of crop grown in Florida based on data from the USDA. Therefore, the Agency has assumed that only 11% of the U.S. avocado crop is treated with folpet. For all other commodities (except hops and avocados), the Agency has assumed (see March 5, 2003 folpet final rule) a maximum PCT of 1% for each commodity (i.e., apple, cranberry, cucumber, grape, lettuce, melon, onion, strawberry, and tomato) based upon information derived through an analysis of import and domestic production data available from the USDA for the years 1995 through 1999 and adjusted for the countries in which folpet is registered.

For all potentially treated commodities the Agency used estimated maximum PCT assumptions in conducting both the acute and chronic dietary exposure assessments. The exposure estimates from this approach the Agency is reasonably certain, represent the highest levels to which individuals could be exposed, and are unlikely to be an underestimation. As to Conditions 2 and 3, regional consumption information and consumption information for significant subpopulations is taken into account through EPA's computer-based model for evaluating the exposure of significant Subpopulation including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available information on the regional consumption of food to which folpet may be applied in a particular area.

2. Dietary exposure from drinking water. The Agency lacks sufficient monitoring exposure data to complete a comprehensive dietary exposure analysis and risk assessment for folpet in drinking water (other than avocados in Florida all tolerances reflect imported commodities and monitoring data other than from Florida would probably not be useful). Because the Agency does not have comprehensive monitoring data, drinking water concentration estimates are made by reliance on simulation or modeling taking into account data on the physical characteristics of folpet.

The Agency uses the FQPA Index Reservoir Screening Tool (FIRST) or the Pesticide Root Zone Model/Exposure Analysis Modeling System (PRZM/EXAMS), to produce estimates of pesticide concentrations in an index reservoir. The screening concentration in ground water (SCI-GROW) model is used to predict pesticide concentrations in shallow ground water. For a screening-level assessment for surface water EPA will use FIRST (a Tier 1 model) before using PRZM/EXAMS (a Tier 2 model). The FIRST model is a subset of the PRZM/EXAMS model that uses a specific high-end runoff scenario for pesticides. Both FIRST and PRZM/EXAMS incorporate an index reservoir environment, and both models include a percent crop area factor as an adjustment to account for the maximum percent crop coverage within a watershed or drainage basin.

None of these models include consideration of the impact processing (mixing, dilution, or treatment) of raw water for distribution as drinking water would likely have on the removal of pesticides from the source water. The primary use of these models by the Agency at this stage is to provide a screen for sorting out pesticides for which it is unlikely that drinking water concentrations would exceed human health LOC.

Since the models used are considered to be screening tools in the risk assessment process, the Agency does not use estimated environmental concentrations (EECs), which are the model estimates of a pesticide's concentration in water. EECs derived from these models are used to quantify drinking water exposure and risk as a %RfD or %PAD. Instead drinking water levels of comparison (DWLOCs) are calculated and used as a point of comparison against the model estimates of a pesticide's concentration in water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food, and from residential uses. Since DWLOCs address total aggregate exposure to folpet they are further discussed in the aggregate risk Unit III.E.

Based on the Tier 1 FIRST and SCI-GROW models, the EECs of folpet for acute exposures are estimated to be 309 parts per billion (ppb) for surface water and 0.06 ppb for ground water. The EECs for chronic exposures are estimated to be 0.62 ppb for surface water and 0.06 ppb for ground water.

3. From non-dietary exposure . The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets).

Folpet is currently registered for use on the following residential non-dietary sites: Fungicide/preservative in wood sealants for use on exterior wood surfaces including residential/recreational decks and playsets, as well as siding, shingles, and fences. There are two wood preservative product registered that have residential use sites. The risk assessment was conducted using the following residential exposure assumptions: Residential handlers may receive short-term dermal and inhalation exposure to folpet when applying the ready-to-use formulations. Adults and children may be exposed to folpet residues from dermal contact with treated wood during post-application activities. In addition, toddlers may receive short- and intermediate-term oral exposure from incidental ingestion (i.e., hand-to-mouth) during post-application activities on treated decks or playsets.

Exposure and risk estimates of dermal and inhalation exposure for residential handlers were assessed using: An oral NOAEL of 10 mg/kg/day (LOAEL = 20 mg/kg/day based on the increase in number of fetuses and litters with hydrocephaly and related malformations). Because the endpoints are based on an oral study, the estimated dermal exposures were adjusted by applying a 2.7% dermal absorption rate, while absorption in the lung was assumed to be 100%. In addition, these endpoints are applicable to females 13+ years old; therefore, a 60-kg body weight was used in the calculations. The endpoints are the same for both dermal and inhalation exposure therefore, the individual dermal and inhalation MOEs were combined into a total MOE. The dermal endpoint used in the adult post-application exposure assessment is the same as that for residential handlers. To assess toddler incidental ingestion and dermal exposure, the maternal NOAEL (10 mg/kg/day) from the rabbit developmental toxicity study; based on a decrease in food consumption at the LOAEL of 20 mg/kg/day, was used for risk assessment purposes because it occurs at the same dose level as the developmental NOAEL (i.e., protective of developmental effects), is from the same study, and is more applicable to toddlers than hydrocephaly effects, which apply only to females of child-bearing age. In addition, using the maternal NOAEL for the toddler dermal assessment is more protective in that it allows for combination with the toddler incidental oral assessment, because they are compared to the same endpoint. The FQPA safety factor was reduced to 1X for the U.S. population and all population subgroups and for all exposure scenarios, thus, the target MOE for risk assessment purposes is 100.

To quantify cancer risk, the Q1* of 1.86 x 10 - 3 mg/kg/day - 1 was multiplied by the estimated lifetime average daily doses from handler and post-application exposure. As with the non-cancer assessment, dermal doses were first adjusted for dermal absorption (i.e., 2.7%) because the Q1* is based on an oral study, while inhalation doses were assumed to be 100% absorbed. Cancer risks for residential handler and postapplication that exceed the range of 1 in 1 million are indicative of concern.

Handler exposures were previously assessed in the 1999 Reregistration Eligibility Decision (RED) for folpet. However, the assessment has been revised in this document to account for the possibility of the residential handler wearing short sleeves and short pants, rather than the long sleeves/pants assumed for both occupational and residential handlers in the RED.

Dermal and inhalation daily doses for residential handlers were calculated for the wood sealant formulation using data for applying a paint or stain. The following handler scenarios were evaluated:

1. Application of ready-to-use wood sealant with a paint brush.

2. Application of ready-to-use wood sealant using an airless sprayer.

The calculated non-occupational handler MOEs are greater than the target of 100, and therefore, are not of concern to the Agency. The handler cancer risks range from 7.6E-08 to 1.0E-07, which also do not exceed the Agency's LOC.

4. Cumulative effects from substances with a common mechanism of toxicity . Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

Unlike other pesticides for which EPA has followed a cumulative risk approach based on a common mechanism of toxicity, EPA has not made a common mechanism of toxicity finding as to folpet and any other substances and folpet does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has not assumed that folpet has a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see the policy statements released by EPA's OPP concerning common mechanism determinations and procedures for cumulating effects from substances found to have a common mechanism on EPA's web site at http://www.epa.gov/pesticides/cumulative/ .

Captan and folpet share a common metabolite, thiophosgene, which the Agency believes to be responsible for the carcinogenic effects of these compounds. Thiophosgene is a highly reactive, short-lived compound. Studies indicate that thiophosgene causes local irritation of the site with which it comes in contact, and is believed to cause tumors through irritation of the duodenum. Because they are so short-lived, thiophosgene residues cannot be quantified. Without measurable residues of the common metabolite, it is difficult to relate exposures of captan to those of folpet since the formation of thiophosgene may be different for both compounds. However, assuming that the carcinogenic effects observed in both pesticides are due solely to the metabolite thiophosgene, the Agency believes it is reasonable to add the estimated cancer risks from the individual aggregate risks from both folpet and captan to obtain a worst-case estimate.

1. In general . Section 408 of FFDCA provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines based on reliable data that a different margin of safety will be safe for infants and children. Margins of safety are incorporated into EPA risk assessments either directly through use of a MOE analysis or through using uncertainty (safety) factors in calculating a dose level that poses no appreciable risk to humans. In applying this provision, EPA either retains the default value of 10X when reliable data do not support the choice of a different factor, or, if reliable data are available, EPA uses a different additional safety factor value based on the use of traditional UFs and/or special FQPA safety factors, as appropriate.

2. Prenatal and postnatal sensitivity —a. The Agency made a determination of susceptibility, as well as performed a degree of concern analysis regarding pre- and/or postnatal toxicity resulting from exposure to folpet. The Agency recommended that the FQPA safety factor be reduced to 1X based upon the following:

i. There was no quantitative or qualitative evidence of increased susceptibility following in utero exposure in two developmental toxicity studies in the rat.

ii. There was no quantitative or qualitative evidence of enhanced susceptibility to the pups in two different two-generation reproduction studies in the rat.

iii. Although there was qualitative evidence of susceptibility in one developmental study in the rabbit (hydrocephaly (developmental LOAEL = 20 mg/kg/day; developmental NOAEL = 10 mg/kg/day)), and quantitative evidence of susceptibility in the other developmental study in the rabbit (delayed ossification (developmental LOAEL = 40 mg/kg/day; developmental NOAEL = 10 mg/kg/day)), the Agency determined that there is low concern for the observed susceptibility because:

• Clear NOAELs/LOAELs were established in these studies.

• There were inconsistencies in the results seen between these studies (hydrocephaly seen in one study was not seen in the other study).

• A conservative determination was made to use hydrocephaly as the endpoint for acute dietary, and short- and intermediate-term dermal and inhalation exposure scenarios, in spite of lack of replication of this effect.

• The dose selected for overall risk assessment would address the concerns for developmental toxicity seen in this species.

• The structure-activity relationship analysis showed that there was not evidence of increased susceptibility in rabbits following in utero exposure to captan, a structural analog of folpet.

• There are no other signs from the available toxicology database of a concern for neurotoxic effects.

b. Therefore, the Agency concluded that there is no residual uncertainty for prenatal and/or postnatal toxicity. The Agency also determined that a developmental neurotoxicity (DNT) study for folpet is not warranted based upon the following considerations:

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to:

• Crop production (NAICS 111), e.g., agricultural workers; greenhouse, nursery, and floriculture workers; farmers.

• Animal production (NAICS 112), e.g., cattle ranchers and farmers, dairy cattle farmers, livestock farmers.

• Food manufacturing (NAICS 311), e.g., agricultural workers; farmers; greenhouse, nursery, and floriculture workers; ranchers; pesticide applicators.

• Pesticide manufacturing (NAICS 32532), e.g., agricultural workers; commercial applicators; farmers; greenhouse, nursery, and floriculture workers; residential users.

This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT .

In addition to using EDOCKET (http://www.epa.gov/edocket/) , you may access this Federal Register document electronically through the EPA Internet under the “ Federal Register ” listings at http://www.epa.gov/fedrgstr/ . A frequently updated electronic version of 40 CFR part 180 is available at E-CFR Beta Site Two at http://www.gpoaccess.gov/ecfr/ .

In the Federal Register of December 31, 2002 (67 FR 79918) (FRL-7285-6), and March 17, 2004 (69 FR 12683) (FRL-7346-8), EPA issued notices pursuant to section 408(d)(3) of FFDCA, 21 U.S.C. 346a(d)(3), announcing the filing of pesticide petitions (PP 1F6296 and 0F6171) by Valent U.S.A. Corporation, 1333 North California Boulevard, Suite 600, Walnut Creek, CA 94596-8025 and pesticide petitions (PP 3E6777, 3E6788 and 3E6779) by Interregional Research Project Number 4 (IR-4), 681 U.S. Highway #1 South, North Brunswick, NJ 08902-3390. The notices included a summary of the petitions prepared by Valent U.S.A. Corporation, the registrant, and IR-4. There were no comments received in response to the notices of filing.

The petitions requested that 40 CFR 180.568 be amended by establishing tolerances for residues of the herbicide flumioxazin, 2-[7-fluoro-3,4-dihydro-3-oxo-4-(2-propynyl)-2H-1,4-benzoxazin-6-yl]-4,5,6,7-tetrahydro-1H-isoindole-1,3(2H)-dione, in or on the raw agricultural commodities grape at 0.02 parts per million (ppm), almonds at 0.02 ppm, pistachios at 0.02, almond, hulls at 0.70 ppm (1F6296), sugarcane at 0.20 ppm (0F6171), peppermint, tops; and spearmint, tops at 0.04 ppm (3E6777), onion, dry bulb; garlic, bulb; and shallot, bulb at 0.02 ppm (3E6788), vegetable, tuberous and corm subgroup 1C at 0.02 ppm (3E6779). The proposed tolerances were corrected to conform to the Food and Feed Commodity Vocabulary database ( http://www.epa.gov/pesticides/foodfeed/ ) to read as follows: Grape at 0.02 ppm, almond (nutmeat) at 0.02 ppm, almond (hulls) at 0.70 ppm, pistachio at 0.02 ppm, onion (dry bulb) at 0.02 ppm, garlic (bulb) at 0.02 ppm, shallot (bulb) at 0.02 ppm, tuberous/corm vegetables (Subgroup 1C) at 0.02 ppm, sugarcane (cane) at 0.20 ppm, peppermint (tops) at 0.04 ppm, and spearmint (tops) at 0.04 ppm.

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish tolerances (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”

EPA performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. For further discussion of the regulatory requirements of section 408 of FFDCA and a complete description of the risk assessment process, see the final rule on Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997) (FRL-5754-7).

Consistent with section 408(b)(2)(D) of FFDCA, EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure, consistent with section 408(b)(2) of FFDCA, for tolerances for residues of flumioxazin, 2-[7-fluoro-3,4-dihydro-3-oxo-4-(2-propynyl)-2H-1,4-benzoxazin-6-yl]-4,5,6,7-tetrahydro-1H-isoindole-1,3(2H)-dione on grape at 0.02 ppm, almond (nutmeat) at 0.02 ppm, almond (hulls) at 0.70 ppm, pistachio at 0.02 ppm, onion (dry bulb) at 0.02 ppm, garlic (bulb) at 0.02 ppm, shallot (bulb) at 0.02 ppm, tuberous/corm vegetables (Subgroup 1C) at 0.02 ppm, sugarcane (cane) at 0.20 ppm, peppermint (tops) at 0.04 ppm, and spearmint (tops) at 0.04 ppm. EPA's assessment of exposures and risks associated with establishing the tolerance follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The nature of the toxic effects caused by flumioxazin are discussed in a March 31, 2004 Federal Register document (69 FR 16823) (FRL-7351-2).

The dose at which no adverse effects are observed (the NOAEL) from the toxicology study identified as appropriate for use in risk assessment is used to estimate the toxicological level of concern (LOC). However, the lowest dose at which adverse effects of concern are identified (the LOAEL) is sometimes used for risk assessment if no NOAEL was achieved in the toxicology study selected. An uncertainty factor (UF) is applied to reflect uncertainties inherent in the extrapolation from laboratory animal data to humans and in the variations in sensitivity among members of the human population as well as other unknowns. An UF of 100 is routinely used, 10X to account for interspecies differences and 10X for intraspecies differences.

Three other types of safety or uncertainty factors may be used: “Traditional UFs”; the “special FQPA safety factor”; and the “default FQPA safety factor.” By the term “traditional uncertainty factor,” EPA is referring to those additional UFs used prior to FQPA passage to account for database deficiencies. These traditional UFs have been incorporated by the FQPA into the additional safety factor (SF) for the protection of infants and children. The term “special FQPA SF” refers to those safety factors that are deemed necessary for the protection of infants and children primarily as a result of the FQPA. The “default FQPA SF” is the additional 10X SF that is mandated by the statute unless it is decided that there are reliable data to choose a different additional factor (potentially a traditional UF or a special FQPA SF).

For dietary risk assessment (other than cancer) the Agency uses the UF to calculate an acute or chronic reference dose (aRfD or cRfD) where the RfD is equal to the NOAEL divided by an UF of 100 to account for interspecies and intraspecies differences and any traditional UFs deemed appropriate (RfD = NOAEL/UF). Where a special FQPA SF or the default FQPA SF is used, this additional factor is applied to the RfD by dividing the RfD by such additional factor. The acute or chronic Population Adjusted Dose (aPAD or cPAD) is a modification of the RfD to accommodate this type of SF.

For non-dietary risk assessments (other than cancer) the UF is used to determine the LOC. For example, when 100 is the appropriate UF (10X to account for interspecies differences and 10X for intraspecies differences) the LOC is 100. To estimate risk, a ratio of the NOAEL to exposures (margin of exposure (MOE) = NOAEL/exposure) is calculated and compared to the LOC.

The linear default risk methodology (Q*) is the primary method currently used by the Agency to quantify carcinogenic risk. The Q* approach assumes that any amount of exposure will lead to some degree of cancer risk. A Q* is calculated and used to estimate risk which represents a probability of occurrence of additional cancer cases (e.g., risk). An example of how such a probability risk is expressed would be to describe the risk as one in one hundred thousand (1 x 10 - 5 ), one in a million (1 x 10 - 6 ), or one in ten million (1 x 10 - 7 ). Under certain specific circumstances, MOE calculations will be used for the carcinogenic risk assessment. In this non-linear approach, a “point of departure” is identified below which carcinogenic effects are not expected. The point of departure is typically a NOAEL based on an endpoint related to cancer effects though it may be a different value derived from the dose response curve. To estimate risk, a ratio of the point of departure to exposure (MOE cancer = point of departure/exposures) is calculated.

A summary of the toxicological endpoints for flumioxazin used for human risk assessment is shown in Table 1 of this unit:

1. Dietary exposure from food and feed uses . Tolerances have been established (40 CFR 180.568) for the residues of flumioxazin, in or on cotton, peanuts and soybean seed. No secondary residues are expected in meat, milk, poultry or eggs. Risk assessments were conducted by EPA to assess dietary exposures from flumioxazin in food as follows:

i. Acute exposure . Acute dietary risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure.

In conducting the acute dietary risk assessment, EPA used the Dietary Exposure Evaluation Model software with the Food Commodity Intake Database (DEEM-FCID TM ), which incorporates food consumption data as reported by respondents in the United States Department of Agriculture (USDA) 1994-1996 and 1998 Nationwide Continuing Surveys of Food Intake by Individuals (CSFII), and accumulated exposure to the chemical for each commodity. The following assumptions were made for the acute exposure assessments: For the acute analyses, tolerance-level residues were assumed for all food commodities with current or proposed flumioxazin tolerances, and it was assumed that all of the crops included in the analysis were treated. Percent Crop Treated (PCT) and/or anticipated residues were not used in the acute risk assessment.

ii. Chronic exposure . In conducting the chronic dietary risk assessment, EPA used the DEEM-FCID TM , which incorporates food consumption data as reported by respondents in the USDA 1994-1996 and 1998 Nationwide CSFII and accumulated exposure to the chemical for each commodity. The following assumptions were made for the chronic exposure assessments: For the chronic analyses, tolerance-level residues were assumed for all food commodities with current or proposed flumioxazin tolerances, and it was assumed that all of the crops included in the analysis were treated. PCT and/or anticipated residues were not used in the chronic risk assessment.

2. Dietary exposure from drinking water . The Agency lacks sufficient monitoring exposure data to complete a comprehensive dietary exposure analysis and risk assessment for flumioxazin and its degradates (482-HA and APF) in drinking water. Because the Agency does not have comprehensive monitoring data, drinking water concentration estimates are made by reliance on simulation or modeling taking into account data on the physical characteristics of flumioxazin and its degradates (482-HA and APF).

The Agency uses the FQPA Index Reservoir Screening Tool (FIRST) or the Pesticide Root Zone Model/Exposure Analysis Modeling System (PRZM/EXAMS), to produce estimates of pesticide concentrations in an index reservoir. The screening concentration in ground water (SCI-GROW) model is used to predict pesticide concentrations in shallow ground water. For a screening-level assessment for surface water EPA will use FIRST (a Tier 1 model) before using PRZM/EXAMS (a Tier 2 model). The FIRST model is a subset of the PRZM/EXAMS model that uses a specific high-end runoff scenario for pesticides. Both FIRST and PRZM/EXAMS incorporate an index reservoir environment, and both models include a percent crop area factor as an adjustment to account for the maximum percent crop coverage within a watershed or drainage basin.

None of these models include consideration of the impact processing (mixing, dilution, or treatment) of raw water for distribution as drinking water would likely have on the removal of pesticides from the source water. The primary use of these models by the Agency at this stage is to provide a screen for sorting out pesticides for which it is unlikely that drinking water concentrations would exceed human health LOC.

Since the models used are considered to be screening tools in the risk assessment process, the Agency does not use estimated environmental concentrations (EECs), which are the model estimates of a pesticide's concentration in water. EECs derived from these models are used to quantify drinking water exposure and risk as a %RfD or %PAD. Instead drinking water levels of comparison (DWLOCs) are calculated and used as a point of comparison against the model estimates of a pesticide's concentration in water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food, and from residential uses. Since DWLOCs address total aggregate exposure to flumioxazin they are further discussed in Unit III.E.

Based on the FIRST and SCI-GROW models, the EECs of flumioxazin and its degradates (482-HA and APF) for acute exposures are estimated to be a total of 34 parts per billion (ppb) for surface water and 48 ppb for ground water. The EECs for chronic exposures are estimated to be a total of 18 ppb for surface water and 48 ppb for ground water.

3. From non-dietary exposure . The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets).

Flumioxazin is not registered for use on any sites that would result in residential exposure.

4. Cumulative effects from substances with a common mechanism of toxicity . Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

Unlike other pesticides for which EPA has followed a cumulative risk approach based on a common mechanism of toxicity, EPA has not made a common mechanism of toxicity finding as to flumioxazin and any other substances. Flumioxazin does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has not assumed that flumioxazin has a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see the policy statements released by EPA's Office of Pesticide Programs concerning common mechanism determinations and procedures for cumulating effects from substances found to have a common mechanism on EPA's web site at http://www.epa.gov/pesticides/cumulative/ .

1. In general . Section 408 of FFDCA provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines based on reliable data that a different margin of safety will be safe for infants and children. Margins of safety are incorporated into EPA risk assessments either directly through use of a MOE analysis or through using uncertainty (safety) factors in calculating a dose level that poses no appreciable risk to humans. In applying this provision, EPA either retains the default value of 10X when reliable data do not support the choice of a different factor, or, if reliable data are available, EPA uses a different additional SF value based on the use of traditional UFs and/or special FQPA SFs, as appropriate.

2. Prenatal and postnatal sensitivity . Although increased prenatal and postnatal quantitative susceptibility was seen in rats, it was concluded that there is low concern and no residual uncertainties for prenatal and/or postnatal toxicity because:

i. Developmental toxicity NOAELs/LOAELs are well characterized after oral and dermal exposure.

ii. Offspring toxicity NOAEL/LOAEL are well characterized.

iii. There is a well-defined dose-response curve for the cardiovascular effects seen following oral exposure (i.e. critical period).

iv. The endpoints of concern are used for overall risk assessments for appropriate route and population subgroups.

3. Conclusion . There is a complete toxicity database for flumioxazin and exposure data are complete or are estimated based on data that reasonably accounts for potential exposures. EPA determined that the special 10X SF to protect infants and children should be removed. The FQPA factor is removed because developmental toxicity and offspring toxicity NOAELs/LOAELs are well characterized; there is a well-defined dose-response curve for the cardiovascular effects and the endpoints of concern are used for overall risk assessments are appropriate for the route of exposure and population subgroups.

To estimate total aggregate exposure to a pesticide from food, drinking water, and residential uses, the Agency calculates DWLOCs which are used as a point of comparison against EECs. DWLOC values are not regulatory standards for drinking water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food and residential uses. In calculating a DWLOC, the Agency determines how much of the acceptable exposure (i.e., the PAD) is available for exposure through drinking water (e.g., allowable chronic water exposure (mg/kg/day) = cPAD - (average food + residential exposure)). This allowable exposure through drinking water is used to calculate a DWLOC.

A DWLOC will vary depending on the toxic endpoint, drinking water consumption, and body weights. Default body weights and consumption values as used by the EPA's Office of Water are used to calculate DWLOCs: 2 liter (L)/70 kg (adult male), 2L/60 kg (adult female), and 1L/10 kg (child). Default body weights and drinking water consumption values vary on an individual basis. This variation will be taken into account in more refined screening-level and quantitative drinking water exposure assessments. Different populations will have different DWLOCs. Generally, a DWLOC is calculated for each type of risk assessment used: Acute, short-term, intermediate-term, chronic, and cancer.

When EECs for surface water and ground water are less than the calculated DWLOCs, EPA concludes with reasonable certainty that exposures to the pesticide in drinking water (when considered along with other sources of exposure for which EPA has reliable data) would not result in unacceptable levels of aggregate human health risk at this time. Because EPA considers the aggregate risk resulting from multiple exposure pathways associated with a pesticide's uses, levels of comparison in drinking water may vary as those uses change. If new uses are added in the future, EPA will reassess the potential impacts of residues of the pesticide in drinking water as a part of the aggregate risk assessment process.

1. Acute risk . Using the exposure assumptions discussed in this unit for acute exposure, the acute dietary exposure from food to flumioxazin will occupy less than ( < ) 1% of the aPAD for females 13 to 49 years old. In addition, there is potential for acute dietary exposure to flumioxazin in drinking water. After calculating DWLOCs and comparing them to the EECs for surface water and ground water, EPA does not expect the aggregate exposure to exceed 100% of the aPAD, as shown in Table 2 of this unit:

2. Chronic risk . Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that exposure to flumioxazin from food will utilize < 1% of the cPAD for the U.S. population, < 1% of the cPAD for all infant and children subpopulations. There are no residential uses for flumioxazin that result in chronic residential exposure to flumioxazin. In addition, there is potential for chronic dietary exposure to flumioxazin in drinking water. After calculating DWLOCs and comparing them to the EECs for surface water and ground water, EPA does not expect the aggregate exposure to exceed 100% of the cPAD, as shown in Table 3 of this unit:

3. Short-term risk . Short-term aggregate exposure takes into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

Flumioxazin is not registered for use on any sites that would result in residential exposure. Therefore, the aggregate risk is the sum of the risk from food and water, which do not exceed the Agency's LOC.

4. Intermediate-term risk . Intermediate-term aggregate exposure takes into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

Flumioxazin is not registered for use on any sites that would result in residential exposure. Therefore, the aggregate risk is the sum of the risk from food and water, which do not exceed the Agency's LOC.

5. Determination of safety . Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, and to infants and children from aggregate exposure to flumioxazin residues.

Adequate enforcement methodology (example—gas chromotography) is available to enforce the tolerance expression. The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; e-mail address: residuemethods@epa.gov .

There are no Codex, Canadian or Mexican maximum residue limits established for flumioxazin on grape, almond, pistachio, onion, garlic, shallot, tuberous/corm vegetables (Subgroup 1C), sugarcane, peppermint, or spearmint.

Therefore, the tolerance is established for residues of flumioxazin, (2-[7-fluoro-3,4-dihydro-3-oxo-4-(2-propynyl)-2H-1,4-benzoxazin-6-yl]-4,5,6,7-tetrahydro-1H-isoindole-1,3(2H)-dione) in or on grape at 0.02 ppm, almond (nutmeat) at 0.02 ppm, almond (hulls) at 0.70 ppm, pistachio at 0.02 ppm, onion (dry bulb) at 0.02 ppm, garlic (bulb) at 0.02 ppm, shallot (bulb) at 0.02 ppm, tuberous/corm vegetables (Subgroup 1C) at 0.02 ppm, sugarcane (cane) at 0.20 ppm, peppermint (tops) at 0.04 ppm, and spearmint (tops) at 0.04 ppm.

Under section 408(g) of FFDCA, as amended by FQPA, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. The EPA procedural regulations which govern the submission of objections and requests for hearings appear in 40 CFR part 178. Although the procedures in those regulations require some modification to reflect the amendments made to FFDCA by FQPA, EPA will continue to use those procedures, with appropriate adjustments, until the necessary modifications can be made. The new section 408(g) of FFDCA provides essentially the same process for persons to “object” to a regulation for an exemption from the requirement of a tolerance issued by EPA under new section 408(d) of FFDCA, as was provided in the old sections 408 and 409 of FFDCA. However, the period for filing objections is now 60 days, rather than 30 days.

You must file your objection or request a hearing on this regulation in accordance with the instructions provided in this unit and in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number OPP-2004-0212 in the subject line on the first page of your submission. All requests must be in writing, and must be mailed or delivered to the Hearing Clerk on or before October 25, 2004.

1. Filing the request . Your objection must specify the specific provisions in the regulation that you object to, and the grounds for the objections (40 CFR 178.25). If a hearing is requested, the objections must include a statement of the factual issues(s) on which a hearing is requested, the requestor's contentions on such issues, and a summary of any evidence relied upon by the objector (40 CFR 178.27). Information submitted in connection with an objection or hearing request may be claimed confidential by marking any part or all of that information as CBI. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2. A copy of the information that does not contain CBI must be submitted for inclusion in the public record. Information not marked confidential may be disclosed publicly by EPA without prior notice.

Mail your written request to: Office of the Hearing Clerk (1900L), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001. You may also deliver your request to the Office of the Hearing Clerk in Suite 350, 1099 14 th St., Washington, DC 20005. The Office of the Hearing Clerk is open from 8 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Office of the Hearing Clerk is (202) 564-6255.

2. Copies for the Docket . In addition to filing an objection or hearing request with the Hearing Clerk as described in Unit VI.A., you should also send a copy of your request to the PIRIB for its inclusion in the official record that is described in ADDRESSES . Mail your copies, identified by docket ID number OPP-2004-0212, to: Public Information and Records Integrity Branch, Information Resources and Services Division (7502C), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001. In person or by courier, bring a copy to the location of the PIRIB described in ADDRESSES . You may also send an electronic copy of your request via e-mail to: opp-docket@epa.gov . Please use an ASCII file format and avoid the use of special characters and any form of encryption. Copies of electronic objections and hearing requests will also be accepted on disks in WordPerfect 6.1/8.0 or ASCII file format. Do not include any CBI in your electronic copy. You may also submit an electronic copy of your request at many Federal Depository Libraries.

A request for a hearing will be granted if the Administrator determines that the material submitted shows the following: There is a genuine and substantial issue of fact; there is a reasonable possibility that available evidence identified by the requestor would, if established resolve one or more of such issues in favor of the requestor, taking into account uncontested claims or facts to the contrary; and resolution of the factual issues(s) in the manner sought by the requestor would be adequate to justify the action requested (40 CFR 178.32).

This final rule establishes a tolerance under section 408(d) of FFDCA in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993). Because this rule has been exempted from review under Executive Order 12866 due to its lack of significance, this rule is not subject to Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. , or impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Public Law 104-4). Nor does it require any special considerations under Executive Order 12898, entitled Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994); or OMB review or any Agency action under Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997). This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note). Since tolerances and exemptions that are established on the basis of a petition under section 408(d) of FFDCA, such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ) do not apply. In addition, the Agency has determined that this action will not have a substantial direct effect on States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999). Executive Order 13132 requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” This final rule directly regulates growers, food processors, food handlers and food retailers, not States. This action does not alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of section 408(n)(4) of FFDCA. For these same reasons, the Agency has determined that this rule does not have any “tribal implications” as described in Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments (65 FR 67249, November 6, 2000). Executive Order 13175, requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that have “substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and the Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.” This rule will not have substantial direct effects on tribal governments, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does not apply to this rule.

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

This is a summary of the Commission's Second Report and Order in IB Docket No. 97-95, FCC No. 03-296, adopted November 17, 2003 and released on December 5, 2003. The full text of this Commission decision 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 document is also available for download over the Internet at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-03-296A1.pdf . The complete text may also be purchased from the Commission's copy contractor, Qualex International, in person at 445 12th Street, SW., Room CY-B402, Washington, DC 20554, via telephone at (202) 863-2893, via facsimile at (202) 863-2898, or via e-mail at qualexint@aol.com .

On May 24, 2001, the Commission adopted a Further Notice of Proposed Rulemaking (66 FR 35399, July 5, 2001) in this proceeding to obtain comment on proposals to modify the band plan for the 36.0-51.4 GHz band. On December 5, 2003, the Commission released a Second Report and Order in this proceeding. In the Second Report and Order, the Commission made various designation and allocation changes in the 37.0-42.0 GHz band to create contiguous spectrum for both fixed-satellite services and terrestrial fixed and mobile services (wireless services), which reflects decisions made at the 2000 World Radiocommunication Conference (WRC-2000) in Istanbul, Turkey and the 2003 World Radiocommunication Conference (WRC-2003) in Geneva, Switzerland. The Commission finalized the satellite and terrestrial designations required by the Commission's “soft segmentation” approach and adopted service rules for satellite services, including gateway definitions and power-flux density (PFD) limits. The Commission will address in separate service rulemakings additional service rules for satellite and terrestrial systems' use of the designations we adopt in this item, including the precise conditions applied to the satellite PFD limits adopted in this Second Report and Order, and proposed rules to coordinate certain types of earth stations operating in the V-band spectrum. The Commission also will address in future rulemakings the National Telecommunications and Information Administration's (NTIA's) request to delete Broadcasting-Satellite Service (BSS) from the 42.0-42.5 GHz band and to protect Radio Astronomy operations at 42.5-43.5 GHz from satellite services in adjacent downlink bands. By making these designation and allocation changes, the Commission brings certainty to systems currently operating n the 37.0-40.0 GHz portion of the spectrum and codify the concept of “soft-segmentation,” and allow ubiquitous deployment of fixed service and fixed satellite service operations to commence in the V-band.

This Second Report and Order does not contain a new or modified information collection.

As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated into the Further Notice of Proposed Rulemaking in IB Docket No. 97-95. The Commission sought written public comment on the Proposals in the V-band Further Notice, including comment on the IRFA. This present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.

In this Second Report and Order, we modify the band segmentation plan governing operations in the 36.0-51.4 GHz band to reflect decisions reached at the 2000 World Radiocommunication Conference (WRC-2000) and the 2003 World Radiocommunication Conference (WRC-2003). The changes adopted in the domestic Table of Allocations seek to maximize efficient use of the radio spectrum by both satellite and terrestrial uses, with minimal changes to the existing Table. These changes will provide satellite and terrestrial operators, including small entity operators, with greater certainty about the scope of operations in this band, and should therefore provide benefits for small entity operators.

We make various designation and allocation changes in the 37.0-42.0 GHz band to create two gigahertz of contiguous spectrum for the fixed satellite services and three gigahertz for terrestrial fixed wireless services. Specifically, we:

• Redesignate the spectrum available for wireless services from the 41.0-42.0 GHz band to the 37.6-38.6 GHz band, redesignate the spectrum available for satellite uses from the 37.6-38.6 GHz band to the 41.0-42.0 GHz band, and modify parts 25 and 101 of our rules accordingly.

• Decline to adopt a Mobile-Satellite Service (MSS) designation in the 40.5-41.0 GHz band on a primary basis, and allocate MSS on a secondary basis in the 40.5-41.0 GHz band for Federal and non-Federal Government use.

• Add an additional 100 megahertz Fixed-Satellite Service (FSS) allocation in the 37.5-37.6 GHz band.

• Delete the non-Federal Government MSS allocation from the 39.5-40.0 GHz band and no longer require that non-Federal Government fixed and mobile operations protect Federal Government MSS earth stations in this band.

• Add a Government FSS allocation to the 40.5-41.0 GHz band, and require Government and commercial operators to coordinate their operations on a co-primary basis. (A service that is primary is the only service given priority status to operate in a frequency band. A service that is co-primary must share operations with other services specified as co-primary in the frequency band on a co-equal basis. A service that is secondary is allowed to use the band as long as its operations do not cause interference to any primary operations, and it must accept any interference caused by a primary service. If a secondary service operation causes interference to a primary service, the secondary service provider must eliminate the interference or cease operations. See generally 47 CFR § 2.105 (2002)).

• Adopt a primary non-Government FSS allocation in the 41.0-42.0 GHz band and modify the Table of Allocations in section 2.106 of our rules accordingly.

• Maintain the current 47.2-48.2 GHz allocation for exclusive commercial use, and preserve the 42.5-43.5 GHz allocation for exclusive Government use (with the exception of Radio Astronomy operations).

• Incorporate into the Commission's rules PFD limits in the 37.5-40.0 GHz band that apply during normal (free-space, clear-sky) conditions and upper bound PFD limits that may apply during rain fade conditions.

• Adopt a description of “gateway” for earth stations licensed in the 37.5-40.0 GHz band.

The proposed action is taken pursuant to sections 1, 4(i), 301, 302, 303(e), 303(f), 303(g), 303(r), 304, and 307 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 301, 302, 303(e), 303(f), 303(g), 303(r), 304, and 307.

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. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A small business concern is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).

Geostationary and Non-Geostationary Orbit Fixed-Satellite Service Applicants and Licensees. Regarding future satellite use of the bands that are the subject of this rulemaking, the applicable definition of small entity is the definition under the Small Business Administration (SBA) rules applicable to Satellite Telecommunications. This definition provides that a small entity is one with $12.5 million or less in annual receipts. ( See 13 CFR 121.201 (2002), North American Industry Classification System (NAICS) 517410). According to 1997 Census Bureau data (in 1997—the most recent year in which census data is available—the NAICS code for “Satellite Telecommunications” was 513340), there are 273 satellite communication firms with annual receipts of under $10 million. In addition, 24 firms had receipts for that year of $10 million to $24,999,990 (U.S. Bureau of Census, U.S. Department of Commerce, 1997 Economic Census, EC97S51S-SZ, Subject Series, Establishment and Firm Size, Table 2, Employment Size of Establishments of Firms Subject to Federal Income Tax: 1997, NAICS Code 51740 (issued October 2000)). Generally, these NGSO and GSO FSS systems cost several millions of dollars to construct and operate. Therefore the NGSO and GSO FSS companies, or their parent companies, rarely qualify under this definition as a small entity. In addition, the proposed rules may affect allocations for the space research (passive) and radio astronomy services. There are no small entities affected by this action because only Federal agencies currently make use of these services.

Terrestrial Fixed and Mobile Wireless Services. We note that the rules in this order provide spectrum for future wireless and satellite licensees and the proposal would not affect any current non-Federal Government users. Regarding future terrestrial fixed and mobile use of the subject bands, the applicable definition of small entity is the definition under the SBA rules applicable to the Cellular and Other Wireless Telecommunications industry. This definition provides that a small entity is a firm employing no more than 1,500 persons ( see 13 CFR 121.201 (2002), NAICS Code 513322 (changed to 517410 in October 2002)). The 1997 Census of Transportation, Communications, and Utilities, conducted by the Bureau of the Census, which is the most recent information available, shows that only 12 cellular and other wireless telecommunications firms out of a total of 1,238 such firms that operated during 1997 had 1,000 or more employees. (U.S. Bureau of the Census, U.S. Department of Commerce, 1997 Economic Census, EC97551S-SZ, Subject Series, Establishment and Firm Size, Table 5, Employment Size of Firms: 1997, NAICS Code 513322 (issued October 2000).) While we cannot at this time know precisely which entities will ultimately be utilizing all the subject spectrum, the following services are possibilities:

Fixed Microwave Services. Fixed microwave services include common carrier, private operational-fixed, and broadcast auxiliary radio services. ( See 47 CFR 101 et seq. (2002) (formerly part 21 of the Commission's rules) for common carrier fixed microwave services (except Multipoint Distribution Service). Persons eligible under parts 80 and 90 of the Commission's rules can use Private Operational-Fixed Microwave services. See 47 CFR parts 80 and 90 (2002). Stations in this service are called operational-fixed to distinguish them from common carrier and public fixed stations. Only the licensee may use the operational-fixed station, and only for communications related to the licensee's commercial, industrial, or safety operations. Auxiliary Microwave Service is governed by part 74 of Title 47 of the Commission's rules. See 47 CFR part 74 et seq. (2002). (This service is available to licensees of broadcast stations and to broadcast and cable network entities. Broadcast auxiliary microwave stations are used for relaying broadcast television signals from the studio to the transmitter, or between two points such as a main studio and an auxiliary studio. The service also includes mobile television pickups, which relay signals from a remote location back to the studio.) At present, there are approximately 22,015 common carrier fixed licensees and 61,670 private operations-fixed licensees and broadcast auxiliary radio licensees in the microwave services. The Commission has not created a size standard for a small business specifically with respect to fixed microwave services. For purposes of this analysis, the Commission uses the SBA small business size standard for the category “Cellular and Other Telecommunications,” which is 1,500 or fewer employees. ( See 13 CFR 121.201 (2002), NAICS code 513322 (changed to 517212 in October 2002).) The Commission does not have data specifying the number of these licensees that have more than 1,500 employees, and thus are unable at this time to estimate with greater precision the number of fixed microwave service licensees that would qualify as small business concerns under the SBA's small business size standard. Consequently, the Commission estimates that there are 22,015 or fewer small common carrier fixed licensees and 61,670 licensees in the microwave services that may be affected by the rules and policies adopted herein. The Commission notes, however, that the common carrier microwave fixed licensee category includes some large entities.

39 GHz Service. The Commission created a special small business size standard for 39 GHz licenses—an entity that has average gross revenues of $40 million or less in the three previous calendar years. ( See Amendment of the Commission's Rules Regarding the 37.0-38.6 GHz and 38.6-40.0 GHz Bands, ET Docket No. 95-183, Report and Order, 63 FR 6079 (February 6, 1998).) An additional size standard for “very small businesses” is: an entity that, together with affiliates, has average gross revenues of not more than $15 million for the preceding three calendar years. The SBA has approved these small business size standards. ( See Letter to Kathleen O'Brien Ham, Chief, Auctions and Industry Analysis Division, Wireless Telecommunications Bureau, Federal Communications Commission, from Aida Alvarez, administrator, Small Business Administration (February 4, 1998).) The auction of the 2,173 39 GHz licenses began on April 12, 2000 and closed on May 8, 2000. The 18 bidders who claimed small business status won 849 licenses. Consequently, the Commission estimates that 18 or fewer 39 GHz licensees are small entities that may be affected by the rules and policies adopted herein.

Local Multipoint Distribution Service. The auction of the 1,030 Local Multipoint Distribution Service (LMDS) licenses began on February 18, 1998 and closed on March 25, 1998. The Commission established a small business size standard for LMDS licensees as an entity that has average gross revenues of less than $40 million in the three previous calendar years. ( See Local Multipoint Distribution Service, Second Report and Order, 12 FCC Rcd 12545 (1997).) An additional small business size standard for “very small business” was added as an entity that, together with its affiliates, has average gross revenues of not more than $15 million for the preceding three calendar years. The SBA approved these small business size standards in the context of LMDS auctions. ( See Letter to Dan Phythyon, Chief, Wireless Telecommunications Bureau, Federal Communications Commission, from A. Alvarez, Administrator, Small Business Administration (January 6, 1998).) There were 93 winning bidders that qualified as small entities in the LMDS auctions. A total of 93 small and very small business bidders won approximately 277 A Block licenses and 387 B Block licenses. On March 27, 1999, the Commission re-auctioned 161 licenses; there were 40 winning bidders. Based on this information, we conclude that the number of small LMDS licenses will include the 93 winning bidders in the first auction and the 40 winning bidders in the re-auction, for a total of 133 small entity LMDS providers as defined by the SBA and the Commission's auction rules.

None. These changes impose no cost or reporting burdens on fixed-satellite, mobile-satellite, or broadcasting-satellite service operators. No incumbents are affected by this proposed action. The only service rule changes proposed concern power flux density limits and frequency tolerance and emission limitations, which do not have associated compliance burdens.

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. (See 5 U.S.C. 603.)

In this Second Report and Order, we modify the band segmentation plan governing operations in the 36.0-51.4 GHz band to reflect decisions reached at the 2000 World Radiocommunication Conference (WRC-2000) and the 2003 World Radiocommunication Conference (WRC-2003). These changes primarily attempt to settle allocation and segmentation issues and, as a result, provide similar benefits for all entities, including small. Specifically, the changes adopted in the domestic Table of Allocations seek to maximize efficient use of the radio spectrum by both satellite and terrestrial uses, with minimal changes to the existing Table. These changes will benefit all satellite and terrestrial operators by providing satellite and terrestrial operators, including small entity operators, with greater certainty about the scope of operations in this band.

None.

It is ordered that, pursuant to sections 4(i), 7(a), 303(c), 303(f), 303(g), and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 157(a), 303(c), 303(f), 303(g), 303(r), parts 2, 25, and 101 of the Commission's rules are amended, as specified in the rule changes, effective September 24, 2004.

It is further ordered that the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

These corrections amend the Board's fee regulations.

NMFS manages the groundfish fishery in the BSAI exclusive economic zone according to the Fishery Management Plan for the Groundfish Fishery of the Bering Sea and Aleutian Islands Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.

The portion of the Atka mackerel TAC allocated to other gears in the Eastern Aleutian District and the Bering Sea subarea is 10,293 metric tons (mt) as established by the 2004 Harvest Specifications for Groundfish (69 FR 9242, February 27, 2004). See § 679.20(c)(3)(iii) and 679.20(a)(8)(ii).

In accordance with § 679.20(d)(1)(i), the Administrator, Alaska Region, NMFS (Regional Administrator), has determined that the TAC for Atka mackerel allocated to other gears in the Eastern Aleutian District and the Bering Sea subarea will be reached. Therefore, the Regional Administrator is establishing a directed fishing allowance of 3,293 mt, and is setting aside the remaining 7,000 mt as bycatch to support other anticipated groundfish fisheries. In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Atka mackerel in the Eastern Aleutian District and the Bering Sea subarea of the BSAI by vessels using other gears.

In accordance with § 679.20(a)(8)(iii)(C), the Regional Administrator is opening the first directed fisheries for Atka mackerel within the HLA in areas 542 and 543, 48 hours after the closure of the area 541 Atka mackerel directed fishery. The Regional Administrator has also established the opening date for the second HLA directed fisheries as 48 hours after the last closure of the first HLA fisheries in either 542 or 543. Consequently, NMFS is opening and closing directed fishing for Atka mackerel in the HLA of areas 542 and 543 in accordance with the periods listed under the DATES section of this notice.

In accordance with § 679.20(a)(8)(iii), vessels using trawl gear for directed fishing for Atka mackerel have previously registered with NMFS to fish in the HLA fisheries in areas 542 or 543. NMFS has randomly assigned each vessel to the directed fishery or fisheries for which they have registered. NMFS has notified each vessel owner as to which fishery each vessel has been assigned by NMFS (69 FR 51014, August 17, 2004).

In accordance with § 679.20(a)(8)(ii)(C)(1), the HLA limit of the TAC in areas 542 and 543 are 5,733 mt and 8,630 mt, respectively. Based on those limits and the proportion of the number of vessels in each fishery compared to the total number of vessels participating in the HLA directed fishery for area 542 or 543, the harvest limits for the HLA directed fishery in areas 542 and 543 are as follows: 3,185 mt for the first directed fishery in area 542, 4,315 mt for the first directed fishery in area 543, 2,548 mt for the second directed fishery in area 542, and 4,315 mt for the second directed fishery in area 543. In accordance with § 679.20(a)(8)(iii)(E), the Regional Administrator has establish the closure dates of the Atka mackerel directed fisheries in the HLA for areas 542 and 543 based on the amount of the harvest limit and the estimated fishing capacity of the vessels assigned to the respective fisheries. Consequently, NMFS is prohibiting directed fishing for Atka mackerel in the HLA of areas 542 and 543 on the dates and times listed under the DATES section of this notice.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA, (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay both the closure of the Atka mackerel fishery by other gears in the Eastern Aleutian District and the Bering Sea subarea and the opening and closures of the fisheries for the HLA limits established for the Central (area 542) and Western (area 543) Aleutian Districts pursuant to the 2004 Atka mackerel TAC.

The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.

This action is required by § 679.20 and is exempt from review under Executive Order 12866.