This rule proposes changes to the FSA guaranteed farm loan program. FSA guaranteed loans provide conventional agricultural lenders with up to a 95 percent guarantee of the principal loan amount, and accrued interest. The lender is responsible for servicing a borrower's account for the life of the loan. All loans must meet certain qualifying criteria to be eligible for guarantees, and FSA has the right and responsibility to monitor the lender's servicing activities. Farmers interested in these loans must apply to a conventional lender, which then arranges for the FSA guarantee. When a farmer does not fully repay the loan from the lender that FSA guaranteed, the lender will submit a formal request to the Agency for payment of the guaranteed percentage of the unpaid debt. This rule proposes changes to provisions that govern such loss claims and related loan servicing issues.

The first change proposed is to amend 7 CFR 762.106(g)(2)(ii) regarding the revocation of PLP status for failure to maintain eligibility, specifically with regard to the maximum loss percentage. The status of “preferred lender” is awarded by FSA to lenders with demonstrated expertise in agricultural lending and experience with the FSA Guaranteed Loan Program. This section, in part, requires that PLP lenders maintain eligibility established in 7 CFR 762.106(c)(4) governing the losses that a PLP lender may have incurred, currently three percent for loans made in the previous 7 years. The amendment will allow a PLP lender to maintain its status as a PLP lender for up to one year after its loss ratio exceeds, for reasons explained below which are beyond its control, the maximum allowable PLP loss rate. Lenders would be required to explain the reason their loss rate exceeds the allowable limit, and develop and implement a plan to reduce the loss rate below the allowable limit within the one year period. A lender that does not submit such a request to retain their PLP status for the one-year period, will not retain their status as a PLP lender. The proposed waiver will not apply to Certified Lenders, because their loss criteria is already generous compared to the requirements for PLP lenders.

This amendment also would broaden the conditions under which FSA may grant a waiver to existing PLP lenders for exceeding the maximum loss ratio. Present regulations at 7 CFR 762.106(c)(4) provide that the Agency may waive the maximum PLP loss ratio if the applicable lender's loss rate was substantially affected by a disaster (such as storms, earthquakes, drought, flooding, and freezes) as defined in 7 CFR part 1945, subpart A. This provision only covers natural disasters that are widespread enough to be declared a disaster. Conditions, such as a freeze with only local impact, may not be declared a disaster but may cause excessive losses for one or two lenders in a community. Further, lender loss ratios may be affected by an unforeseeable economic downturn, drops in land value, industry moving into or out of an area, a loss of access to a market, biological or chemical damage, or other circumstances beyond the lender's control. Such one-occasion losses may have an inordinate affect on a lender in that local area, or a lender with a concentration of loans to producers of a commodity suffering localized reduction in production and market prices. The proposal would allow the Agency more flexibility in granting a waiver to an existing PLP lender for exceeding the maximum loss ratio for reasons beyond their control. A lender requesting a 1-year waiver of the maximum loss ratio must provide a satisfactory explanation of why it's losses suddenly increased, and a realistic plan detailing the actions they plan to take to reduce their loss ratio to the requisite level. Whether losses could have been controlled by the lender and whether a plan for loss reduction is acceptable will be determined in each case by FSA. If the Agency grants a 1-year waiver, and the lender's loss ratio does not meet the maximum PLP loss ratio at the end of the 1-year period, the lender's PLP status will be revoked.

FSA also proposes to amend the amount of interest accrual that the Agency will pay lenders on loss claims. Specifically, this rule proposes changes to the way loss claims are handled when liquidation is delayed by a Chapter 7 bankruptcy filing, a Chapter 7 bankruptcy results in a lower estimated loss claim due to an over-estimation of security value, or where a mandatory state right of redemption prevents a lender from disposing of property acquired through foreclosure.

Loss claims in case of a Chapter 7 bankruptcy. This rule proposes to amend 7 CFR 762.148(d)(1) to clarify that, in Chapter 7 bankruptcy cases, the date of the decision to liquidate, for the purposes of calculating total interest due on a final loss claim under § 762.149, is the date the borrower files for Chapter 7 bankruptcy. This will preclude any misunderstanding as to the date beyond which the Agency will not pay accruing interest. Currently, 7 CFR 762.148(d)(1) requires the lender with such a borrower who to proceed under section 762.149 and submit a liquidation plan and estimated loss claim within 30 days of the decision to liquidate, if liquidation is expected to exceed 90 days. That policy exists because collateral or property mortgaged for a debt discharged under Chapter 7 of the Bankruptcy Code is subject to repossession or sale by the secured creditor. Thus, a Chapter 7 discharge of an FSA guaranteed farm loan typically results in sale of the security for the guaranteed loan. Although the decision to liquidate is not actually made by the lender, as is commonly the case where defaults cannot be cured and the borrower does not file for bankruptcy, the bankruptcy petition of the borrower is, in effect, a “decision to liquidate.”

The Agency also is proposing to amend § 762.149 so that in the case of a Chapter 7 bankruptcy, a lender will not be penalized for submitting an estimated loss claim that later proves to be underestimated, based on the final loss claim. The estimated loss claim submitted with the liquidation plan is calculated based on the remaining principal and interest of the loan, less the estimated value of the remaining security for the loan. In a bankruptcy case, lenders often lack reliable information regarding the value of the remaining collateral, their appraisals are outdated, and the bankruptcy schedules may not yet be available for the lenders to use for a liquidation plan and estimated loss claim. Also, when the borrower files bankruptcy the borrower and lender are often in an adverse relationship and the lender cannot inspect or accurately evaluate the security property. Other problems may cause the estimated claim in a Chapter 7 case to vary from the final claim, such as depreciation, missing security property, or an inaccurate estimate of the time required to complete liquidation. Thus, at the time of the bankruptcy filing and submission of the estimated loss claim, the lender's valuation of its remaining loan security may be far from what the liquidation sale actually brings. Regardless, for purposes of calculating final loss claims, present Agency regulations allow no further interest on the loan after payment of the estimated loss claim. Therefore, this rule proposes that 7 CFR 762.149(d)(2) be amended to provide that a lender receive the guaranteed percentage of the interest that accrued on the amount that had been estimated to be secure, but upon final disposition of collateral was found to be unsecured. Interest will not be paid on the amount estimated to be unsecured, and will not be paid if the lender did not submit an estimated loss claim within the established timeframe. The Agency proposes to pay the additional interest up to a maximum of 45 days after the earlier of the relief from stay, or discharge of the Chapter 7 Bankruptcy. This is a reasonable period of time for a lender to accomplish liquidation after the relief from stay or discharge.

Redemption rights . This rule proposes that lenders will be paid the guaranteed portion of interest that accrues during a redemption period on the additional unsecured debt if the lender submitted an estimated loss claim as required. State right of redemption statutes provide the former owner of the property, and, in some states, parties with any interest in the property such as subordinate lien holders, with a time period, typically six months to one year, during which they may redeem the property by paying the obligations secured by it. Numerous states provide that redemption rights continue after foreclosure proceedings. Therefore, these rights may frustrate creditors, including FSA guaranteed lenders, when they are attempting to enforce their liens on mortgaged property. A creditor who submits successful bids at foreclosure sales cannot get a clear deed to the property until the debtor's redemption period has passed. Such lenders cannot convey clear title to a buyer, and if they do sell it, the final sales price could be depressed because of the uncertainty of the finality of the transaction. Further, any successful bidder at a foreclosure sale in a state with a redemption period cannot take title to the property until the end of the redemption period. A winning bidder who improves the property, such as erecting buildings or fences, risks losing his or her investment if the former owner “redeems” it and retains title by paying the redemption amount. This discourages bidding on property and may reduce the amount potential purchasers are willing to bid. For this reason, lenders rarely sell properties prior to the expiration of the redemption period. Many factors beyond the lender's control, such as actions of the former owner, economic conditions, and even the weather may affect the real estate value during the redemption period. Currently, FSA loss claim regulation, 7 CFR 762.149, prohibits paying the lender interest that accrues beyond 90 days from the date of the decision to liquidate. However, borrower redemption rights are circumstances beyond the lender's control, and the Agency has determined that the lender is entitled to the guaranteed portion of the interest that accrues during the redemption period on the additional portion of the loan that is unsecured. The Agency is proposing to pay the additional interest during the time of the redemption period, plus up to an additional 45 days, which is considered sufficient time for the lender to dispose of the property.

There will be some additional cost to the Agency for the above proposed changes, but based on an analysis of losses paid during fiscal years 2002 through 2004, the total costs to the Agency should be minimal. The analysis indicated that the proposals will result in an increase of only one-sixth of one percent of the amount currently paid in loss claims.

This rule has been determined not significant and was not reviewed by the Office of Management and Budget under Executive Order 12866.

The Agency certifies that this rule will not have a significant economic effect on a substantial number of small entities. This rule does not require any specific actions on the part of the subject program's borrowers or lenders, except for a PLP lender that is requesting the Agency to grant an exception to the loss rate criteria, to allow them to retain their PLP status for a year while they attempt to reduce their loss ratio to an acceptable level. In the six year period since the Agency has been granting PLP status, an average of less than one lender a year has had their status removed due to their loss ratio exceeding the established standard. When a PLP lender decides to request that their PLP status be maintained for an additional year, the Agency anticipates that request will require minimal submission of information, no more than a page or two of narrative explaining why their loss rate is high, and their plans to bring it down, further justifying the conclusion that a Regulatory Flexibility Analysis is not required. The Agency, therefore, concludes that it is not required to perform a Regulatory Flexibility Analysis as required by the Regulatory Flexibility Act, Public Law 96-534, as amended (5 U.S.C. 601).

The environmental impacts of this proposed 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 regulation for compliance with NEPA, 7 CFR part 1940, subpart G. FSA completed an environmental evaluation and concluded that the rule requires no further environmental review. 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 E.O. 12988, Civil Justice Reform. In accordance with that Executive Order: (1) All State and local laws and regulations that are in conflict with this rule will be preempted; (2) no retroactive effect will be given to this rule except that lender servicing under this rule will apply to loans guaranteed prior to the effective date of the rule to the extent permitted by existing contracts; and (3) administrative proceedings in accordance with 7 CFR part 11 must be exhausted before requesting judicial review.

For reasons contained in the Notice related to 7 CFR part 3015, subpart V (48 FR 29115, June 24, 1983), the programs and activities within this rule are excluded from the scope of Executive Order 12372, which requires intergovernmental consultation with state and local officials.

This rule contains no Federal mandates, as defined by title II of Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, 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.

The policies contained in this rule do not have any 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. Nor does this rule impose substantial direct compliance costs on state and local governments. Therefore, consultation with the states is not required.

The amendments to 7 CFR part 762 contained in this rule require no revisions to the information collection requirements that were previously approved by OMB under control number 0560-0155.

These changes affect the following FSA programs as listed in the Catalog of Federal Domestic Assistance:

10.406—Farm Operating Loans.

10.407—Farm Ownership Loans.

Accordingly, 7 CFR part 762 is proposed to be amended as follows:

In response to Items 4(a) and (b) of the Form, filing parties currently must provide paper copies of annual reports, annual audit reports and regularly prepared balance sheets and copies of certain documents, such as 10K's, filed with the SEC. Many of these documents are routinely submitted in electronic form to the SEC and are available on the SEC's Electronic Data Gathering, Analysis, and Retrieval (“EDGAR”) system, or via the Internet on company Web sites. Responses to these Items may often be voluminous and can account for the bulk of documents submitted with the Form.

In view of the ease with which the antitrust agencies can access these documents via the Internet, the proposed modification of paragraph 803.2(e) and Instructions to the Form would allow filing parties to provide an Internet address linking directly to the documents required by Items 4(a) and 4(b) in lieu of providing paper copies. Incorporating documents by reference to Internet Web pages would only apply to Items 4(a) and 4(b) and would not be available for responding to other items on the Form.

It would remain the filer's duty to ensure that the filing is accurate and complete, as attested by the filer's certification signature. Accordingly, it is proposed that Section 803.2 be further amended to provide that if an Internet link submitted is, or becomes, inoperative or the document that is linked to is incomplete, such that the documents required by Items 4(a) or 4(b) are not available for review by the FTC and DOJ, the filer shall make the document(s) available by referencing operative Internet link(s) or provide paper copies of the relevant document(s) by 5 p.m. on the business day following any request by the FTC or the Assistant Attorney General. Failure to provide requested documents by the close of the next business day would result in notice of a deficient filing under Section 803.10(c)(2). Given the ability to incorporate such documents by linking, the previous option to cite the date and place of filing if copies are not readily available would no longer be necessary, and it is proposed that it be deleted from the Instructions.

The Commission and the DOJ have encountered instances in which, after parties make premerger notification filings and after second requests are issued, the parties make no effort to comply with the second requests. Generally this occurs when the parties have decided not to go forward with the proposed acquisition, either because of the issuance of second requests or for business reasons unrelated to the government's antitrust investigation. In nearly all of these instances, the parties have voluntarily withdrawn their premerger notification filings. The agency is then able to close its investigation, as there no longer is a transaction pending with a waiting period.

In some instances, however, the parties have refused to withdraw their notification even though they lack a present intention to undertake the acquisition. In such instances, the agency's investigation remains open indefinitely because the waiting period is suspended, and would only begin to run for the final 30 days if and when there was compliance with the second requests.

The information contained in the parties' notifications becomes stale with the passage of time. In order to conduct the meaningful review contemplated by the Act, the agencies require information pertaining to the competitive implications of transactions. Indeed, since the rules' inception in 1978, Section 803.7 of the Rules has provided that notification with respect to an acquisition shall expire one year following expiration of the waiting period. As the Statement of Basis and Purpose (“SBP”) states, “If the acquisition is to be consummated after that time, the possibility of changed circumstances warrants a fresh review by the enforcement agencies.” 43 FR 33450 , 33512 (July 31, 1978). Fresh review of a proposed acquisition cannot be assured when the information contained in the parties' notification has become outdated. Further, both Section 803.7 and the requirement in Section 803.5 of an affidavit attesting to a good faith intention to make the acquisition are intended in part to ensure that the parties intend to consummate the acquisition, so that the agencies are not forced to waste resources investigating hypothetical transactions. See 43 FR 33450, 33510-12 (July 31, 1978).

Parties should already be on notice, by virtue of Section 803.21, that they cannot toll their HSR waiting period indefinitely by failing to comply with a second request. Section 803.21 requires that all additional information or documentary material sought via a second request (or partial submission accompanied by a Section 803.3 statement of reasons for noncompliance) “be supplied within a reasonable time.” Although the SBP accompanying the promulgation of Section 803.21 states that the rule was “designed primarily to prevent an acquired person in a transaction subject to Section 801.30 from frustrating the acquisition[,]”  2 the wording of the rule itself is not limited to certain types of transactions or persons.

While Section 803.21 requires compliance with all second requests “within a reasonable time[,]” it does not define “a reasonable time” and does not expressly provide the consequences for noncompliance. The Commission believes that there would come a point when the agency would have sound legal basis under Section 803.21 for disregarding, rejecting or deeming withdrawn or expired a notification where the party had failed to comply with a second request.

The Commission believes, however, that it is preferable and would improve the certainty of the premerger notification process to clearly identify the specific time at which an acquiring person's Notification (or an acquired person's notification in a non-Section 801.30 transaction) will expire when a second request remains outstanding to that person. The Commission proposes that such date be 18 months from the date of the initial notification (which typically would be approximately 17 months from the issuance of the second request). We are not aware of second request compliance ever having taken that long. Even in instances where the parties may have reason to delay their second request response for some period of time, 3 eighteen months should provide them ample time. Beyond that time, the Commission believes that a more up-to-date Notification should be provided, triggering a new waiting period.

The Commission proposes specifying this 18-month requirement in Section 803.7, entitled “Expiration of Notification”. Section 803.7 would be split into two parts: one (the current provision) addressing expiration of notification when the waiting period has expired; the other (new language) addressing expiration of the waiting period due to failure to comply with a second request. The current text of Section 803.7 would thus be redesignated “ (a) Waiting period expired. ” A new paragraph (b) would be added, along with a new example:

(b) Failure to comply with request for additional information. An acquiring person's notification and, in the case of an acquisition to which section 801.30 does not apply, an acquired person's notification shall expire eighteen months following the date of receipt of such person's notification if a request for additional information or documentary material remains outstanding to such person (or entities included therein, officers, directors, partners, agents or employees thereof), without a certification as required by section 803.6(b), on such date. If either person's notification expires pursuant to this paragraph, both parties must file a new notification and observe the waiting period in order to carry out the transaction.

The Commission is proposing the modification to Section 803.7 rather than Section 803.21 because the “stale filings” situations that the agencies have encountered are separate and distinct from the problem, addressed by the “reasonable time” requirement of Section 803.21, of an acquired person in a Section 801.30 transaction trying to frustrate the acquisition. Indeed, the proposed rule is drafted to exclude acquired persons in Section 801.30 transactions so as not to recreate the problem that Section 803.21 was designed to address. The new rule also fits well within the caption of Section 803.7, because it deals with expiration of notification.

The Commission anticipates that if the proposed new rule is adopted, it will apply upon its adoption to pending transactions. Thus, for example, if there are any pending transactions in which the acquiring person (or the acquired person in a non-Section 801.30 transaction) has failed to comply with a second request within 18 months of that person's notification, that notification will expire upon adoption of the rule.

All comments should be filed as prescribed in the ADDRESSES section above, and must be received on or before October 14, 2005.

Written communications and summaries or transcripts of oral communications respecting the merits of this proceeding from any outside party to any Commissioner or Commissioner's advisor will be placed on the public record. 16 CFR 1.26(b)(5).

The Regulatory Flexibility Act, 5 U.S.C. 601-612, requires that the agency conduct an initial and final regulatory analysis of the anticipated economic impact of the proposed amendments on small businesses, except where the Commission certifies that the regulatory action will not have a significant economic impact on a substantial number of small entities. 5 U.S.C. 605.

Because of the size of the transactions necessary to invoke a Hart-Scott-Rodino filing, the premerger notification rules rarely, if ever, affect small businesses. Indeed, the 2000 amendments to the Act were intended to reduce the burden of the premerger notification program by exempting all transactions valued at $50 million or less 4 . Further, none of the proposed rule amendments expands the coverage of the premerger notification rules in a way that would affect small business. Accordingly, the Commission certifies that these proposed rules will not have a significant economic impact on a substantial number of small entities. This document serves as the required notice of this certification to the Small Business Administration.

The Paperwork Reduction Act, 44 U.S.C. 3501-3518, requires agencies to submit “collections of information” to the Office of Management and Budget (“OMB”) and obtain clearance before instituting them. Such collections of information include reporting, recordkeeping, or disclosure requirements contained in regulations. The information collection requirements in the HSR rules and Form have been reviewed and approved by OMB under OMB Control No. 3084-0005. The current clearance expires on May 31, 2007.

The Commission's proposed revisions to the Form and rules do not “substantive [ly] or material[ly] modify” the existing terms of the currently approved collection of information (OMB Control Number 3084-0005) to necessitate OMB's further review and approval. See 44 U.S.C. 3507(h)(3); 5 CFR 1320.5(g). It is highly unlikely that a Notification which expires under the proposed rule change would need to be re-filed by the parties because the rule changes are intended to apply to situations in which the parties have already abandoned the transaction.

For the reasons stated in the preamble, the Federal Trade Commission proposes to amend 16 CFR part 803 as set forth below:

On March 20, 1998, the Department published regulations addressing the procedures for participation in, and conduct of, sunset reviews. See 63 Fed. Reg. 13516. On December 17, 2004, the Dispute Settlement Body (DSB) of the World Trade Organization (WTO) adopted the reports of the Appellate Body (“AB”) and the dispute settlement panel in United States—Sunset Reviews of Anti-dumping Measures on Oil Country Tubular Goods from Argentina , WT/DS268/AB/R (November 29, 2004) and WT/DS268/R (July 16, 2004), respectively. The AB/panel found that the waiver provisions of section 751(c)(4)(B) of the Tariff Act of 1930 and section 351.218(d)(2)(iii) of Commerce's sunset regulations are inconsistent with Articles 6.1, 6.2, and 11.3 of the Antidumping Agreement.

Section 123 of the Uruguay Round Agreements Act (“URAA”) governs the process for changes to the Department's regulations where a dispute settlement panel and/or the Appellate Body finds a regulatory provision to be inconsistent with any of the WTO agreements. Consistent with section 123(g)(1)(C), the Department is publishing proposed amendments to its regulations related to sunset reviews to conform the existing regulations to the United States' obligations under Articles 6.1, 6.2, and 11.3 of the Antidumping Agreement. The proposed regulations, if adopted, would amend the “waiver” provisions which govern treatment of interested parties who do not provide a complete substantive response to the Department's Notice of Initiation of a sunset review and clarify the basis for parties' participation in a public hearing in an expedited sunset review.

Section 751(c)(4)(B) of the Tariff Act provides that where an interested party “waives” its participation in a sunset review, the Department “shall conclude that revocation of the order ... would be likely to lead to continuation or recurrence of dumping or a countervailable subsidy (as the case may be) with respect to that interested party.” Paragraph (d)(2) of 19 CFR 351.218 deals with the procedure for waiving participation in a sunset review before the Department. Specifically, paragraph (d)(2)(i) provides for filing a “statement of waiver” for parties electing not to participate in the Department's sunset review (so-called “affirmative waiver”), and paragraph (d)(2)(iii) provides that failure to file a complete substantive response to a notice of initiation also will be treated as a waiver of participation (so-called “deemed waiver”). The panel and Appellate Body found that the operation of the statutory and regulatory waiver provisions was inconsistent with the obligation under Article 11.3 to arrive at a “reasoned conclusion” because the Department's order-wide likelihood determination would be based, at least in part, on statutorily-mandated “assumptions” about a company's likelihood of dumping. The AB/panel also found that the operation of paragraph (d)(2)(iii) was inconsistent with “due process rights” of Articles 6.1 and 6.2, because the Department could assume likelihood with respect to a particular company even though that party had filed a substantive response to the notice of initiation, albeit an “incomplete” response.

To implement the AB/panel findings with respect to the operation of the waiver provisions, we propose to modify the Department's regulations to eliminate the possibility that the Department's order-wide likelihood determinations would be based on assumptions about likelihood of continuation or recurrence of dumping or a countervailable subsidy due to interested parties' waiver of participation in sunset reviews. Thus, we propose the following three modifications to paragraph (d)(2) of 19 CFR 351.218. First, with respect to so-called “affirmative waivers” set forth in paragraph (d)(2)(i) which provides that a party may elect not to participate in the Department's sunset review by filing a “statement of waiver” within 30 days of initiation of the sunset review we propose to amend the contents of a “statement of waiver” which are set forth in paragraph (d)(2)(ii). Specifically, we proposed to amend paragraph (d)(2)(ii) to require that a party filing a Statement of Waiver include a statement that it is likely to dump or benefit from a countervailable subsidy (as the case may be) or, in the case of a foreign government in a CVD sunset review, provide a countervailable subsidy, if the order is revoked or the investigation is terminated. Second, we propose to eliminate paragraph (d)(2)(iii) which provides that an interested party is “deemed” to have waived participation in the sunset review by failing to file a complete substantive response to a notice of initiation. Thus, the Department will no longer make company-specific likelihood findings for companies that fail to file a statement of waiver and fail to file a substantive response to the notice of initiation. Finally, we propose to modify paragraphs (d)(2)(iv)(C) and (e)(1)(ii)(B)(3) which address waiver of participation by a foreign government in a CVD sunset review to eliminate cross-references to paragraph (d)(2)(iii) and to eliminate certain language that might suggest the possibility that the Department's order-wide likelihood determination in a CVD sunset review would be based on assumptions about likelihood of continuation or recurrence of a countervailable subsidy. In sum, these three modifications to the waiver provisions of the Department's sunset regulations will ensure that there is no longer the possibility that the Department's order-wide likelihood determinations might be based on assumptions about likelihood of continuation or recurrence of dumping or a countervailable subsidy. The Department will make its order-wide likelihood determinations on the basis of the facts and information available on the record of the sunset review.

The Appellate Body upheld the panel's finding that the operation of paragraph (d)(2)(iii) of 19 CFR 351.218 was inconsistent with Article 6.2 in that it allegedly denies an interested party that is deemed to have waived its right to participate in a sunset review by submitting an incomplete substantive response the right to participate in a hearing. Paragraph (d)(2)(iii) does not explicitly address the issue of hearings; nor do the regulations preclude hearings in expedited sunset reviews resulting from the application of the waiver provisions. Nevertheless, in the interest of alleviating any perceived confusion with respect to participation in a hearing in an expedited sunset review, we propose to modify paragraph (c)(1)(iii) of 19 CFR 351.309 to clarify that the Secretary will specify a due date for case briefs in an expedited sunset review. Case briefs provide the basis for parties' affirmative presentations at a hearing. In addition, as discussed above, for other reasons we propose to eliminate paragraph (d)(2)(iii) in its entirety.

Pursuant to section 123(g)(2) of the URAA, the final amended regulation may not become effective until the end of the 60-day period beginning on the date on which the Department and the Office of the U.S. Trade Representative (“USTR”) undertake consultations with the appropriate congressional committees concerning the proposed contents of the final rule. Since the date of consultations has not yet been determined, we are unable to project the possible effective date at this time. If the proposed regulation is adopted, we will publish the effective date in the notice of final rule based upon the date on which USTR and the Department consult with Congress.

This proposed rule has been determined to be not significant under E.O. 12866.

Notwithstanding any other provision of law, no person is required to respond to nor shall a person be subject to a penalty for a failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a currently valid Office of Management and Budget (OMB) control number. This proposed rule involves collection-of-information requirements subject to the Paperwork Reduction Act, 44 USC Chapter 35. The requirements have been approved by OMB under control numbers 0625-0148.

This proposed rule does not contain federalism implications warranting the preparation of a Federalism Assessment.

The Chief Counsel for Regulation of the Department of Commerce has certified to the Chief Counsel for Advocacy of the Small Business Administration that these proposed rules, if adopted, would not have a significant impact on a substantial number of small entities. We cannot identify the number of small entities that may be affected by this rule because we do not keep track of that information. The Department's existing regulations contain procedures for the conduct of five-year (“sunset”) reviews in which the Secretary considers whether to revocation of an order is likely to lead to continuation or recurrence of dumping or a countervailable subsidy. The proposed amendments revise the process for interested parties electing not to participate in a sunset review and clarify the basis for parties' participation in a hearing in an expedited sunset review. These actions, in and of themselves, will not have a significant economic impact because they do not impose any new reporting requirements. Therefore, the Chief Counsel concluded that the proposed rules would not have a significant impact on a substantial number of small business entities, and a regulatory flexibility analysis was not prepared.

Administrative practice and procedure, Antidumping duties, Business and industry, Cheese, Confidential business information, Countervailing duties, Investigations, Reporting and record keeping requirements.

For the reasons stated, 19 CFR Part 351 is amended as follows:

1. Section 351.218 is amended by revising paragraphs (d)(2)(ii), (d)(2)(iv) introductory text, (d)(2)(iv)(C), (e)(1)(ii)(B) introductory text, and (e)(1)(ii)(B)(3), and removing and reserving paragraph (d)(2)(iii), as follows:

Section 105(e) of the Federal Alcohol Administration Act (the FAA Act, 27 U.S.C. 201 et seq. ) requires that alcohol beverage labels provide consumers with adequate information regarding product identity and prohibits the use of misleading information on those labels. The FAA Act also authorizes the Secretary of the Treasury to issue regulations to carry out its provisions. The Alcohol and Tobacco Tax and Trade Bureau (TTB) administers these regulations.

Part 4 of the TTB regulations (27 CFR part 4) allows the establishment of definitive viticultural areas and the use of their names as appellations of origin on wine labels and in wine advertisements. Part 9 of the TTB regulations (27 CFR part 9) contains the list of approved viticultural areas.

Section 4.25(e)(1)(i) of the TTB regulations (27 CFR 4.25(e)(1)(i)) defines a viticultural area for American wine as a delimited grape-growing region distinguishable by geographical features, the boundaries of which have been recognized and defined in part 9 of the regulations. These designations allow vintners and consumers to attribute a given quality, reputation, or other characteristic of a wine made from grapes grown in an area to its geographical origin. The establishment of viticultural areas allows vintners to describe more accurately the origin of their wines to consumers and helps consumers to identify wines they may purchase. Establishment of a viticultural area is neither an approval nor an endorsement by TTB of the wine produced in that area.

Section 4.25(e)(2) of the TTB regulations outlines the procedure for proposing an American viticultural area and provides that any interested party may petition TTB to establish a grape-growing region as a viticultural area. Section 9.3(b) of the TTB regulations requires the petition to include—

• Evidence that the proposed viticultural area is locally and/or nationally known by the name specified in the petition;

• Historical or current evidence that supports setting the boundary of the proposed viticultural area as the petition specifies;

• Evidence relating to the geographical features, such as climate, elevation, physical features, and soils, that distinguish the proposed viticultural area from surrounding areas;

• A description of the specific boundary of the proposed viticultural area, based on features found on United States Geological Survey (USGS) maps; and

• A copy of the appropriate USGS map(s) with the proposed viticultural area's boundary prominently marked.

The Lodi American Viticultural Areas (LAVA) Steering Committee has petitioned TTB to establish seven new viticultural areas within the boundary of the existing Lodi viticultural area (27 CFR 9.107) in southern Sacramento and northern San Joaquin Counties in California. The seven LAVA Steering Committee petitions propose the creation of the Alta Mesa, Borden Ranch, Clements Hills, Cosumnes River, Jahant, Mokelumne River, and Sloughhouse viticultural areas. The 16 wine industry members that comprise the committee state that their proposal subdivides the existing Lodi area into “seven smaller viticultural areas of distinction.”

The establishment of the seven proposed viticultural areas would not in any way affect the existing 551,500-acre Lodi viticultural area. The Lodi area will continue as a single American viticultural area within its current boundary. However, TTB notes that the seven proposed areas fall entirely within the 458,000 acres within the original 1986 boundary of the Lodi viticultural area and thus, as proposed, would not include any of the 93,500 acres added to the Lodi area when it was expanded along its western and southern borders in 2002. (See T.D. ATF-223, published in the Federal Register on February 13, 1986 (51 FR 5324) for the Lodi viticultural area as originally defined. See T.D. ATF-482, published in the Federal Register on September 4, 2002 (67 FR 56481), for the Lodi area expansion in 2002.)

The proposed Cosumnes River, Alta Mesa, and Sloughhouse viticultural areas lie, respectively, in the northwestern, north-central, and northeastern portions of the existing Lodi viticultural area and are entirely within Sacramento County. The proposed Clements Hills and Mokelumne River areas cover, respectively, the southeastern and southwestern portions of the existing Lodi viticultural area and are entirely within San Joaquin County. The proposed Borden Ranch and Jahant areas cover, respectively, the east-central and central portions of the existing Lodi viticultural area and lie in portions of both Sacramento and San Joaquin Counties.

The Cosumnes River flows southwest across the Sacramento County, portion of the Lodi viticultural area and crosses the proposed Sloughhouse, Alta Mesa and Cosumnes River viticultural areas. The Cosumnes River joins the Mokelumne River, which flows west, then northwest, through the San Joaquin County portion of the Lodi area. The Mokelumne River crosses the proposed Clements Hills and Mokelumne River viticultural areas, and forms a portion of the southwestern boundary of the proposed Jahant area. Neither river touches the proposed Borden Ranch viticultural area.

According to the LAVA Steering Committee petition, climate data—such as temperature, precipitation, and wind patterns—outline the distinctive microclimates of the seven proposed viticultural areas. To varying degrees, the petition notes, the Lodi viticultural area's climate is affected by its inland San Joaquin valley location between the Sierra Nevada Range to the east and the Sacramento Delta, with its Pacific coast marine influence, to the west.

Differences in topography, elevation, and soils also help to distinguish the seven proposed areas from one another, according to the petition. In addition, the LAVA Committee uses the Storie Index (Huntington, 1992) to rate the agricultural potential of the soils within the seven proposed viticultural areas. This index ranges from 100 points for highly suitable soils to 0 points for unsuitable soils. The petition notes that Storie Index ratings for the seven proposed areas range from 95 to 15 points.

The table below lists the general features of each of the seven proposed viticultural areas as outlined in the LAVA Steering Committee petition:

In addition, the LAVA Steering Committee petition provided an overview of each proposed area's grape-growing environment, which we outline in this table:

Below, we discuss the name and boundary evidence and distinguishing features for each of the seven viticultural areas proposed by the LAVA Steering Committee.

The proposed Alta Mesa viticultural area is located in Sacramento County in the north-central portion of the established Lodi viticultural area, approximately 21 miles south of the city of Sacramento and 13 miles north of the city of Lodi. The proposed area covers 55,400 acres, of which approximately 5,000 acres are planted to grapes, according to the LAVA Steering Committee petition. This irregularly shaped, five-sided area is 13.3 miles long north to south, and 8.3 miles wide at its widest point east to west. The Alta Mesa region's “tabletop” landform and the Joaquin soil series are the proposed area's distinctive and unifying features, the petition states.

Below, we summarize the evidence presented in the Alta Mesa petition.

The petition explains that the name “Alta Mesa,” which means “high table” in Spanish, reflects California's history under Spanish-controlled Mexico. The petition states that local ranchers, farmers, and winemakers refer to this region within the existing Lodi viticultural area as “Alta Mesa,” and notes that the name is also used for places within the proposed viticultural area. The Alta Mesa Farm Bureau Hall, which is listed on the National Register of Historic Places, is on Alta Mesa Road, while the Alta Mesa Fair is held in Elk Grove and the Alta Mesa Dairy is in Wilton, both of which are within the proposed area's boundary.

The name “Alta Mesa” also appears four times on the USGS Sloughhouse map within the proposed viticultural area's boundaries. The map shows the 138-foot high Alta Mesa benchmark and the Alta Mesa Community Hall in section 9, and the Alta Mesa Gun Club in section 8, T6N, R7E. Alta Mesa Road runs along the northern and eastern boundaries of section 5, T6N, R7E, and continues onto the USGS Clay, California, map. The road serves as part of the Alta Mesa viticultural area's proposed eastern boundary.

The Alta Mesa tabletop landform and the extent of the Joaquin soil series generally outline the boundary of the proposed Alta Mesa viticultural area, according to the petition. The petition explains that the American and Cosumnes Rivers have built up intermediate elevation river terraces and alluvial fans, which form the proposed area's tabletop or “mesa,” the elevation of which gently rises from approximately 35 feet in the west to 135 feet in the east.

The proposed Alta Mesa area's northern boundary coincides with the established Lodi viticultural area's boundary at Sheldon Road in Sacramento County. According to the petition, eroded terrain and a change in soil types mark the proposed area's southern boundary at the Dry Creek estuary. Changes in elevation from Alta Mesa's tabletop landform, the petition explains, mark the proposed area's eastern and western boundary lines. Also, the petition notes, the proposed area's western boundary marks a transition to the warmer climate of the proposed Cosumnes River viticultural area. In addition, the proposed Alta Mesa area is bordered on the east by the proposed Sloughhouse and Borden Ranch viticultural areas, and, to the south, by the proposed Jahant area.

The proposed Alta Mesa viticultural area's tabletop or mesa-like landform is one of the area's most distinctive and unifying features, the petition states. The proposed Alta Mesa area sits on intermediate elevation river terraces and alluvial fans, and, despite some depressions and mounds, the area has a generally flat surface. This tabletop landform peaks at 138 feet in its northeast corner and gradually declines to 35 feet along its western side. To the east of the proposed Alta Mesa area, the Sierra Range foothills begin to rise within the proposed Sloughhouse viticultural area. To the proposed Alta Mesa area's immediate west, the proposed Cosumnes River viticultural area has lower elevations that almost dip to mean sea level. Deer Creek and the lower course of the Cosumnes River run parallel and southwest through the proposed area.

The San Joaquin soil series, which covers about 90 percent of the Alta Mesa region, is also a distinctive feature of the proposed viticultural area, the petition states. The petition explains that this soil series consists of dense, heavy clay that limits rooting depth and the need for irrigation. Classified as Abruptic Durixeralfs, the San Joaquin soils have high percentages of clay and gravel, and intensive reddening and cementation caused by silica, clay, and iron. This soil series has intermediate-age parent materials, 12,000 to 45,000 years old, from stage 2 of the late Pleistocene glacial age, making these some of the oldest soils within the established Lodi viticultural area, according to the petition.

The San Joaquin soil series, the petition emphasizes, creates a distinctive and beneficial viticultural environment in the proposed Alta Mesa viticultural area. The Storie Index, which rates soils from 0 to 100 points for potential agricultural use (100 being most suitable), places the Alta Mesa soils between 25 and 40 points of suitability.

The petition uses data from the Lodi, Sacramento, Folsom, and Camp Pardee weather stations, which are located close to the proposed Alta Mesa viticultural area. Climatically, the petition states, the proposed Alta Mesa area is a transitional region that is warmer than the other proposed viticultural areas within the existing Lodi viticultural area, except for Sloughhouse, which is further inland to the east of the proposed Alta Mesa area. The petition states that the proposed Alta Mesa area's mean annual temperature is 60.5 degrees Fahrenheit. The average growing season degree-day total  * for the proposed Alta Mesa viticultural area, according to the petition, is more than 100 degree days over that of the cooler, proposed Cosumnes River viticultural area to its west and the proposed Borden Ranch and Clements Hills viticultural areas to its east and southeast. Also, the petition continues, the warmer Alta Mesa area is more than 200 degree days higher than the proposed Jahant and Mokelumne River viticultural areas to its south, which are closer to the Sacramento Delta's cooling winds.

The sea breeze from the Pacific Ocean that funnels through the Carquinez Straits and the Sacramento Delta, the petition explains, cools the overall Lodi area. However, this natural air conditioning gradually decreases in intensity and disperses as it flows inland from west to east. As measured across the northern portion of the existing Lodi viticultural area from west to east, these marine winds are strongest in the proposed Cosumnes River viticultural area, less intense in the proposed Alta Mesa area, and weakest in the proposed Sloughhouse area.

Winter fog is also common in the proposed Alta Mesa viticultural area, the petition explains, due to seasonal standing water and cold-air drainage from the foothills to the east. This fog slightly decreases the Alta Mesa area's growing season degree-day total, according to the petition, by limiting the springtime heating of the soil and vines. In addition, the petition notes, the proposed Alta Mesa viticultural area's elevation provides a buffer between this fog from the west and the proposed Sloughhouse viticultural area to the east.

The average annual rain total in the proposed Alta Mesa viticultural area, according to petition evidence, is 18.5 inches. This amount, the petition notes, is less than the 23-inch annual average in Sloughhouse to the east and more than the 14 to 17.5-inch average in regions to Alta Mesa's immediate south.

The proposed Borden Ranch viticultural area is located in southern Sacramento and northern San Joaquin Counties in the east-central portion of the established Lodi viticultural area, approximately 27 miles southeast of the city of Sacramento and 13 miles north of the city of Lodi. Covering 70,000 acres, the petition notes that approximately 11,000 acres within the proposed Borden Ranch area are planted to grapes. Located between the Sierra Foothills to the east and the San Joaquin Valley to the west, the proposed area has a distinctive terrain of old alluvial fans, river terraces and plains, and high elevations, according to the LAVA Steering Committee petition.

Below, we summarize the evidence presented in the Borden Ranch petition.

In 1864, Ivey Lewis Borden established the Borden Ranch in this area, and local residents have used the name ever since, according to the petition. For example, the petition notes an August 16, 1929, Stockton Daily Evening Record article reporting on a barn fire on the Borden Ranch that killed a famous horse. More recently, the Borden Ranch name appeared in a court case and related news media stories involving a developer who sued the U.S. Army Corps of Engineers over wetlands issues, and the petition included a January 6, 2003, Sacramento Business Journal article on the case.

The petition states that since the 1970s, when the Burton and Dedomenico families began the first major grape plantings within the proposed area, local residents have also come to know Borden Ranch for its grape growing. Since that time, the petition continues, Sutter Home, Mondavi, and Delicato have also planted vineyards in the proposed area. The petition also claims that between 1995 and 1996, the single largest vineyard expansion in California history occurred in this area.

In addition, the petition includes articles from the April 8, 2003, Stockton Record and the April 18, 2003, Modesto Bee that discuss recent vineyard development around Clay Station. Named for a popular stagecoach stop from the California Gold Rush days and located on the historic Borden Ranch, Clay Station is noted for its rich reddish clay soils and large stones, which provide for well-drained soil for grape growing, according to the Stockton Record article.

The petition also included statements from local residents regarding the use of the Borden Ranch name. For example, Jeff Sparrowk, a longtime Clements-area rancher, notes that the Borden Ranch is well known for its quality grazing land and vineyards. Robert Disch, a Borden Ranch-area farmer, states that Borden Ranch has become well known since vineyard development began there in the 1970s. He adds, “We are happy to see the notoriety of this region increasing and can declare that the Borden Ranch has a well-known history in our community.”

Wine industry publications have also taken notice of the Borden Ranch area, according to several articles supplied with the petition. An article titled “Lodi & the Sacramento Valley Vintage 2000” from the Wine Institute's “Harvest 2000” publication comments on the “enormous quality potential” of newer grape growing areas “such as Borden Ranch.” The Spring 2002 edition of the “V&E Trellis Wire,” a publication of the Department of Viticultural and Enology at the University of California-Davis, includes an article about a student field trip to the Lodi-Woodbridge wine region. The article describes the students' visit to the Borden Ranch, which it characterized as a 4,000-acre vineyard region.

The proposed Borden Ranch viticultural area lies between the Sierra Range foothills to the east and the San Joaquin Valley to the west. The proposed area's northern and southern boundaries are based on two generally parallel streams—the Laguna, a tributary of the Cosumnes River, in the north, and Dry Creek, a tributary of the Mokelumne River, in the south. Both flow northeast to southwest from the Sierra Foothills to the San Joaquin Valley.

The stream deposits from the Laguna and Dry Creek are the distinguishing and unifying feature of the proposed Borden Ranch viticultural area, according to the petition. The proposed area's predominant geographical features are the high elevation, older river terraces and hills located within the watersheds of the Laguna and Dry Creek. These deposits and river terraces, the petition explains, extend from the Laguna in the north to near Liberty Road at the area's proposed southern boundary near Dry Creek. As a result, the proposed Borden Ranch area's northern boundary follows the path of the Laguna, while Dry Creek runs slightly north of the proposed area's southern boundary. The petition uses roads to mark the proposed area's eastern and western boundaries.

As explained in the petition, the proposed Borden Ranch viticultural area has distinctive terrain due to its location between the Laguna and Dry Creek streams and its location at the base of the Sierra Foothills. The river terraces and stream deposits left by the Laguna and Dry Creek throughout the proposed Borden Ranch area are its distinguishing and unifying feature, according to the petition. The petition notes that the proposed area's lower, western elevations also have prairie mounds and vernal pools along these river terraces. Hills and ridges, which are the eroded remnants of very old river deposits, are found near the Sierra Foothills in the proposed area's higher eastern elevations. In addition, the petition states, the oldest alluvial fans in Sacramento and San Joaquin Counties are found in the eastern portion of the proposed area close to the Sierras.

The proposed Borden Ranch viticultural area inclines upward toward the Sierra Range, from 73 feet in elevation along its western boundary to 520 feet along its eastern border, a rise of 447 feet. While these elevations and rise are similar to the proposed Sloughhouse viticultural area to the north of the Borden Ranch area, the proposed Alta Mesa and Jahant areas to the west of Borden Ranch have peak elevations of only 137 feet and 105 feet, respectively. The existing Lodi viticultural area's eastern boundary also marks the eastern limit of the proposed Borden Ranch area—beyond which lies the higher elevations and more mountainous terrain of the Sierra Foothills.

The terrain within the proposed Borden Ranch viticultural area exceeds 700,000 years in age, and is distinctively older than the terrain found in the other six proposed Lodi viticultural areas, according to the petition. In addition, the petition notes, the oldest valley soils in the Lodi region are found on the tops of the terraces above the streams in the proposed Borden Ranch area. These old Durixeralfs soils, the petition states, include the Redding, Hicksville, Corning, and Yellowlark soil series.

In contrast, the petition states that the surface terrain in the proposed Sloughhouse viticultural area to the north of the Borden Ranch area and in the proposed Clements Hills viticultural area to its south is from 125,000 and 250,000 years old, respectively, to 700,000 years old. Additionally, the proposed Borden Ranch viticultural area's soils contain a large percentage of surface and below ground rock cobble, or stones, a feature unique to this area, according to the petition.

The petition incorporates data from the Lodi, Sacramento, Folsom, Camp Pardee, and Stockton weather stations, which are located near the proposed Borden Ranch viticultural area. The proposed Borden Ranch area, the petition notes, has a greater diversity of topographic-climatic vineyard sites than any of the other six areas proposed for establishment within the existing Lodi viticultural area. As the petition explains, vineyards within the proposed Borden Ranch area are found on hilltops or slopes, and in flat valley floors, facing different compass directions. These topographic variables, the petition states, are responsible for differences of sun, temperature, soil, water, and windiness in the vineyards.

The proposed Borden Ranch area, according to the petition, is windier, warmer, and wetter, than the lowland regions to its west. The combination of cooling Sacramento Delta breezes from the west and cold air drainage from the Sierra Foothills to the east, the petition explains, generates high wind intensity and duration in the proposed Borden Ranch area. The petition notes that this windswept environment, in conjunction with the area's hills and stony soils, creates high water evaporation conditions in the vineyards that lessen the vigor of the grapevine growth.

While the Borden Ranch area's growing season degree day total is similar to that of the other six proposed Lodi viticultural areas, its annual mean temperature of 60.4 degrees Fahrenheit is slightly warmer than the other six proposed areas, with the exception of the Sloughhouse area to its north. Annual rainfall in the Borden Ranch area is 20 inches, which is less than the 23 inches of the Sloughhouse area to the north, the petition states, with the other proposed Lodi viticultural areas averaging as low as 14 inches of annual rainfall.

Located in northern San Joaquin County, the proposed Clements Hills viticultural area occupies much of the southeastern portion of the established Lodi viticultural area, approximately 41 miles southeast of Sacramento and 13 miles east of the city of Lodi. Covering 85,400 acres, of which approximately 16,000 acres are planted to grapes, the LAVA Steering Committee petition states that the proposed Clements Hills viticultural area is a hilly transitional region between the low, flat San Joaquin Valley floor to the west and the progressively higher Sierra Foothills to the east. The petition adds that the proposed area's high elevation river terraces and rounded hilltops distinguish it from surrounding grape-growing regions.

Below, we summarize the evidence presented in the Clements Hills petition.

The small town of Clements is located in the northern portion of the proposed Clements Hills viticultural area and is shown on the USGS Clements map and on California highway maps. According to the petition, Thomas Clements, who had settled in the region in 1857, donated 25 acres of land in 1882 to develop the town as a stop on the San Joaquin and Sierra Nevada Railroad. Named for its benefactor, the town served as a shipping point for the region's grain, wool, hops, fruit, and other agricultural commodities.

The proposed “Clements Hills” viticultural area name combines the town's name with a reference to the proposed area's hilly terrain. Local residents, realtors, and members of the wine industry, the petition states, commonly use the Clements Hills name to refer to the land within the proposed area's boundaries. For example, realtor Tad Platt states that while marketing materials formerly referred to the “rolling hills of Clement,” the area has become better known simply as “Clements Hills” in recent years. Farmer Wesley Breitchenbucher and businessman Jeff Myers, whose families have lived in the Clements area for generations, also indicate that the proposed area is known as Clements Hills, according to the petition. The petition quotes Mr. Myers as stating that “the red, shallow soils of the Clements Hills” has attracted many vineyards and ranchette developments in the past decade. In addition, the petition notes the use of the Clements Hills name on the label of Vino Con Brio's 2001 Sangiovese wine.

The high elevation river terraces and hills formed by the Mokelumne River, along with the region's older soils, distinguish the proposed Clements Hills area from surrounding areas, according to the petition. The Clements Hills area's proposed northern boundary, along Liberty Road, approximates the northern edge of the higher and older Mokelumne River terraces, the petition explains. The petition adds that, north of the proposed boundary, elevations decrease in the proposed Borden Ranch viticultural area due to the more eroded land found in the vicinity of Dry Creek.

The Clements Hills proposed eastern boundary follows the San Joaquin County line, separating the proposed area from the more mountainous Amador, Calaveras, and Stanislaus Counties. These county lines, according to the petition, mark the transition from the rolling hills of the Clements Hills region to the Sierra Foothills more mountainous environment.

The Clements Hills proposed southern boundary line follows the Calaveras River as it meanders west from the Sierra Foothills to the San Joaquin Valley. To the north of the Calaveras River, within the proposed area's boundaries, the terrain is made up primarily of hills from older Mokelumne River deposits, the petition explains. Also, the petition states, the Calaveras River's alluvial terrace and fan deposits become progressively younger as one moves south from the proposed area's southern boundary.

The Clements Hills proposed western boundary is along Jack Tone and Elliott roads. To the east of these roads within the proposed area, the petition explains, the terrain consists primarily of hilly deposits from the older alluvial terraces and fans. The petition adds that to the west of Jack Tone and Elliott roads beyond the Clements Hills area, the hilly terrain gives way to younger, sandier, and lower alluvial fan formations and eventually the flat San Joaquin valley floor.

The proposed Clements Hills viticultural area is located between the flat, low elevations of the San Joaquin Valley floor to its west and the higher Sierra Foothills elevations to its east, according to the petition. Elevations within the proposed boundary area increase from a low of 90 feet on its western, San Joaquin Valley side to greater than 400 feet high at its eastern boundary line, according to the provided USGS maps. The petition also notes that the hilltops within the Clements Hills proposed viticultural area are distinctively convex and rounded. The Clements Hills, the petition states, contrast with the flat valley terrain to the west, the flat hilltops of the proposed Borden Ranch viticultural area to the north, and the more mountainous environment of the Sierras. Through time and weather, the petition adds, the bluffs and terraces of the Mokelumne River have become smooth topped, rolling hills that extend toward the proposed Clements Hills area's southern boundary at the Calaveras River.

The petition explains that the soils found within the proposed Clements Hills proposed viticultural area are old and primarily classified as Haploxerailfs, Durixeralfs, and Palexeralfs. These brown, red and yellow loams, clay loams, and clays, the petition states, principally belong to the Redding, Cometa, Yellowlark, and Montpellier soil series. Also, the petition notes, these low vigor soils have higher water holding capacities than the stony soils to the north in the proposed Borden Ranch viticultural area, but less than the loamy soils to the west in the proposed Mokelumne River area. Using a scale of 0 to 100, with 0 most unsuitable for agriculture and 100 most suitable, the Storie Index rates the soils in the proposed Clements Hills viticultural area at between 15 and 30, according to the petition.

Using data from the Lodi, Sacramento, Folsom, Stockton, and Camp Pardee weather stations, which are located close to the proposed Clements Hills viticultural area, the petition states that the proposed Clements Hills viticultural area is warmer and wetter than the regions to its west. While the mean annual temperature of the proposed Clements Hills viticultural area is 60.5 degrees Fahrenheit, which is similar to the other proposed Lodi viticultural areas, the Clements Hills area growing season annual degree-day total is approximately 100 degree days more than the proposed Mokelumne River and Jahant viticultural areas to the west, according to the petition.

The petition notes that fog is less frequent in the proposed Clements Hills viticultural area than in lower elevation, San Joaquin valley floor areas to its west and, therefore, the proposed area receives more hours of warming sunshine. Reduced winds also help warm the proposed Clements Hills area, according the petition. Although the proposed area receives consistent Sacramento Delta breezes, the hilly terrain of the proposed Clements Hills area, the petition notes, reduces the marine wind speed and movement across the proposed area. Air drainage from the higher slopes to the east, the petition adds, reduces frost occurrences in the proposed viticultural area as well.

Rainfall in the proposed Clements Hills viticultural area averages 21 to 22 inches annually, according to the petition, which is more than the lower elevation Jahant and Mokelumne River areas to its west and the Borden Ranch area to its north receive. The petition explains that the proposed Clements Hills area's hilly topography and its location just west of the Sierra Mountains bring more rain to the area since these higher elevations cause moisture-laden Pacific air to rise, forcing the air's moisture to condense and fall to the ground.

The proposed Cosumnes River viticultural area is in the northwestern portion of the existing Lodi viticultural area, approximately 20 miles south of the city of Sacramento and 14 miles north of the city of Lodi. Approximately 3,000 acres of the 54,700 acres within the proposed Cosumnes River viticultural area are currently planted to grapes, according to the petition. The climate of the proposed viticultural area, most notably a relatively cool and windy growing season, as well as its young, alluvial soils and low-elevation terrain distinguish the proposed area from surrounding areas, according to the petition.

Below, we summarize the evidence presented in the Cosumnes River petition.

The May 2001 California State Automobile Association “Central California” map shows the Cosumnes River from its headwaters in the Sierra Range to its confluence with the Mokelumne River between Walnut Grove and Thornton, California. The lower portion of the river flows through the proposed Cosumnes River viticultural area. The USGS quadrangle maps for Bruceville, Elk Grove, and Galt, California, which are used to define portions of the proposed Cosumnes River viticultural area boundary, identify the Cosumnes River and show its northeast-to-southwest path through the proposed area. The LAVA Committee considered using the “Upper Cosumnes” and “Lower Cosumnes” names for the proposed “Sloughhouse” and “Cosumnes River” viticultural areas, respectively, but believes the proposed name choices are more appropriate.

As noted in the petition, the Cosumnes River name is associated with other places within the proposed viticultural area. For example, the Cosumnes River Preserve, located between Interstate Highways 5 and State Route 99 in southern Sacramento County, is also prominently shown on the California State Automobile Association's Central California map. The petition explains that this Nature Conservancy preserve, a 1,450-acre protected natural area and wildlife habitat, is in the heart of the proposed Cosumnes River viticultural area. Also, Cosumnes River College is located in the suburbs of Sacramento, just north of the proposed area's northern boundary.

Historically, the petition explains, the name “Cosumnes” comes from the Native American Miwok people's term for “salmon people.” The petition adds that an alternative Miwok translation is “the place of the koso berry.” John Sutter, an early settler, provides an 1841 written reference to the term “Cosumnes River,” the petition states, and 1845 and 1848 maps by John Fremont label this waterway as the “Cosumnes River.” The March 1, 1851, edition of the Stockton Times, in describing the region, states: “Some of the earlier settlements made in this country were along the Cosumnes”.

The existing Lodi viticultural area boundary marks the limits of the proposed Cosumnes River viticultural area to the north and west. To the east, the proposed Cosumnes River viticultural area shares a boundary with the proposed Alta Mesa viticultural area, and, to the south, with the proposed Jahant and Mokelumne River viticultural areas. A portion of the Mokelumne River marks the proposed area's southern boundary line.

The proposed Cosumnes River viticultural area lies south of the city of Sacramento and borders the west side of the town of Galt. The proposed area primarily produces white wine grape varietals, as compared to red grape varietals in areas to the east and a mixture of red and white grape varietals in areas to the south.

The relatively cool and windy growing season of the proposed Cosumnes River viticultural area, its young, alluvial soils, and its low-elevation terrain distinguish the proposed area from surrounding areas, according to the petition.

The petition explains that the proposed Cosumnes River viticultural area topography includes wetlands, natural and artificial levees, sloughs, streams, and the Cosumnes River. In addition, the Mokelumne River marks a portion of the area's southern boundary. A large alluvial fan crosses the proposed Cosumnes River viticultural area and slopes towards its southwest corner.

The low elevations found in the proposed Cosumnes River viticultural area distinguish it from the surrounding, higher-elevation areas, the petition states. At its southwestern corner, where the Cosumnes River joins the Mokelumne River, the elevation of the proposed Cosumnes River viticultural area dips to almost sea level. Elevations within the proposed area gradually rise to a high point of 48 feet at its southeast corner, according to the provided UGSS maps. In contrast, the petition notes, the proposed Alta Mesa viticultural area, to the east of the proposed Cosumnes River viticultural area, has elevations to 138 feet. To the south, the proposed Jahant viticultural area rises to 80 feet in elevation, and the proposed Mokelumne River viticultural area rises to 85 feet, according to the petition.

The proposed Cosumnes River viticultural area, the petition explains, is dominated by young, alluvial soils that distinguish it from the surrounding areas. The petition notes that 60 percent of the agricultural land within the proposed area is covered by a series of younger alluvial and organic soils, Xerothents and Histosols. These younger soils, the petition continues, predominate in the lower areas, including the floodplains, sloughs, and wetlands, and around the Cosumnes River and its tributaries along the western side of the proposed viticultural area. The intermediate-age, deep reddish, gravelly clay loam soils of the San Joaquin series cover the remaining 40 percent of the agricultural land within the proposed Cosumnes River viticultural area, according to the petition. These soils, classified as Abruptic Durixeralfs, have good water-holding capacity and moderate fertility.

To the east of the proposed Cosumnes River viticultural area, the proposed Alta Mesa viticultural area soils are of intermediate age, and about 90 percent of its soils are from the San Joaquin series, according to the petition. To the south, the proposed Jahant and Mokelumne River viticultural areas have a combination of young and intermediate in age soils. According to the petition, the Storie Index, which rates soils from 0 to 100 points for potential agricultural use, places the Cosumnes River soils at between 24 and 40 points for suitability.

The petition provides statistics and data from the Lodi, Sacramento, and Folsom weather stations, which are close to the proposed Cosumnes River viticultural area. Overall, according to the petition, the proposed Cosumnes River viticultural area has a cool and breezy climate.

The proposed Cosumnes River viticultural area has a mean annual growing season temperature of approximately 60 degrees Fahrenheit and intermediate level winds, the petition explains. The surrounding areas to the north and east are warmer and have less wind than the proposed Cosumnes River viticultural area, according to the petition. Also, to the south, the proposed Jahant and Mokelumne River viticultural areas are cooler and have stronger marine winds. The petition adds that the Pacific Ocean's cooling breezes funnel eastward through San Francisco's Golden Gate, the Carquinez Strait, and the Sacramento Delta to reach the Lodi area. These marine breezes cool the Lodi area's lower elevations, including the Cosumnes River floodplain and the areas to the river's south. The intensity and effect of these cooling winds, according to the petition, dissipate as they continue eastward over the proposed Cosumnes River viticultural area to the proposed Alta Mesa and Sloughhouse viticultural areas.

The petition states that maritime and inland fog is persistent in the low elevations of the proposed Cosumnes River viticultural area. This fog cools the proposed viticultural area more than the surrounding areas, which are less influenced by the maritime winds. The annual precipitation within the proposed Cosumnes area is 17.4 inches, according to the petition, which is more than the low elevation areas to its immediate south, but less than the high elevation regions to the north and east of the proposed viticultural area's boundaries.

The proposed Jahant viticultural area is located in the center of the existing Lodi viticultural area, about 29 miles south of the city of Sacramento and 7 miles north of the city of Lodi. Currently, approximately 8,000 acres of the 28,000 acres within the proposed Jahant viticultural area are planted to grapes, according to the petition. The pink Jahant loam soil found in the proposed viticultural area is its most distinguishing characteristic, according to the petition, giving the Jahant area a unique grape-growing environment. Also, the petition notes that the proposed Jahant viticultural area's climate is cooler, dryer, and windier than most of the other proposed viticultural areas discussed in this notice. The petition adds that the terrain within the proposed Jahant viticultural area is noted for its river terraces and old floodplain deposits.

Below, we summarize the evidence presented in the Jahant petition.

The “Jahant” name is associated with the central portion of the established Lodi viticultural area in southern Sacramento and northern San Joaquin Counties, according to the petition. The name comes from Peter Jahant and several of his brothers, all 1850s settlers to the area, the petition states. The Jahant family settled and successfully farmed in the Acampo area of the Lodi region, and, in 1912, Peter Jahant's son Charles planted 130 acres to grapes on the original family farm and on additional purchased land.

Jahant Slough and Jahant Road, a light-duty, east-west road, are shown on the Lodi North and Lockeford USGS maps, in the approximate center of the proposed Jahant viticultural area. Also, Jahant Road is shown in sections B-4, B-5, C-5, and C-6 of the Gold Country map, published in April 2002 by the California State Automobile Association. The Jahant Equestrian Center is on Jahant Road, and some area vineyards use Jahant in their names, according to the petition.

The petition states that the unique pink Rocklin-Jahant loam soils found within the proposed Jahant viticultural area and the deep dissections through river deposits left by flooding within the past 20,000 years distinguish the proposed Jahant area from the surrounding proposed viticultural areas. To the south, the proposed Mokelumne River viticultural area has predominantly young, light colored sandy soils, the petition notes, while to the north, the proposed Alta Mesa viticultural area has predominantly intermediate age red soils. The petition states that the boundaries of the proposed Jahant viticultural area encompass the extent of the Jahant soils.

The petition also explains that dissected river terraces and old floodplain deposits, located between Dry Creek and the Mokelumne River, distinguish the proposed Jahant area from the surrounding areas. Dry Creek is part of the northern boundary of the proposed Jahant viticultural area, and the creek flows through its northwest section. The Mokelumne River forms the western boundary of the proposed Jahant area, close to where it joins with the Cosumnes River, according to the provided USGS maps.

Elevations in the proposed Jahant viticultural area vary from about 10 feet to 100 feet, according to USGS maps of the area. Also, these elevations rise from the west to the east, increasing toward the Sierra Range. The proposed viticultural area, the petition explains, is dotted with small lakes, sloughs, rivers on the north and west sides, the larger Tracy Lake to the east, and a gas field in the southeast corner. The contours of the area, predominantly river terraces and old, eroded floodplain deposits, the petition continues, have developed from the actions of Dry Creek and the Mokelumne River.

The proposed Jahant viticultural area, located primarily between Dry Creek and the Mokelumne River, has distinctive pink Rocklin-Jahant soils that are principally sandy loams and sandy clay loams with massive structure, thickness, and hardened depth, the petition explains. The soils are classified as Mollic Pelexeralfs. These old soils, the petition continues, have younger sandy surfaces and are generally different in structure, thickness, and depth from the San Joaquin deep reddish, gravelly clay loam soils found north of the proposed Jahant viticultural area. To the south, the petition states, the light sandy loam Tokay and Acampo soils are young, deep and well drained, tend to be granular and crumbly, and of a fine texture without gravel, in contrast to the Jahant soils.

The petition provides statistics and data from the Lodi, Sacramento, Folsom, Camp Pardee, and Stockton weather stations, which are close to the proposed Cosumnes River viticultural area. The proposed Jahant viticultural area, the petition comments, has cool climatic characteristics similar to those of the proposed Mokelumne River viticultural area to the south. Both regions, according to the petition, receive the Pacific marine breezes that funnel east from the San Francisco Golden Gate, through the Carquinez Straights, the Sacramento Delta, and into the Lodi area. The petition also notes the cooling effect of persistent valley and coastal fog within the proposed boundaries.

The winds in the proposed Jahant viticultural area are of high intensity and prolonged duration, similar to those of the proposed Mokelumne River viticultural area to the south, the petition states. In contrast, to the north and northeast of the proposed Jahant area, the proposed Alta Mesa and Sloughhouse viticultural areas have less wind intensity and warmer temperatures, according to the petition.

The mean annual temperature of the proposed Jahant viticultural area is 60.1 degrees Fahrenheit, which is lower than the majority of other proposed viticultural areas discussed in this notice, according to the petition. Also, the growing season degree-day annual totals are between 100 and 400 degree days lower than other parts of the Lodi region, except for the proposed Mokelumne River viticultural area to the immediate south. Finally, the Jahant area's annual rainfall is 18.0 inches, which is less than rainfall totals in the other areas of the Lodi region with the exception of proposed Mokelumne River viticultural area.

The proposed Mokelumne River viticultural area is in northern San Joaquin County in the southwestern portion of the existing Lodi viticultural area. According to the petition, the proposed Mokelumne River viticultural area covers 85,700 acres, of which approximately 42,000 acres are vineyards. The young alluvial fan created by the Mokelumne River distinguishes the proposed Mokelumne River viticultural area from the surrounding areas, the petition states. In addition, the distinctively breezy climate of this proposed viticultural area is the coolest within the original Lodi viticultural area, according to the petition.

Below, we summarize the evidence presented in the Mokelumne River petition.

Historically, the “Mokelumne” name is derived from the Miwok Indians and has been translated as “the place of the fish net,” according to the petition. Known earlier as the Rio Mokellemos, the present spelling of Mokelumne was set in 1848 by John C. Fremont, as documented in the “California Place Names,” by Erwin Gudde, published in 1960 by the University of California Press.

The Mokelumne River, which flows west from the Sierras into the San Joaquin Valley, is shown on a number of USGS maps, including the Lockeford, Lodi North, Bruceville, Thornton, Clements, and Wallace maps. Other maps also show the river, including the Gold Country map published by the California State Automobile Association in April 2002.

The petition explains that the “classic, young” alluvial fan of the Mokelumne River extends east-to-west through the proposed Mokelumne River viticultural area. Given its distinctive geology and topography, the river's alluvial fan contrasts with the geology and topography of the other proposed viticultural areas discussed in this notice and the areas beyond. According to the petition, east of Jack Tone Road, beyond the proposed Mokelumne River viticultural area boundary line, are the older terrace deposits of the proposed Clements Hills viticultural area, while south of the proposed boundary, toward Linden and Farmington, the coarse deposits of the Calaveras River alluvial fan contrast with the sandy loam of the proposed Mokelumne River viticultural area. To the west of Interstate 5, and beyond the original Lodi viticultural area western boundary line, very young organic and inorganic soils dominate the Sacramento Delta region, according to the petition. To the north of the proposed Mokelumne River area boundary line are the older river deposits that distinguish the Jahant region.

The Mokelumne River meanders through the northern portion of the proposed Mokelumne River viticultural area, while creeks, sloughs, a canal, and an aqueduct run through its interior. Also, the city of Lodi is located on the south bank of the Mokelumne River in the approximate center of the proposed viticultural area.

The topography of the proposed Mokelumne River viticultural area is dominated by a relatively young alluvial fan over an intermediate age fan, according to the petition. To the east, the fan joins with the older Mokelumne River terrace deposits along Jack Tone Road, which serves as part of the boundary line for proposed viticultural area, the petition notes. The Mokelumne River alluvial fan extends from the higher eastern elevations of the Clements region to the lower elevations along Interstate 5 and Eight Mile Road to the southwest, according to the provided USGS maps and the petition. The USGS maps of the proposed Mokelumne River viticultural area show elevations sloping downward to the west from a high of 100 feet at the northeast corner of the proposed area to a low of 5 feet at its southwest corner.

The petition explains that sandy loam Tokay and Acampo soils dominate the proposed Mokelumne River viticultural area. These soils are young, deep and drain well, according to the petition. Also, the soils tend to be granular and crumbly, of a fine texture and without gravel. The sandy loams in the region, the petition describes, are generally between 6 and 12 feet in depth with low moisture holding capacity, especially in the western portion of the proposed area.

The petition uses climate statistics and data from the Lodi weather station, which is located near the proposed Mokelumne River viticultural area. The climate of the proposed Mokelumne River viticultural area is the coolest within the existing Lodi viticultural area, the petition explains. The proposed Mokelumne River viticultural area, the petition continues, is the closest of the seven proposed Lodi viticultural areas to the Carquinez Straights that funnel Pacific Ocean breezes eastward from the Golden Gate, through the Sacramento Delta, to the Lodi area.

The winds in the proposed Mokelumne River viticultural area are of high intensity and prolonged duration, blowing more than 70 percent of the time, the petition states. The winds lose little intensity as they cross the low elevations and flat terrain within the proposed boundaries, according to the petition.

The mean annual temperature within the proposed Mokelumne viticultural area is 60.0 degrees Fahrenheit, which is lower than the other proposed viticultural areas discussed in this notice, according to the petition. Also, the growing season degree-day annual totals are between 50 and 450 degree days lower than those found in the other six proposed Lodi viticultural areas. Rainfall within the proposed Mokelumne River viticultural area is 17.57 inches, which is the lowest of the seven proposed viticultural areas discussed in this notice, the petition states.

The proposed Sloughhouse viticultural area is located in southern Sacramento County, approximately 21 miles southeast of the city of Sacramento and 22 miles north of the city of Lodi. Located in the northeastern portion of the existing Lodi viticultural area, approximately 7,000 acres within the 78,800-acre proposed Sloughhouse viticultural area are currently planted to grapes, according to the petition.

The petition states that warmer temperatures, more rain, less fog, higher elevations, and older soils distinguish the proposed Sloughhouse viticultural area from the other proposed viticultural areas discussed in this notice. The proposed Sloughhouse viticultural area, which is also adjacent to the established Sierra Foothills viticultural area (27 CFR 9.120), has rolling plains and hilly terrain that transitions to the Sierra Foothills further east, according to the petition.

Below, we summarize the evidence presented in the Sloughhouse petition.

The Sacramento Bee newspaper published an article on January 19, 1998, detailing the history of the Sloughhouse region. In the 1850's the Sloughhouse Inn, which gave the region its name, was a popular stagecoach stop. According to the article, the building, rebuilt several times after fires, is a registered California historical landmark. Today, the Sloughhouse Inn is a restaurant. Modern usage of the Sloughhouse name, according to petition evidence, is also seen in the names of the Sloughhouse Resource Conservation District, the Sloughhouse Fire Protection District, and the Sloughhouse Area Genealogical Society.

The USGS Geographic Names Information System (GNIS) database lists “Sloughhouse” as a populated place in Sacramento County, California. The USGS Sloughhouse quadrangle map shows the hamlet of Sloughhouse along State Road 16 on the Township 7 and 8 North line, between Ranges 6 and 7 East. Sloughhouse Road, a secondary road, is shown on the USGS Elk Grove and Sloughhouse maps within the proposed viticultural area boundary lines.

Warmer temperatures, less intense winds, more rainfall, and greater climatic variations distinguish the proposed Sloughhouse viticultural area from the surrounding areas within the Lodi region according to the petition. It adds that elevations within the proposed Sloughhouse viticultural area are generally higher and the soils older than the other surrounding proposed viticultural areas. The distinguishing Sloughhouse terrain and climatic characteristics, the petition explains, make this proposed viticultural area significantly different from the surrounding areas. Red varietals, including Cabernet Sauvignon, Cabernet Franc, Merlot, and Zinfandel, are popular in the Sloughhouse area as they can withstand drought and other climatic variations, the petition states.

The proposed Sloughhouse area's outer boundaries follow a portion of the existing Lodi viticultural area northern and eastern boundary lines, and the proposed area abuts the established Sierra Foothills viticultural area western boundary line. The petition explains that the shared Lodi and Sierra Foothills viticultural areas boundary line, which coincides with the Amador County line, is the logical division between the valley and mountain environments.

The proposed Sloughhouse viticultural area, the petition states, has the most diverse terrain of the seven proposed viticultural areas discussed in this notice. Gently rolling hills, flat creek and river valleys, plains, and an alluvial fan characterize the proposed viticultural area, according to the petition.

The proposed Sloughhouse viticultural area ranges in elevation from a low of 73 feet in its southwest region to a high of 590 feet in its northeast region, according to the provided USGS maps. The northeast region of Sloughhouse, which has the highest elevations in the proposed area, slopes upward and becomes the bedrock-based foothills of the Sierra Range, the petition notes. These higher elevations are similar to Borden Ranch to the south, but contrast with the proposed Alta Mesa viticultural area to the west with its lower elevations of between 35 and 138 feet.

Three significant waterways, the Cosumnes River and its Deer Creek and Laguna tributaries flow west from the Sierra Foothills through the proposed Sloughhouse viticultural area. Deer Creek constitutes the northeastern boundary line of the proposed viticultural area, as noted in the petition's boundary description. Deer Creek, according to USGS maps, then meanders southwesterly through the interior of the proposed Sloughhouse area. The Cosumnes River runs roughly parallel to Deer Creek and through the approximate middle of the proposed Sloughhouse viticultural area. Deer Creek eventually joins the Cosumnes River to the west of the proposed viticultural area. The Laguna forms the south boundary line for the proposed Sloughhouse viticultural area and joins the Cosumnes River and Deer Creek to the west of the proposed area.

The petition notes that the predominant soils in the western portion of the proposed Sloughhouse viticultural area are found on an older alluvial fan. Classified as Durixeralfs and Haploxeralfs, the soils series found there include a complex of Redding, Corning, Pentz, and Hadlesville soils, which are generally of low vigor. Older soils, including patches of significantly older soils, are found in the higher eastern elevations of the proposed viticultural area. These older soils formed from sedimentary, metamorphic, and volcanic rock, including Sierra basement granite. Also, the Cosumnes River, Deer Creek, and the Laguna have left older river deposits within the proposed Sloughhouse viticultural area, according to the petition.

The petition uses statistics and data from the Lodi, Sacramento and especially the Folsom weather stations, located close to the proposed Sloughhouse viticultural area. The petition explains that the proposed Sloughhouse viticultural area has a climate distinguishable from the surrounding proposed viticultural areas due to its combination of warm growing season temperatures and heavy winter rains.

The Sloughhouse area, at 61.6 mean annual degrees Fahrenheit, is the warmest of the seven proposed viticultural areas within the established Lodi viticultural area, the petition states. The average growing season degree-day total of the Sloughhouse area, according to the petition, is more than 200 total degree days higher than the Alta Mesa area to the immediate west and 300 total degree days higher than the cooler Borden Ranch and Clements Hills areas to the south.

The proposed Sloughhouse viticultural area, the petition claims, has little marine sea breeze influence as compared to other proposed viticultural areas to the west, which are closer to the Sacramento Delta. Also, the Alta Mesa “table-top” landform, to the immediate west, acts as a buffer between the west-to-east marine breezes and the proposed Sloughhouse area.

The proposed Sloughhouse viticultural area receives more rain, 23-inches annually according to petition documentation, than the other proposed viticultural areas discussed in this notice. The petition states that to the west of the proposed Sloughhouse area, the proposed Alta Mesa viticultural area averages 18.5 inches annual rainfall, and, to the south, the proposed Borden Ranch viticultural area averages 20 inches annual rainfall. Also, other proposed viticultural areas discussed in this notice average as low as 14 inches of annual rainfall, the petition notes.

In addition, fog is less frequent in the proposed Sloughhouse viticultural area than in the adjacent lower elevation and cooler proposed Alta Mesa viticultural area to the west, the petition states. The upland environment, with less cooling marine influence and warmer temperatures, discourages the formation of fog.

See the narrative boundary descriptions of the seven petitioned-for viticultural areas in the proposed regulatory texts published at the end of this notice.

The petitioner provided the required maps for the proposed seven viticultural areas, and we list them below in the appropriate proposed regulatory texts below.

Part 4 of the TTB regulations prohibits any label reference on a wine that indicates or implies an origin other than the wine's true place of origin. If we establish the proposed “Jahant” or “Sloughhouse” viticultural areas, the name in question will be recognized as a name of viticultural significance. If we establish the proposed “Alta Mesa,” “Borden Ranch,” or “Clements Hills,” viticultural areas, the full name of the viticultural area in question will be recognized as a name of viticultural significance. On the other hand, we do not believe that any single part of these three proposed viticultural area names standing alone, such as “Mesa,” “Borden,” or “Clements” would have viticultural significance if we establish the viticultural area in question.

If we establish the proposed “Cosumnes River” or “Mokelumne River” viticultural areas, the full name of the viticultural area in question will be recognized as a name of viticultural significance. In addition, with the establishment of the Cosumnes River or Mokelumne River viticultural areas, the name “Cosumnes” or the name “Mokelumne” standing alone will be considered a term of viticultural significance because consumers and vintners could reasonably attribute the quality, reputation, or other characteristic of wine made from grapes grown in the proposed Cosumnes River or Mokelumne River viticultural area to the name Cosumnes or the name Mokelumne itself.

We note in this regard that a review of the information contained in the Geographic Names Information System maintained by the USGS, and a general search of relevant Internet Web sites reveal that the “Cosumnes” and “Mokelumne” names are not used in a variety of different geographic contexts throughout the United States but rather appear to apply in particular to the respective regions in California encompassed by the two proposed viticultural areas. See 27 CFR 4.39(i)(3), which also provides that a name has viticultural significance when determined by a TTB officer.

Therefore, the seven proposed 27 CFR part 9 section texts set forth in this notice specify, respectively, that “Alta Mesa,” “Borden Ranch,” “Clements Hills,” “Cosumnes River” and “Cosumnes” standing alone, “Jahant,” “Mokelumne River” and “Mokelumne” standing alone, and “Sloughhouse” are terms of viticultural significance for purposes of part 4 of the TTB regulations. Consequently, wine bottlers using any of those terms in a brand name, including a trademark, or in another label reference as to the origin of the wine, will have to ensure that the product is eligible to use the name of the viticultural area in question as an appellation of origin.

For a wine to be eligible to use as an appellation of origin, a viticultural area name or term specified as being viticulturally significant in part 9 of the TTB regulations, at least 85 percent of the grapes used to make the wine must have been grown within the area represented by that name or other term, and the wine must meet the other conditions listed in 27 CFR 4.25(e)(3). If the wine is not eligible to use as an appellation of origin, a viticultural area name or other viticulturally significant term that appears in the brand name, then the label is not in compliance and the bottler must change the brand name and obtain approval of a new label. Similarly, if the viticultural area name or other viticulturally significant term appears in another reference on the label in a misleading manner, the bottler would have to obtain approval of a new label. Accordingly, if a new label or a previously approved label uses one of the viticultural area names or other viticulturally significant terms identified above for a wine that does not meet the 85 percent standard, the new label will not be approved, and the previously approved label will be subject to revocation, once the viticultural area in question is approved.

Different rules apply if a wine has a brand name containing a viticultural area name that was used as a brand name on a label approved before July 7, 1986. See 27 CFR 4.39(i)(2) for details.

We also note that the establishment of any or all of these seven proposed viticultural areas will not affect the established Lodi viticultural area or approved labels using the “Lodi” name.

We invite comments from interested members of the public on whether we should establish any or all of the seven proposed viticultural areas within the existing Lodi viticultural area. We are also interested in receiving comments on the sufficiency and accuracy of the names, climactic, boundary, and other required information submitted in support of the petitions. Please provide any available specific information in support of your comments. Also, please identify the specific proposed viticultural area or areas that your comments concern.

Because of the potential impact of the establishment of the seven proposed viticultural areas on brand labels that include the words “Alta Mesa,” “Borden Ranch,” “Clements Hills,” “Cosumnes River” (or “Cosumnes” alone), “Jahant,” “Mokelumne River” (or “Mokelumne” alone), or “Sloughhouse,” as discussed above under Impact on Current Wine Labels, we are particularly interested in comments regarding whether there will be a conflict between any of the proposed areas names and currently used brand names. If a commenter believes that a conflict will arise, the comment should describe the nature of that conflict, including any negative economic impact that approval of the proposed viticultural area in question will have on an existing viticultural enterprise. We are also interested in receiving suggestions for ways to avoid any conflicts, for example, by adopting modified or different names for the viticultural area.

Please submit your comments by the closing date shown above in this notice. Your comments must include this notice number and your name and mailing address. In addition, please identify the specific proposed viticultural area or areas that your comments concern. Your comments must be legible and written in language acceptable for public disclosure. We do not acknowledge receipt of comments, and we consider all comments as originals. You may submit comments in one of five ways:

• Mail: You may send written comments to TTB at the address listed in the ADDRESSES section.

• Facsimile: You may submit comments by facsimile transmission to 202-927-8525. Faxed comments must—

(1) Be on 8.5- by 11-inch paper;

(2) Contain a legible, written signature; and

(3) Be no more than five pages long. This limitation assures electronic access to our equipment. We will not accept faxed comments that exceed five pages.

• E-mail: You may e-mail comments to nprm@ttb.gov. Comments transmitted by electronic mail must—

(1) Contain your e-mail address;

(2) Reference this notice number on the subject line; and

(3) Be legible when printed on 8.5- by 11-inch paper.

• Online form: We provide a comment form with the online copy of this notice on our Web site at http://www.ttb.gov/alcohol/rules/index.htm. Select the “Send comments via e-mail” link under this notice number.

• Federal e-Rulemaking Portal: To submit comments to us via the Federal e-rulemaking portal, visit http://www.regulations.gov and follow the instructions for submitting comments.

You may also write to the Administrator before the comment closing date to ask for a public hearing. The Administrator reserves the right to determine, in light of all circumstances, whether to hold a public hearing.

All submitted material is part of the public record and subject to disclosure. Do not enclose any material in your comments that you consider confidential or inappropriate for public disclosure.

You may view copies of this notice, the petition, the appropriate maps, and any comments we receive by appointment at the TTB Library at 1310 G Street, NW., Washington, DC 20220. You may also obtain copies at 20 cents per 8.5- × 11-inch page. Contact our librarian at the above address or by telephone at 202-927-2400 to schedule an appointment or to request copies of comments.

For your convenience, we will post this notice and any comments we receive on this proposal on the TTB Web site. We may omit voluminous attachments or material that we consider unsuitable for posting. In all cases, the full comment will be available in the TTB Library. To access the online copy of this notice and any submitted comments, visit http://www.ttb.gov/alcohol/rules/index.htm. Select the “View Comments” link under this notice number to view the posted comments.

We certify that this proposed regulation, if adopted, would not have a significant economic impact on a substantial number of small entities. The proposed regulation imposes no new reporting, recordkeeping, or other administrative requirement. Any benefit derived from the use of a viticultural area name would be the result of a proprietor's efforts and consumer acceptance of wines from that area. Therefore, no regulatory flexibility analysis is required.

This proposed rule is not a significant regulatory action as defined by Executive Order 12866, 58 FR 51735. Therefore, it requires no regulatory assessment.

N. A. Sutton and M.D. Hoover of the Regulations and Procedures Division drafted this notice.

For the reasons discussed in the preamble, we propose to amend 27 CFR, chapter I, part 9, as follows:

The Postal Service and the Periodicals mailing industry are working together to control costs. We can reduce the costs of transporting and processing mail in sacks by requiring more pieces in most sacks of Periodicals mail and by adding two new types of sacks: a 3-digit carrier routes sack and a merged 3-digit sack. We are creating these new sacks to eliminate 5-digit sacks with fewer than 24 pieces while preserving carrier route rate eligibility.

This sack contains pieces sorted to carrier routes in a 3-digit area, consolidating the bundles formerly prepared in 5-digit carrier routes sacks containing fewer than 24 pieces.

• This sack must contain a minimum of one six-piece carrier route bundle.

• This sack may contain additional carrier route bundles of fewer than six pieces when those pieces are paid at the basic rate.

This sack consolidates carrier route, automation, and presorted bundles formerly prepared in merged 5-digit sacks containing fewer than 24 pieces.

• Mailers must prepare this sack if they have one or more carrier route bundles for the 3-digit area once all carrier route and merged 5-digit sacks containing 24 or more pieces are prepared.

• If a mailing does not include at least one carrier route bundle for the 3-digit area, the merged 3-digit sack must contain a minimum of 24 pieces prepared in 5-digit, 5-digit scheme, 3-digit, and 3-digit scheme bundles.

In addition to the two new types of sacks, we can reduce costs by requiring a minimum of 24 pieces in:

• Carrier route sacks,

• 5-digit carrier routes sacks,

• 5-digit scheme carrier routes sacks,

• 5-digit sacks,

• 5-digit scheme sacks,

• Merged 5-digit sacks,

• Merged 5-digit scheme sacks,

• 3-digit sacks,

• 3-digit scheme sacks,

• SCF sacks, and

• ADC sacks.

The proposed standards and how they are applied for different mail preparation options for Periodicals are provided below. We are proposing to make these changes on March 1, 2006.

Although exempt from the notice and comment requirements of the Administrative Procedure Act (5 U.S.C 410(a)), the Postal Service invites comments on the following proposed revisions to Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM), incorporated by reference in the Code of Federal Regulations. See 39 CFR part 111.

On March 15, 2005, the Maryland Department of the Environment (MDE) submitted a revision to its SIP. The SIP revision consists of amendments to Regulations .06, .10, and .12; repeal of existing Regulation .13; and adoption of new Regulation .13 under COMAR 26.11.33 Architectural Coatings.

On March 19, 2004, MDE submitted a regulation establishing standards to reduce VOC emissions from AIM coatings in Maryland. These standards were based on a regional model rule developed by an Ozone Transport Commission (OTC) workgroup consisting of several states, including Maryland. EPA published a proposed rulemaking of the Maryland AIM coatings rule on May 25, 2004 (69 FR 29674), and the final rulemaking on May 12, 2005 (70 FR 24979) with an effective date of June 13, 2005.

To provide consistency with similar regulations adopted by the other states in the Ozone Transport Region (OTR), MDE submitted amendments to COMAR 26.11.33 Architectural Coatings. The amendments are:

1. Addition of four industrial coatings to the list of specific coatings that are excluded from applying the most restrictive VOC limit in Regulation .06B: calcimine recoaters, impacted immersion coatings, nuclear coatings, and thermoplastic rubber coating and mastic. Regulation .06A requires the application of the most restrictive VOC limit to a coating that satisfies the definition for more than one coating or for different applications.

2. Remove the requirement to include on the label that conversion varnishes are to be used only by professionals. Conversion varnish is a specially formulated coating made available to professionals that are involved with the coating or recoating of hardwood floors.

3. The requirement for coating manufacturers to submit annual reports on the volume of coating sold in Maryland has been changed to require the information to be maintained for five years and made available to MDE upon request.

EPA's review of this material indicates that the MDE amendments to its AIM coatings rule are administrative changes that will not affect VOC reductions achieved though compliance with the coating standards. EPA is proposing to approve a revision to the Maryland SIP for the amendments of COMAR 26.11.33 submitted on March 15, 2005. EPA is soliciting public comments on the issues discussed in this document. These comments will be considered before taking final action.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this proposed 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 proposes to approve state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this proposed 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 proposes to approve pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). This proposed rule also 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, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely proposes to approve 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 proposed rule also is not subject to Executive Order 13045 (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. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this proposed rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the executive order. This proposed rule pertaining to the amendments to the Maryland's AIM coatings 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. ).

Submitting Comments: We welcome comments from the public on all issues set forth in this rule to assist us in fully considering issues and developing policies. You can assist us by referencing the file code CMS-3198-P and the specific “issue identifier” that precedes the section on which you choose to comment.

Inspection of Public Comments: All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. CMS posts all electronic comments received before the close of the comment period on its public Web site as soon as possible after they have been received. Hard copy comments received timely will be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, at the headquarters of the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view public comments, phone 1-800-743-3951.

The CDC's Advisory Committee on Immunization Practices (ACIP) reported on May 28, 2004 ( http://www.cdc.gov/mmwr/preview/mmwrhtml/ rr5306a1.htm ), that epidemics of influenza have been responsible for an average of approximately 36,000 deaths per year in the United States between 1990 and 1999. There is an added danger when it comes to people age 65 or older or with high risk conditions such as individuals residing in long term care facilities. In 2002, ACIP estimated the rates of influenza related hospitalization as 392 to 635 per 100,000 among adults with one or more high risk conditions, compared to 13 to 33 per 100,000 among those without high risk conditions.

According to the CDC, influenza and invasive pneumococcal disease kill more people in the United States each year than all other vaccine-preventable diseases combined. Influenza and pneumonia combined represent the fifth leading cause of death in the elderly. Immunization is the primary method for preventing invasive pneumococcal disease as well as influenza and its more severe complications. The ACIP reported in 2002 that the primary target group for influenza vaccination includes persons who are at high risk for serious complications from influenza, including approximately 35 million persons who are more than 65 years of age and approximately 33 to 39 million persons less than 65 years of age who have chronic underlying medical conditions. ACIP recommends that all residents of long term care facilities should be assessed for their needs for pneumococcal polysaccharide vaccine (PPV) and that people 65 or older, as well as persons less than 65 who have chronic illness or who are living in long term care facilities, receive the immunization if eligible. As the vast majority of the residents in nursing homes are 65 years and older, or if younger, probably have one or more chronic medical conditions for which the vaccine is indicated, one would expect that nearly all residents are candidates for pneumococcal vaccination. Therefore, it is vital to increase immunization rates to reduce and eliminate vaccine-preventable causes of morbidity and mortality.

Despite the Federal government's unified efforts to increase the availability of safe and effective vaccines and despite substantial progress in reducing many vaccine-preventable diseases, many individuals are not receiving influenza and pneumococcal vaccines.

Section 4107 of the Balanced Budget Act of 1997 extended the influenza and pneumococcal immunization campaign being conducted by CMS in conjunction with CDC and the National Coalition for Adult Immunization through fiscal year 2002, authorizing $8 million for each fiscal year from 1998 to 2002. Although Medicare reimbursement for influenza and pneumococcal immunizations was increased under this legislation, rates of immunization did not improve as anticipated.

On April 30, 1999, the CDC and CMS entered into a memorandum of understanding (IA 99-87), to establish a program of collaboration between the two agencies to enhance assessment of health status and delivery of preventive services to beneficiaries of the Medicare program. One of the initial areas highlighted for collaboration was improving influenza and pneumococcal immunization coverage through “standing orders” for those populations and in those settings designated as appropriate by the ACIP.

A March 24, 2000 ACIP report recommended the use of standing orders programs in both outpatient and inpatient settings to increase the number of individuals who receive the influenza vaccine ( http://www.cdc.gov/mmwr/preview/mmwrhtml/rr4901a1.htm ). On October 2, 2002 (67 FR 61808), CMS published a final rule with comment period that removed the physician order requirement for influenza and pneumococcal vaccinations from the Conditions of Participation (CoPs) for Medicare and Medicaid participating hospitals, (LTC) facilities, and home health agencies (HHAs). The final rule was effective as of its publication date. Although the CoPs for these provider types require a physician's order for drugs and biologicals that must be signed by the practitioner responsible for the care of the patient or resident, the CoPs make an exception for influenza and PPV. These vaccines now can be administered per a physician-approved facility or agency policy, following assessment of the patient or resident for contraindications. The final rule was a major step towards increasing the immunization rates in the LTC population.

To date we do not have data on the specific immunization rates of nursing facility residents since the publication of this rule. Medicare Current Beneficiary Survey (MCBS) data shows that, the rate of influenza vaccination of individuals age 65 and older was 70.4 percent in the year 2000, 67.4 percent in 2001, 69 percent in 2002 and 70.4 percent in 2003. MCBS data for pneumococcal vaccination for individuals age 65 and older was 62.7 percent in 2000, 63.3 percent in 2001, 64.6 percent in 2002 and 66.4 percent in 2003. These rates demonstrate that we need to implement strategies to help us achieve the goal set by the Department of Health and Human Services (DHHS) Healthy People 2010, which set a target rate of 90 percent for influenza and pneumococcal vaccination for adults aged 65 years and older. Further information on preventive services like immunizations are available at the healthy aging site at http://www.cms.hhs.gov/healthyaging/2a.asp and at http://www.healthypeople.gov/ .

Numerous studies referenced by the CDC at the Morbidity and Mortality Weekly Report (MMWR) website show that: (1) Persons 65 years and older are at high risk of contracting influenza, (2) they are more likely than the general population to need hospitalization or to die from complications of influenza, and (3) immunizations are effective in preventing influenza and its complications in this population ( http://www.cdc.gov/mmwr/preview/mmwrhtml/rr5306a1.htm ).

In the May 2004 MMWR referenced above, the ACIP stated that while rates of influenza infection are high among children, rates of serious illness and death are highest among persons aged ≥65 years and persons of any age who have medical conditions that place them at increased risk for complications from influenza. According to ACIP, the primary target groups recommended for annual vaccination are as follows: (1) Persons at increased risk for influenza-related complications (for example, those aged ≥65 years and persons of any age with certain chronic medical conditions); (2) persons aged 50 to 64 years (because this group has an elevated prevalence of certain chronic medical conditions); and (3) persons who live with or care for persons at high risk (for example, health-care workers and individuals within a household who have frequent contact with persons at high risk and who can transmit influenza to those persons at high risk).

The ACIP report states that vaccination is associated with reductions in influenza-related respiratory illness and physician visits among all age groups, hospitalization and death among persons at high risk, otitis media among children, and work absenteeism among adults. Although influenza vaccination levels increased substantially during the 1990s, further improvements in vaccine coverage levels are needed. Influenza vaccination remains the cornerstone for the control and treatment of influenza. (MMWR: Recommendations and Reports May 28, 2004/53(RR06); 1-40 http://www.cdc.gov/mmwr/preview/mmwrhtml/rr5306a1.htm ).

Although influenza affects persons of all ages, the CDC has identified several groups who are at increased risk for complications. One such group is comprised of residents of nursing homes or other long-term care facilities. An article in American Family Physician, January 1, 2002 titled, “Influenza in the Nursing Home,” states that during influenza epidemics, mortality rates among nursing home residents often exceed 5 percent of the nursing home population in the country. To lessen the impact of this infectious disease, the CDC recommends the influenza vaccine as the primary way of preventing the illness and its complications ( http://www.aafp.org/afp/20020101/75.html ).

The Director of Health Care-Public Health Issues for the General Accountability Office (GAO) testified before the United States Senate Special Committee on Aging, on September 28, concerning a 2004 GAO study titled, “Infectious Disease Preparedness: Federal Challenges in Responding to Influenza Outbreaks” ( http://www.gao.gov/new.items/d041100t.pdf ). She stated that the study was conducted to identify the challenges in preventing the spread of the influenza virus because influenza is associated with an average of 36,000 deaths and more than 200,000 hospitalizations each year in the United States. Furthermore, nine out of ten persons who die from influenza and one out of two who are hospitalized due to influenza are age 65 or older. The GAO was asked to conduct the study to assess issues related to supply, demand, and distribution of vaccine during a typical flu season and to assess the Federal plan to respond to an influenza pandemic. The study was based on a survey of physician group practices, interviews with health department officials in all 50 states, as well as information about CDC activities in the 2003-04 flu season. The GAO found that the most effective way to prevent influenza is by immunizing individuals against influenza every fall season.

The 2004 ACIP recommendations referenced earlier state that influenza vaccine effectiveness varies in the elderly; however, influenza vaccine is still effective at preventing severe illness, secondary complications, and death. In the elderly population residing in nursing homes, the vaccine can be 50-60 percent effective in preventing hospitalization or pneumonia and 80 percent effective in preventing death, even though the effectiveness in preventing influenza illness often ranges from 30 percent to 40 percent.

According to the January 1, 2002 article in American Family Physician referenced earlier, a number of studies have also shown that nursing homes with high rates of vaccinated residents have fewer outbreaks of influenza than nursing homes with lower vaccination rates. The article further states that many studies have shown that influenza vaccination of nursing home residents and staff can significantly decrease rates of hospitalization, pneumonia, and related mortality. Therefore, it is vital to the well being of the residents of nursing homes that they are offered immunization, if not medically contraindicated, and that facilities ensure residents receive the immunizations at the appropriate time to prevent the spread of the influenza virus.

The February 14, 2005, article in the Archives of Internal Medicine titled “Impact of Influenza Vaccination on Seasonal Mortality in the U.S. Elderly Population” reports the results of the study conducted by Lone Simonsen and colleagues on flu vaccination rates among elderly ( http://archinte.ama-assn.org/cgi/content/abstract/165/3/265 ). This study reports that vaccination of the elderly population against influenza may be less effective in preventing death among the elderly than previously estimated. CDC and National Institute of Health (NIH) jointly, in a February 15, 2005, press release ( http://www.cdc.gov/flu/pdf/statementeldmortality.pdf ) concluded that the Simonsen, et al. study does not show that the flu vaccine is ineffective at protecting the elderly from influenza. Rather, the study indicates that different research approaches result in different estimates of influenza vaccine effectiveness at preventing death among the elderly.

The Simonsen, et al. , study does not imply that the elderly should not receive influenza vaccine. Furthermore, we note that this study addresses the elderly population as a whole, and does not analyze the more vulnerable group, nursing home residents, addressed by this regulation and the studies of those residents summarized later in this preamble. The conclusions in the study are in sharp contrast to other peer-reviewed studies that address the same issue ( see for example, JAMA; Chicago; Oct 22-Oct 29, 1997; 278; 16; Jane E Sisk; Alan J Moskowitz; William Whang; Jean D Lin et al .). The CDC and ACIP continually review their influenza vaccine recommendations as well as studies and published research in order to develop the best recommendations for protecting all Americans from influenza. The Simonsen, et al. , study is a reminder that there is room for improvement in how we protect the elderly from influenza, and CDC and NIH encourage research that strengthens our ability to do so.

The CDC continues to recommend that people aged 65 and older get vaccinated against influenza each year as persons aged 65 and older are at high risk for complications, hospitalizations, and deaths from influenza. In the joint press release referenced above, the CDC and National Institute of Health (NIH) continue to support the ACIP recommendation that people aged 65 and older get vaccinated against influenza each year.

Like influenza, invasive pneumococcal disease is particularly prevalent and severe in those 65 years and older. This population is at high risk of contracting invasive pneumococcal disease, with a high risk of resultant complications, hospitalizations, and deaths. Pneumococcal immunizations are effective in preventing pneumococcal disease in this population.

According to CDC's Active Bacterial Core Surveillance for pneumococcal disease, approximately 5,700 deaths from invasive pneumococcal disease (bacteremia and meningitis) are estimated to have occurred in the United States in 2002 ( http://www.cdc.gov/ncidod/dbmd/abcs/survreports/spneu02.pdf ). An article in the American Journal of Preventive Medicine, August 2003, titled “Standards for Adult Immunization Practices” states that overall, vaccine effectiveness against invasive pneumococcal disease among immunocompetent people aged 65 years is 75 percent. Based on 1998 projections, annually, 76 percent of invasive pneumococcal disease cases and 87 percent of resulting deaths occurred in people who were eligible for pneumococcal vaccine in the United States. ( http://www.cdc.gov/nip/recs/rev_stds_adult_AJPM.pdf )

The ACIP and CDC recommend immunization for pneumococcal disease for those 65 years old or older, and for people with a serious long-term health problem, such as heart disease, diabetes, or immunosuppression due to disease, organ transplantation, or medical treatment such as chemotherapy. The American Lung Association warns that people considered at high risk for invasive pneumococcal disease include the elderly, the very young, and those with underlying health problems, such as chronic obstructive pulmonary disease (COPD). Patients with diseases that impair the immune system, such as AIDS, or patients with other chronic illnesses, such as asthma, or those undergoing cancer therapy or organ transplantation, are particularly vulnerable.

According to CDC recommendations, usually one dose of the PPV is all that is needed to prevent pneumococcal disease or a person only needs to be immunized once in a life time. However, a second dose is recommended for people 65 and older who received their first dose prior to 65 years of age, if five or more years have passed since that dose. A second dose is also recommended for people with a damaged spleen or without a spleen, sickle-cell disease, HIV infection or AIDS, cancer, leukemia, lymphoma, multiplemyeloma, kidney failure or nephrotic syndrome, an organ or bone marrow transplant, or who are taking medication that lowers immunity (such as chemotherapy or long-term steroids).

Accordingly, we believe it vital that facilities secure the consent of their residents or legal representative for vaccination and provide their residents with vaccinations. In some cases, this may require that they educate residents about the advantages of being vaccinated so that the residents will understand the risks of pneumococcal infections and will be willing to receive the vaccine. The 1997 ACIP recommendations state that, “Pneumococcal polysaccharide vaccine generally is considered safe based on clinical experience since 1977, when the pneumococcal polysaccharide vaccine was licensed in the United States. Approximately half of the persons who receive pneumococcal vaccine develop mild, local side effects (for example, pain at the injection site, erythema, and swelling). These reactions usually persist for less than 48 hours. Moderate systemic reactions (for example, fever and myalgias) and more severe local reactions (for example, local induration) are rare. Severe systemic adverse effects (for example, anaphylactic reactions) rarely have been reported after administration of pneumococcal vaccine. In a recent meta-analysis of nine randomized controlled trials of pneumococcal vaccine efficacy, local reactions were observed among approximately one third or fewer of 7,531 patients receiving the vaccine, and there were no reports of severe febrile or anaphylactic reactions.” The 1997 ACIP recommendations further state that pneumococcal vaccination has not been causally associated with death among vaccine recipients. Additional information about precautions and contraindications can be attained from CDC and the vaccine manufacturer's package insert should also be reviewed. ( http://www.cdc.gov/mmwr/preview/mmwrhtml/00047135.htm#00002349.htm ).

CDC's March 24, 2000 MMWR states that in recent years, a rapid emergence of antimicrobial resistance among pneumococci, especially to penicillin, has occurred. Increasing pneumococcal vaccination rates could help prevent invasive pneumococcal disease caused by vaccine-type, multidrug-resistant pneumococci. Outbreaks of pneumococcal disease caused by a single drug resistant pneumococcal serotype have occurred in institutional settings, including nursing homes. The same MMWR report states that in 1999, because of concerns about pneumococcal antimicrobial resistance and underuse of pneumococcal vaccine, the American Medical Association and several partner organizations issued a Quality Care Alert that supports ACIP's recommendations for pneumococcal vaccination. (Use of Standing Orders Programs to Increase Adult Vaccination Rates: MMWR 2000/49 RR01 15-26 March 24.)

A CMS/CDC report, “Respiratory Disease Burden in Nursing Homes” ( http://www.nationalpneumonia.org/sop/RDBNH_INTERIMProjectRpt_1-31-03.pdf ) states that both influenza vaccine and PPV are protective to residents in nursing homes. Based on two years of analysis (multivariate/multilevel), influenza vaccine may be associated with a 27 to 35 percent reduction in mortality, and a 44 to 52 percent reduction in all-cause hospitalization. Similarly, pneumococcal vaccination may be associated with a 20 to 26 percent reduction in mortality, and a 12 to 28 percent reduction in all-cause hospitalization in nursing home residents. The report also suggests that a facility-level influenza vaccination of 80 percent of residents may be independently associated with reduced patient hospitalization and death.

In January 2000, the Department of Health and Human Services launched Healthy People 2010, a comprehensive, nationwide health promotion and disease prevention agenda. “Immunizations and Infectious Diseases” is one of the focus areas. Healthy People 2010 set the target rate for influenza and PPV vaccination of adults aged 65 years and older at 90 percent. According to CMS's Adult Immunization Project “despite the fact that influenza and pneumococcal vaccines are clinically effective, cost-effective, and are Medicare Part B covered benefits, they remain underutilized” ( http://www.ofmq.com/user_uploads/National%20Immunization%20Project.pdf ).

Based on the 1999 National Nursing Home Survey, only 66 percent of nursing home residents had received the influenza vaccine in the previous year and only 38 percent had ever had the pneumococcal vaccine. The October 2004 article in the American Family Physician titled “Pneumonia in Older Residents of Long-Term Care Facilities” stated that, when compared to persons in the overall community, residents in LTC facilities have more functional disabilities and underlying medical illnesses and are at increased risk of acquiring infectious diseases ( http://www.aafp.org/afp/20041015/1495.html ). Risk factors include un-witnessed aspiration, sedative medication, and co-morbid illnesses. Influenza-associated mortality is a major concern for persons with chronic diseases; this mortality increase is most marked in persons 65 years of age or older, with more than 90 percent of the deaths attributed to pneumonia and influenza occurring in persons of this age group.

As noted in the October 15, 2004 article “Pneumonia in Older Residents of Long-Term Care Facilities” in the journal of American Family Physician, October 15, 2004, “The number of frail older adults living in LTC facility is expected to increase dramatically over the next 30 years” ( http://www.aafp.org/afp/20041015/1495.html ). The article further states that an estimated 40 percent of adults will spend some time in a LTC facility before dying. Unless control measures are more vigorously implemented, the number of deaths from influenza and pneumonia with respect to residents in LTC facilities and the number of consequent complications might increase significantly.

In summary, immunizations save lives and can help avoid needless suffering and unnecessary costs caused by complications from various infectious diseases, and, as many family members and health care workers know, they can prevent infection of others. However, despite the availability of safe and effective vaccines, substantial portions of susceptible adults are not being immunized. To reduce morbidity and mortality rates, delivering appropriate vaccinations in a timely manner is vital. This rule would facilitate the delivery of appropriate vaccinations to residents in LTC facilities in a timely manner and increase vaccination rates, and thereby decrease the morbidity and mortality rate of influenza and pneumococcal diseases. This rule also has the potential to reduce overall healthcare costs by reducing the need for the treatment of influenza and pneumococcal diseases and their complications.

According to a June 2002 CDC summary of the National Nursing Home Survey, 46,000 nursing home residents (2.5 percent) had pneumonia in 1999. The average length of stay in a LTC facility for a resident with pneumonia as a primary diagnosis was 124 days in 1999 ( http://www.cdc.gov/nchs/data/series/sr_13/sr13_152.pdf ).

A November 2000 article in the journal Infection Control and Hospital Epidemiology titled “Increasing Pneumococcal Vaccination Rates Among Residents of Long-Term Care Facilities,” noted that there were 1,590,763 individuals over 65 years of age residing in LTC facilities in the United States in 1990, and the number is estimated to grow to 2.9 million by 2020 (Infection Control and Hospital Epidemiology, Volume 21 (11) (705-710) November 2000). A substantial increase in vaccination rates among such a large population would significantly decrease the number of cases of influenza and pneumococcal bacteremia and related death.

A 1999 RAND report stated that the proportion of the U.S. population over age 65 had increased from 5 percent in 1900 to 13 percent in 1997. This change in demographics, combined with an increase in average life expectancy, has highlighted the importance of preventive care services for older individuals. The October 1997 Journal of the American Medical Association (JAMA) article “Cost-Effectiveness of Vaccination Against Pneumococcal Bacteremia Among Elderly People” indicated that vaccination of elderly people against pneumococcal bacteremia is one of the few interventions that have been found to both improve health and save medical costs. Vaccination both reduced medical expenses and improved health for the overall age group of 65 years and older (JAMA; Chicago; Oct 22-Oct 29 1997; 278; 16; Jane E Sisk; Alan J Moskowitz; William Whang; Jean D Lin et al. ). The article further states “Vaccination of the 23 million elderly people unvaccinated in 1993 would have gained about 78,000 years of healthy life and saved $194 million.”

Pneumococcal vaccination saves costs in the prevention of bacteremia alone and is greatly underused among the elderly population, on both health and economic grounds. These results support recent recommendations of the ACIP and public and private efforts under way to improve vaccination rates

In the fall of 2004 there was a major shortage of inactivated influenza vaccine in the United States. One of the major manufacturers of the influenza vaccine informed the CDC in early October 2004 that none of its flu vaccine would be available for distribution in the United States. Because of the shortage, Federal health officials released new guidelines as to who should receive a flu vaccine, describing those at high-risk of influenza-related health complications as priority groups. At that time, the interim recommendations from CDC stated that people 65 and older, as well as all those between the ages of 2 to 64 with chronic medical conditions and 6-23 month old children, were to be prioritized for receiving influenza vaccination. Other groups deemed a priority were nursing homes residents. We understand that providers of LTC services may be concerned about how they would meet the requirements of this regulation should an influenza vaccine shortage occur in the future. In the case of a true vaccine shortage as declared by CDC, CMS could exercise its enforcement discretion by instructing the State Survey Agencies (SSAs) not to cite facilities as out-of-compliance with this requirement if they were unable to obtain vaccine for their residents.

On May 28, 2004, the ACIP recommendations on “Prevention and Control of Influenza” ( http://www.cdc.gov/mmwr/preview/mmwrhtml/rr5306a1.htm ), outlined the requirements for a successful vaccination program, including combined publicity and education for health-care workers and other potential vaccine recipients; a plan for identifying persons at high risk; use of reminder/recall systems; and efforts to remove administrative and financial barriers that prevent persons from receiving the vaccines, including use of standing orders programs. We propose to add § 483.25 (n), that would require LTC facilities to offer each resident between, October 1 through March 31, immunization against influenza annually, as well as lifetime immunization against pneumococcal disease. LTC facilities would be required to ensure that each resident receives an annual immunization against influenza and receives the pneumococcal immunization unless medically contraindicated, based on an assessment, or unless the resident or the resident's legal representative refuses consent. As an alternative, a second pneumococcal shot may be given 5 years after the first pneumococcal immunization if the vaccine was administered prior to age 65, and only according to a practitioner recommendation.

We are not proposing to require the development of protocols nor specific documentation. However, as a facility develops and implements immunization protocols or procedures, we expect that obtaining previous immunization history on each resident, when possible, would be a part of the process. Additionally, this rule proposes that the resident's immunization status be documented in the resident's medical record including but not limited to the information that the resident received influenza or/and pneumococcal immunization , or immunization was medically contraindicated, or immunization was refused. If the immunization was refused, documention must include that the resident or the resident's legal representative received appropriate education and consultation regarding the benefits of influenza and pneumococcal immunization. Updating and maintaining resident medical records related to immunization was identified as an issue by the CDC. The National Nursing Home Survey (NNHS), conducted in 1995 by the CDC, National Center for Health Statistics, indicated that a large number of nursing facilities did not maintain complete, easily-accessible information on the vaccination status of their residents. Nearly 21 percent of the nursing home residents did not have documentation regarding influenza vaccination, and 43 percent did not have documentation regarding pneumococcal vaccination. Thus, it was difficult to reliably estimate levels of influenza and pneumococcal vaccine use among nursing home residents in 1995. The 1995 NNHS also indicated that facilities with an organized immunization program had higher immunization rates than those without a program. To encourage the development of organized immunization programs in long-term care facilities, CDC created a “how to” manual. The manual outlines general recommendations for establishing immunization programs that should integrate seamlessly into the facility's overall policies and procedures for quality care. The manual is available on line at http://www.cdc.gov/nip/publications/long-term-care.pdf.

The March 18, 2005 CDC manual titled “Prevention and Control of Vaccine-Preventable Diseases in Long-Term Care Facilities,” Section IV, focuses on the ACIP recommendation related to “staff immunization to reduce staff illnesses during the influenza season to reduce the spread of influenza from workers to residents” ( http://www.cdc.gov/nip/publications/long-term-care.pdf ). We acknowledge the importance of staff immunization. In a similar vein, our infection control requirements at 42 CFR 483.65(b)(2) state that “The facility must prohibit employees with a communicable disease or infected skin lesions from direct contact with residents or their food, if direct contact will transmit the disease.” The intent of this regulation is to prevent the spread of communicable diseases from employees to residents.

Influenza immunizations are given annually. ACIP (May 27, 1994) recommends that during October and November each year, vaccination should be routinely provided to all residents of chronic-care facilities with the concurrence of attending physicians. Consent is required for vaccination and can be obtained from the resident or their legal representative at the time of admission to the facility or anytime afterwards. When possible, all residents should be vaccinated at the beginning of the influenza season. Residents admitted after the influenza season begins, must be vaccinated at the time of admission until the end of March (ACIP, May 27, 1994). Therefore, we propose that all residents be offered immunization annually from October 1 through March 31. We hope to have this rule finalized by October 1, 2005, before the 2005-2006 influenza season.

PPV is given once in a life time, with certain exceptions. This proposed rule recognizes the exception by including language about a second shot at § 483.25(n)(2)(iv). This exception states, a second shot may be given 5 years after the first pneumococcal immunization if the vaccine was administered before age 65 and only according to a practitioner recommendation. The following is a simple algorithm ACIP recommends for pneumococcal polysaccharide vaccine.

For further information, please go to the CDC Web site listed below: http://www.cdc.gov/mmwr/preview/mmwrhtml/00047135.htm#00001211.gif.

Facilities must assess residents for medical contraindications before immunizing them to prevent complications and adverse effects. ACIP recommendations (February 8, 2002) state, “contraindications and precautions to vaccination dictate circumstances when vaccines must not be administered. The majority of contraindications and precautions are temporary, and the vaccination can be administered later. For example, persons with acute febrile conditions should not be immunized until their fever subsides. A medical contraindication is a condition in a recipient that increases the risk for a serious adverse reaction. For example, administering influenza vaccine to a person with an anaphylactic allergy to egg protein could cause serious illness in or death of the recipient.” The ACIP recommendations further state that one universal contraindication applicable to all vaccines is a history of a severe allergic reaction after a prior dose of vaccine or vaccine constituent.

If immunization is medically contraindicated, ACIP recommendations (2002) state that prophylactic use of antiviral agents is an option for preventing influenza among these persons. Persons who have a history of anaphylactic hypersensitivity to vaccine components but who are also at high risk for complications from influenza can benefit from the vaccine after appropriate allergy evaluation and desensitization. The report on the “Use of Standing Orders Programs to Increase Adult Vaccination Rates,” in the March 24, 2000 MMWR, states that standing orders protocols should also specify that vaccines be administered by healthcare professionals trained to (a) screen patients for contraindications to vaccination, (b) administer vaccines, and (c) monitor patients for adverse events, in accordance with State and local regulations.

It is important for facilities to remember that residents have the right to refuse immunization. However, educating residents and family members regarding the benefits of receiving immunizations generally results in consent.

Under the Paperwork Reduction Act of 1995, we are required to provide 60-day notice in the Federal Register and solicit public comment before a collection of information requirement is submitted to the Office of Management and Budget (OMB) for review and approval. In order to fairly evaluate whether an information collection should be approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995 requires that we solicit comment on the following issues:

• The need for the information collection and its usefulness in carrying out the proper functions of our agency.

• The accuracy of our estimate of the information collection burden.

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

• Recommendations to minimize the information collection burden on the affected public, including automated collection techniques.

We are soliciting public comment on each of these issues for the following sections of this document that contain information collection requirements:

This proposed rule requires facilities to develop protocols or policies and procedures. As a facility develops and implements immunization protocols or procedures, we expect that obtaining previous immunization history on each resident, when possible, would be a part of the process. Additionally, we expect the facility to document in the resident's medical record information concerning immunization history, contraindications etc. as a part of the process of immunizing residents. For example, the facility must indicate in the resident's medical record that the resident had received an influenza immunization, or that the vaccination was medically contraindicated, or that the immunization was refused. If the immunization was refused, documentation must include that the resident or the resident's legal representative received appropriate education and consultation regarding the benefits of influenza immunization.

The initial burden associated with these requirements in the first year, would be related to the establishment of policies and protocols for implementation of the immunization rule. This would be approximately 5 hours of a registered nurse's time per facility i.e. 80,695 hours for the first year (5 hours × 16,139 facilities). In subsequent years, we estimate that the burden associated with documentation of the immunization status of the resident in the medical records would be approximately 5 minutes of the registered nurse's time, which would be 134,492 hours per year (5 minutes per resident × 100 residents per facility × 16,139 facilities.

If you comment on these information collection and recordkeeping requirements, please mail copies directly to the following:

Because of the large number of public comments we normally receive on Federal Register documents, we are not able to acknowledge or respond to them individually. We will consider all comments we receive by the date and time specified in the DATES section of this preamble, and, when we proceed with a subsequent document, we will respond to the comments in the preamble to that document.

We ordinarily publish a notice of proposed rulemaking in the Federal Register and invite public comment on the proposed rule. The notice of proposed rulemaking includes a reference to the legal authority under which the rule is proposed, and the terms and substance of the proposed rule or a description of the subjects and issues involved. In accordance with section 1871(b)(1) of the Act, we routinely allow a comment period of at least 60 days on proposed rules that affect the Medicare program. This procedure can be waived; however, if an agency finds good cause that a 60-day comment period is impracticable, unnecessary, or contrary to the public interest, and incorporates a statement of the finding and its reasons in the rule issued. In accordance with section 1871(b)(2)(C) of the Act, we have shortened the comment period for this proposed rule from 60 to 15 days to allow us to hopefully finalize these provisions by October 1, 2005 in time for the 2005-2006 flu season. It is our view that a 60 day delay in receiving public comments on this proposed rule and publishing the subsequent final rule will be extremely detrimental to the health of nursing home residents, as epidemics of influenza typically occur during the winter months and are responsible for an average of approximately 20,000 to 40,000 deaths per year in the United States. Influenza viruses also can cause pandemics, during which rates of illness and death from influenza-related complications can increase dramatically. Rates of infection are highest among children, but rates of serious illness and death are highest among persons 65 and older and persons of any age who have medical conditions that place them at increased risk for complications from influenza and pneumonia. Vaccines are the most effective means to protect against many complications related to influenza and pneumonia. The ACIP recommendations for 2004 to 2005, to decrease the risk of influenza, state that the optimal time for influenza vaccinations is October through November. If this proposed rule is published with a 60-day comment period it is highly unlikely that a final rule can be issued before October, and even if that were possible, nursing facilities would not have the lead time necessary to obtain resident and/or family consent. If expedited and published with a 15-day comment period, this delay can be prevented and the rule can be effective in the 2005-2006 flu season, with the potential of saving many lives.

We anticipate that the affect of this rule will be to increase immunization rates in nursing homes to 90 percent, which is the Healthy People 2010 goal. This will enable about half a million frail elderly individuals who are not currently immunized to be immunized. The CMS/CDC standing orders project in 2003 found that in nursing home residents, influenza vaccine is associated with a 27-35 percent reduction in mortality, and a 44-52 percent reduction in all-cause hospitalizations. Similarly, pneumococcal vaccination is associated with a 20-26 percent reduction in mortality, and a 12-28 percent reduction in all-cause hospitalization. We recognize that these associations are not necessarily causal because the data are cross-sectional with no correction for confounding variables. However, the findings are consistent with findings regarding immunization in the general population. Therefore, it is imperative that this proposed rule is published with a 15-day comment period so that a final rule can be published and effective in the 2005-2006 flu season. Even though pneumococcal vaccines can be administered throughout the year, the percentage of patients and residents immunized remains low. Therefore, this proposed rule would be a vehicle to improve immunization rates and would be consistent with the Healthy People 2010 objectives.

We believe that a continued delay in implementation of this rule would greatly hinder increased immunization of residents in LTC facilities before the onset of this year's influenza season. We conclude that, in this instance, a 60-day comment period is unnecessary and contrary to public interest. We find on this basis, that there is good cause for waiving the 60-day comment period under section 1871(b)(2)(C) of the Act.

We have examined the impacts of this rulemaking as required by Executive Order 12866 (September 1993, Regulatory Planning and Review), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, Executive Order 13132 (August 4, 1999, Federalism), the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4), and the Congressional Review Act (5 U.S.C. 804(2)).

Executive Order 12866 directs agencies to issue regulations only after consideration of all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). A regulatory impact analysis (RIA) must be prepared for rules with economically significant effects ($100 million or more in any 1 year). This proposed rule is an economically “significant regulatory action” as defined by section 3(f) of Executive Order 12866, and a “major rule” as defined in the Congressional Review Act. We have reached this conclusion because of the substantial life-saving effects of the rule and its anticipated reduction in the medical costs associated with influenza and pneumonia. We believe that there are no significant costs associated with this proposed rule. It would not impose any mandates on State, local, or tribal governments, or the private sector that would result in an expenditure of $100 million in any given year. Since most program participants comply with the statutory and regulatory requirements making unnecessary the imposition of termination from Medicare, Medicaid and, where applicable, other Federal health care programs, and since Medicare generally pays the cost of the vaccines that are the subject of this rule we do not anticipate more than a minimal economic impact on nursing facilities as a result of this proposed rule. There is a cost to the Medicare program for the vaccines to the extent that they are provided to Medicare beneficiaries, as discussed below.

As previously discussed in this preamble, this proposed rule would have a substantial life-saving effect. We have developed estimates of these life-saving effects, along with estimated changes in medical care costs, and present these estimates and the assumptions on which they are based in the discussion and table that follows.

There are approximately 2 million residents in LTC facilities. Sixty-five percent had documentation stating they received influenza immunization per the 1999 National Nursing Home Survey, National Center for Health Statistics, CDC. An October, 2000 article in the Journal of American Geriatric Society “Influenza outbreak detection and control measures in nursing homes in the United States (Zadeh MM, Buxton Bridges C, Thompson WW, Arden NH, Fukuda K.)” indicated that 83 percent of LTC residents in the study received immunizations. The midpoint between the two reports is 74 percent. The projected immunization rate after regulation implementation is 90 percent.

The 2005 influenza vaccination administration reimbursement rate is $18 (unweighted average of Medicare “National Flu Biller Administration Codes”). The 2005 Influenza vaccine reimbursement rate is $10.10 (Medicare rate; 95 percent of Average Wholesale Price (AWP). There is a wide variation in the influenza rate year to year, due to the prevalent strains of influenza virus each influenza season and the degree to which the vaccine matches prevalent strains as well as other factors. Effectiveness of Influenza vaccine for preventing influenza illness is 30-40 percent according to ACIP (Harper SA, Fukuda K, Uyeki TM, Cox NJ, Bridges CB; Prevention and control of influenza: recommendations of the ACIP. MMWR Recomm Rep. 2004 May 28; 53(RR-6):1-40).

As stated above, the rate of hospitalization for the LTC population among those ill with influenza is 25 percent (Arden NH, et al. ). The influenza vaccine is 50-60 percent effective in preventing hospitalization due to influenza in the LTC population (ACIP, May 2004).

According to (Arden NH, et al. ) the case-fatality for influenza disease in the LTC population is 10 percent of the number of residents who become ill with influenza. The influenza vaccine is 80 percent effective in preventing death in LTC residents with influenza illness (ACIP, May 2004). The average Medicare cost per hospital discharge for influenza is $8,500 per the Office of the Actuary, CMS (including medical education, disproportionate share and other pass through). The data on the influenza related hospitalization of SNF residents is not available. SNF residents are short term stay therefore we do not think those numbers are sufficiently large to have a great impact on the overall Medicare costs.

Influenza vaccine must be administered annually: however, virtually all influenza vaccinations administered in LTC facilities are covered under the Medicare Part B program. The cost to Medicare for provision of the influenza vaccinations is equal to the cost of the vaccines plus administration costs. In addition to these direct Medicare costs, an indirect Federal cost would be incurred from reduced savings in the Medicaid program. For every hospitalization of a LTC facility resident, Medicaid saves $1,000 for nursing home care not provided while the resident is in the hospital. The weighted average of the Federal contribution to Medicaid is 57 percent (Office of the Actuary, CMS), and Medicaid is a primary source of payment for 40 to 59 percent of LTC facility residents (1999 National Nursing Home Survey) and with a mid point of 50 percent. The total federal cost related to the increased influenza immunizations is the total of the direct Medicare costs combined with the lost savings to Medicaid.

In other rules, we have used an average value of a statistical life of $5 million to monetize the decreased mortality benefits of the rule. The population affected by this rule has different demographic and other characteristics from the populations that were addressed in these other rules. However, due to the lack of data on this specific population and in order to be consistent with previous rules, we are assuming a value of $5 million for the average value of a statistical life for this rule.

Therefore, since we estimate 2,304 lives will be saved by the influenza vaccination, we estimate the value saved from saving these lives as $11.52 billion.

There are approximately 2 million residents in LTC facilities. The projected immunization rate after regulation implementation is 90 percent. The LTC resident vaccination rate is estimated between 39 percent (1999 National Nursing Home Survey (NNHS)) and 56 percent (community rate, 2003 National Health Interview Survey). Virtually all residents with invasive disease are hospitalized. The rate of pneumococcal invasive disease in unvaccinated persons aged greater than or equal to 65 equals 52-85/100 000, (ACIP, 1997). The case fatality ratio of invasive pneumococcal disease in persons aged greater than or equal to 65 (despite appropriate medical treatment) is 30-40 percent. The average cost per hospital discharge for invasive pneumococcal disease is $8500 (Including medical education, disproportionate share and other pass through) (Office of the Actuary, CMS). According to CDC recommendations, usually one dose of the pneumococcal polysaccharide vaccine (PPV) is all that is needed, for a person only needs to be immunized once in a life time. However, in some situations a second dose is recommended for people 65 and older. Therefore, expense related to this rule is projected to cost more at the beginning period of implementation.

The 45 percent documented immunization rate in the table below represents data obtained in the year 1999, and since then the rate may have increased. Implementing the influenza immunization process is more challenging than implementing the similar PPV immunization process. Pneumococcal immunizations can be given all through the year without time constraints and the vaccine supplies have not been an issue. We anticipate that implementation of this rule would result in increase in immunization rate and documentation of the related data for future comparison. The table below is relating the years 1-5 to the current data.

The 2005 pneumococcal vaccination administration reimbursement rate is $18 (unweighted average of Medicare “National Flu Biller Administration Codes”) and the pneumococcal vaccine reimbursement rate is $23.28 (Medicare rate; 95% of AWP). The pneumococcal vaccine is generally administered once per beneficiary lifetime. Therefore this is not a recurring cost, but would cost more up front to give lifetime immunity to residents (for the cost estimate, we assumed 500,000 people would receive the vaccine in the first year and 100,000 people each would receive the vaccine in years two through five). The reason we assume the higher number the first year is because we expect all the eligible residents in the facilities in the first year would receive the pneumococcal vaccine. In the following years only the new residents who are eligible would need the immunization. Virtually all pneumococcal immunizations administered in LTC facilities are covered under the Medicare Part B program. For every hospitalization concerning Medicaid beneficiaries, Medicaid saves $1000 for nursing home care not provided while the resident is in the hospital. The weighted average of the Federal contribution to Medicaid is 57 percent (Office of the Actuary, CMS). Medicaid is a primary source of payment for 40 to 59 percent in LTC (1999 National Nursing Home Survey) and the mid point is 50 percent. The total Federal cost related to the increased pneumococcal immunizations is the total of the direct Medicare reimbursement costs combined with the lost savings to Medicaid.

Using the same $5 million per life value of a statistical life as before and since we estimate 560 lives will be saved by the pneumococcal vaccination, we estimate the value saved from saving these lives as $2.8 billion.

For the purpose of this analysis we have considered the protective effects of influenza and pneumococcal immunization individually. However, the combined effect of both immunizations is additive in preventing hospitalization and deaths. The July 30, 1999 article in the journal “Vaccine” titled “The additive benefits of pneumococcal vaccinations during influenza seasons among elderly persons with chronic lung disease” reports that both vaccinations together demonstrated additive benefit as there was a 65 percent reduction in hospitalization for pneumonia and 81 percent reduction in death versus the situation when neither had been received. Also excluded in this analysis is the increased protection against influenza infection afforded by the “herd” effect after 80 to 90 percent of residents are immunized against influenza. The 2003, CMS/CDC standing orders project report states that a facility-level influenza vaccination of 80 percent and more of residents may be independently associated with reduced patient hospitalization and death. Further, the cost-saving effects of this rule, and the costs of the vaccine doses themselves, are respectively benefits and costs to the taxpayer. Since Medicare pays virtually all medical, hospital, and (starting in 2006) drug costs for this population, the expected savings from reduced hospitalizations would largely accrue to the Federal budget.

In order to comply with this rule, facilities will develop the necessary policies and procedures which will be followed by staff as a standard practice. We estimate the time and cost related to this process in the following tables:

This rule proposes that the resident's immunization status be documented in the resident's medical record therefore, the following table presents the estimated time and cost related to the implementation of this process.

The RFA (15 U.S.C. 603(a)), as modified by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA) (Pub. L. 104-121), requires agencies to determine whether proposed or final rules would have a significant economic impact on a substantial number of small entities and, if so, to identify in the notice of proposed rulemaking or final rulemaking any regulatory options that could mitigate the impact of the proposed regulation on small businesses. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small government jurisdictions. Most nursing facilities are small entities, either by nonprofit status or by having revenues of $11.5 million or less annually (the applicable size standard of the Small Business Administration). Individuals and States are not included in the definition of a small entity, and other medical care providers are not affected by this proposed rule except indirectly, through reduced utilization of care by individuals who do not, but would otherwise, require hospitalization.

In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area and has fewer than 100 beds. We do not believe a regulatory impact analysis is required here because, for the reasons stated above, this proposed rule would not have a significant impact on the operations of a substantial number of small rural hospitals.

Section 202 of the Unfunded Mandates Reform Act of 1995 also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates may result in expenditure in any 1 year by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million in 1995 dollars. This proposed rule would impose no mandates on State, local, or tribal governments. As indicated elsewhere in this analysis, costs mandated on nursing facilities, are minimal, and do not remotely approach this threshold.

Executive Order 13132 on Federalism establishes certain requirements that an agency must meet when it publishes a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. We have determined that this proposed rule would not significantly affect the rights, roles, or responsibilities of the States. This proposed rule would not impose substantial direct requirement costs on State or local governments, preempt State law, or otherwise implicate federalism.

Based on the various studies and reports referenced earlier in the preamble, we expect that LTC facilities would benefit from the implementation of this proposed rule. The various studies discussed are evidence that prevention of influenza and pneumonia would lower the level of acuity, staff time and other expenses resulting in cost reductions.

The influenza vaccine is 50-60 percent effective in preventing hospitalization due to influenza in the LTC population and increased immunizations are expected to improve health overall for the age group of 65 years and older. As estimated above 2,304 lives may be saved annually when residents receive influenza immunizations.

According to CDC's Active Bacterial Core Surveillance for pneumococcal disease, approximately 5,700 deaths from invasive pneumococcal disease (bacteremia and meningitis) are estimated to have occurred in the United States in 2002. The October 1997 Journal of the American Medical Association (JAMA) article “Cost-Effectiveness of Vaccination Against Pneumococcal Bacteremia Among Elderly People” indicated that vaccination of elderly people against pneumococcal bacteremia is one of the few interventions that have been found to both improve health and save medical costs.

The reports from the January 2000, CMS's Adult Immunization Project, indicates that “despite the fact that influenza and pneumococcal vaccines are clinically effective, cost-effective, and are Medicare Part B covered benefits, they remain underutilized.” Increased immunizations are expected to reduce the medical expenses and improve health overall for the age group of 65 years and older as reported in the Oct, 1997 JAMA article referenced earlier. As stated above, the rate of hospitalization for the LTC population among those ill with influenza is 25 percent (Arden NH, et. al.). The average cost per hospital discharge for influenza is $8,500 per the Office of the Actuary, CMS. The influenza vaccine is 80 percent effective in preventing death in the LTC population (ACIP, May 2004). As estimated above the net saving would be $34,777,520 and 2,304 lives saved when residents receive influenza immunizations. The net cost related to pneumococcal immunizations is estimated to be $ 18,821,360 the first year of implementation and $ 3,753,887 in the following two to five years and 143 lives saved.

We considered other alternatives regarding immunizing residents.

1. One alternative would be to keep the present rules, as they are written. The current regulations, however, have thus far not been effective at assisting us in increasing the rate of immunization of institutionalized residents to 90 percent. Despite the Federal government's unified efforts to increase the availability of safe and effective vaccines, and despite substantial progress in reducing many vaccine-preventable diseases, at-risk individuals are not receiving influenza and pneumococcal vaccines. Section 4107 of the Balanced Budget Act of 1997 extended the influenza and pneumococcal immunization campaign being conducted by CMS in conjunction with CDC and the National Coalition for Adult Immunization through fiscal year 2002, authorizing $8 million for each fiscal year from 1998 to 2002. Although Medicare reimbursement for influenza and pneumococcal immunizations was increased under this legislation, rates of immunization did not improve as anticipated.

2. Another alternative would be to educate providers on the value of influenza and pneumococcal vaccines without rule making. However, as discussed in studies cited earlier in this rule, this has not been effective in improving immunization rates.

Increasing the utilization of cost-effective preventive services is the goal of both CMS and CDC, and this proposed rule would facilitate the delivery of appropriate vaccinations in a timely manner, increase the levels of vaccination rate, and decrease the morbidity and mortality rate of influenza and pneumococcal diseases. As a result, the economic effects of the rule are substantial and overwhelmingly beneficial. In accordance with the provisions of Executive Order 12866, the Office of Management and Budget reviewed this proposed rule.

For the reasons set forth in the preamble, the Centers for Medicare & Medicaid Services amends 42 CFR chapter IV as set forth below:

Section 27 of the Merchant Marine Act of 1920, commonly known as the Jones Act (46 App. U.S.C. 883), requires, with a few exceptions, that all cargo transported in the coastwise trade be carried on ships that are U.S.-owned and U.S.-built. The Jones Act has been amended over the years, and in 1988 a special technical proviso, known as the thirteenth proviso, was added to allow for the use of foreign-built platform jacket launch barges in the coastwise trade if no U.S.-built vessels were found to be available.

On August 9, 2004, the thirteenth proviso of the Jones Act was amended by section 417 of the Coast Guard and Maritime Transportation Act of 2004, Public Law 108-293 (the Act). Under the Act, the Secretary of Transportation is directed to establish procedures to issue determinations as to whether suitable U.S.-built barges are available for use in transportation and launching (i.e., installation) of offshore oil drilling or production structures. The Act directs that if the Secretary determines, upon application by the owner/operator of a foreign-built barge, that a suitable U.S.-built barge is not reasonably available for use in a specified launch project, then the foreign-built barge may be used. Because the Bureau of Customs and Border Protection (CBP) is responsible for enforcing violations of the coastwise laws, MARAD recommends that applicants that receive a determination from MARAD further obtain a ruling regarding the use of the thirteenth proviso of the Jones Act from CBP before proceeding with their transportation and launch projects.

In this rulemaking, MARAD is proposing procedures to be followed in order to apply for U.S.-flag availability determinations for the specialized “platform jacket” launch market. “Platform jacket” refers to a single physical component and includes any type of offshore exploration, development, or production structure or component thereof, including platform jackets, tension leg or SPAR platform superstructures (including the deck, drilling rig and support utilities, and supporting structure), hull (including vertical legs and connecting pontoons or vertical cylinder), tower and base sections of a platform jacket, jacket structures, and deck modules (known as “topsides”).

For each proposed project, MARAD will publish a notice of application in the Federal Register and will provide the appropriate references to the DOT Docket Management System where applications will be available for public review and comment. Each application must include the engineering details (specifying the need for a vessel with a launch capacity of 12,000 long tons or more) and the timing requirements (establishing an approximate date and time window for the launch). MARAD will request that comments and information on the availability of coastwise-qualified vessels be submitted within thirty (30) days after publication of the initial notice of application. If MARAD does not receive information within the thirty (30) day comment period indicating that a suitable coastwise-qualified vessel is available for the project, or if MARAD receives such information, but determines that the vessel is not suitable or is not reasonably available for the project, then MARAD will issue a determination indicating the non-availability of a coastwise-qualified barge. Determinations will be issued within ninety (90) days from the date the initial notice of application is published in the Federal Register.

Because launch barges have long lead times for construction, applicants are encouraged to provide the Maritime Administration and the public with as much notice as possible in advance of their projects. Early notification will help ensure the maximum utilization of coastwise-qualified vessels, and will assist the Maritime Administration in its review process. The ideal time for providing notification is when the need for the installation of a platform jacket is identified. For instance, transportation plans for launch projects are typically arranged when application is made to the Minerals Management Service for use of an offshore portion of the outer continental shelf, which is typically years in advance of a launch project.

The Maritime Administration recognizes that advance notice of projects may increase the U.S. presence in the launch barge industry, as companies would be more likely to build barges to meet known market demands. MARAD welcomes suggestions, in addition to comments on the proposed regulation, regarding how to increase the utilization of U.S.-flag launch barges and is interested in hearing from the public on how it may facilitate the flow of information regarding early notification of projects so that the U.S. launch barge industry may effectively respond to projected needs.

Title V of the Independent Offices Appropriations Act of 1952 (“IOAA”; 31 U.S.C. 9701) authorizes Federal agencies to establish and collect user fees. The statute provides that each service or thing of value provided by an agency should be self-sustaining to the extent possible, and that each charge shall be fair and based on the costs to the Government, the value of the service or thing to the recipient, the policy or interest served, and other relevant factors. 31 U.S.C. 9701.

The primary guidance for implementation of the IOAA is Office of Management and Budget (OMB) Circular No. A-25 (“User Charges,” July 8, 1993). Circular A-25, section 6, directs agencies to assess user charges against identifiable recipients for special benefits derived from Federal activities beyond those received by the general public. Circular A-25 further directs agencies, with limited exceptions, to recover the full cost of providing a Government service from the direct recipients of special benefits. Section 6(d) of Circular A-25 defines “full cost” as including “all direct and indirect costs to any part of the Federal Government of providing a good, resource, or service.”

Pursuant to these directives, MARAD is proposing to set the application fee for administrative determination of availability at $16,460.00. Because determinations of availability under part 389 represent special benefits to identifiable recipients (i.e., vessel owners) that are beyond the benefits and services normally received by the general public, the IOAA and Circular A-25 direct MARAD to assess user fees for providing this service.

Following the principles embodied in Circular A-25, MARAD estimates the costs associated with processing and issuing determinations under part 389 as follows. The main cost components of the program include direct and indirect personnel costs and Federal Register publication costs. MARAD estimates that average personnel costs for processing each application will be $15,995.00. The second main cost component of the program will be the cost of publishing notices of applications in the Federal Register. The current Federal Register publication cost is $155 per column and the average length of a public notice published for this program is estimated to be three columns. Thus, the total average publication cost will be $465.00. The total of personnel costs and Federal Register publication costs is estimated to be $16,460.00.

This rulemaking is not significant under section 3(f) of Executive Order 12866, and as a consequence, OMB did not review the rule. This rulemaking is also not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034; February 26, 1979). It is also not considered a major rule for purposes of congressional review under Public Law 104-121. MARAD believes that the economic impact of this rulemaking is so minimal as to not warrant the preparation of a full regulatory evaluation. This rulemaking merely establishes procedures to determine if a coastwise-qualified barge is available for use in a project and, if not, to allow the use of a non-coastwise qualified barge.

We analyzed this rulemaking in accordance with the principles and criteria contained in Executive Order 13132 (“Federalism”) and have determined that it does not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement. The regulations herein have no substantial effects on the States, the current Federal-State relationship, or the current distribution of power and responsibilities among local officials. Therefore, MARAD did not consult with State and local officials because it was not necessary.

The Regulatory Flexibility Act requires MARAD to assess the impact that regulations will have on small entities. After analysis of this proposed rule, the Maritime Administrator certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities. We anticipate that few, if any, small entities will participate in this process due to the nature of the shipping industry and the capital costs associated with vessels that fall under this program.

We have analyzed this proposed rule for purposes of compliance with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321 et seq. ) and we have concluded that, under the categorical exclusions provision in section 4.05 of Maritime Administrative Order (MAO) 600-1, “Procedures for Considering Environmental Impacts,” 50 FR 11606 (March 22, 1985), neither the preparation of an Environmental Assessment, an Environmental Impact Statement, nor a Finding of No Significant Impact for this rulemaking is required. This rulemaking will not result, either individually or cumulatively, in a significant impact on the environment. This rulemaking only relates to the determination of whether a coastwise-qualified barge is available for a project, and, if not, allows the use of a non-coastwise qualified barge.

This rulemaking contains an information collection that will require review and clearance by the Office of Management and Budget (OMB).

This rulemaking does not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It does not result in costs of $100 million or more to either State, local, or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves this objective of U.S. policy.

MARAD believes that these regulations will have no significant or unique effect on the communities of Indian tribal governments when analyzed under the principles and criteria contained in Executive Order 13175 (Consultation and Coordination with Indian Tribal Governments). Therefore, the funding and consultation requirements of this Executive Order do not apply.

A regulation identifier number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN contained in the heading of this document can be used to cross-reference this action with the Unified Agenda.

Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78) or you may visit http://dms.dot.gov.

Accordingly, the Maritime Administration proposes to amend 46 CFR chapter II, subchapter J, by adding Part 389 to read as follows:

This proposed rule is also accessible via the Internet at the Office of the Federal Register 's website at http://www.gpoaccess.gov/fr/index.html .

The United States is a member of the IATTC, which was established under the Convention for the Establishment of an Inter-American Tropical Tuna Commission signed in 1949 (Convention). The IATTC was established to provide an international arrangement to ensure the effective international conservation and management of highly migratory species of fish in the Convention Area. For the purposes of this closure, the Convention Area is defined to include the waters of the eastern tropical Pacific Ocean bounded by the coast of the Americas, the 40° N. and 40° S. parallels, and the 150° W. meridian. The IATTC has maintained a scientific research and fishery monitoring program for many years and annually assesses the status of stocks of tuna and the fisheries to determine appropriate harvest limits or other measures to prevent overexploitation of the stocks and promote viable fisheries.

Under the Tuna Conventions Act, 16 U.S.C. 951-961 and 971 et seq. , NMFS must publish proposed rules to carry out IATTC recommendations that have been approved by DOS. The Southwest Regional Administrator, also is required by rules at 50 CFR 300.29(b)(3) to issue a direct notice to the owners or agents of all U.S. purse seine vessels that operate in the ETP of actions recommended by the IATTC and approved by the DOS.

At an extraordinary meeting in October 2003, the IATTC adopted a resolution addressing yellowfin, bigeye, and skipjack tuna conservation for 2003 and 2004. The 2003 resolution called upon the Parties to the Convention and cooperating non-Parties to prohibit tuna purse seine fishing in a portion of the IATTC Convention Area for the month of December 2003 and for a 6-week period beginning August 1, 2004. NMFS implemented the 2003 closure by separate action in 2003.

At the June 2004 IATTC meeting, the October 2003 resolution was revised and a new resolution was adopted by the Commission. The June 2004 resolution is a multi-annual program on the conservation of tuna in the eastern Pacific Ocean for 2004, 2005, and 2006. This resolution offers a choice for closing the purse seine fishery, either a 6-week closure beginning August 1, of each year, or a 6-week closure beginning November 20, of each year. The resolution of June 2004 incorporated flexibility for nations to administer the purse seine closure in accordance with national legislation and national sovereignty. The selected measures should provide protection against overfishing of the stocks in a manner that is fair, equitable, and readily enforceable.

Comments were received during the 2004 proposed rule comment period with respect to the timing of the closure. Most comments received noted that a closure later in the fishing year gave better public notice, minimized the disruption of planned fishery operations, and was in keeping with the timing of closures for this purse seine fishery and the ability for the industry to prepare for and plan the closure while meeting the conservation goals for tunas in the ETP. In response to these comments, the U.S. chose the period beginning on November 20, 2004 for the 2004 closure of the purse seine fishery.

The June 2004 resolution also calls upon each Party and cooperating non-Party to take measures necessary to ensure that each nation's longline catch of bigeye tuna in the ETP during 2005 and 2006 will not exceed the catch level of 2001. The U.S. catch level of longline caught bigeye tuna for 2001 is estimated to be 150 metric tons in the Convention Area. This limitation is intended to prevent overfishing of the stock, which has declined in recent years while longline fishing effort has greatly expanded. In 2004, the U.S. catch level of longline-caught bigeye in the Convention Area of 150 mt was reached. On December 10, 2004, NMFS closed the U.S. longline fishery for bigeye tuna in the Convention Area for the remainder of 2004.

The IATTC action at the extraordinary meeting in October 2003 and the June 2004 resolution came after considering a variety of measures, including the use of quotas and partial fishery closures as in 1999 through 2002 and the full month purse seine closure used in 2003.

The proposed 2005 and 2006 time/area closure is based on 2004 assessments of the condition of the tuna stocks in the ETP and historic catch and effort data for different portions of the ETP, as well as records relating to implementation of quotas and closures in prior years. The closure is targeted to areas with high catches of bigeye tuna in the purse seine fishery and is believed by the IATTC scientific staff to be sufficient to reduce the risk of overfishing of that stock, especially when considered in combination with the measures implemented in December 2004. The IATTC met in June 2005 and reviewed tuna stock assessments and fishery information and considered that new information in evaluating the need for management measures for 2005 and future years. The IATTC's June 2004 resolution remains in force, and the DOS has approved the resolution, including the management measures described above.

The Regional Administrator, Southwest Region, sent a notice May 31, 2005, to owners and agents of U.S. fishing vessels of the actions adopted by the IATTC and approved by the DOS.

This action is proposed under the regulations for the Pacific Tuna Fisheries found at 50 CFR 300.25.

On December 8, 1999, NMFS prepared a biological opinion (BO) assessing the impacts of the fisheries as they would operate under the regulations (65 FR 47, January 3, 2000) implementing the International Dolphin Conservation Program Act (IDCPA). For the final rule (69 FR 176, September 13, 2004) to implement the IDCPA, NMFS amended the incidental take statement included in the December 8, 1999 BO. NMFS concluded that the fishing activities conducted under those regulations are not likely to jeopardize the continued existence of any endangered or threatened species under the jurisdiction of NMFS or result in the destruction or adverse modification of critical habitat. This proposed rule will not result in any changes in the fisheries such that there would be impacts beyond those considered in that BO. The IATTC has also taken action to reduce sea turtle injury and mortality from interactions in the purse seine fishery so impacts of the fisheries should be lower than in the past. Because this closure does not alter the scope of the fishery management regime analyzed in the IDCPA rule, or the scope of the impacts considered in that consultation, NMFS is relying on that analysis to conclude that this rule will not likely adversely effect any endangered or threatened species under the jurisdiction of NMFS or result in the destruction or adverse modification of critical habitat. Therefore, NMFS has determined that additional consultation is not required for this action.

The U.S. ETP tuna purse seine fisheries occasionally interact with a variety of species of dolphin, and dolphin takes are authorized and managed under the IDCPA. These conservation management measures in this proposed rule do not affect the administration of that program, which is consistent with section 303(a)(2) of the Marine Mammal Protection Act.

NMFS prepared an EA for the final rule (70 FR 69, April 12, 2005), to implement resolutions adopted by the IATTC and by the Parties to the Agreement on the International Dolphin Conservation Program. The Assistant Administrator for Fisheries concluded that there would be no significant impact on the human environment as a result of that final rule. The impacts of the fisheries as they will operate under the 6-week closures in 2005 and 2006 are within the range of impacts of the alternatives considered in that EA, and are not expected to pose different impacts to the human environment. Therefore, this action does not require further analysis under NEPA.

This proposed rule has been determined to be not significant for the purposes of Executive Order 12866.

An IRFA was prepared that describes the economic impact that this proposed rule, if adopted, would have on small entities. A copy of the IRFA for this proposed rule is available for public comment (see ADDRESSES ). A summary of the analysis follows.

This action would prohibit the use of purse seine gear to harvest tuna in the Convention Area for a 6- week period beginning November 20, 2005, through December 31, 2005, and beginning November 20, 2006, through December 31, 2006, and limit the annual 2005 and 2006 U.S. catch of bigeye tuna caught by longline in the ETP to the level reached in 2001 (150 metric tons).

The proposed purse seine closure would apply to the U.S. tuna purse seine fleet, which consists of 10- 20 small vessels (carrying capacity below 400 short tons (363 metric tons)) and 4-6 large vessels (carrying capacity 400 short tons (363 metric tons) or greater). The large vessels usually fish outside U.S. waters and deliver their catch to foreign ports or transship to processors outside the mainland United States. The large vessels are categorized as large business entities (revenues in excess of $3.5 million per year). A large purse seine vessel typically generates 4,000 to 5,000 metric tons of tuna valued at between $4 and $5 million per year. The closure should not significantly affect their operations as they are capable of fishing in other areas that would remain open. The small vessels are categorized as small business entities (revenues below $3.5 million per year). They fish out of California in the U.S. exclusive economic zone (EEZ) most of the year for small pelagic fish (Pacific sardine, Pacific mackerel) and for market squid in summer. Some small vessels harvest tuna seasonally when they are available. The proposed time/area closure will have no effect on small vessels because they do not have the endurance and markets to fish that far south.

For 2004, the U.S. chose to close the purse seine fishery beginning November 20, 2004, for the remainder of 2004. In 2004 the U.S. catch level of longline caught bigeye tuna in the Convention Area of 150 metric tons was reached. On December 10, 2004, NMFS closed the U.S. longline fishery for bigeye tuna in the Convention Area for the remainder of 2004.

The portion of the U.S. longline fleet (approximately 18 vessels) operating out of California has historically caught bigeye tuna in the swordfish fishery (now closed), so they should not be affected by the longline fishery limit. Further, the prohibition of swordfish targeted by this fleet has encouraged many of the vessel owners to relocate their activity to Hawaii; therefore, the likelihood that they will fish in the ETP for bigeye tuna is reduced. The portion of the fleet operating out of Hawaii has generally operated outside the boundaries of the IATTC Convention Area, and has not made significant catches in those waters. In 2004, the Hawaii based longline fishery harvested the 150 metric ton limit of bigeye tuna in the Convention Area. With the reopening of the swordfish fishery for that fleet, effort directed at bigeye tuna (which has mainly occurred west of the Convention Area) should decrease. A closure should not significantly affect their operations as they are capable of fishing in other areas that would remain open, outside the boundaries of the IATTC Convention Area.

NMFS is not aware of any relevant Federal rules that duplicate, overlap, or conflict with this proposed rule. This rule does not impose reporting or recordkeeping requirements, and the compliance requirements for the closure areas are as described at the outset of this summary.

NMFS considered three alternatives for this proposed rule:

The 2004 IATTC Tuna Conservation Resolution allows nations to opt for a six-week summer closure of the purse seine fishery from August 1 through September 20 of each of the years 2004, 2005, and 2006, rather than the closure from November 21 through December 31. Based on public comments on the proposed rule in 2004, NMFS chose to pursue six-week closures that begin in November 2005 and November 2006. The August 1 September 20 closure alternative would have had a greater economic impact on small entities than the November 20 December 31 closure. In particular, the U.S. purse seine fleet prefers a closure later in the fishing year because the winter weather is not conducive to fishing. Also, throughout the history of this fishery shipyards have been prepared to accept vessels for scheduled repairs during the winter months. The fishery closure later in the year allows the industry to plan for and mitigate economic impacts of a closure while still providing the conservation benefits to the tuna resources in the ETP.

NMFS also considered the alternative of not implementing the 2004 IATTC Tuna Conservation Resolution. This alternative would have imposed no economic costs on small entities. However, failure to implement measures that have been agreed on pursuant to this Convention would violate the United States' obligations under the Convention, and would violate the Tuna Conventions Act.

A proposed rule that covers NMFS' proposed revisions to the NS1 guidelines was published on June 22, 2005 (70 FR 36240), with a comment period ending date of August 22, 2005. After receiving several requests to extend the comment period, NMFS has decided to extend it for another 60 days through October 21, 2005.

This action extends the comment period for a proposed rule that the Office of Management and Budget determined to be significant under Executive Order 12866.

NMFS conducted a section 7 consultation under the Endangered Species Act (ESA) on interactions between sea turtles and fisheries managed under the Pelagic FMP. The result of this consultation was a Biological Opinion that was issued on February 23, 2004 (2004 Opinion). The 2004 Opinion concluded that the fisheries managed under the Pelagics FMP were not likely to jeopardize the continued existence of sea turtles or other species listed as threatened or endangered under the ESA. Included in the actions considered under the 2004 Opinion were several measures required by a previous (15 November 2002) Biological Opinion (2002 Opinion) on the Pelagics FMP fisheries. These measures were vacated on 1 April 2004, by a Federal Court order. The requirements for general longline permits were additional to those pre-existing requirements for Hawaii-based longline limited access permit holders. Terms and conditions of the 2004 Opinion required: (a) owners and operators of vessels registered for use under longline general permits to attend protected species workshops annually; (b) owners and operators of vessels registered for use under longline general permits to carry and use dip nets, line clippers, and bolt cutters, and follow sea turtle handling, resuscitation, and release requirements for incidentally hooked or entangled sea turtles; and (c) operators of non-longline vessels using hooks to target pelagic management unit species to follow sea turtle handling, resuscitation, and release requirements, as well as to remove the maximum amount of the gear possible from incidentally hooked or entangled sea turtles.

At its 122nd meeting (March 22-25, 2004), the (Western Pacific Fishery Management Council (WPFMC) took initial action on the three measures listed above by indicating its preliminarily preferred alternatives and recommending the development and analysis of a full range of alternatives for final action. The WPFMC also requested alternatives to be developed and analyzed for a fourth measure that would require operators of vessels registered for use under longline general permits (including those that will be registered for use under American Samoa limited access longline permits) to use 18/0 or larger circle hooks with a 10 offset, mackerel-type bait, and dehookers, when shallow-setting north of the Equator. These requirements had previously been implemented in the Hawaii-based limited access longline fishery in April 2004.

The WPFMC recommended the inclusion of this fourth measure for two reasons: (a) to extend the conservation benefits derived from the use of circle hooks, mackerel-type bait, and dehookers, to all longline vessels managed under the Pelagics FMP that may shallow-set north of the Equator, and (b) to remove incentives for owners of Hawaii-based longline vessels to shed their permits in favor of general permits, to avoid using circle hooks, mackerel bait, etc., when shallow-setting north of the Equator. The combination of large (size 18/0) circle hooks and mackerel bait were shown to reduce catches of loggerhead sea turtles by 92 percent and leatherback turtles by 67 percent, and improve swordfish catches 30 percent, when used on Atlantic longline vessels making shallow sets to target swordfish. Circle hooks have also been found to hook turtles predominantly in the mouth rather than the delicate tissues of the esophagus, thus minimizing trauma and increasing survival rates for those turtles that are unavoidably hooked.

Logbook data indicate that longline fishing under longline general permits has been concentrated south of the Equator in U.S. exclusive economic zone (EEZ) waters around American Samoa, where most vessels target deep-swimming albacore tuna to sell to canneries in Pago Pago, American Samoa. There are no domestic longline fisheries in Guam and the Commonwealth of the Northern Mariana Islands, although there is local interest in developing such fisheries. To date, no longline general permit holders have elected to target swordfish (or other species) north of the Equator using shallow sets. The main reason for this is that the principal market for swordfish in the western Pacific is Hawaii, and to land longline caught fish directly into Honolulu or other ports in the State requires a Hawaii longline limited access permit.

Vessels with longline general permits, however, could potentially land in other ports within and beyond the western Pacific region. In the past, for example, some longline vessels from the western Pacific landed swordfish in California ports, but this opportunity is now closed to vessels that are not permitted under the Pacific Fishery Management Council's West Coast Highly Migratory Species Fishery Management Plan. No western Pacific longline vessels have opted to land fish at ports outside the U.S.A. in Central or South America, as the economics of doing so weigh against this. Nonetheless, the WPFMC believed it was prudent to anticipate the possibility of shallow-setting north of the Equator by vessels that are registered for use under longline general permits, no matter how unlikely this seems at present. Thus, the WPFMC recommended that owners and operators of such vessels should be required to employ the same sea turtle mitigation measures as their Hawaii-based counterparts.

At its 123rd meeting (June 21-24, 2005), the WPFMC took final action and recommended that NMFS approve and implement regulations to require owners and operators of vessels registered for use under longline general permits to: (a) attend annual protected species workshops; (b) carry and use dip nets, line clippers, and bolt cutters, and follow sea turtle handling, resuscitation, and release requirements for incidentally-hooked or entangled sea turtles (vessels with a freeboard of 3 ft (0.91 m) or less are exempted from carrying dipnets or long-handled line clippers); and (c) use 18/0 or larger circle hooks with a 10 offset, mackerel-type bait, and dehookers, when shallow-setting north of the Equator (vessels with a freeboard of 3 ft (0.91 m) or less are exempted from carrying long-handled dehookers). The WPFMC also recommended that owners and operators of other (non-longline) vessels, managed under the Pelagics FMP and using hooks to target PMUS, remove trailing gear from incidentally hooked and entangled sea turtles, and follow sea turtle handling, resuscitation, and release requirements.

At this time, NMFS has not determined that this proposed rule is consistent with the national standards of the Magnuson-Stevens Fishery Conservation and Management Act and other applicable laws. NMFS, in making that determination, will take into account the data, views, and comments received during the comment period.

This proposed rule has been determined to be not significant for purposes of Executive Order 12866.

The WPFMC prepared an IRFA that describes the economic impact this proposed rule, if adopted, would have on small entities. A copy of the IRFA is available from Kitty M. Simonds, WPFMC (see ADDRESSES ). A description of the action, why it is being considered, its objectives, and the legal basis for this action are contained at the beginning of this section in the preamble and in the SUMMARY section of the preamble. A summary of the analysis follows.

Most fishing vessels operating in the western Pacific region under the Pelagics FMP are owner-operated, with few individuals holding permits for more than one vessel. There are estimated to be between 9,416 and 15,816 of these fishing operations (these estimated totals may include vessels that do not operate in EEZ waters), all of which are believed to be small businesses, i.e., they have gross revenues of less than $3.5 million annually.

Previously, all operators of longline vessels managed under the Pelagics FMP were required to attend protected species workshops. This requirement was removed when several regulations were vacated by a U.S. District Court on April 1, 2004 (D.D.C., Civ. No. 01-0765). Requiring both the owners and operators of vessels registered for use under longline general permits to annually attend protected species workshops will have a minimal cost for those who reside in Hawaii or American Samoa, where the training workshops are conducted. Some 15 percent of the vessels that fish in American Samoa and Hawaii under longline permits, however, have owners that reside outside of those two areas. A substantial travel cost to attend the workshops would be incurred by those people. NMFS is currently accommodating the owners and operators of Hawaii-based vessels that live outside Hawaii by providing interim protected species training via computer disk, mailed to the owner or operator. This type of remote training and certification relieves potential travel costs, and may be further developed and implemented for other owners and operators who are not able to attend the workshops in person.

Owners and operators of the vessels that are registered for use under longline general permits were previously required to carry and use dipnets, long-handled line clippers, and bolt cutters, so most vessels with longline general permits already have this gear. However, these measures were also removed when several regulations were vacated in the same April 1, 2004, case cited above. If these vessels need to re-equip themselves, the costs are not expected to exceed $100 per vessel. The WPFMC recommended that small longline vessels such as alias (American Samoa-based catamaran longline vessels generally less than 40 ft (12.2 m) in length) not be required to carry a dip net or long-handled line clippers because, due to the low freeboard on these boats, operators can simply retrieve and release the turtle from the side of the vessel without risk of additional injury to the animal.

The WPFMC's recommendation to require vessels registered under a longline general permit to use 18/0 or larger circle hooks with a 10 offset, mackerel-type bait, and dehookers when shallow-setting north of the Equator would incur the following costs: Re-equipping longlines with 18/0 circle hooks plus swivels would cost approximately $1.50/hook, and a large (> 75 ft) longline vessel generally deploys 2,000-2,500 hooks/set, so the cost per vessel of that size would be $3,000 to $3,750. American Samoa-based longline vessels already use mackerel-type bait (sardine or saury (sanma)), so there would be no additional cost for the bait requirement for these vessels. Obtaining approved dehookers and associated equipment would cost about $500 per vessel. The WPFMC recommended that small longline vessels with a freeboard of less than or equal to three feet not be required to carry long-handled dehookers because operators can more effectively and safely use short-handled dehookers to release sea turtles without risk of additional injury to the animal.

Under this proposed rule, the total cost to equip a vessel registered for use with a longline general permit to shallow-set north of the Equator is estimated to be between $3,500 and $4,250. An ongoing additional annual replacement cost of $0.20 per hook would also be required as circle hooks are slightly more expensive than typical “J” hooks.

The WPFMC recommendation to require operators of all vessels that use hooks to target PMUS to follow sea turtle handling, resuscitation, and release requirements, including removing trailing gear, is not expected to exact any economic burden on these fishery participants because there no gear requirements are being proposed for non-longline vessels, and interactions are rare.

For each of the four measures recommended by the WPFMC, three alternatives were developed, so altogether, 12 alternatives were considered. The alternatives considered for the measure regarding protected species workshop attendance by owners and of operators vessels registered for use under longline general permits were: (a) no action maintaining the status quo; (b) requiring annual attendance by only vessel operators; and (c) requiring annual attendance by both vessel owners and operators.

The alternatives considered for the measure regarding sea turtle mitigation gear (i.e., dip nets, line clippers, bolt cutters) and handling, resuscitation, and release requirements were: (a) no action maintaining the status quo; (b) requiring owners and operators of vessels registered under a longline general permit to carry and use dip nets, line clippers, and bolt cutters, as well as follow handling, resuscitation, and release requirements for hooked or entangled sea turtles (vessels with 3 ft (0.91 m) of freeboard or less would be exempt from carrying dip nets or long-handled line clippers;) and (c) requiring owners and operators of vessels registered under a longline general permit to carry and use dip nets, line clippers, and bolt cutters, as well as follow handling, resuscitation, and release requirements for hooked or entangled sea turtles with no exemptions for longline vessels with freeboard less than three ft (0.91 m).

The alternatives for the measure regarding vessels that use hooks to target pelagic management unit species were: (a) no action maintaining the status quo; (b) requiring vessel owners and operators to follow sea turtle handling, resuscitation, and release requirements, including the removal of trailing gear from a hooked or entangled sea turtle when fishing in the EEZ of the western Pacific region; and (c) requiring vessel owners and operators to follow sea turtle handling, resuscitation, and release requirements, including the removal of trailing gear, wherever they fish.

The alternatives for the measure regarding gear and bait requirements for owners and operators of vessels registered for use under a longline general permit that may shallow-set north of the Equator were: (a) no action maintaining the status quo; (b) requiring owners and operators to use 18/0 or larger circle hooks with 10 offset, mackerel-type bait, and dehookers when shallow-setting north of the Equator; and (c) prohibiting shallow-setting north of the Equator by vessels registered under longline general permits.

The following alternative was preferred in the IRFA because it best complied with the terms and conditions of the 2004 Biological Opinion: (a) requiring annual workshop attendance by both owners and operators; (b) requiring owners and operators of vessels registered for use under a longline general permit to carry and use dip nets, line clippers, and bolt cutters, as well as to follow handling, resuscitation, and release requirements for hooked or entangled sea turtles (vessels with 3 ft (0.91 m) of freeboard or less would be exempted from carrying dip nets or long-handled line clippers); (c) requiring longline vessel owners and operators to follow sea turtle handling, resuscitation, and release requirements, including the removal of trailing gear wherever they fish; and (d) requiring longline vessels owners and operators to use 18/0 or larger circle hooks with 10 offset, mackerel-type bait, and dehookers when shallow-setting north of the Equator (vessels with 3 ft (0.91 m) of freeboard or less would not be required to carry long handled dehookers).

The inclusion of existing text on turtle handling requirements from 50 CFR 660.32 (c) and (d), which is largely duplicative of text in 50 CFR 223.206, is necessary because 50 CFR 223.206 only applies to threatened species of sea turtles. This proposed rule would extend those handling requirements to interactions between Pelagics FMP fishing vessels and all species of sea turtles. To the extent practicable, it has been determined that there are no other Federal rules that may duplicate, overlap or conflict with this proposed rule.

For the reasons set out in the preamble, 50 CFR part 660 is proposed to be amended as follows:

1. The authority citation for part 660 continues to read as follows:

2. In § 660.22, paragraphs (ff), (gg), (ii), (ll), (nn), and (oo) are revised to read as follows:

3. In § 660.32, paragraphs (a)(2) through (a)(4) are redesignated as paragraphs (a)(4) through (a)(6); introductory text is added to paragraph (a); paragraphs (a)(1) and (b) are revised; new paragraphs (a)(2) and (a)(3) are added; and paragraphs (c) and (d) are removed to read as follows:

4. In § 660.33, paragraphs (f) and (g) are revised to read as follows:

5. In § 660.34, paragraphs (a), (c) and (d) are revised to read as follows:

On June 2, 2005, at its 127th meeting, the WPFMC recommended a “control date” of June 2, 2005, applicable to persons who are contemplating entering the non-longline commercial fisheries for pelagic species (i.e., troll, handline, pole and line, other) in the U.S. exclusive economic zone (EEZ) around Hawaii. The WPFMC requested that this control date be published in the Federal Register to notify fishermen that if they enter these fisheries after June 2, 2005, they may not be assured of future access if the WPFMC and/or NMFS decide to limit entry or impose other measures to manage these fisheries.

Establishment of a control date responds to NMFS' notice to the WPFMC, dated December 30, 2004 (69 FR 78397), that overfishing is occurring Pacific-wide on bigeye tuna, and that management action must be taken by the WPFMC to end this overfishing. The WPFMC tentatively has determined that a limited access program in the U.S. EEZ around Hawaii might be one of the viable mechanisms to reduce fishing mortality in Pacific bigeye tuna, as a step toward ending overfishing in the pelagic fisheries.

The State of Hawaii maintains a registry of commercial pelagic fishermen, as required by state regulations. In 2003, some 2,037 people were registered as commercial pelagic fishermen. Of these, 1,681 (83 percent) were non-longline fishermen. Most of these non-longline pelagic fishermen were active in the EEZ and, thus, represent an estimate of fishermen who could be affected by this control date. Based on the state's 2003 commercial fishing data reported by fishermen, the total catch of pelagic species in Hawaii was 22.6 million lb (10,251 mt), of which 5.2 million lb (2,359 mt)(23 percent) was made by non-longline small-boat pelagic methods. The entire pelagic fishery landed fish with an ex-vessel value of $47.9 million, of which about $9.3 million (19.4 percent) were from non-longline methods.

Control dates are intended to discourage speculative entry into fisheries, as new entrants entering the fishery after the control date are forewarned that they are not guaranteed future participation in the fishery.

Establishment of this control date does not commit the WPFMC or NMFS to any particular management regime or criteria for entry into the non-longline commercial pelagic fisheries. Fishermen are not guaranteed future participation in this fishery, regardless of their level of participation before or after the control date. The WPFMC may recommend a different control date or it may choose a management regime that does not involve a control date. Other criteria, such as documentation of commercial landings and sales, may be used to determine eligibility for participation in a limited access fishery. The WPFMC and/or NMFS also may choose to take no further action to control entry or access to the fishery, in which case the control date may be rescinded.

This advance notice of proposed rulemaking has been determined to be not significant for the purposes of Executive Order 12866.

On June 2, 2005, at its 127th meeting, the WPFMC recommended a “control date” of June 2, 2005, applicable to persons who are contemplating entering the pelagic purse seine (for tunas) and longline fisheries in the U.S. exclusive economic zone (EEZ) around islands of the western Pacific region. The WPFMC requested that this control date be published in the Federal Register to notify fishermen that if they enter these fisheries after June 2, 2005, they may not be assured of future access if the WPFMC and/or NMFS decide to limit entry or impose other measures to manage these fisheries.

Establishment of a control date responds to NMFS' notice to the WPFMC, dated December 30, 2004 (69 FR 78397), that overfishing is occurring Pacific-wide on bigeye tuna, and that management action must be taken by the WPFMC to end this overfishing. The WPFMC tentatively has determined that limited access programs for purse seine and longline fisheries in the U.S. EEZ of the western Pacific region might be one of the viable mechanisms to reduce fishing mortality in Pacific bigeye tuna, as a step toward ending overfishing in the pelagic fisheries.

Domestic longline and purse seine vessels operate in the U.S. EEZ, on the high seas, and in foreign EEZs under specific arrangements. Fishery access (in terms of both number of participants and geographical operations) is already limited in several of these fisheries. There is a limited access program in the Hawaii longline fishery, and a similar program will limit access to the American Samoa longline fishery on December 1, 2005. In Hawaii, the pelagic longline fishery is limited to 164 vessels, with about 120 active in recent years. In American Samoa, participation will likely be limited to 138 vessels. There are 65 additional general (open-access) longline permits in the region. Some 64 of these are located in American Samoa, and many of these are expected to qualify under the American Samoa limited entry program. One more general longline permit holder is located in the Commonwealth of the Northern Mariana Islands, but the vessel is inactive. Currently, there are no domestic longline vessels operating out of Guam. Domestic purse seine vessels have access to foreign EEZs under the arrangements of the South Pacific Tuna Treaty. The treaty limits U.S. participation to 40 vessels, plus an additional five for joint ventures. The number of active U.S. purse seine vessels has decreased gradually from 36 in 1999 to 17 in 2005. There has been limited activity in recent years within the U.S. EEZ by purse seiners, specifically around the Pacific Remote Island Areas.

Control dates are intended to discourage speculative entry into fisheries, as new entrants entering the fisheries after the control date are forewarned that they are not guaranteed future participation in the fisheries.

Establishment of this control date does not commit the WPFMC or NMFS to any particular management regime or criteria for entry into the pelagic purse seine or longline fisheries. Fishermen are not guaranteed future participation in the fisheries, regardless of their level of participation before or after the control date. The WPFMC may recommend a different control date or it may recommend a management regime that does not involve a control date. Other criteria, such as documentation of commercial landings and sales, may be used to determine eligibility for participation in a limited access fishery. The WPFMC and/or NMFS also may choose to take no further action to control entry or access to the fisheries, in which case the control date may be rescinded.

This advance notice of proposed rulemaking has been determined to be not significant for the purposes of Executive Order 12866.