SBA is amending its regulations to reflect the new titles of certain SBA officials. The new titles conform SBA's management titles with those commonly used across the Federal Government. No changes are made to the responsibilities, reporting relationship, or other regulatory duties of the SBA officials whose titles are changed.

Basically, the title “Associate Deputy Administrator” is retired and replaced with the title “Associate Administrator.” All current Associate Administrators will also receive new titles. Heads of program offices that report directly to the Office of the Administrator will receive the title “Assistant Administrator.” Heads of program offices that do not report directly to the Office of the Administrator, and report through a new Associate Administrator, will receive the title of “Director” of their respective offices.

The nomenclature changes will help clarify and add transparency to a management structure that has become unwieldy and opaque to our customers, partners, and the public. Almost all of these changes can be made administratively.

SBA has asked for Congressional assistance with changing the few statutory titles that would require legislation to conform to SBA's new title procedures. The statutory titles for SBA officials are: (1) Associate Administrator for Investment; (2) Associate Administrator for Minority Small Business (MSB) and Capital Ownership Development (COD); (3) Associate Administrator for Veterans Business Development (VBD); (4) Associate Administrator for Small Business Development Centers (SBDC); (5) Assistant Administrator for Women's Business Ownership (WBO); (6) Director of the Division of Program Certification and Eligibility; (7) Small Business and Agriculture Regulatory Enforcement Ombudsman; (8) Director of Office of Rural Affairs (ORA); and (9) Chief Counsel for Advocacy.

This rule shall constitute notice that all references to the old titles cited in SBA rules affected by this Final Rule in any documents, statements, or other communications, in any form or media, and whether made before, on, or after the effective date of this rule, shall be deemed to be references to the new titles. Any actions undertaken in the name of or on behalf of these SBA officials under the old title, whether taken before, on, or after the effective date of this rule, shall be deemed to have been taken in the name of the SBA official under the new title.

The final rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or the distribution of power and responsibilities among the various levels of government. Therefore, for the purposes of Executive Order 13132, SBA determines that this final rule has no federalism implications warranting preparation of a federalism assessment.

The Office of Management and Budget (OMB) has determined that this rule does not constitute a significant regulatory action under Executive Order 12866.

This action meets applicable standards set forth in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. The action does not have retroactive or preemptive effect.

SBA has determined that this final rule does not impose additional reporting or recordkeeping requirements under the Paperwork Reduction Act, 44 U.S.C., Chapter 35.

The provisions of the Administrative Procedures Act (5 U.S.C. 553), requiring notice of proposed rulemaking, the opportunity for public participation, and a delay in effective date, are inapplicable because this rule involves a rule of agency organization, procedure, or practice. 5 U.S.C. 553(b)(B). Further, no other law requires that a notice of proposed rulemaking and an opportunity for public comment be given for this final rule.

Because a notice of proposed rulemaking and opportunity for public comment are not required to be given for this rule under 5 U.S.C. or any other law, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601, et seq. ) are not applicable. Accordingly, this rule is issued in final form.

Although there is no formal comment period, public comments on this rule are welcome on a continuing basis. Comments should be submitted to Richard L. Brechbiel, Chief Human Capital Officer, Office of Human Capital Management, Office of Management and Administration, Small Business Administration, 409 3rd Street, SW., Washington, DC 20416. Tel: (202) 205-6780.

On May 30, 2007, we issued AD 2007-12-10, Amendment 39-15088 (72 FR 31973, June 11, 2007). That AD required actions intended to address an unsafe condition on the products listed above.

Since we issued AD 2007-12-10, it has been determined that the drive end bearing (DEB) failures did not occur instantly, and small debris in the filter could be detected before collapse of the DEB. The one-time inspection mandated by AD 2007-12-10 only detects large debris.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA Airworthiness Directive (EAD) 2007-0188R1, dated July 24, 2007 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

The corrective action includes retaining the requirements of the existing AD (a one-time inspection of the inlet screen and, for certain airplanes, a check of the differential pressure indicator button, and applicable corrective actions). The corrective action adds repetitive inspections of the APU Generator scavenge oil filter element and housing and the APU Generator drain plug for signs of metallic debris, and applicable corrective actions. Those corrective actions include shipping the debris to Airbus or Goodrich. The corrective actions also include the following:

• Replacing the APU generator scavenge oil filter for airplanes on which metallic debris is found.

• Inspecting the inside filter element and outer diameter of the filter housing for damage to the packing and replacing the packing if damaged.

• Cleaning the generator drain plug and reinstalling the plug with a new seal for airplanes on which no metallic debris or metallic debris within acceptable criteria is found.

• Keeping the APU inoperative.

You may obtain further information by examining the MCAI in the AD docket.

Airbus has issued All Operators Telexes (AOTs) A330-24A3044 and A340-24A5021, both Revision 01, both dated July 20, 2007; and AOT A340-24A4057, Revision 02, dated August 14, 2007. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with the State of Design Authority, we have been notified of the unsafe condition described in the MCAI and service information referenced above. We are issuing this AD because we evaluated all pertinent information and determined the unsafe condition exists and is likely to exist or develop on other products of the same type design.

We have reviewed the MCAI and related service information and, in general, agree with their substance. But we might have found it necessary to use different words from those in the MCAI to ensure the AD is clear for U.S. operators and is enforceable. In making these changes, we do not intend to differ substantively from the information provided in the MCAI and related service information.

We might also have required different actions in this AD from those in the MCAI in order to follow FAA policies. Any such differences are highlighted in a NOTE within the AD.

An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because an uncontained APU failure can lead to damage to the APU fire wall, which might reduce its fire extinguishing capability, possibly leading to an uncontrolled fire. Therefore, we determined that notice and opportunity for public comment before issuing this AD are impracticable and that good cause exists for making this amendment effective in fewer than 30 days.

This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2007-29073; Directorate Identifier 2007-NM-178- AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

We will post all comments we receive, without change, to http://dms.dot.gov , including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this AD.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. “Subtitle VII: Aviation Programs,” describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in “Subtitle VII, Part A, Subpart III, Section 44701: General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

We determined that this AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify this AD:

1. Is not a “significant regulatory action” under Executive Order 12866;

2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and

3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a regulatory evaluation of the estimated costs to comply with this AD and placed it in the AD docket.

History

On June 1, 2007, the FAA published in the Federal Register a notice of proposed rulemaking to establish Class E airspace at Hailey, ID (72 FR 30498). This action would improve the safety of IFR aircraft at Friedman Memorial Airport, Hailey, ID. Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received.

Class E airspace designations are published in paragraph 6005 of FAA Order 7400.9P dated September 1, 2006, and effective September 15, 2006, which is incorporated by reference in 14 CFR part 71.1. The Class E airspace designations listed in this document will be published subsequently in that Order.

This action amends Title 14 Code of Federal Regulations (14 CFR) part 71 by establishing Class E airspace at Hailey, ID. Additional controlled airspace is necessary to accommodate IFR aircraft at Friedman Memorial Airport, Hailey, ID.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (1) Is not a “significant regulatory action” under Executive Order 12866;

(2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

This document and additional information concerning the Office of Foreign Assets Control (“OFAC”) are available from OFAC's Web site ( http://www.treas.gov/ofac ) or via facsimile through a 24-hour fax-on demand service, tel.: (202) 622-0077.

On December 17, 2004, the Office of Foreign Assets Control (“OFAC”) of the Department of the Treasury amended the Cuban Assets Control Regulations, 31 CFR Part 515 (the “CACR”), the Sudanese Sanctions Regulations, 31 CFR Part 538 (the “SSR”), and the Iranian Transactions Regulations, 31 CFR Part 560 (the “ITR”), to authorize certain activities related to publishing. See 69 FR 75468 (December 17, 2004). OFAC added §§ 515.577, 538.529, and 560.538 to the CACR, SSR, and ITR, respectively, to authorize by general license transactions not already exempt from regulation that support the publishing and marketing of manuscripts, books, journals, and newspapers in paper and electronic format (“written publications”). On August 16, 2005, OFAC amended and reissued the Burmese Sanctions Regulations, 31 CFR Part 537 (the “BSR”) including, at § 537.526, a general license for the same publishing-related transactions.

OFAC is amending these general licenses in various places to authorize the augmentation of written publications in electronic format through the addition of embedded software necessary for reading, browsing, navigating, or searching the written publications as well as the exportation of such embedded software provided certain conditions are met. These amendments also clarify that the term “written publications” used in the general licenses includes manuscripts, books, journals, and newspapers even if they are published solely in electronic format. A note is added to each general license clarifying that the importation and exportation of information or informational materials are exempt from the prohibitions and regulations contained in the CACR, SSR, and ITR and, in the case of the BSR, clarifying that the importation of informational materials is authorized and the exportation of informational materials is exempt from the prohibitions and regulations of the BSR. These amendments also make various other technical corrections, clarifications, and conforming changes.

Because the CACR, BSR, SSR, and ITR involve a foreign affairs function, the provisions of Executive Order 12866 and the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, opportunity for public participation, and delay in effective date are inapplicable. Because no notice of proposed rulemaking is required for this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not apply.

The collections of information related to 31 CFR parts 515, 537, 538, and 560 are contained in 31 CFR part 501. Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), those collections of information have been approved by the Office of Management and Budget under control number 1505-0164. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.

Caltrans requested a temporary change to the operation of the Rio Vista Drawbridge, mile 12.8, Sacramento River, at Rio Vista, CA. The Rio Vista Drawbridge navigation span provides a vertical clearance of 17 feet above Mean High Water in the closed-to-navigation position. The draw opens on signal as required by 33 CFR 117.5. Navigation on the waterway consists of both commercial and recreational vessels.

This deviation allows the bridge to require a 4-hour notice for openings. The 4-hour notice for openings during the maintenance period, from 9 p.m. September 5, 2007 through 5 a.m. on October 21, 2007, will allow Caltrans to clear the drawspan of maintenance equipment so as not to delay approaching vessels. This temporary deviation has been coordinated with all affected waterway users. No objections to the proposed temporary deviation were raised.

Vessels that can transit the bridge, while in the closed-to-navigation position, may continue to do so at any time.

In accordance with 33 CFR 117.35(e), the drawbridge must return to its regular operating schedule immediately at the end of the designated time period. This deviation from the operating regulations is authorized under 33 CFR 117.35.

On March 29, 2006, the Coast Guard published a Notice of Proposed Rulemaking (NPRM) in Volume 71, No. 60, pages 15649 to 15656 of the Federal Register , under the heading “Navigation and Waterways Management Improvements, Buzzards Bay, MA”. We received 17 comments on the proposed rule. No public meeting was requested and none was held. Pursuant to issues and obligations discussed in Federalism below, on September 13, 2006, the Coast Guard held a consultation meeting for Massachusetts cities and towns that border Buzzards Bay. The city of New Bedford and the town of Westport sent representatives to this meeting and were consulted on the Coast Guard's actions with respect to this rulemaking process and their federalism implications. On October 11, 2006, the Coast Guard held a similar consultative meeting with the Acting Commissioner of the Massachusetts Department of Environmental Protection.

Congress designated Buzzards Bay as an Estuary of National Significance in 1985, one of only five estuaries in the U.S. so designated. The Bay has some of Massachusetts' most productive shellfish beds. It interacts with three very different marine systems, the Atlantic Ocean to the south, Vineyard Sound to the east, and Cape Cod Bay to the north. In 2002, there were nearly 10,000 commercial vessel transits and over 1,200 tank barge transits in Buzzards Bay. An estimated 80% of those tank barges were single hull vessels. Note that the term “single hull” and other terms used in this rule have the same meaning as those found in Title 33, Code of Federal Regulations (CFR), § 165.100(b).

Since 1969 there have been several significant incidents of tank barge groundings with oil spills in Buzzards Bay. These included the grounding of the tank barge Florida in 1969 with a spill of approximately 175,000 gallons of No. 2 fuel oil; the grounding of the tank barge Bouchard in 1977 with a spill of approximately 81,000 gallons of No. 2 fuel oil; the grounding of the tank barge ST-85 in 1986 with a spill of approximately 119,000 gallons of gasoline; the grounding of the tug Marie J. Turecamo and its asphalt-laden barge in 1999; the grounding of the tug Mary Turecamo and its barge Florida in 1999 carrying 4.7 million gallons of No. 6 fuel oil; and the grounding of the barge B-120 in April 2003 with a spill of No. 6 oil estimated to be of approximately 22,000 to 98,000 gallons.

Groundings, allisions, or collisions of single hull tank barges could lead to a significant discharge or release of oil or other hazardous materials, as demonstrated by the incidents noted above, with potentially significant adverse impacts to people, property, the coastal and maritime environment, and the local economy. The purpose of these navigation safety and waterways management regulations for Buzzards Bay is to reduce the likelihood of another incident that might result in the discharge or release of oil or hazardous material, or other serious harm, on the navigable waters of the United States.

After a previous oil spill from the tank barge North Cape off of Point Judith, Rhode Island, in 1996, the Coast Guard chartered a Regional Risk Assessment Team (RRAT), comprised of government, commercial, and environmental entities, to examine navigation safety issues within New England waters. The RRAT recommended, and the Coast Guard implemented, a Regulated Navigation Area (RNA) that imposed certain requirements on single hulled tank barges transiting New England waters, including Buzzards Bay. Regulations governing the RNA in First Coast Guard District waters are contained in 33 CFR 165.100.

Subsequent to an oil spill in Buzzards Bay in April, 2003, noted above, the Coast Guard sponsored a Ports and Waterways Safety Assessment (PAWSA), which was conducted by a cross-section of key Buzzards Bay waterways users and stakeholders, resulting in numerous suggestions for improving navigation safety in the Bay. The safety assessment process is a disciplined approach to identify major waterway safety hazards, estimate risk levels, evaluate potential mitigation measures, and set the stage for implementation of selected measures to reduce risk. The process involved convening a select group of waterway users/stakeholders and conducting a two-day structured workshop to meet these objectives. The assessment process represents a significant part of joint public-private sector planning for mitigating risk in waterways. When applied consistently and uniformly in a number of waterways, the process provides a basis for making best value decisions for risk mitigation investments, both on the local and national level. For further information on the PAWSA project go to: http://www.navcen.uscg.gov/mwv/projects/pawsa/PAWSA_home.htm .

The PAWSA report suggested, in part, that the risk for oil or hazardous material discharge in Buzzards Bay is relatively high, and that one method of reducing that risk, among many that were suggested, might be to “establish requirements for escort tugs.” (The PAWSA report is available in docket CGD01-04-133. See ADDRESSES above on procedures to access the docket.) The PAWSA also recommended that Recommended Vessel Routes be established to help assist vessel traffic and provide a safer transit route for commercial vessels.

Additionally, in a letter from several members of the U.S. Congressional delegation from Massachusetts, the Coast Guard was asked to consider measures similar to those recommended in the PAWSA, specifically: Assist tugs, Recommended Routes, and an Automatic Identification System (AIS). This letter, along with the Coast Guard's response, is available in the docket.

The Automatic Identification System (AIS) is a maritime navigation safety communications system standardized by the International Telecommunication Union (ITU) and adopted by the International Maritime Organization (IMO) that provides vessel information, including the vessel's identity, type, position, course, speed, navigational status and other safety-related information automatically to appropriately equipped shore stations, other ships, and aircraft; receives automatically such information from similarly fitted ships; monitors and tracks ships; and exchanges data with shore-based facilities.

As of December 31, 2004, AIS is required on most commercial vessels either navigating abroad or within a Vessel Traffic Service (VTS) area, such as VTS New York. (See 33 CFR 164.46.) As the vast majority of tug/barge combinations that transit Buzzards Bay are either traveling from or to New York and hence must participate in New York's VTS, they already carry AIS. The Coast Guard plans to propose expanding AIS requirements in the future. Regardless of whether a tug/barge combination is equipped with AIS, under this rule it must still participate in the Vessel Movement Reporting System (VMRS) by either AIS or VHF radiotelephone.

The National Oceanic and Atmospheric Administration (NOAA), at the request of the Coast Guard, has already overlaid recommended vessel routes on navigational charts for Rhode Island Sound, Narragansett Bay, and Buzzards Bay. These recommended vessel routes are currently included on all new editions of charts 13205, 13218, 13221, and 13230. To allow maximum operating flexibility to meet differing conditions and situations, at this time the Coast Guard is not making the recommended vessel routes depicted on these charts mandatory.

Currently, an escort tug is required in Buzzards Bay only for single hull tank barges, unless the single hull tank barge is being towed by a primary towing vessel with twin-screw propulsion and with a separate system for power to each screw. Consequently, the vast majority of tug and barge combinations transiting Buzzards Bay employ tugs with twin screws and twin engines, but with no additional positive control.

On March 29, 2006, the Coast Guard published a Notice of Proposed Rule Making (NPRM) that proposed amending the current First Coast Guard District RNA to require that all single hull tank barges carrying 5,000 or more barrels of oil or other hazardous material and being towed through Buzzards Bay:

1. Participate in a Vessel Movement Reporting System (VMRS) (33 CFR part 161, subpart B) managed by the U.S. Army Corps of Engineers at its Cape Cod Canal control center on behalf of the Coast Guard.

2. Be accompanied by a federally licensed pilot, who could remain on the escort tug vessel, to monitor the navigation of the tug/barge, and to advise the master of the tug/barge accordingly.

3. Be accompanied by an escort tug between the west entrance to Buzzards Bay and the east end of the Cape Cod Canal.

Seventeen comments were received in response to the NPRM. All late comments received were reviewed and considered. Nine comments concerned the provision in the NPRM that would allow pilots, in times of adverse weather, to remain on the escort tug and to advise the master of the primary tug (i.e., the vessel actually towing the tank barge) from the escort tug. The comments noted that a pilot executing his/her pilotage duties from any vessel other than the primary tug would add little or no value, and may even increase danger due to confusion and communications difficulties.

The Coast Guard concurs with these comments. Accordingly, the provision to permit pilots to advise the master of a primary tug from an escort tug has been removed. Consequently, when this rule applies, pilots will be required to embark the primary tug during transits of Buzzards Bay.

Three comments urged that pilots be required to embark the primary tug only from a pilot boat, not an escort tug. Comments noted that pilot boats are better designed for such transfers of people between two underway vessels, and would be safer than permitting a transfer between a tug escort and primary tug. Many factors must be considered when deciding what constitutes a safe transfer between two underway vessels (e.g., an escort tug and primary tug, or a pilot boat and primary tug), including the design of each vessel, weather, physical abilities of the person transferring, etc. These decisions are better left to those actually on-scene and are not addressed in this rule.

Three comments asked that state-licensed pilots be required in addition to or in place of federally licensed pilots. One comment suggested that pilotage requirements similar to those for Prince William Sound, Alaska, be adopted for Buzzards Bay. In Prince William Sound, pilots are required to be state-licensed, but operate under their federal pilot's license. The Coast Guard notes that the pilotage requirement to which the commenter refers was enacted by Congress as part of Oil Pollution Act of 1990, Pub. L. 101-380, and that both the Prince William Sound requirement and the request that the Coast Guard adopt a similar requirement in Buzzards Bay by this regulation is contrary to the generally applicable Congressional scheme for state-federal pilotage of vessels in Chapter 85 of Subtitle II of Title 46, U.S. Code.

The Coast Guard has looked carefully at whether, as a matter of federal regulatory exercise of authority, it can vary that generally applicable state-federal pilotage scheme and has concluded that it is without authority to do so. Unlike the Congressionally mandated Prince William Sound state-federal pilotage requirements, this regulation is being promulgated under the Ports and Waterways Safety Act, Public Law 92-340, section 5 (33 U.S.C. 1223(a)(4)). Authority under this Act is not so broad as to support a provision mandating the carriage of a state pilot where such a provision is contrary to the usual Congressional scheme prohibiting states from requiring a state licensed or commissioned pilot on a vessel subject to inspection under part B of subtitle II of Title 46, or is subject to inspection under chapter 37 of that Title.

An examination of the legislative history of that provision shows that nowhere did Congress mention imposing a State commissioned pilot in addition to or in lieu of a Federal pilot on vessels operating on the navigable waters of the United States. Given the long standing Congressional scheme for division of responsibility among Federal and State pilotage on vessels, which these comments would run counter to, and the absence of any legislative history that would suggest that Congress intended the words “operating condition” to include authority to promulgate a regulation that runs counter to that scheme, the Coast Guard is without authority to promulgate such a regulation. Accordingly, the Coast Guard does not adopt the suggestion in these comments.

One comment requested that the Coast Guard conduct a cost-benefit analysis to demonstrate that the benefits of this rule outweigh the cost.

As noted in the NPRM and contained in the docket for this rule (CGD01-04-133), a Regulatory Evaluation was conducted in March 2006. That evaluation found that this rule would prevent approximately 500 barrels of oil from being spilled into Buzzards Bay, would have a negligible impact on consumer energy costs, and would not have a significant economic impact on a substantial number of small entities.

Some comments stated it was unclear if the pilotage requirement was for a federally licensed pilot in addition to the vessel's master, or if a master (or other crewmember) holding a Federal pilot's license could also serve as pilot while transiting Buzzards Bay.

The requirement in this rule is for a federally licensed pilot in addition to the vessel's master and crew. Under this rule, neither a master of a primary tug nor any member of its crew may serve as pilot while transiting Buzzards Bay. It is intended that the federally licensed pilot be an additional navigation resource to the master and crew of the vessel.

Some comments recommended this rule, particularly the escort tug requirement, apply to single hull tank ships in addition to barges.

The PAWSA report specifically addresses the hazards associated with single hull tank barges and was used as an indicator and resource for this rule. There is no indication in the PASWA that tank ships represent a similar risk of pollution. Consequently, this rule applies only to single hull tank barges, not tank ships.

Some comments asked for clarification on whether or not federally licensed pilots are required aboard escort tugs. They are not.

The requirement is for a federally licensed pilot to be aboard the primary tug towing a single hull tank barge.

Three written comments stated that the requirement for escort tugs should apply to double hull tanks vessels in addition to single hull tank vessels. At the consultative meeting discussed elsewhere in this preamble, the Massachusetts Department of Environmental Protection also urged that all tank vessels transiting Buzzards Bay, both single and double hull, be required to have an escort tug.

The majority of tank barge casualties in Buzzards Bay have been caused by groundings, and the bottom characteristics of the area are generally rocky. Double hulls provide sufficient protection against this type of casualty, and there has never been a major oil spill from a double hull tank barge grounding in Buzzards Bay. Therefore, the Coast Guard does not feel it is necessary to require tug escorts for double hull tank barges at this time. Additionally, the Coast Guard considers that, as adopted in this rule, its three-pronged approach to navigation safety ((1) Mandatory participation in a Vessel Movement Reporting System (VMRS); (2) a federally licensed pilot and (3) a tug escort for single hull tank barges) constitutes a redundant vessel accident and pollution prevention system that will provide a sufficient measure of safety for tank vessels transiting Buzzards Bay.

Two comments suggested that use of the currently-existing (and voluntary) recommended vessel route in Buzzards Bay be mandated for commercial vessels.

The Coast Guard recognizes that, in light of variations in visibility, traffic density, tides and currents, and other on-scene conditions, and given the uniqueness of vessel and tow configurations and handling characteristics, prudent seamanship (and the Rules of the Road) may dictate departure from any given vessel route. The Coast Guard wishes to avoid creating any situation in which a mariner may feel constrained to follow a set route when conditions may warrant an alternative approach.

Importantly, the VMRS established by this rule will provide the Coast Guard the capability to monitor tank vessel movements in Buzzards Bay, including the capability to ascertain vessel intentions before entering the Bay. Most, if not all, tank vessels currently use the recommended vessel route voluntarily. Through the VMRS established by this rule, the Coast Guard will be able to monitor vessels as they transit the recommended vessel route to query and respond appropriately should a vessel deviate from the route without good and sufficient reason, including, but not limited to, proceeding to an anchorage, or briefly exiting the route to allow an approaching vessel to pass. Consequently, the Coast Guard considers the voluntary recommended vessel route, when combined with the enhanced ability to monitor the usage thereof, to provide an ample measure of safety.

While no comments addressed the proposed requirement that VMRS Buzzard's Bay users attain “approval” from the VMRS center (1) Prior to entering into, or getting underway within, the VMRS area; and (2) prior to meeting, crossing, or overtaking other VMRS users; in keeping with the monitoring—vice directive—function of a Vessel Movement Reporting System, the word “approval” was changed to better reflect the requirement that vessels “notify” the VMRS before undertaking the aforementioned actions.

Two comments suggested that escort tugs should have minimum horsepower or bollard pull requirements.

This rule amends the currently existing Regulated Navigation Area (RNA) for waters within the First Coast Guard District. As defined in the current RNA, an escort tug is a vessel of “sufficient capability to promptly push or tow the tank barge away from danger of grounding or collision * * *” That definition is the product of several recommendations made by a Regional Risk Assessment Team (RRAT) chartered by the Coast Guard in 1996 to examine tug and barge operation and navigation procedures in the waters of the First Coast Guard District. The RRAT was composed of operators of towing vessels and tank barges, environmental groups, state agencies, and Coast Guard officials. In the Coast Guard Authorization Act of 1998 (Pub. L. 105-383), Congress directed the Coast Guard to adopt the recommendations of the RRAT. Consequently, the Coast Guard believes that definition is sufficient for this amendment to the existing RNA.

One comment requested that oil spill response vessels (OSRVs) and oil spill response barges (OSRBs) be exempt from these regulations. The commenter was concerned that, after one or more of these vessels had been called to respond to an oil spill in Buzzards Bay, its exit from the Bay (after recovering spilled oil) may be delayed due to the requirements of these regulations.

The Coast Guard considers these regulations to be important for all single hull tank barges carrying oil or petroleum products in sufficient quantity, including OSRVs and OSRBs, so as to enhance navigation safety and environmental protection in Buzzard's Bay. Further, we view the impacts of this regulation to be minimal on an OSRV or OSRB. Consequently, we did not provide the requested exemption.

One comment asked that the Commonwealth of Massachusetts be included in any partnership between the Coast Guard and the Army Corps of Engineers to operate a Vessel Movement Reporting System (VMRS) for Buzzards Bay.

The Coast Guard and Army Corps of Engineers are finalizing a Memorandum of Agreement that will delineate the functions and responsibilities of each agency in operating the VMRS. This MOA, once executed, will be added in the final docket for this rule. The Massachusetts Department of Environmental Protection has been and will remain a key partner in the planning and operation of the VMRS for Buzzards Bay.

In addition to the 17 comments received, two joint letters from U.S. Representatives Barney Frank, William D. Delahunt, and James P. McGovern were sent to the Commandant of the Coast Guard on July 26, 2006, and September 14, 2006, respectively. Both letters urged the Coast Guard to adopt navigation safety provisions for Buzzards Bay similar to those provided for in a Massachusetts oil spill prevention law which had recently been overturned by a Federal court. Specifically, the Representatives requested that the Coast Guard:

1. Institute minimum watch and manning requirements for oil tankers and barges;

2. Mandate the use of State pilots to assist in navigating Buzzards Bay;

3. Mandate the use of tugboat escorts for all oil barges;

4. Institute mandatory navigational routes through state waters; and

5. Mandate a certificate of at least $1 billion in financial backing to dock in Massachusetts, unless the shipping companies take special safety measures, such as using double hulls.

Although the Coast Guard did not adopt a state pilot requirement, the Coast Guard did adopt a requirement that the primary tug towing a single hull tank barge in Buzzards Bay have on board a federally licensed pilot, in addition to the vessel's master and normal crew complement. Thus, the provisions of this rule, along with other currently existing Federal statutes and regulations, will sufficiently address each of the Representatives' concerns for the following reasons:

1. Federal regulations at 46 CFR 15 comprehensively regulate manning and watchstanding on tank vessels and tugs. Additionally, 33 CFR 164.13(c) specifically requires tankers to have at least two licensed deck officers on watch on the bridge;

2. This rule requires that a federally licensed pilot be employed in addition to the normal crew for the transit of any single hull tank barge through Buzzards Bay;

3. This rule requires escort tugs, in addition to the primary tug, for all single hull tank barges transiting Buzzards Bay;

4. For the reasons discussed in this Notice, while use of the recommended vessel route in Buzzards Bay will not be mandatory, vessel movements within the route will be monitored through the Vessel Movement Reporting System established by this rule; and

5. Under Title VI of the Coast Guard and Maritime Transportation Act of 2006 (Pub. L. 109-241), the financial liability limits for vessel oil discharge removal costs and damages under the Oil Pollution Act of 1990 (33 U.S.C. 2704) were amended, and the Financial Responsibility for Water Pollution regulations at 33 CFR part 138 will be amended accordingly via separate rulemaking. For further information on this rulemaking, see docket USCG-2005-21780 at http://dms.dot.gov/ , or contact Mr. Benjamin White at Coast Guard National Pollution Fund Center at 202-493-6863.

Executive Order 12866, “Regulatory Planning and Review”, 58 FR 51735, October 4, 1993, requires a determination whether a regulatory action is “significant” and therefore subject to review by the Office of Management and Budget (OMB) and subject to the requirements of the Executive Order. This rule is not significant under Executive Order 12866 and has not been reviewed by OMB.

During the period of analysis, 2006-2014, this rule is expected to cost approximately $3.9 million net present value (7 percent discount rate). A copy of the regulatory evaluation, which further describes the expected costs and benefits of this rule, is posted in the docket and is available for inspection and copying at the offices of Commander, Coast Guard Sector Southeastern New England, East Providence office, 20 Risho Avenue, East Providence, RI 02914, between 8 a.m. and 3 p.m. Monday through Friday, except Federal holidays.

No comments to the NPRM were received challenging the content of the regulatory evaluation, nor claiming a significant adverse economic impact should this rule be implemented as proposed. Nonetheless, to confirm the conclusions of the regulatory evaluation that this rule would not create a significant adverse impact on small entities, the Coast Guard reviewed selected economic data for the period of time between the evaluation's original publication in March 2006 and the publication of this rule in July 2007. A comparison of the regulatory evaluation's forecast of tug and barge activity with actual transits validated those projections. For example, the regulatory evaluation projected that there would be 234 transits of loaded tank barges through Buzzards Bay in 2006. The actual number was 208, only an 11% deviation from the projection. A review of more recent cost data associated with tug escort and pilot fees, when compared with revenue data of the small businesses most affected by this rule, also confirmed the fundamental finding of the regulatory evaluation, which is that the cost of compliance with this rule will not have a significant economic impact on a substantial number of small entities.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this rule would not have a significant economic impact on a substantial number of small entities.

This rule would affect the following entities, some of which might be small entities: The owners or operators of tugs and/or single hull barges carrying 5,000 or more barrels of oil or other hazardous materials and intending to transit or anchor in Buzzards Bay, Massachusetts.

This rule would not have a significant economic impact on a substantial number of small entities for the following reasons. This rule requires escort tugs and federally licensed pilots only for single hull barges, which are being phased out of operation in accordance with the Oil Pollution Act of 1990 (OPA), specifically 46 U.S.C. 3703a, and will be prohibited from operating effective January 1, 2015. Additionally, the VMRS established by this rulemaking applies only to vessels subject to the bridge-to-bridge radiotelephone regulations in § 26.03 (and therefore already equipped with VHF radios), so no additional costs will be incurred to participate in the VMRS. Those vessels with a Coast Guard-approved, properly installed, operational AIS would be relieved from the voice reporting requirements implemented by this rule.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact Mr. Edward G. LeBlanc at Coast Guard Sector Southeastern New England, Providence, RI, 401-435-2351.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520.). The reports required by this rule are considered to be operational communications, transitory in nature, and, do not constitute a collection of information under the Paperwork Reduction Act.

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. The U.S. Supreme Court, in the cases of United States v. Locke , 529 U.S. 89 (2000) and Ray v. Atlantic Richfield Co. , 435 U.S. 151 (1978) has ruled that certain regulations issued pursuant to the Ports and Waterways Safety Act of 1972, as amended, are reserved exclusively to the Coast Guard, and that state regulation in these areas is preempted. In general, only the federal government may regulate the design, construction, alteration, repair, maintenance, operation, equipping, personnel qualification, and manning of tank vessels. Similarly, where the Coast Guard enacts regulations—such as those implemented by this final rule—that control vessel traffic or are otherwise intended to protect navigation and the marine environment, or affirmatively determines that such regulation is unnecessary or inappropriate, a state may not enact rules that conflict with the Coast Guard's determination in that area, including situations in which the State rules are identical to the federal rules.

The Coast Guard believes that by operation of law and our Agency determination, State law is preempted on the subjects covered by this rulemaking. The Coast Guard's affirmative decisions: (1) Not to institute mandatory ship routes, but to monitor use of the existing recommend routes via the Vessel Movement Reporting System created by this rule; (2) to require a federally licensed pilot in addition to the normal crew aboard a tug towing a single hull tank barge thorough Buzzard's Bay, but not to require any other modifications to the applicable manning requirements; and (3) to require an escort tug in addition to the primary tug, for all single hull tank barges transiting Buzzard's Bay, but not for other vessels; each represent a considered determination of the appropriate level of regulation to ensure navigation safety and environmental protection. As such, the Coast Guard has determined that any other non-Coast Guard schemes relating to vessel routing, manning, and tug escort requirements in Buzzards Bay are preempted.

To the extent not otherwise already preempted, this rule is intended to, and does, preempt those provisions of Massachusetts' “Act Relative to Oil Spill Prevention and Response in Buzzards Bay and Other Harbors and Bays of the Commonwealth,” (“MOSPA”) regarding enhanced manning requirements for tank barges and tow vessels in Buzzards Bay, see Mass. Gen. Laws ch. 21M § 4, and tugboat escorts for certain waters, see id. § 6. Further, it is the Coast Guard's view that, by Operation of Law, MOSPA's provisions regarding mandatory vessel routes in Massachusetts waters, see id. § 5; and compulsory State pilotage, see Mass. Gen. Laws ch. 103 § 21, are likewise preempted. See U.S. v. Massachusetts , 440 F.Supp.2d 24 (D.Mass., 2006), remanded on other grounds —F.3d—, 2007 WL 1775913 (1st Cir., June 21, 2007) (NO. 06-2361, 06-2362).

In accordance with E.O. 13132 for regulations with preemptive effect, the following federalism impact statement is provided to document (1) The extent of the Coast Guard's consultation with State and local officials, (2) a summary of the nature of their concerns and the Coast Guard's position thereon, and (3) a statement of the extent to which the concerns of State and local officials have been met.

The Coast Guard provided elected officials of affected state and local governments notice and an opportunity to consult on this rulemaking. Ten Massachusetts municipalities surrounding Buzzards Bay indicated that they wished to participate, as did the Commonwealth of Massachusetts. Accordingly, the Coast Guard engaged the towns of Bourne, Dartmouth, Fairhaven, Gosnold, Marion, Mattapoisett, Wareham, Westport, Falmouth, the city of New Bedford, and the Massachusetts Department of Environmental Protection (“DEP”) to discuss their concerns. On September 13, 2006, after inviting all parties desiring consultative status to participate, the Coast Guard met with representatives from the city of New Bedford and the town of Westport. On October 11, 2006, the Coast Guard met with the Acting Commissioner of DEP. Representatives from the towns of Bourne, Fairhaven, Marion, and Mattapoisett, and representatives from DEP, spoke at public hearings held on this rulemaking. Ten municipalities (Bourne, Buzzards Bay, Dartmouth, Fairhaven, Gosnold, Marion, Mattapoisett, New Bedford, Wareham, and Westport) submitted statements regarding recommended oil spill prevention measures for Buzzard's Bay. We also received additional written comments to the docket from the towns of Bourne and Mattapoisett, the Massachusetts Attorney General, and DEP.

In general, all consulting state and local officials agreed upon the need for increased oil spill prevention measures in Buzzard's Bay and certain other Massachusetts' waters. The consulted parties' concerns related to the specific mechanisms to accomplish this goal. Essentially, the consulted parties encouraged the Coast Guard to enact regulations that would require (1) Implementation of a mandatory, Coast Guard-administered vessel movement system (2) mandatory use of the existing “recommended vessel route,” (3) State-licensed (vice federally licensed) pilots aboard certain tank barges, and (4) escort tugs for both single and double hull tank barges.

As discussed in greater detail in Discussion of comments and changes, above, the Coast Guard is establishing a Vessel Movement Reporting System (VMRS) as urged.

Regarding mandatory ship routes in Buzzard's Bay, as previously indicated, the Coast Guard wishes to avoid creating any situation in which a mariner may feel constrained to follow a set route when operating or weather conditions may warrant an alternative approach. Thus, use of the already existing recommended vessel routes in Buzzards Bay will not be mandatory. Vessel movement along these recommended routes, however, will now be closely tracked through the VMRS established by this rule.

For reasons also set forth above, the Coast Guard is without the authority to require that a tug have a Federal pilot that is also licensed or commissioned by the State. The Coast Guard is, however, requiring a federally licensed pilot aboard vessels towing certain single hulled tank barges through Buzzard's Bay as an additional navigation resource to the master and crew of the vessel.

With respect to the issue of requiring escort tugs for only single hull tank barges, as opposed to both single and double hulled barges, the Coast Guard believes that mandatory participation in a VMRS, the requirement to embark and employ a federally licensed pilot, and a tug escort requirement together provide a sufficient measure of safety for tank vessels transiting Buzzards Bay. Accordingly, the Coast Guard believes that the concerns for navigation safety and environmental protection underlying the specific recommendations of the consulted State and localities will be met by the regulations promulgated by this final rule.

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

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

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

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

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

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

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

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

We have analyzed this rule under Commandant Instruction M16475.1D, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(g) and (34)(i) of the Instruction, from further environmental documentation. This rule fits the category selected from paragraph (34)(g) and (34)(i), as it amends a currently existing Regulated Navigation Area and establishes a VMRS.

An “Environmental Analysis Check List” and “Categorical Exclusion Determination” are available in the docket where indicated under ADDRESSES .

Organization of this document. The following outline is provided to aid in locating information in this preamble.

On December 17, 2004, (69 FR 943; January 5, 2005), EPA designated the New York-Northern New Jersey-Long Island, NY-NJ-CT area as nonattainment for the annual National Ambient Air Quality Standards (NAAQSs) for fine particle pollution or PM 2.5. [Airborne particles less than or equal to 2.5 micrometers in diameter are considered to be “fine particles,” also referred to as PM 2.5 .] One year after the April 5, 2005 effective date of the PM 2.5 designations, transportation conformity applies to this multi-state PM 2.5 nonattainment area. Within three years of final designation, (by April 5, 2008), consistent with section 172(b) of the Clean Air Act, and 40 CFR 51.1002 of the PM 2.5 implementation regulations, the States of New Jersey, New York and Connecticut are required to submit an attainment demonstration and adopted regulations ensuring that the New York-Northern New Jersey-Long Island, NY-NJ-CT PM 2.5 nonattainment area will attain the National Ambient Air Quality Standards as expeditiously as practicable. This PM 2.5 attainment demonstration must include motor vehicle emissions budgets for direct PM 2.5 (including re-entrained road dust and/or highway and transit construction dust if determined significant contributors), and any PM 2.5 precursors determined to be significant (which may include nitrogen oxides (NO X ), volatile organic compounds (VOC), sulfur dioxide (SO 2 ) and ammonia (NH 3 )). The SIP must clearly identify the budgets (motor vehicle emissions budgets) for transportation conformity purposes.

In the June 8, 2006 Federal Register (71 FR 33305), EPA announced that the direct PM 2.5 and NO X motor vehicle emissions budgets identified in New Jersey's PM 2.5 early progress state implementation plan (SIP) for the New Jersey portion of the NY-NJ-CT PM 2.5 nonattainment area were adequate for transportation conformity purposes. As a result of EPA's adequacy finding, the two metropolitan planning organizations in northern New Jersey (the North Jersey Transportation Planning Authority (NJTPA) and the Delaware Valley Regional Planning Commission (DVRPC)) must use the new 2009 direct PM 2.5 and NO X budgets from the early progress PM 2.5 SIP for future conformity determinations. In addition, with the establishment of adequate motor vehicle emissions budgets, New Jersey can independently determine conformity for the New Jersey portion of the NY-NJ-CT PM 2.5 nonattainment area and is no longer tied to New York and Connecticut for transportation conformity determinations. On July 10, 2006, EPA approved the PM 2.5 motor vehicle emissions budgets for Northern New Jersey into the New Jersey SIP (71 FR 38770).

On April 17, 2007, the Connecticut Department of Environmental Protection (DEP) submitted a revision to its SIP for establishing early fine particulate (PM 2.5 ) transportation conformity emission budgets for the Connecticut portion of the New York-Northern New Jersey-Long Island, NY-NJ-CT PM 2.5 nonattainment area. This SIP revision was developed in accordance with EPA's transportation conformity rule (69 FR 40028; July 1, 2004), which allows states with PM 2.5 nonattainment areas to adopt early motor vehicle emission budgets that address the annual PM 2.5 NAAQSs in advance of a complete SIP attainment demonstration. This SIP revision establishes early budgets to simplify the conformity process for Connecticut Metropolitan Planning Organizations (MPOs) while increasing the level of protection for Connecticut's citizens during this interim period before PM 2.5 attainment plans are due in April 2008.

The PM 2.5 motor vehicle emission budgets for calendar year 2009 included in Connecticut's April 17, 2007 SIP revision apply to MPOs in the Connecticut counties of Fairfield and New Haven. Before these budgets were determined adequate (see Section C below), these Connecticut MPOs were required to determine conformity jointly with the New York MPOs included in the NY-NJ-CT PM 2.5 nonattainment area based on a calendar year 2002 interim baseline budget test. Consistent with a supplemental EPA rulemaking on transportation conformity (70 FR 24280; May 6, 2005), Connecticut's April 17, 2007 SIP revision establishes early motor vehicle budgets for direct PM 2.5 emissions and for emissions of nitrogen oxides (NO X ) [the only PM 2.5 precursor found to be significant at this time for onroad mobile sources]. Since the budgets have been determined adequate, Connecticut MPOs must demonstrate that all transportation plans result in emissions of PM 2.5 and NO X that do not exceed the annual 2009 motor vehicle emissions budget levels.

The total inventory of direct PM 2.5 emissions for the Connecticut portion of the NY-NJ-CT PM 2.5 nonattainment Area is 6,663 tons in calendar year 2002, and is projected to be 6,495 tons in calendar year 2009. This represents an overall inventory reduction of 2.5% (168 tons of direct PM 2.5 emissions). Table 1, below, compares calculated year 2002 and year 2009 direct PM 2.5 inventories by source type for the Connecticut portion of the NY-NJ-CT PM 2.5 nonattainment area. Although direct PM 2.5 emissions from area and point sources are projected to increase by two and eight percent, respectively, emissions from nonroad and onroad sources are projected to decrease by 13 and 31 percent, respectively.

The total inventory of NO X emissions for the Connecticut portion of the NY-NJ-CT PM 2.5 nonattainment area is 61,199 tons in calendar year 2002, and projected to be 44,433 tons in calendar year 2009. This represents an overall inventory reduction of 27% (16,766 tons of NO X emissions). Table 2, below, compares calculated 2002 and 2009 annual NO X inventories by source type for the Connecticut portion of the NY-NJ-CT PM 2.5 nonattainment area. Although NO X emissions from area and point sources are projected to increase by four and seven percent, respectively, emissions from nonroad and onroad sources are projected to decrease by 12 and 46 percent, respectively.

On March 2, 1999, the United States Court of Appeals for the District of Columbia Circuit issued a decision on EPA's third set of transportation conformity amendments in response to a case brought by the Environmental Defense Fund. The decision held that conformity determinations could no longer be based on submitted SIP emissions budgets, prior to a positive adequacy determination by EPA.

A May 14, 1999, EPA memorandum from Gay MacGregor to the Regional Division Directors provides guidance on how to review budgets for adequacy and the process for public comment and notification (posting on the Web). The May 14, 1999 guidance is available on EPA's conformity Web site at URL address: http://www.epa.gov/otaq/stateresources/transconf/policy/epaguidf.pdf. EPA provided additional guidance in its Final Rulemaking on July 1, 2004 (69 FR 40004-40081) “Transportation Conformity Rule Amendments for the New 8-hour Ozone and PM 2.5 National Ambient Air Quality Standards and Miscellaneous Revisions for Existing Areas; Transportation Conformity Rule Amendments: Response to Court Decision and Additional Rule Changes; Final Rule.”

EPA initiated the adequacy process for Connecticut's motor vehicle emissions budgets on April 19, 2007, by announcing that Connecticut had submitted an early progress SIP for PM 2.5 on EPA's Web site “SIP Submissions Currently Under EPA Adequacy Review” http://www.epa.gov/otaq/stateresources/transconf/currsips.htm. The criteria by which EPA determines whether a SIP's motor vehicle emission budgets are adequate for conformity purposes are outlined in 40 CFR 93.118(e)(4)(i) through 93.118(e)(4)(vi) and 93.118(e)(5). On May 24, 2007, EPA notified the Connecticut Department of Environmental Protection (CT DEP) that no comments were received during the thirty day public comment period, and that EPA had determined the 2009 motor vehicle emissions budgets submitted on April 17, 2007, to be adequate for transportation conformity purposes. EPA New England published a Notice of Adequacy Federal Register on Tuesday, June 5, 2007 (72 FR 31069), announcing our May 24, 2007 adequacy determination and making the motor vehicle emissions budgets effective on June 20, 2007. A copy of EPA's May 24, 2007 adequacy determination to CT DEP and the Federal Register Notice of Adequacy are both posted in the electronic docket as well as on EPA's Web site “SIP Submissions that EPA has Found Adequate or Inadequate,” at URL address: http://www.epa.gov/otaq/stateresources/transconf/pastsips.htm.

This positive adequacy determination simplifies the administrative process for demonstrating transportation conformity by establishing the 2009 direct PM 2.5 and NO X motor vehicle emissions budgets as conformity criteria for all 2009 and later evaluation years. Connecticut's early motor vehicle emissions budgets will insure progress is made towards achieving and maintaining the PM 2.5 NAAQS by limiting the transportation sector to a more restrictive year 2009 level of on-road direct PM 2.5 and NO X than currently allowed by transportation conformity's interim emissions tests which are based on 2002 emissions in the New York and Connecticut portions of the nonattainment area. Connecticut will also be able to evaluate conformity independently and will no longer be required to re-evaluate conformity whenever a MPO in the New York portion of the New York-Northern New Jersey-Long Island, NY-NJ-CT PM 2.5 nonattainment area triggers conformity. EPA's adequacy determination for New Jersey's PM 2.5 motor vehicle emissions budgets (71 FR 33305; June 8, 2006) already allows New Jersey to independently determine conformity.

Today's direct final rulemaking approves Connecticut's adequate 2009 direct PM 2.5 and NO X motor vehicle emissions budgets into the Connecticut SIP.

The early direct PM 2.5 and NO X annual motor vehicle emissions budgets being established are the on-road portion of the 2009 projections illustrated in Table 3, below, 360 tons per year for direct PM 2.5 and 18,279 tons per year for NO X . The State of Connecticut Department of Transportation and Metropolitan Planning Organizations within the Connecticut portion of the NY-NJ-CT PM 2.5 nonattainment area [Council of Governments of the Central Naugatuck Valley (portion), Greater Bridgeport and Valley Regional Planning Organizations, Housatonic Valley Council of Elected Officials (portion), South Central Regional Council of Governments, and South Western Regional Planning Agency], shall use these budgets for future transportation conformity determinations.

EPA's review of Connecticut's SIP revision concludes that this SIP revision is consistent with EPA's Transportation Conformity Rule. Approval of Connecticut's SIP revision is directionally sound since it would approve year 2009 motor vehicle emissions budgets which are more stringent than the year 2002 baseline emissions now used to evaluate transportation conformity in the NY-NJ-CT PM 2.5 nonattainment area. The projected overall annual inventory reduction in direct PM 2.5 emissions from 2002 to 2009 is approximately 2.5 percent, along with a 27 percent reduction in NO X emissions. This results from a projected 31 percent reduction in direct PM 2.5 emissions and a 46 percent reduction in NO X emissions from onroad sources.

Connecticut's projected reduction in direct PM 2.5 and NO X emissions demonstrates progress towards attainment of the PM 2.5 annual standard. Although, the projected reduction in direct PM 2.5 emissions is below the five to ten percent reduction that was provided as an example in the July 2004 conformity rule preamble (69 FR 40019; July 1, 2004), EPA believes that Connecticut's early progress SIP should be approved since it will strengthen the existing SIP. Listed below are several factors that make Connecticut's SIP package directionally sound.

1. Fairfield County and New Haven County were included in the New York-Northern New Jersey-Long Island, NY-NJ-CT PM 2.5 nonattainment area because of traffic and commuting patterns and other weighting factors used in EPA's designation process. Connecticut has never monitored values at or above the annual NAAQSs for PM 2.5 . 1

2. There were no monitored violations of EPA's annual PM 2.5 standard in Fairfield and New Haven counties in 2002, and any reduction in the overall inventory for the two county area below 2002 levels should help ensure that this level of air quality is maintained or improved in the future.

3. There is a significant projected tonnage decrease in overall PM 2.5 emissions (168 tons) and NO X emissions (16,766 tons) by 2009 in comparison to 2002 base year levels.

4. There is a very large percent reduction projected in both PM 2.5 direct and NO X on-road emissions (31% and 46%, respectively) and traffic and commuting patterns were one of the areas highlighted in the technical support documentation for EPA's PM 2.5 designation decisions.

5. The large reduction in Connecticut's NO X emissions (27% overall reduction from all inventory sources) may be more beneficial to transport issues by reducing precursors, than immediate reduction of direct PM 2.5 emissions in Connecticut.

EPA is approving the Connecticut SIP revision for establishment of interim progress for the annual fine particle National Ambient Air Quality Standard, which was submitted on April 17, 2007. The direct PM 2.5 and annual NO X motor vehicle emissions budgets being approved are the on-road mobile source 2009 projections of 360 tons per year of direct PM 2.5 and 18,279 tons per year of NO X . These motor vehicle emissions budgets must be used to demonstrate that all transportation plans in the Connecticut portion of the NY-NJ-CT PM 2.5 nonattainment area result in emissions of PM 2.5 and NO X that do not exceed the annual 2009 motor vehicle emissions budget levels.

The EPA is publishing this rule without prior proposal because the Agency views this as a noncontroversial amendment and anticipates no adverse comments. However, in the proposed rules section of this Federal Register publication, EPA is publishing a separate document that will serve as the proposal to approve the SIP revision should adverse comments be filed. This action will be effective October 29, 2007 without further notice unless the EPA receives adverse comments by October 1, 2007.

If the EPA receives such comments, then EPA will publish a document withdrawing the final rule and informing the public that the rule will not take effect. All public comments received will then be addressed in a subsequent final rule based on the proposed rule. The EPA will not institute a second comment period. Parties interested in commenting should do so at this time. If no such comments are received, the public is advised that this rule will be effective on October 29, 2007 and no further action will be taken on the proposed rule.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). This action merely approves State law as meeting Federal requirements and imposes no additional requirements beyond those imposed by State law. Accordingly, the Administrator certifies that this rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). Because this rule approves pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4).

This rule also does not have tribal implications because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action also does not have Federalism implications because it does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely approves a state rule implementing a federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it approves a state rule implementing a Federal standard.

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

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 29, 2007. Interested parties should comment in response to the proposed rule rather than petition for judicial review, unless the objection arises after the comment period allowed for in the proposal. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

This is a summary of the Commission's Report and Order, WT Docket No. 05-265, FCC No. 07-143, adopted August 7, 2007 and released August 16, 2007. The full text of the Report and Order is available for public inspection on the Commission's Internet site at http://www.fcc.gov . It is also available for inspection and copying during regular business hours in the FCC Reference Center (CY-A257), 445 12th Street, SW., Washington, DC 20554. The full text of this document also may be purchased from the Commission's duplication contractor, Best Copy and Printing Inc., Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554; telephone (202) 488-5300; fax (202) 488-5563; e-mail FCC@BCPIWEB.COM .

The Report and Order does not contain an information collection subject to the Paperwork Reduction Act of 1995, and therefore does not contain any new or modified “information collection burden for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002.

1. In this Report and Order, the Commission finds that automatic roaming is a common carrier obligation pursuant to Sections 201 and 202 of the Communications Act, and discusses the scope of the automatic roaming obligation for commercial mobile radio service (CMRS) carriers. The Commission also declines to regulate the automatic roaming rates and addresses other issues raised by commenters in the record, including a request for “most favored” roaming partner rates for Tier IV CMRS carriers, in-market or home roaming issues, access to non-interconnected features and enhanced digital networks, and public filing of roaming rates. Finally, the Commission codifies the automatic roaming obligations into a rule, imposing an affirmative obligation to provide automatic roaming on CMRS carriers under certain conditions, denies the petition for investigation pursuant to Section 403 of the Act, and declines to sunset the existing manual roaming rule at this time.

2. The Commission believes its findings and clarifications in this Report and Order with respect to CMRS providers' obligations regarding roaming services serve the public interest and safeguard wireless consumers' reasonable expectations of receiving seamless nationwide commercial mobile telephony services through roaming.

3. The Commission clarifies that automatic roaming is a common carrier service, subject to the protections outlined in Sections 201 and 202 of the Communications Act. If a CMRS carrier receives a reasonable request for automatic roaming, pursuant to Section 332(c)(1)(B) and Section 201(a), it is desirable and serves the public interest for that CMRS carrier to provide automatic roaming service on reasonable and non-discriminatory terms and conditions. Services that are covered by the automatic roaming obligation are limited to real-time, two-way switched voice or data services, provided by CMRS carriers, that are interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. These findings are consistent with the Commission's previous determinations.

4. Roaming is a common carrier service, because roaming capability gives end users access to a foreign network in order to communicate messages of their own choosing, as previously determined in CC Docket No. 94-54, published at 61 FR 44026, August 27, 1996. 1 In finding that roaming is a common carrier service, the Commission noted the contrast between roaming and services such as billing and collection offered by local exchange carriers (LECs) and interexchange carriers (IXCs), which are not common carriage because they do “not allow customers of the service * * * to communicate or transmit intelligence of their own design and choosing,” and because they can be offered by non-communications entities such as credit card companies. The Commission also found that roaming satisfies all the statutory elements of commercial mobile radio service, and “is thus a common carrier service, because it is (1) an interconnected mobile service (2) offered for profit (3) in such a manner as to be available to a substantial portion of the public.” There are two forms of roaming—manual and automatic. The Commission finds that both forms of roaming are common carrier services because both forms of roaming capability give end users access to a foreign network in order to communicate messages of their own choosing.

5. Further, under Section 332 of the Communications Act, CMRS providers are subject to common carrier regulations. Section 332(c)(1)(A) provides that a “person engaged in the provision of a service that is a commercial mobile service shall, insofar as such person is engaged, be treated as a common carrier,” and Subsection (c)(1)(B) states that, “[u]pon reasonable request of any person providing commercial mobile service, the Commission shall order a common carrier to establish physical connections with such service pursuant to the provisions of Section 201 of this Title.” Like any other common carrier service offering, if a CMRS provider offers automatic roaming, it triggers its common carrier obligations with respect to the provisioning of that service under the Communications Act. The Commission determines that, if a CMRS carrier receives a reasonable request for automatic roaming, pursuant to Section 332(c)(1)(B) and Section 201(a), it is desirable and necessary to serve the public interest for that CMRS carrier to provide automatic roaming service on reasonable and non-discriminatory terms and conditions.

6. Additionally, the Commission determines that a reasonable request for automatic roaming will be limited to real-time, two-way switched voice or data services, provided by CMRS carriers, that are interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. This ensures that all CMRS providers competing in the mass market for real-time, two-way voice and data services are similarly obligated to provide automatic roaming services, thereby equally benefiting all subscribers of mobile telephony services who seek to roam seamlessly over CMRS networks. The Commission also concludes, as it has in prior proceedings, that an important indicator of a provider's ability to compete with other CMRS providers is whether the provider's system has “in-network” switching capability. In-network switching facilities accommodate the reuse of frequencies in different portions of the same service area, thus enabling any CMRS provider to offer interconnected service to a larger group of customers and compete directly with other CMRS providers in the mass consumer market.

7. Complaint Procedures. Based on its finding that automatic roaming is a common carrier service, the Commission determines that the provisioning of automatic roaming service is subject to Section 208 which provides that complaints may be filed with the Commission against common carriers subject to the Communications Act. There has been some confusion regarding whether the provisioning of automatic roaming services is subject to the requirements of Section 208. Given the fact-specific nature of the roaming issues that have come to light during this proceeding and several merger proceedings, the Commission concludes that many disputes involving automatic roaming services would be best resolved through an adjudicatory process. In deciding roaming complaints, the Commission will consider whether a request is reasonable or whether the activity complained of is unjust and unreasonable based on the totality of the circumstances of the case. When roaming-related complaints are filed, the Commission intends to address them expeditiously on a case-by-case basis.

8. Further, the Commission notes that the Accelerated Docket procedure, including pre-complaint mediation, is available to roaming complaints. Several commenters—including parties both supporting and opposing adoption of an automatic roaming rule—requested use of the Commission's Accelerated Docket procedures to resolve roaming complaints. Although all roaming complaints will not automatically be placed on the Accelerated Docket, an affected carrier can seek consideration of its complaint under the Commission's Accelerated Docket rules and procedures where appropriate.

9. Reasonableness of Automatic Roaming Requests. In order to provide some guidance as to the reasonableness of automatic roaming requests under Sections 201(b) and 202(a), the Commission also establishes several rebuttable presumptions with respect to requests for automatic roaming and the would-be host carriers' response. The Commission will presume a request for automatic roaming to be reasonable, in the first instance, if the requesting CMRS carriers' network is technologically compatible and the roaming request is for areas outside of the requesting carrier's home market. As noted above, to be deemed reasonable, a request for automatic roaming may involve only those real-time, two-way switched voice or data services that are interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. When a presumptively reasonable automatic roaming request is made, a would-be host CMRS carrier has a duty to respond to the request and avoid actions that unduly delay or stonewall the course of negotiations regarding that request. For example, following receipt of a reasonable automatic roaming request, evidence of a would-be host carrier's refusal to respond at all or a persistent pattern of stonewalling behavior will likely support a finding of a breach of the would-be host carrier's automatic roaming obligations.

10. The presumptions and examples of reasonableness cited above are not exhaustive, but rather are intended to provide some guidance to parties that may be participating in a Section 208 complaint proceeding involving roaming services. CMRS carriers may argue that the Commission should consider other relevant factors in determining whether there is a violation of the automatic roaming obligations, based on the totality of the circumstances present in a particular case.

11. The Commission declines to impose a price cap or any other form of rate regulation on the fees carriers pay each other when one carrier's customer roams on another carrier's network. In particular, the Commission is not persuaded that consumers would be harmed in the absence of a price cap or some other form of rate regulation. The Commission believes that the better course, as established in this Report and Order, is that the rates individual carriers pay for automatic roaming services be determined in the marketplace through negotiations between the carriers, subject to the statutory requirement that any rates charged be reasonable and non-discriminatory.

12. The Commission finds that there is insufficient evidence to justify regulating the roaming rates of carriers, and that any harm to consumers in the absence of affirmative regulation in this regard is speculative. Moreover, with the clarifications it makes herein with respect to automatic roaming, the Commission finds that consumers are protected from being harmed by the level and structure of roaming rates negotiated between carriers. Absent a finding that the existing level and structure of roaming rates harm consumers, regulation of rates for automatic roaming service is not warranted.

13. Because it is not persuaded that the existing level and structure of roaming rates negotiated between carriers harm consumers of mobile telephony services, the Commission does not need to address the argument that the state of competition in the intermediate product market is such as to warrant rate regulation.

14. Based on the foregoing considerations, the Commission concludes that regulation of roaming rates is not warranted on economic grounds. In addition, however, the Commission agrees with concerns raised in the record that rate regulation has the potential to distort carriers' incentives and behavior with regard to pricing and investment in network buildout. Capping roaming rates by tying them to a benchmark based on larger carriers' retail rates may diminish larger carriers' incentives to lower retail prices paid by their customers, and perhaps even give them an incentive to raise retail rates. At the same time, by requiring larger carriers to offer national roaming coverage to their competitors' customers at nearly the same rates offered to their own customers, this form of rate regulation may also give smaller regional carriers an incentive to reduce, or even eliminate, the discounts they offer on regional calling plans, thereby driving up the prices regional subscribers pay for calls within their plan's calling area.

15. Similarly, regulation to reduce roaming rates has the potential to deter investment in network deployment by impairing buildout incentives facing both small and large carriers. By enabling smaller regional carriers to offer their customers national roaming coverage at more favorable rates without having to build a nationwide network, rate regulation would tend to diminish smaller carriers' incentives to expand the geographic coverage of their networks. In addition, by reducing or eliminating any competitive advantage gained as a result of building out nationwide or large regional networks, rate regulation would impair larger carriers' incentives to expand, maintain, and upgrade their existing networks.

16. Since the Commission's determination that automatic roaming is common carrier service applies to all CMRS providers regardless of size, it declines to create a special Tier IV category for roaming services. The Commission also declines to adopt a rule requiring that large nationwide carriers offer the same roaming arrangements to Tier IV providers as they offer to their “most favored” roaming partners.

17. Because the need for automatic roaming services may not always be the same, and the value of roaming services may vary across different geographic markets due to differences in population and other factors affecting the supply and demand for roaming services, it is likely that automatic roaming rates will reasonably vary. Mobile services in the United States are differentiated based on price, as well as non-price attributes, including geographic coverage. Competition between mobile telephone pricing plans that are differentiated in these ways benefits consumers by allowing them to choose pricing plans that offer the best deal on the types of services they use most frequently. Mandating that a subcategory of CMRS carriers ( i.e. , Tier IV providers) are entitled to the same rates as “most favored” roaming partners and imposing this obligation on certain large CMRS carriers, without a clear demonstration of why such a requirement would serve the public interest, would distort competitive market conditions, resulting in unjust and unreasonable practices and discriminatory treatments.

18. Accordingly, the Commission declines to mandate that a subcategory of CMRS carriers ( i.e. , Tier IV providers) be entitled to the same rates as “most favored” roaming partners. The Commission similarly declines to impose such an obligation on only certain larger CMRS carriers. Instead, the Commission believes that its finding that automatic roaming rule is a common carrier service subject to provisions of Sections 201, 202 and 208 of the Communications Act and guidance as to rebuttable presumptions establishing the reasonableness of an automatic roaming request provide small CMRS carriers with an effective mechanism for recourse against unjust and unreasonable practices.

19. The Commission determines that the automatic roaming obligation does not include an in-market or home roaming requirement. The Commission is not requiring a CMRS carrier to provide automatic roaming to a requesting CMRS carrier in a market where the CMRS carrier directly competes with the requesting CMRS carrier. Specifically, a CMRS carrier is not required to provide automatic roaming to a requesting CMRS carrier where the requesting CMRS carrier holds a wireless license or spectrum usage rights ( e.g. , spectrum leases) in the same geographic location as the would-be host CMRS carrier. In geographic areas outside of these overlapping areas or markets, however, a host carrier must comply with the Commission's automatic roaming requirement and provide this service in a manner consistent with the common carrier obligations of Sections 201 and 202 of the Communications Act.

20. The Commission finds that an automatic roaming request in the home area of a requesting CMRS carrier, the area where the requesting CMRS carrier has the spectrum to compete directly with the would-be host carrier, does not serve the Commission's public interest goals of encouraging facilities-based service and supporting consumer expectations of seamless coverage when traveling outside the home area. The Commission finds that if a carrier is allowed to “piggy-back” on the network coverage of a competing carrier in the same market, then both carriers lose the incentive to build out into high cost areas in order to achieve superior network coverage. This conclusion, however, should not be construed as prohibiting a requesting carrier from seeking to negotiate a roaming agreement including such terms if desired, or a host carrier from providing a requesting CMRS carrier with in-market or home roaming should it chose to do so. The Commission continues to encourage all CMRS carriers to negotiate desired terms and conditions of automatic roaming agreements, including automatic roaming in overlapping geographic markets.

21. For purposes of this exclusion from automatic roaming obligations, in-market or home roaming is defined as any geographic location where the would-be host carrier and the requesting CMRS carrier have wireless licenses or spectrum usage rights that could be used to provide CMRS that cover or overlap the same geographic location(s). Within these overlapping geographic areas, the would-be host carrier is not required to comply with an automatic roaming request. This in-market or home roaming exclusion does not depend on the level of service the requesting CMRS carrier is providing in the overlapping geographic area. The exclusion applies regardless of whether the requesting CMRS carrier is providing no service, limited service, or state-of-the-art service.

22. Finally, the Commission also determines that the automatic roaming obligation under Sections 201 and 202 and the home roaming exclusion are not intended to resurrect CMRS resale obligations. CMRS resale entails a reseller's purchase of CMRS service provided by a facilities-based CMRS carrier in order to provide resold service within the same geographic market as the facilities-based CMRS provider. The Commission notes that its mandatory resale rule was sunset in 2002, and automatic roaming obligations can not be used as a backdoor way to create de facto mandatory resale obligations or virtual reseller networks.

23. As discussed above, the scope of automatic roaming services includes only services offered by CMRS carriers that are real-time, two-way switched voice or data services that are interconnected with the public switched network and utilize an in-network switching facility that enables providers to reuse frequencies and accomplish seamless hand-offs of subscriber calls. The Commission finds that it would serve the public interest to extend automatic roaming obligations to push- to-talk and SMS. The Commission declines at this time, however, to adopt a rule extending the automatic roaming obligation beyond that to offerings that do not fall within the scope of the automatic roaming services' definition, such as non-interconnected services or features.

24. With respect to push-to-talk and SMS, the Commission notes that such offerings are typically bundled as a feature on the handset with other CMRS services, such as real-time, two-way switched mobile voice or data, that are interconnected with the public switched network. Provision of these features differs from one carrier to another, i.e. , push-to-talk and SMS are interconnected features or services in some instances, but non-interconnected in others, depending on the technology and network configuration chosen by the carriers. The Commission is also aware that consumers consider push-to-talk and SMS as features that are typically offered as adjuncts to basic voice services, and expect the same seamless connectivity with respect to these features and capabilities as they travel outside their home network service areas. For these reasons, the Commission finds that it is in the public interest to impose an automatic roaming obligation on push-to-talk and SMS offerings, subject to several provisos. Namely, the requesting carrier must offer push-to-talk and SMS to its subscribers on its own home network; push-to-talk and SMS roaming must be technically feasible; and any changes to the would-be host carrier's network that are necessary to accommodate push-to-talk and SMS roaming requests must be economically reasonable.

25. With respect to non-interconnected features or services, the Commission finds that the record in this proceeding lacks a clear showing that it is in the public interest at this time to impose an automatic roaming obligation. While proponents of unrestricted data roaming have argued that requiring roaming access to the non-interconnected features of a competitor's network would benefit consumers by providing greater availability for data features that are increasingly used by consumers, opponents are concerned that that it might undercut incentives to differentiate products and could chill innovation. These opponents claim that extending roaming to non-interconnected features of a competitors' network may also adversely affect business decisions to build out facilities for facilities-based competition and reduce the incentives to access the spectrum through other means such as initial spectrum licensing or secondary markets. In light of these diverse views, the Commission believes it is in the public interest, however, to examine the issue of automatic roaming for non-interconnected features or services through a Further Notice of Proposed Rulemaking (FNPRM).

26. As previously explained, the automatic roaming obligation applies to real-time, two-way switched voice or data services that are interconnected with the public switched network and utilize an in-network switching facility that enables providers to reuse frequencies and accomplish seamless hand-offs of subscriber calls. As discussed above with respect to non-interconnected services, the Commission similarly declines at this time to extend the scope of the automatic roaming services definition to include non-interconnected services provided over enhanced digital networks, such as wireless broadband Internet access. The Commission finds that automatic roaming, as a common carrier obligation, does not extend to services that are classified as information services or to other wireless services that are not CMRS.

27. While the Commission finds that, based on the current record, it is premature to impose any roaming obligation regarding enhanced data services that are not CMRS and not interconnected to the public switched network, the Commission will examine this matter further in the FNPRM.

28. The Commission declines to impose an affirmative obligation on CMRS carriers to post their roaming rates. As is generally the case with commercial agreements, roaming agreements are confidential and filing them would impose administrative costs on the carriers. In light of its adoption of an automatic roaming rule as discussed below, the Commission finds that the available remedies for redress are sufficient to address disputes that may arise.

29. The Commission codifies the automatic roaming obligations of CMRS carriers into a rule requiring that they provide automatic roaming to any requesting technologically compatible CMRS carrier outside of the requesting CMRS carrier's home market on reasonable and nondiscriminatory terms and conditions. This rule applies to CMRS carriers that offer real-time, two-way switched voice or data service over digital network that is interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. The Commission also notes that codification of an automatic roaming obligation gives CMRS carriers another avenue to redress roaming disputes, benefiting mobile telephony subscribers.

30. Finally, the Commission clarifies that automatic roaming, pursuant to Sections 201 and 202, as a common carrier obligation applies to CMRS carriers' analog networks. The Commission does not find, however, that it is necessary to codify this obligation into a specific rule. With the sunset of the analog service requirement on February 18, 2008, there would be little benefit to a codified automatic roaming rule for analog networks that might potentially apply between now and that date. Individual carriers may, of course, enter into automatic roaming agreements for their analog networks, and any allegations that particular practices on analog networks are unjust, unreasonable or otherwise in violation of Sections 201 and 202 of the Communications Act would be subject to the complaint process of Section 208 of the Communications Act.

31. Because the Commission finds that the record is sufficient to codify automatic roaming obligations of CMRS carriers, the Commission denies the Joint Petition for Investigation Pursuant to Section 403, which petitioners contend will assist the Commission in gathering necessary information to support the adoption of an automatic roaming rule.

32. The Commission declines to sunset its existing manual roaming rule and, instead, retains it as a safety net for consumers. The Commission is aware that as automatic roaming becomes increasingly ubiquitous, it will render the need for manual roaming obsolete. The Commission notes, however, that the record demonstrates that automatic roaming is not available in certain instances today and, therefore, the continuing utility of the manual roaming rule in the immediate future is not completely obviated. For this reason, the Commission retains the manual roaming rule as a safety net to ensure that subscribers can initiate a wireless call when they are outside of their service area through manual roaming if there is no automatic roaming agreement in place.

33. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), 2 an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the NPRM in WT Docket No. 05-265, published at 70 FR 56612, September 28, 2005. 3 The Commission sought written public comment on the proposals in the NPRM, including comment on the IRFA. This present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA. 4

34. In the Report and Order, with regard to commercial services, the Commission takes an affirmative step to facilitate the provision of wireless services to consumers, especially those in rural areas, and to clarify its rules related to roaming. The Commission clarifies that automatic roaming is a common carrier obligation for CMRS carriers, requiring them to provide roaming services to other carriers upon reasonable request and on a just, reasonable, and non-discriminatory basis pursuant to Sections 201 and 202 of the Communications Act. The Commission reiterates its earlier determination that roaming is a common carrier service because roaming capability gives end users access to a foreign network in order to communicate messages of their own choosing. Thus, the provision of roaming is subject to the requirements of Section 201, 202, and 208 of the Communications Act. 5

35. The Commission also finds that the common carrier obligation to provide roaming extends to services that are real-time, two-way switched voice or data service that are interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. The Commission notes that roaming, as a common carrier obligation, does not extend to services that are classified as information services or to services that are not CMRS. 6

36. The Commission recognizes that today CMRS consumers increasingly rely on mobile telephony services and they reasonably expect to continue their wireless communications even when they are out of their home network area. Thus, the findings in this Report and Order with respect to CMRS providers' obligations regarding roaming services serve the public interest and safeguard wireless consumers' reasonable expectations of seamless continuous nationwide commercial mobile telephony services through roaming. The Commission also declines to sunset the existing manual roaming requirement at this time to provide additional flexibility for consumers.

37. There were no comments filed specifically in response to the IRFA.

38. The RFA directs agencies to provide a description of, and, where feasible, an estimate of, the number of small entities that may be affected by the proposed rules, if adopted. 7 The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.”  8 In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. 9 A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA). 10

39. In the following paragraphs, the Commission further describes and estimates the number of small entity licensees that may be affected by the rules the Commission adopts in this Report and Order. The Commission's finding that automatic roaming is a common carrier service subject to protections outlined in Sections 201, 202 and 208 of the Act affects all CMRS carriers that provide real-time, two-way switched voice or data service that are interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. Such carriers are obligated to provide automatic roaming. As a common carrier obligation, the automatic roaming rule does not extend to non-interconnected services/features or services that are classified as information services or to services that are not CMRS.

40. Since this Report and Order applies to multiple services, this FRFA analyzes the number of small entities affected on a service-by-service basis. When identifying small entities that could be affected by the Commission's new rules, this FRFA provides information that describes auctions results, including the number of small entities that were winning bidders. However, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily reflect the total number of small entities currently in a particular service. The Commission does not generally require that licensees later provide business size information, except in the context of an assignment or a transfer of control application that involves unjust enrichment issues.

41. Wireless Service Providers. The SBA has developed a small business size standard for wireless firms within the two broad economic census categories of “Paging” 11 and “Cellular and Other Wireless Telecommunications.”  12 Under both categories, the SBA deems a wireless business to be small if it has 1,500 or fewer employees. For the census category of Paging, Census Bureau data for 2002 show that there were 807 firms in this category that operated for the entire year. 13 Of this total, 804 firms had employment of 999 or fewer employees, and three firms had employment of 1,000 employees or more. 14 Thus, under this category and associated small business size standard, the majority of firms can be considered small. For the census category of Cellular and Other Wireless Telecommunications, Census Bureau data for 2002 show that there were 1,397 firms in this category that operated for the entire year. 15 Of this total, 1,378 firms had employment of 999 or fewer employees, and 19 firms had employment of 1,000 employees or more. 16 Thus, under this second category and size standard, the majority of firms can, again, be considered small.

42. Cellular Licensees. The SBA has developed a small business size standard for small businesses in the category “Cellular and Other Wireless Telecommunications.”  17 Under that SBA category, a business is small if it has 1,500 or fewer employees. 18 For the census category of “Cellular and Other Wireless Telecommunications,” Census Bureau data for 2002 show that there were 1,397 firms in this category that operated for the entire year. 19 Of this total, 1,378 firms had employment of 999 or fewer employees, and 19 firms had employment of 1,000 employees or more. 20 Thus, under this category and size standard, the majority of firms can be considered small.

43. Broadband Personal Communications Service. The broadband Personal Communications Service (PCS) spectrum is divided into six frequency blocks designated A through F, and the Commission has held auctions for each block. The Commission has created a small business size standard for Blocks C and F as an entity that has average gross revenues of less than $40 million in the three previous calendar years. 21 For Block F, an additional small business size standard for “very small business” was added and is defined as an entity that, together with its affiliates, has average gross revenues of not more than $15 million for the preceding three calendar years. 22 These small business size standards, in the context of broadband PCS auctions, have been approved by the SBA. 23 No small businesses within the SBA-approved small business size standards bid successfully for licenses in Blocks A and B. There were 90 winning bidders that qualified as small entities in the C Block auctions. A total of 93 “small” and “very small” business bidders won approximately 40 percent of the 1,479 licenses for Blocks D, E, and F. 24 On March 23, 1999, the Commission reauctioned 155 C, D, E, and F Block licenses; there were 113 small business winning bidders. 25 On January 26, 2001, the Commission completed the auction of 422 C and F PCS licenses in Auction 35. 26 Of the 35 winning bidders in this auction, 29 qualified as “small” or “very small” businesses. Subsequent events concerning Auction 35, including judicial and agency determinations, resulted in a total of 163 C and F Block licenses being available for grant.

44. Narrowband Personal Communications Service. The Commission held an auction for Narrowband Personal Communications Service (PCS) licenses that commenced on July 25, 1994, and closed on July 29, 1994. A second commenced on October 26, 1994 and closed on November 8, 1994. For purposes of the first two Narrowband PCS auctions, “small businesses” were entities with average gross revenues for the prior three calendar years of $40 million or less. 27 Through these auctions, the Commission awarded a total of forty-one licenses, 11 of which were obtained by four small businesses. 28 To ensure meaningful participation by small business entities in future auctions, the Commission adopted a two-tiered small business size standard in the Narrowband PCS Second Report and Order. 29 A “small business” is an entity that, together with affiliates and controlling interests, has average gross revenues for the three preceding years of not more than $40 million. 30 A “very small business” is an entity that, together with affiliates and controlling interests, has average gross revenues for the three preceding years of not more than $15 million. 31 The SBA has approved these small business size standards. 32 A third auction commenced on October 3, 2001 and closed on October 16, 2001. Here, five bidders won 317 (MTA and nationwide) licenses. 33 Three of these claimed status as a small or very small entity and won 311 licenses.

45. Specialized Mobile Radio . The Commission awards “small entity” bidding credits in auctions for Specialized Mobile Radio (SMR) geographic area licenses in the 800 MHz and 900 MHz bands to firms that had revenues of no more than $15 million in each of the three previous calendar years. 34 The Commission awards “very small entity” bidding credits to firms that had revenues of no more than $3 million in each of the three previous calendar years. 35 The SBA has approved these small business size standards for the 900 MHz Service. 36 The Commission has held auctions for geographic area licenses in the 800 MHz and 900 MHz bands. The 900 MHz SMR auction began on December 5, 1995, and closed on April 15, 1996. Sixty bidders claiming that they qualified as small businesses under the $15 million size standard won 263 geographic area licenses in the 900 MHz SMR band. The 800 MHz SMR auction for the upper 200 channels began on October 28, 1997, and was completed on December 8, 1997. Ten bidders claiming that they qualified as small businesses under the $15 million size standard won 38 geographic area licenses for the upper 200 channels in the 800 MHz SMR band. 37 A second auction for the 800 MHz band was held on January 10, 2002 and closed on January 17, 2002 and included 23 BEA licenses. One bidder claiming small business status won five licenses. 38

46. The auction of the 1,050 800 MHz SMR geographic area licenses for the General Category channels began on August 16, 2000, and was completed on September 1, 2000. Eleven bidders won 108 geographic area licenses for the General Category channels in the 800 MHz SMR band qualified as small businesses under the $15 million size standard. In an auction completed on December 5, 2000, a total of 2,800 Economic Area licenses in the lower 80 channels of the 800 MHz SMR service were sold. Of the 22 winning bidders, 19 claimed “small business” status and won 129 licenses. Thus, combining all three auctions, 40 winning bidders for geographic licenses in the 800 MHz SMR band claimed status as small business.

47. In addition, there are numerous incumbent site-by-site SMR licensees and licensees with extended implementation authorizations in the 800 and 900 MHz bands. The Commission does not know how many firms provide 800 MHz or 900 MHz geographic area SMR pursuant to extended implementation authorizations, nor how many of these providers have annual revenues of no more than $3 million or $15 million (the special small business size standards), or have no more than 1,500 employees (the generic SBA standard for wireless entities, discussed, supra). One firm has over $15 million in revenues. The Commission assumes, for purposes of this analysis, that all of the remaining existing extended implementation authorizations are held by small entities.

48. Advanced Wireless Services. In the AWS-1 Report and Order, the Commission adopted rules that affect applicants who wish to provide service in the 1710-1755 MHz and 2110-2155 MHz bands. 39 The AWS-1 Report and Order defines a “small business” as an entity with average annual gross revenues for the preceding three years not exceeding $40 million, and a “very small business” as an entity with average annual gross revenues for the preceding three years not exceeding $15 million. The AWS-1 Report and Order also provides small businesses with a bidding credit of 15 percent and very small businesses with a bidding credit of 25 percent.

49. Rural Radiotelephone Service. The Commission uses the SBA small business size standard applicable to cellular and other wireless telecommunication companies, i.e., an entity employing no more than 1,500 persons. 40 There are approximately 1,000 licensees in the Rural Radiotelephone Service, and the Commission estimates that there are 1,000 or fewer small entity licensees in the Rural Radiotelephone Service that may be affected by the rules and policies adopted herein.

50. Wireless Communications Services. This service can be used for fixed, mobile, radiolocation, and digital audio broadcasting satellite uses in the 2305-2320 MHz and 2345-2360 MHz bands. The Commission defined “small business” for the wireless communications services (WCS) auction as an entity with average gross revenues of $40 million for each of the three preceding years, and a “very small business” as an entity with average gross revenues of $15 million for each of the three preceding years. 41 The SBA has approved these definitions. 42 The Commission auctioned geographic area licenses in the WCS service. In the auction, which commenced on April 15, 1997 and closed on April 25, 1997, there were seven bidders that won 31 licenses that qualified as very small business entities, and one bidder that won one license that qualified as a small business entity.

51. 220 MHz Radio Service—Phase I Licensees. The 220 MHz service has both Phase I and Phase II licenses. Phase I licensing was conducted by lotteries in 1992 and 1993. There are approximately 1,515 such non-nationwide licensees and four nationwide licensees currently authorized to operate in the 220 MHz Band. The Commission has not developed a definition of small entities specifically applicable to such incumbent 220 MHz Phase I licensees. To estimate the number of such licensees that are small businesses, the Commission applies the small business size standard under the SBA rules applicable to “Cellular and Other Wireless Telecommunications” companies. This category provides that a small business is a wireless company employing no more than 1,500 persons. 43 For the census category of “Cellular and Other Wireless Telecommunications,” Census Bureau data for 2002 show that there were 1,397 firms in this category that operated for the entire year. 44 Of this total, 1,378 firms had employment of 999 or fewer employees, and 19 firms had employment of 1,000 employees or more. 45 Thus, under this category and size standard, the majority of firms can be considered small.

52. 220 MHz Radio Service—Phase II Licensees. The 220 MHz service has both Phase I and Phase II licenses. The Phase II 220 MHz service is subject to spectrum auctions. In the 220 MHz Third Report and Order, the Commission adopted a small business size standard for defining “small” and “very small” businesses for purposes of determining their eligibility for special provisions such as bidding credits and installment payments. 46 This small business standard indicates that a “small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $15 million for the preceding three years. 47 A “very small business” is defined as an entity that, together with its affiliates and controlling principals, has average gross revenues that do not exceed $3 million for the preceding three years. 48 The SBA has approved these small size standards. 49 Auctions of Phase II licenses commenced on September 15, 1998, and closed on October 22, 1998. 50 In the first auction, 908 licenses were auctioned in three different-sized geographic areas: Three nationwide licenses, 30 Regional Economic Area Group (EAG) Licenses, and 875 Economic Area (EA) Licenses. Of the 908 licenses auctioned, 693 were sold. 51 Thirty-nine small businesses won 373 licenses in the first 220 MHz auction. A second auction included 225 licenses: 216 EA licenses and 9 EAG licenses. Fourteen companies claiming small business status won 158 licenses. 52 A third auction included four licenses: 2 BEA licenses and 2 EAG licenses in the 220 MHz Service. No small or very small business won any of these licenses. 53

53. 700 MHz Guard Band Licenses. In the 700 MHz Guard Band Order, the Commission adopted size standards for “small businesses” and “very small businesses” for purposes of determining their eligibility for special provisions such as bidding credits and installment payments. 54 A small business in this service is an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $40 million for the preceding three years. 55 Additionally, a “very small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues that are not more than $15 million for the preceding three years. 56 SBA approval of these definitions is not required. 57 An auction of 52 Major Economic Area (MEA) licenses commenced on September 6, 2000, and closed on September 21, 2000. 58 Of the 104 licenses auctioned, 96 licenses were sold to nine bidders. Five of these bidders were small businesses that won a total of 26 licenses. A second auction of 700 MHz Guard Band licenses commenced on February 13, 2001, and closed on February 21, 2001. All eight of the licenses auctioned were sold to three bidders. One of these bidders was a small business that won a total of two licenses. 59

54. Upper 700 MHz Band Licenses. The Commission released a Report and Order authorizing service in the Upper 700 MHz band. 60 An auction for these licenses, previously scheduled for January 13, 2003, was postponed. 61

55. Lower 700 MHz Band Licenses. The Commission adopted criteria for defining three groups of small businesses for purposes of determining their eligibility for special provisions such as bidding credits. 62 The Commission has defined a small business as an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $40 million for the preceding three years. 63 A very small business is defined as an entity that, together with its affiliates and controlling principals, has average gross revenues that are not more than $15 million for the preceding three years. 64 Additionally, the Lower 700 MHz Band has a third category of small business status that may be claimed for Metropolitan/Rural Service Area (MSA/RSA) licenses. The third category is entrepreneur, which is defined as an entity that, together with its affiliates and controlling principals, has average gross revenues that are not more than $3 million for the preceding three years. 65 The SBA has approved these small size standards. 66 An auction of 740 licenses (one license in each of the 734 MSAs/RSAs and one license in each of the six Economic Area Groupings (EAGs)) commenced on August 27, 2002, and closed on September 18, 2002. Of the 740 licenses available for auction, 484 licenses were sold to 102 winning bidders. Seventy-two of the winning bidders claimed small business, very small business or entrepreneur status and won a total of 329 licenses. 67 A second auction commenced on May 28, 2003, and closed on June 13, 2003, and included 256 licenses: 5 EAG licenses and 476 CMA licenses. 68 Seventeen winning bidders claimed small or very small business status and won sixty licenses, and nine winning bidders claimed entrepreneur status and won 154 licenses. 69

56. The only reporting or recordkeeping costs to be incurred are administrative costs to ensure that an entity's practices are in compliance with the rule. The only compliance requirement is that CMRS carriers must provide automatic roaming to any requesting technologically compatible CMRS carrier outside of the requesting CMRS carrier's home market on reasonable and non-discriminatory terms and conditions. This rule applies to CMRS carriers that offer real-time, two-way switched voice or data service over digital network that is interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. 70

57. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities. 71

58. In this Report and Order, the Commission clarifies that automatic roaming is a common carrier obligation for CMRS carriers, requiring them to provide roaming services to other carriers upon reasonable request and on a just, reasonable, and non-discriminatory basis pursuant to Sections 201 and 202 of the Communications Act. In adopting this rule, the Commission determined that when a reasonable request is made by a technologically compatible CMRS carrier, a host CMRS carrier must provide automatic roaming to the requesting carrier outside of the requesting carrier's home market, consistent with the protections of Sections 201 and 202 of the Communications Act.

59. In the Report and Order, the Commission finds that the scope of automatic roaming services includes only services offered by CMRS carriers that are real-time, two-way switched voice or data services that are interconnected with the public switched network and utilize an in-network switching facility that enables the provider to reuse frequencies and accomplish seamless hand-offs of subscriber calls. In addition, the Commission determines that it would serve the public interest to extend automatic roaming obligation to push-to-talk and text messaging (SMS). However, the Commission declines to adopt a rule extending the automatic roaming obligation beyond that to offerings that do not fall within the scope of the automatic roaming services' definition, such as non-interconnected services or features or services that are classified as information services or to services that are not CMRS. 72

60. In response to the Reexamination NPRM, some of the commenters requested that the Commission cap the rates that a carrier may charge other carriers for automatic roaming service based on some benchmark of retail rates. 73 Some of these commenters have also submitted economic analyses in support of their proposals. 74 Other commenters oppose any rate regulation and, in turn, have submitted their own economic analyses disputing the theory and evidence used to justify the imposition of rate regulation. 75 In the Report and Order, the Commission declines to impose a price cap or any other form of rate regulation on the fees carriers pay each other when one carrier's customer roams on another carrier's network. The Commission believes that the rates individual carriers pay for automatic roaming services should be determined in the marketplace through negotiations between the carriers, subject to the statutory requirement that any rates charged be reasonable and non-discriminatory.

61. The Commission reiterates that the general policy regarding CMRS services is to allow competitive market forces, rather than regulations, to promote the development of wireless services. On balance, taking into consideration the concerns raised in the record by certain CMRS carriers  76 and its preference for allowing competitive market forces to govern rate and rate structures for wireless services, the Commission expressly declines to impose any corresponding rate regulation of automatic roaming services.

62. In the Reexamination NPRM, the Commission sought comment on whether a carrier should be required to enter into an automatic roaming arrangement on a nondiscriminatory basis with a facilities-based-competitor in the same market. In the Report and Order, the Commission determines that the automatic roaming obligation does not include an in-market or home roaming requirement. The Commission finds that an automatic roaming request in the home area of a requesting CMRS carrier, the area where the requesting CMRS carrier has the spectrum to compete directly with the would-be host carrier, does not serve public interest goals of encouraging facilities-based service and supporting consumer expectations of seamless coverage when traveling outside the home area.

63. In the Reexamination NPRM, the Commission sought comment on access to push-to-talk, dispatch, or other data roaming. Some carriers advocate that the Commission should adopt an automatic roaming rule that requires carriers to permit roaming access to all technical features of their systems, and/or require carriers to make the same features accessible to all of their roaming partners (e.g., push-to-talk, dispatch, text messaging (SMS) or other data roaming services). Based on the record, in the Report and Order, the Commission finds that it would serve public interest to extend automatic roaming obligations to push-to-talk and SMS. However, the Commission declines to adopt a rule extending the automatic roaming obligation beyond that to offerings that do not fall within the scope of the automatic roaming services' definition, such as non-interconnected services or features. With respect to push-to-talk and SMS, the Commission finds that such offerings are typically bundled as a feature on the handset with other CMRS services, such as real-time, two-way switched mobile voice or data, which are interconnected with the public switched network. Thus, consumers consider push-to-talk and SMS as features that are typically offered as adjuncts to basic voice services, and expect the same seamless connectivity with respect to these features and capabilities as they travel outside their home network service areas.

64. With respect to non-interconnected data service, the Commission finds that it is not in the public interest at this time to impose an automatic roaming obligation. In the absence of a clear showing in the record that it would serve the public interest, the Commission believes that open access to the non-interconnected features of a competitor's network might undercut incentives to differentiate products and could chill innovation. It may also adversely affect business decisions to build out facilities for facilities-based competition and reduce the incentives to access the spectrum through other means such as initial spectrum licensing or secondary markets. For these reasons, the Commission declines to impose an automatic roaming requirement on non-interconnected features, such as stand alone dispatch, at this time.

65. In the Report and Order, the Commission also declines to impose an affirmative obligation on CMRS carriers to post their roaming rates. The Commission notes that roaming agreements are generally confidential and filing them would impose administrative costs on the carriers. In light of the adoption of an automatic roaming rule, the Commission finds that the available remedies for redress are sufficient to address disputes that may arise. Therefore, the Commission finds it unnecessary to burden CMRS carriers by requiring them to file roaming agreements.

66. The Commission will send a copy of the Report and Order, including this FRFA, in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act. 77 In addition, the Commission will send a copy of the Report and Order, including the FRFA, to the Chief Counsel for Advocacy of the SBA. A copy of the Report and Order and the FRFA (or summaries thereof) will also be published in the Federal Register . 78

67. Accordingly, it is ordered that, pursuant to the authority contained in Sections 1, 4(i), 201, 202, 251(a), 253, 303(r), and 332(c)(1)(B) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 201, 202, 251(a), 253, 303(r), and 332(c)(1)(B), and Section 1.425 of the Commission's rules, 47 CFR 1.425, this Report and Order and FNPRM is hereby adopted.

68. It is further ordered that Sections 20.3 and 20.12 of the Commission's rules are amended as specified in Appendix A, and such rule amendments shall be effective 60 days after the date of publication of the text thereof in the Federal Register .

69. It is further ordered that the Joint Petition for Commission Inquiry Pursuant to Section 403 of the Communications Act filed by AIRPEAK Communications, LLC, Airtel Wireless LLC, Cleveland Unlimited, Inc., Leap Wireless International, Inc., MetroPCS Communications, Inc., Punxsutawney Communications, Rural Telecommunications Group, Inc., and Southern Communications Services, Inc. d/b/a SouthernLINC Wireless, on April 25, 2006 is hereby denied.

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

This is a synopsis of the Commission's Report and Order, MB Docket No. 06-97, adopted July 25, 2007, and released July 27, 2007. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC Reference Information Center (Room CY-A257), 445 12th Street, SW., Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's copy contractor, Best Copy and Printing, Inc., Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 1-800-378-3160 or http://www.BCPIWEB.com.

Finger Lakes Radio Group, Inc.'s proposal was formerly a rule change to Section 73.202(b), the FM Table of Allotments. See 71 FR 30856 (May 31, 2006). As a result of changes to the Commission's processing rules, modifications of FM channels for existing stations are no longer listed in Section 73.202(b) and are instead reflected in the Media Bureau's Consolidated Data Base System (CDBS). See Revision of Procedures Governing Amendments to FM Table of Allotments and Changes of Community of License in the Radio Broadcast Services, Report and Order, 21 FCC Rcd 14212 (December 20, 2006). Nevertheless, a summary of the Report and Order in the instant proceeding is being published in the Federal Register because the counterproposal involved a proposed amendment to Section 73.202(b). Although the Report and Order set forth an effective date of September 10, 2007, Station WFLR-FM's license and construction permit will be modified effective 30 days after publication of this summary in the Federal Register in compliance with Sections 1.427 and 1.429 of the Commission's rules.

This document is not subject to the Congressional Review Act. (The Commission is, therefore, not required to submit a copy of this Report and Order to GAO, pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A) because the counterproposal was dismissed.)

This is a summary of that portion of the Commission's Report and Order and Declaratory Ruling, FCC 07-111, adopted on May 31, 2007, and released on June 8, 2007, which addresses the Commission's adoption in 2003 of the note to 47 CFR 76.5(mm) (4) and the subsequent remand by the U.S. Court of Appeals. The full text of this document is available for public inspection and copying during regular business hours in the FCC Reference Center, Federal Communications Commission, 445 12th Street, SW., CY-A257, Washington, DC 20554. These documents will also be available via ECFS ( http://www.fcc.gov/cgb/ecfs/ ). (Documents will be available electronically in ASCII, Word 97, and/or Adobe Acrobat.) The complete text may be purchased from the Commission's copy contractor, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. To request this document in accessible formats (computer diskettes, large print, audio recording, and Braille), send an e-mail to fcc504@fcc.gov or call the Commission's Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY).

1. In this Order, the Commission eliminates barriers to competitive entry in multiple dwelling units (MDUs) and in multiunit premises, when a new entrant seeks to compete against an incumbent provider. An MDU is a building or buildings with two or more residences, such as an apartment building, condominium building, or cooperative. See 47 CFR 76.800. This Order responds to a decision issued by the United States Court of Appeals for the District of Columbia Circuit regarding amendment of the Commission's cable television inside wiring rules. In the 2003 order reviewed by the court, the Commission had modified its rules to provide that “home run wiring” located behind sheet rock is considered physically inaccessible for purposes of determining the demarcation point between home wiring and home run wiring. Cable home run wiring in a MDU is the wiring that runs from the demarcation point to the point at which the multichannel video programming distributor's (MVPD) wiring becomes devoted to an individual subscriber or individual loop. See 47 CFR 76.800(d). In contrast, “cable home wiring” is the internal wiring contained within the premises of a subscriber, which begins at the demarcation point and runs to the subscriber's television set or other customer premises equipment. See 47 CFR 76.5(ll). The Commission concluded in 2003 that cutting and repairing sheet rock adds significantly to the physical difficulty and cost of wiring an MDU. In this Order, the Commission concludes that cable wiring located behind sheet rock qualifies as physically inaccessible under the Commission's rules for purposes of determining the demarcation point between home wiring and home run wiring. The record shows that accessing such wiring causes significant damage or modification to a preexisting structural element and generally adds significantly to the physical difficulty and/or cost of accessing the subscriber's home wiring. This ruling will facilitate competition in video distribution markets by clarifying the circumstances under which the existing cable home run wiring in MDUs can be made available to alternative video service providers.

2. The Order takes important steps to ensure that the pro-competitive, deregulatory goals of the 1996 Act are realized. The Commission actions here remove both economic and operational barriers to infrastructure investment in the communications market. New entrants to the video services market should not be foreclosed from competing for consumers in MDUs based on regulatory technicalities or costly and inefficient industry practices. By removing these obstacles, the Commission furthers the opportunities for consumers living in MDUs to enjoy the social and economic benefits of communication services competition.

3. In 1993, the Commission first promulgated rules for cable home wiring and for the disposition of that wiring after termination of service. In 1996, the Commission addressed certain cable home wiring issues and sought comment regarding how the Commission should revise these rules to reflect new developments, and how to promote competition by ensuring that the Commission's rules would facilitate the use of new and diverse services. In 1997, the Commission sought further comment on and addressed issues regarding procedures for the disposition of home run wiring in MDUs when an MDU owner decides to terminate service for the entire building and when an MDU owner is willing to permit two or more video service providers to compete for subscribers in the MDU on a unit-by-unit basis. In 2003, the Commission resolved the issues presented on reconsideration in that proceeding. See 18 FCC Rcd at 1342 (2003).

4. Central to any discussion on cable home wiring or cable home run wiring is the matter of the MDU demarcation point, which is the point at which a consumer's home wiring becomes the network's home run wiring. The Commission had previously stated that the cable wiring demarcation point serves such multiple purposes as defining (1) the location at which the subscriber may control the internal home wiring if he or she owns it; (2) the point at which an alternative multichannel video programming distributor (MVPD) would attach its wiring to the subscriber's wiring in order to provide service; and (3) the point from which the customer has the right to purchase cable home wiring upon termination of service. For purposes of this proceeding, a critical component of our discussion involves the location of the demarcation point because it is where a competing provider may access existing cable home wiring in an MDU building. The demarcation point for MDUs is set at (or about) twelve inches outside of where the cable wire enters the subscriber's individual dwelling unit. The demarcation point for single unit installations is the same. See 47 CFR 76.5(mm)(1). The presumptive demarcation point was adopted in the Cable Wiring Order, 8 FCC Rcd 1435 (1993). In the event that the cable demarcation point is “physically inaccessible” to an alternative MVPD, the demarcation point moves away from the individual dwelling unit to a point at which it first becomes physically accessible. The Commission has concluded that, for the cable demarcation point to be “physically inaccessible,” access to the wiring must (1) require significant modification or damage to preexisting structural elements, and (2) add significantly to the physical difficulty and/or cost of accessing the subscriber's home wiring.

5. The Appeals Court decision remanded that portion of the 2003 order that amended the Note to § 76.5(mm)(4) of the Commission's rules to indicate that wiring embedded in sheet rock would be considered physically inaccessible. Previously, the Commission provided examples of wiring that would be considered “physically inaccessible,” including wiring embedded in brick, metal conduit, and cinder blocks with limited or no access openings. Wiring simply enclosed within hallway molding would not be considered inaccessible. The Court found that the Commission offered no reasoned basis for expanding the Note to include sheet rock and remanded the case to the Commission for further consideration. In response, the Commission sought comment on its conclusions in the 2003 order with regard to § 76.5(mm)(4) of the rules and the amendment of the applicable Note.

6. The Court asserted that the Commission did not adequately support its conclusion that wiring behind sheet rock is “physically inaccessible” for purposes of the inside wiring rules. The Court found that the Commission had not explained why or how accessing wiring behind sheet rock requires “significant modification of, or significant damage to” the sheet rock. The Court also found that the Commission failed to explain the relative nature of the “damage” or “modification” related to accessing wiring behind sheet rock, and therefore that the Commission's conclusion regarding physical inaccessibility lacked adequate evidentiary support.

7. The Court also criticized the Commission's assessment of whether accessing cable wire behind sheet rock would “add significantly to the physical difficulty and/or cost” of accessing the subscriber's home wiring. The Court stated that while the Commission acknowledged that cutting through sheet rock is easier than boring through brick, metal, or cinder block, it did not support the conclusion that the lesser physical difficulty and cost are “significant.”

8. In response, the Commission sought additional comment with respect to whether cable wiring behind sheet rock should be considered physically inaccessible. The Commission set forth its premise that what preexisting structural elements should be included for purposes of determining the demarcation point and what is considered to be an accessible or inaccessible location should be based on practicality. In the 2003 order, the Commission incorporated its response to a Request for Letter Ruling from RCN-BeCoCom, L.L.C. asking the Commission to address the issue of whether cable wiring behind sheet rock is “physically inaccessible,” such that the demarcation point should be located not at the twelve inch mark, but rather at the operator's junction box. Based on the RCN Request for Letter Ruling and responses to that request, the Commission incorporated sheet rock as one of the examples of materials to be considered as a “preexisting structural element” in its definition of physical inaccessibility.

9. In this Order, the Commission finds that sheet rock is a preexisting structural element and that accessing inside wiring behind sheet rock would cause significant modification and damage to that structural element. Sheet rock is a preexisting structural element and not merely a surface finish or decorative finish like molding. Sheet rock is not added after a building is completed. Sheet rock is a fundamental component of the construction of the building. Thus, sheet rock is more like “brick or cinder block” because it is commonly used to form ceilings and walls in MDUs and other structures. We believe that ceilings and walls are an integral and permanent part of the building structure of MDUs, and therefore, sheet rock used to form ceilings and walls qualifies as a preexisting structural element for purposes of the Commission's rules.

10. The Commission concludes that the record supports the conclusion that accessing inside wiring behind sheet rock causes significant modification and damage to structural elements, i.e., walls and ceilings, albeit modification and damage that may be repairable. MDU resident owners and their managers are not only concerned with the condition of individually-owned units or apartments, but also with the condition of the common elements in these structures. For example, the record reveals that MDU resident owners and their managers will sometimes require an entire wall or ceiling to be repainted or re-wallpapered even where the hole cut in the sheet rock is significantly smaller than the wall or ceiling in order to restore the area to its original appearance. Requiring such extensive repair is a strong indication that there has been significant modification or damage to the pre-existing structural area. Unlike with single family residences, MDU residents share common walls and ceilings and have an interest in the condition and treatment of those common elements. With regard to the issues of fire safety and possible degradation of a building's resistance to moisture, we take a conservative approach and give credence to the commenters who argue that cutting into sheet rock may pose a safety risk or affect a building's resistance to moisture and thus may lead to significant modification or damage to such structural elements. Consequently, the Commission concludes that penetration of sheet rock for purposes of accessing inside wiring constitutes significant modification and damage to structural elements under the Commission's rules.

11. The Commission also finds that accessing the demarcation point behind sheet rock adds significantly to the physical difficulty and/or cost of accessing the subscriber's home wiring. The Commission notes that a finding of “physical difficulty” is not required because our rule requires that we find that cutting through the sheet rock would add significantly to the physical difficulty and/or costs of accessing the subscriber's home wiring. Nevertheless, the Commission concludes that the record supports a finding of significant physical difficulty in accessing the subscriber's home wiring. Accessing such wiring requires some level of physical harm to the property—i.e., access holes cut in the sheet rock—and that the property be restored to its original integrity and appearance. As the Commission has recognized throughout this decision, the repair is not always limited to the hole(s) cut; it can include repainting and/or re-wallpapering necessary to restore the premises. Those tasks can add significantly to the physical difficulty involved in accessing the wiring, certainly as compared to accessing wiring behind hallway molding (the example in the Commission's rules of wiring that is not physically inaccessible), See note to 47 CFR 76.5(mm)(4). In any event, the Commission needs only find that cutting through sheet rock significantly increases the physical difficulty or cost of accessing the wiring and, as described below, the Commission finds that the additional costs are typically significant.

12. The Commission concludes that the cost of accessing wiring behind sheet rock is significant. In analyzing the costs involved in accessing wiring behind sheet rock, the Commission recognizes that the record reveals a wide divergence among the estimates offered by commenters—ranging from $25 to $1,000—as the appropriate sum needed to accomplish the job. Although the Commission finds that it cannot pick a precise monetary figure that fairly reflects the costs associated with accessing cable inside wiring, we believe it is reasonable that costs estimates could include factors such as how difficult it may be to satisfy the MDU owner and manager with repair work and whether a single unit or many units are worked on in one time period. Although the Commission does not have specific quotes for restoration work, it seems likely that repainting and/or re-wallpapering entire ceilings and walls can, at a minimum, run into the hundreds of dollars, particularly for more high-end MDUs that use more expensive surface finishes. These figures appear significant, especially when compared to the estimates we received for accessing wiring behind hallway molding.

13. The Commission is persuaded that removing and replacing molding is generally less intrusive and less expensive than cutting into sheet rock, locating the wiring, and then repairing the wall or ceiling to the satisfaction of MDU owners and managers. While there may be cases in which the cost of accessing wiring behind sheet rock may be comparable to removable molding the record demonstrates that the cost for sheet rock generally will be higher, and often significantly so.

14. The Commission finds that that cable wiring located behind sheet rock qualifies as physically inaccessible under Commission rules for purposes of determining the demarcation point between home wiring and home run wiring. Specifically, the Commission concludes that (1) accessing such wiring causes significant damage or modification to a preexisting structural element, and (2) accessing wiring behind sheet rock generally adds significantly to the physical difficulty and/or cost of accessing the subscriber's home wiring. The Commission's cable inside wiring rules are intended to facilitate competition in video distribution markets. This ruling will foster opportunities for competing MVPDs to provide service in MDUs by clarifying the circumstances under which the existing cable home run wiring in MDUs can be made available to alternative video service providers.

15. Final Regulatory Flexibility Act. As required by the Regulatory Flexibility Act (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated into the Further Notice in this proceeding. The Commission sought written public comment on the possible significant economic impact on small entities regarding the proposals addressed in the Further Notice , including comments on the IFRA. Pursuant to the RFA, a Final Flexibility Analysis is contained in Appendix C.

16. Paperwork Reduction Act Analysis. This Order does not contain new or modified information collection requirements subject to the paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified “information collection burdens for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

17. Congressional Review Act. The Commission will send a copy of this Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

18. Accordingly, it is ordered that, pursuant to authority found in sections 1, 4(i), 601, 623, 624, and 632 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 521, 543, 544 and 552, the Commission's amendment of the Note to Section 76.5(mm)(4) of the Commission's rules to include sheet rock as an example of one of the materials that would likely be considered physically inaccessible for purposes of the Commission's cable television inside wiring rules is affirmed .

19. It is further ordered , that in light of the United States Court of Appeals for the District of Columbia's Circuit's decision in NCTA v. FCC , No. 03-1140, 2004 WL 335201, which remanded but did not vacate the decision adopted in Telecommunications Services Inside Wiring, Customer Premises Equipment; Implementation of the Cable Television Consumer Protection and Competition Act of 1992: Cable Home Wiring , 18 FCC Rcd 1342 (2003) (“Home Wiring Decision”), the note to 47 CFR 76.5(mm)(4) adopted in the Home Wiring Decision shall remain in effect.

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

Pursuant to 49 U.S.C. 33112, Insurer reports and information, NHTSA requires certain passenger motor vehicle insurers to file an annual report with the agency. Each insurer's report includes information about thefts and recoveries of motor vehicles, the rating rules used by the insurer to establish premiums for comprehensive coverage, the actions taken by the insurer to reduce such premiums, and the actions taken by the insurer to reduce or deter theft. Pursuant to 49 U.S.C. 33112(f), the following insurers are subject to the reporting requirements:

(1) Issuers of motor vehicle insurance policies whose total premiums account for 1 percent or more of the total premiums of motor vehicle insurance issued within the United States;

(2) Issuers of motor vehicle insurance policies whose premiums account for 10 percent or more of total premiums written within any one state; and

(3) Rental and leasing companies with a fleet of 20 or more vehicles not covered by theft insurance policies issued by insurers of motor vehicles, other than any governmental entity.

Pursuant to its statutory exemption authority, the agency exempted certain passenger motor vehicle insurers from the reporting requirements.

Section 33112(f)(2) provides that the agency shall exempt small insurers of passenger motor vehicles if NHTSA finds that such exemptions will not significantly affect the validity or usefulness of the information in the reports, either nationally or on a State-by-State basis. The term “small insurer” is defined, in Section 33112(f)(1)(A) and (B), as an insurer whose premiums for motor vehicle insurance issued directly or through an affiliate, including pooling arrangements established under State law or regulation for the issuance of motor vehicle insurance, account for less than 1 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the United States. However, that section also stipulates that if an insurance company satisfies this definition of a “small insurer,” but accounts for 10 percent or more of the total premiums for all motor vehicle insurance issued in a particular state, the insurer must report about its operations in that State.

In the final rule establishing the insurer reports requirement (49 CFR part 544), (52 FR 59; January 2, 1987), NHTSA exercised its exemption authority by listing in Appendix A each insurer that must report because it had at least 1 percent of the motor vehicle insurance premiums nationally. Listing the insurers subject to reporting, instead of each insurer exempted from reporting because it had less than 1 percent of the premiums nationally, is administratively simpler since the former group is much smaller than the latter. In Appendix B, NHTSA lists those insurers required to report for particular states because each insurer had a 10 percent or greater market share of motor vehicle premiums in those states. In the January 1987 final rule, the agency stated that it would update Appendices A and B annually. NHTSA updates the appendices based on data voluntarily provided by insurance companies to A.M. Best, which A.M. Best  1 publishes in its State/Line Report each spring. The agency uses the data to determine the insurers' market shares nationally and in each state.

In addition, upon making certain determinations, NHTSA grants exemptions to self-insurers, i.e., any person who has a fleet of 20 or more motor vehicles (other than any governmental entity) used for rental or lease whose vehicles are not covered by theft insurance policies issued by insurers of passenger motor vehicles, 49 U.S.C. 33112(b)(1) and (f). Under 49 U.S.C. 33112(e)(1) and (2), NHTSA may exempt a self-insurer from reporting, if the agency determines:

(1) The cost of preparing and furnishing such reports is excessive in relation to the size of the business of the insurer; and 33112(e)(1) and (2),

(2) The insurer's report will not significantly contribute to carrying out the purposes of Chapter 331.

In a final rule published June 22, 1990 (55 FR 25606), the agency granted a class exemption to all companies that rent or lease fewer than 50,000 vehicles, because it believed that the largest companies' reports sufficiently represent the theft experience of rental and leasing companies. NHTSA concluded that smaller rental and leasing companies' reports do not significantly contribute to carrying out NHTSA's statutory obligations and that exempting such companies will relieve an unnecessary burden on them. As a result of the June 1990 final rule, the agency added Appendix C, consisting of an annually updated list of the self-insurers subject to Part 544. Following the same approach as in Appendix A, NHTSA included, in Appendix C, each of the self-insurers subject to reporting instead of the self-insurers which are exempted. NHTSA updates Appendix C based primarily on information from Automotive Fleet Magazine and Auto Rental News . 2

Under Part 544, as long as an insurer is listed, it must file reports on or before October 25 of each year. Thus, any insurer listed in the appendices must file a report before October 25, and by each succeeding October 25, absent an amendment removing the insurer's name from the appendices.

On April 9, 2007, NHTSA published a notice of proposed rulemaking (NPRM) to update the list of insurers in Appendices A, B, and, C required to file reports (72 FR 17465). Appendix A lists insurers that must report because each had 1 percent of the motor vehicle insurance premiums on a national basis. The list was last amended in a final rule published on September 5, 2006 (71 FR 52291). Based on the 2004 calendar year market share data from A.M. Best, NHTSA proposed to remove Travelers PC Group and add St Paul Travelers Companies to Appendix A.

Each of the 18 insurers listed in Appendix A are required to file a report before October 25, 2007, setting forth the information required by Part 544 for each State in which it did business in the 2004 calendar year. As long as these 18 insurers remain listed, they are required to submit a report by each subsequent October 25 for the calendar year ending slightly less than 3 years before.

Appendix B lists insurers required to report for particular States for calendar year 2004, because each insurer had a 10 percent or greater market share of motor vehicle premiums in those States. Based on the 2004 calendar year data for market shares from A.M. Best, we proposed to remove Arbella Mutual Insurance (Massachusetts) and add the Farm Bureau of Idaho Group (Idaho) to Appendix B.

The nine insurers listed in Appendix B are required to report on their calendar year 2004 activities in every State where they had a 10 percent or greater market share. These reports must be filed by October 25, 2007, and set forth the information required by Part 544. As long as these nine insurers remain listed, they would be required to submit reports on or before each subsequent October 25 for the calendar year ending slightly less than 3 years before.

Appendix C lists rental and leasing companies required to file reports. Based on information in Automotive Fleet Magazine and Auto Rental News for 2004, NHTSA proposed to add Emkay, Inc. Each of the eight companies (including franchisees and licensees) listed in Appendix C are required to file reports for calendar year 2004 no later than October 25, 2007, and set forth the information required by Part 544. As long as those eight companies remain listed, they would be required to submit reports before each subsequent October 25 for the calendar year ending slightly less than 3 years before.

The agency received no comments in response to the NPRM for Appendices A, B and C. Therefore, this final rule adopts the proposed changes to Appendix A, B and C. Accordingly, NHTSA has determined that each of the 18 insurers listed in Appendix A, each of the nine insurers listed in Appendix B and each of eight companies listed in Appendix C are required to submit an insurer report on its experience for calendar year 2004 as required by 49 CFR Part 544.

Passenger motor vehicle insurers listed in the appendices can forward their theft loss reports to the agency in several ways:

a. Mail: Rosalind Proctor, Office of International Vehicle, Fuel Economy and Consumer Standards, Department of Transportation, NHTSA, West Building, 1200 New Jersey Avenue, SE., NVS-131, Room W43-302, Washington, DC 20590

b. E-mail: rosalind.proctor@dot.gov ; or

c. Fax: (202) 493-0073.

Theft loss reports may also be submitted to the docket electronically by:

d. Logging onto the Dockets Management System Web site at http://dms.dot.gov . Click on “ES Submit” or “Help” to obtain instructions for filing the document electronically.

This notice has not been reviewed under Executive Order 12866, Regulatory Planning and Review. NHTSA has considered the impact of this final rule and determined that the action is not “significant” within the meaning of the Department of Transportation's regulatory policies and procedures. This final rule implements the agency's policy of ensuring that all insurance companies that are statutorily eligible for exemption from the insurer reporting requirements are in fact exempted from those requirements. Only those companies that are not statutorily eligible for an exemption are required to file reports.

NHTSA does not believe that this rule, reflecting current data, affects the impacts described in the final regulatory evaluation prepared for the final rule establishing Part 544 (52 FR 59; January 2, 1987). Accordingly, a separate regulatory evaluation has not been prepared for this rulemaking action. Using the Bureau of Labor Statistics Consumer Price Index for 2006 ( see http://www.bls.gov/cpi ), the cost estimates in the 1987 final regulatory evaluation were adjusted for inflation. The agency estimates that the cost of compliance is $100,800 for any insurer added to Appendix A, $40,320 for any insurer added to Appendix B, and $11,632 for any insurer added to Appendix C. In this final rule, the agency made no additional changes to Appendices A, B, or C of the list of insurers published in the April 9, 2007 NPRM. Therefore, there will be no additional net effect of this final rule. Accordingly, this final will adopt the proposed changes to Appendix A, B and C.

Interested persons may wish to examine the 1987 final regulatory evaluation. Copies of that evaluation were placed in Docket No. T86-01; Notice 2. Any interested person may obtain a copy of this evaluation by writing to NHTSA, Docket Section, 1200 New Jersey Avenue, SE., West Building (Ground Floor), Room W12-140, Washington, DC 20590, or by calling (202) 366-4949.

The information collection requirements in this final rule were submitted and approved by the Office of Management and Budget (OMB) pursuant to the requirements of the Paperwork Reduction Act (44 U.S.C. 3501 et seq. ). The existing information collection indicates that the number of respondents for this collection is forty-five, however, the actual number of respondents fluctuate from year to year. Therefore, because the number of respondents required to report for this final rule does not exceed the number of respondents indicated in the existing information collection, the agency does not believe that an amendment to the existing information collection is necessary. This collection of information is assigned OMB Control Number 2127-0547 (“Insurer Reporting Requirements”) and is approved for use through August 31, 2009, and the agency will seek to extend the approval afterwards.

The agency also considered the effects of this rulemaking under the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ). I certify that this final rule will not have a significant economic impact on a substantial number of small entities. The rationale for the certification is that none of the companies listed on Appendices A, B, or C are construed to be a small entity within the definition of the RFA. “Small insurer” is defined, in part under 49 U.S.C. 33112, as any insurer whose premiums for all forms of motor vehicle insurance account for less than 1 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the United States, or any insurer whose premiums within any State, account for less than 10 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the State. This notice exempts all insurers meeting those criteria. Any insurer too large to meet those criteria is not a small entity. In addition, in this rulemaking, the agency exempts all “self insured rental and leasing companies” that have fleets of fewer than 50,000 vehicles. Any self-insured rental and leasing company too large to meet that criterion is not a small entity.

This action has been analyzed according to the principles and criteria contained in Executive Order 12612, and it has been determined that the final rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment.

In accordance with the National Environmental Policy Act, NHTSA has considered the environmental impacts of this final rule and determined that it would not have a significant impact on the quality of the human environment.

This final rule does not have any retroactive effect, and it does not preempt any State law, 49 U.S.C. 33117 provides that judicial review of this rule may be obtained pursuant to 49 U.S.C. 32909, and section 32909 does not require submission of a petition for reconsideration or other administrative proceedings before parties may file suit in court.

The Department of Transportation assigns a regulation identifier number (RIN) 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. You may use the RIN contained in the heading, at the beginning, of this document to find this action in the Unified Agenda.

Executive Order 12866 requires each agency to write all rules in plain language. Application of the principles of plain language includes consideration of the following questions:

• Have we organized the material to suit the public's needs?

• Are the requirements in the proposal clearly stated?

• Does the proposal contain technical language or jargon that is not clear?

• Would a different format (grouping and order of sections, use of headings, paragraphing) make the rule easier to understand?

• Would more (but shorter) sections be better?

• Could we improve clarity by adding tables, lists, or diagrams?

• What else could we do to make the proposal easier to understand?

If you have any responses to these questions, you can forward them to me several ways:

a. Mail: Rosalind Proctor, Office of International Vehicle, Fuel Economy and Consumer Standards, NHTSA, West Building, 1200 New Jersey Avenue, SE., NVS-131, Room W43-302, Washington, DC 20590.

b. E-mail: rosalind.proctor@dot.gov ; or

c. Fax: (202) 493-0073.