On July 1, 2011, the FAA published in the Federal Register a notice of proposed rulemaking (NPRM) to amend Class D and Class E surface airspace and remove Class E airspace designated as an extension at Manassas Regional Airport/Harry P. Davis Field (76 FR 38581). Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received. Also, the airport name change was inadvertently omitted in the NPRM, and is correctly noted in this rule. Class D and E airspace designations are published in paragraphs 5000, 6002, and 6004, respectively, of FAA Order 7400.9V dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class D and Class E airspace designations listed in this document will be published subsequently in the Order.

This action amends Title 14, Code of Federal Regulations (14 CFR) part 71 to amend Class D and E surface airspace at Manassas Regional Airport/Harry P. Davis Field, Manassas, VA. Airspace reconfiguration is necessary due to the cancellation of the VOR approach into the airport. Class E airspace designated as an extension to Class D airspace is no longer needed and is, therefore, removed. This action also notes the airport's name change from Manassas Municipal Airport/Harry P. Davis Airport to Manassas Regional Airport/Harry P. Davis Field. This action enhances the safety and management of IFR operations at the airport.

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. It, therefore, (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, would not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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.

This rulemaking is promulgated under the authority described in subtitle VII, part A, subpart I, section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it amends Class D and E airspace at Manassas Regional Airport/Harry P. Davis Field, Manassas, VA.

In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:

On July 25, 2011, the FAA published in the Federal Register a notice of proposed rulemaking (NPRM) to establish Class E airspace at Gordonsville, VA (76 FR 44287). 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 7400.9V dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in the Order. With the exception of an editorial change, this rule is the same as that proposed in the NPRM.

This amendment to Title 14, Code of Federal Regulations (14 CFR) part 71 establishes the Class E airspace extending upward from 700 feet above the surface at Gordonsville, VA, to provide the controlled airspace required to support the new RNAV GPS standard instrument approach procedures developed for Gordonsville Municipal Airport. This action is necessary for the safety and management of IFR operations at the airport.

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, is non-controversial and unlikely to result in adverse or negative comments. It, therefore, (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.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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.

This rulemaking is promulgated under the authority described in subtitle VII, part A, subpart I, section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it establishes controlled airspace at Gordonsville Municipal Airport, Gordonsville, VA.

In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:

On July 5, 2011, the FAA published in the Federal Register a notice of proposed rulemaking to amend Class E airspace 700 feet above the surface, at Lebanon, PA (76 FR 39038). Subsequent to publication, the FAA found that the geographic coordinates needed to be adjusted. This action makes that adjustment. 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 7400.9V dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in the Order.

This amendment to Title 14, Code of Federal Regulations (14 CFR) part 71 amends Class E airspace extending upward from 700 feet above the surface to support new standard instrument approach procedures developed at Keller Brothers Airport, Lebanon, PA. The geographic coordinates of the airport also are being adjusted to coincide with the FAAs aeronautical database. This enhances the safety and management of IFR operations at the airport.

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, is non-controversial and unlikely to result in adverse or negative comments. It, therefore, (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.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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.

This rulemaking is promulgated under the authority described in subtitle VII, part A, subpart I, section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it establishes Class E airspace at Keller Brothers Airport, Lebanon, PA.

In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:

In the Federal Register of May 4, 2011 (76 FR 25234), FDA amended the color additive regulations to add 21 CFR 73.3129 to provide for the safe use of disodium 1-amino-4-[[4-[(2-bromo-1-oxoallyl)amino]-2-sulphonatophenyl]amino]-9,10-dihydro-9,10-dioxoanthracene-2-sulphonate (CAS Reg. No. 70209-99-3), also known as Reactive Blue 69, as a color additive in contact lenses.

FDA gave interested persons until June 3, 2011, to file objections or requests for a hearing. The agency received no objections or requests for a hearing on the final rule. Therefore, FDA finds that the effective date of the final rule that published in the Federal Register of May 4, 2011, should be confirmed.

Therefore, under the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321, 341, 342, 343, 348, 351, 352, 355, 361, 362, 371, 379e) and under authority delegated to the Commissioner of Food and Drugs, and redelegated to the Director, Office of Food Additive Safety, notice is given that no objections or requests for a hearing were filed in response to the May 4, 2011, final rule. Accordingly, the amendments issued thereby became effective June 6, 2011.

The Postal Service is enhancing its operational capability to track commercial parcels by scanning IMpbs and other extra services barcodes with automated processing equipment and Intelligent Mail scanning devices. Once all of the changes described in this final rule are fully implemented, tracking data, that includes acceptance, enroute, and delivery status data, will be available to commercial mailers who use extra services on their packages.

Mailers using IMpb will receive piece-level visibility throughout USPS® processing and delivery operations. New IMpb enhancements include:

• Incorporation of a routing code to facilitate the processing of packages on automated sorting equipment.

• Use of a channel-specific Application Identifier (AI) that associates the barcode to the payment method, supporting revenue assurance.

• A 3-digit service type code, which will identify the mail class and extra service combination and eliminate the need for multiple barcodes on a package.

• The use of either a 6-digit or 9-digit numeric Mailer ID (MID), to accommodate all mailers.

• Inclusion of specific “mail class only” service type codes that may be used for packages without extra services.

To promote the use of IMpb or other unique tracking barcodes, effective January 22, 2012 the Postal Service will provide end-to-end tracking, including confirmation of delivery, at no additional charge on all commercial parcels (except Standard Mail and Package Services parcels). Merchandise Return Service (MRS) parcels and Business Reply Mail® (BRM) parcels will also qualify for end-to-end tracking, including confirmation of delivery, at no extra charge.

Also effective January 22, 2012, the Postal Service will require the use of a unique tracking barcode on all commercial parcels, except Standard Mail parcels, claiming presort or destination entry pricing; and will require all parcels shipped using PC Postage systems to bear an IMpb and to use version 1.6 of the electronic shipping services manifest files. The PC Postage requirement does not extend to users of PC Postage stamp products. The Postal Service considers these postage imprints to be in the same category as the imprints generated by postage meter systems.

To allow commercial parcel and PC Postage mailers sufficient time to effect the necessary changes to their software and systems, the Postal Service will provide a transitional period, until July 2, 2012, during which the failure to comply with these new standards will not be penalized.

On January 7, 2013, the Postal Service finalizes the implementation of this final rule by requiring an Intelligent Mail package barcode (IMpb) for all commercial mailpieces that include a tracking or extra service barcode and on all parcels (except Standard Mail parcels) claiming presort or destination entry pricing. This January 7, 2013 IMpb requirement also applies to all domestic Express Mail® pieces, except those paying postage through an Express Mail corporate account (EMCA). In addition, the Postal Service will require the use of version 1.6 electronic shipping services manifest files and require that these files include each destination ZIP + 4® code, or each destination delivery address by January 7, 2013. This new file format will also require a new version of the customer extract file.

The Postal Service recognizes that some mailers may have difficulty preparing their systems and processes in time to meet January 22, 2012 implementation (required after July 2, 2012), and further recognizes that some mailers may be unable to meet the January 7, 2013 deadline for use of IMpb and the version 1.6 electronic manifest file. Therefore the Postal Service will provide limited exceptions for those mailers who may require additional time to finalize their transition to the use of unique tracking barcodes or IMpb. Mailers requiring an exception may direct their request to vice president, Product Information, USPS Headquarters, Room 3667, 475 L'Enfant Plaza, SW., Washington, DC 20260-5626.

The Postal Service will provide no charge end-to-end tracking, including confirmation of delivery, for all Parcel Select mailpieces (including the Parcel Select barcoded nonpresort category). Since all nondestination entry and nonpresorted Parcel Select mailpieces are currently required to bear barcodes, this Parcel Select category will also be required to bear a unique tracking barcode no later than July 2, 2012, and will be required to bear an IMpb and to use version 1.6 of the electronic shipping services manifest files no later than January 7, 2013.

To support future sorting efficiencies, the USPS strongly encourages mailers to place a ZIP+4 code or destination address in the electronic files for each mailpiece as soon as possible. Mailers using the IMpb are also encouraged to include the additional two-digit delivery point code in the electronic file.

This final rule also requires a postal routing code on all parcels and all Express Mail pieces (except for EMCA mailers), preferably as a concatenated IMpb or extra service barcode. When a concatenated IMpb or extra service barcode is not used, a separate postal routing barcode must be included in addition to the IMpb. Flat-shaped or letter-shaped Priority Mail® or Critical Mail TM pieces may use an Intelligent Mail barcode (IMb TM ) or POSTNET TM code for the Postal routing barcode. Otherwise, an IMb will not be permitted in lieu of the IMpb.

Mailers of commercial parcels, who claim presort or destination entry pricing, but who do not purchase a trackable extra service, or make use of the no-fee end-to-end tracking, must use a “mail-class only” IMpb service type code that represents the class or subclass of the mailpiece that is being shipped.

Beginning January 22, 2012, the Postal Service requires the use of new generic human-readable service banner text formats when printing an IMpb. Current standards require a different human-readable service banner text for each extra service selected by the mailer. The Postal Service will provide two generic text options for service banners, when used with an IMpb, for most of the extra services selected. Mailers must use a “USPS® Tracking #” human-readable service banner text above the barcode on packages not requiring a signature at delivery, and a “USPS Signature Tracking #” service banner text above the barcode on packages where a signature is required at delivery. These new service banner texts will not be used with Certified Mail®, Registered Mail TM , Adult Signature service, Parcel Return Service, or Express Mail or Priority Mail Open and Distribute services. With these exceptions, mailers may also optionally use the new service banner texts in conjunction with all current USPS-approved extra service barcodes. These new texts will simplify IMpb use for mailers and will more accurately describe future processing and tracking capabilities inherent to the IMpb.

The Postal Service is also providing an exception process, for mailers of small First-Class Mail® and Standard Mail parcels lacking sufficient label space to apply an IMpb or extra service barcode meeting the 3/4 -inch height requirement, to submit barcodes of at least 1/2 inch in height for USPS testing and approval. These exceptions will be administered by the National Customer Service Center (NCSC), as part of the normal barcode approval process.

On September 17, 2010, the Postal Service published an advance notice of proposed rulemaking in the Federal Register (75 FR 56922-56923), announcing plans to provide interim IMpb optional-use standards and to require IMpb use for all commercial mailers at a later date.

The IMpb optional-use standards were announced via Postal Bulletin 22297, dated November 4, 2010, incorporated into the DMM, and were available for mailer use beginning November 1, 2010.

On April 28, 2011, the Postal Service published a proposed rule in the Federal Register (75 FR 23749-23755) to provide its proposal for future IMpb implementation. The Postal Service received comments in response to this proposed rule, which are summarized later in this notice.

For the purposes of this final rule, the term “commercially shipped package” is generally used to describe all domestic mailpieces meeting parcel characteristics, all Express Mail and Priority Mail mailpieces, regardless of shape, including commercially shipped flat-rate items. It does not include EMCA pieces, Critical Mail pieces, some Priority Mail flat-size pieces prepared by high-volume mailers, or Package Service parcels mailed at USPS retail counters. The term “commercially shipped package” will also encompass Parcel Post® pieces, within the Package Services category, bearing a permit imprint.

Piece-level information will allow the Postal Service to improve its competitiveness within the commercial package shipping industry and to create a more comprehensive service performance measurement tool. Barcodes are not currently required on commercially shipped packages, except those entered under an Electronic Verification System (eVS®); and many barcodes now being used are unable to incorporate the data necessary to meet the future needs of the Postal Service. At present, commercially shipped packages can bear barcodes that are designed to provide delivery status information only, and do not always include a routing code (a barcode that represents the destination ZIP Code TM ). These barcodes allow limited integration of multiple extra services and have limited revenue protection capabilities, due to the absence of information associating the piece with its specific payment method.

The IMpb provides unique piece-level data to enable the Postal Service to increase efficiency, enhance package visibility and tracking capabilities, and provide a means to measure service performance. The IMpb is a width-modulated barcode containing up to 34 digits, which generally follows the specifications of the GS1-128 symbology. GS1-128 barcodes are a special type of Code 128 barcodes, which make use of Application Identifiers (AI) to define the encoded data and their use. The IMpb leverages features of the GS1-128 symbology to allow for the unique identification and tracking of domestic packages from induction to delivery. The GS1-128 barcode symbology is already a requirement for users of electronic confirmation services and eVS. Customers participating in these programs will not need to change the symbology of the barcode; however the elements within the barcode and layout will change.

There are several IMpb barcode variations for commercial and retail use that provide sufficient flexibility to accommodate the diverse mailing needs of customers. To improve routing, tracking, and service capabilities, mailers will be required to include the correct 5-digit routing code in the barcode on each commercially shipped package, either incorporated into a single concatenated barcode or as a separate postal routing barcode. The Postal Service will also require mailers to transmit the ZIP + 4 code information to the USPS via an electronic file. As an alternative mailers may include the destination address in the electronic file instead of the ZIP + 4 code.

Mailers who generate their own barcoded labels will benefit from the enhancements to the electronic files, allowing the support of the additional features incorporated into the IMpb. The new version 1.6 electronic file format includes expanded package identification code fields to accommodate up to a 34-digit barcode string, and requires fewer file types to support various combinations of products and services. With the full implementation of this final rule, mailers will be required to include the destination ZIP + 4 code (or destination address) in the electronic file for all records. This additional ZIP Code information will assist in the routing and tracking of our package products. An optional field for the delivery point code of the destination address has been added to the electronic file to provide additional information to improve service. A listing of electronic file formats is located in the addendum to Publication 91, Addendum for Intelligent Mail Package Barcode (IMpb) and 3-digit Service Type Code, available on the RIBBS® Web site at http://ribbs.usps.gov. File formats are also provided in the newly released, Publication 199, Implementation Guide to Intelligent Mail Package Barcode (IMpb) for Confirmation Services and Electronic Verification System (eVS) Mailers. Publication 199 is also available on the RIBBS Web site, and includes all information in the Publication 91 Addendum, but is more comprehensive. The Postal Service currently provides IMpb technical specifications in both publications, but expects to eliminate the Publication 91 Addendum at some point in the near future.

The data construct of the IMpb barcode differs from that of the current confirmation services barcode. The IMpb uses unique 3-digit service type codes to identify the exact product and extra service combinations, eliminating the need for separate barcodes and enabling more efficient package handling and delivery. Detailed specifications for IMpb barcodes are available in the “Barcode Data” section of the specification document, Barcode, Package, Intelligent Mail (USPS2000508) on RIBBS. A list of the 3-digit service type codes is available in Publication 199 and the addendum to Publication 91. Technical specifications may be modified using an alternative approval process authorized by the vice president, Product Information.

Mailers using IMpb can optionally increase package visibility by associating each package with the appropriate sack, or an approved equivalent container, which bears an accurately encoded Intelligent Mail tray label. Each sack or approved alternate container may then be electronically associated to a pallet (or equivalent container) that bears an accurately encoded Intelligent Mail container placard.

The Postal Service also plans to assist Merchandise Return Service (MRS) and Business Reply Mail (BRM) parcel mailers in developing processes capable of generating unique tracking barcodes for their labels, and to replace the nonbarcoded labels many currently use. The use of unique tracking barcodes will be optional for these mailers, but when used, these mailpieces will qualify for end-to-end tracking, including confirmation of delivery, at no additional charge.

The Postal Service has proposed creating two products from its existing Standard Mail parcels/not flat-machinable (NFMs) product. The two products proposed would be Standard Mail Fulfillment parcels and Standard Mail Marketing parcels. The Postal Service has also proposed to transfer all of its Standard Mail Fulfillment parcels (except nonprofit) to its competitive product line, where they would become a subcategory of the Parcel Select product. The Postal Service has obtained approval for this transfer, conditional on the January 22, 2012 price change. If this transfer occurs as planned those transferred parcels would become eligible for end-to-end tracking, including confirmation of delivery, at no cost, would be required to bear a unique tracking barcode no later than July 2, 2012; and would be required to bear an IMpb and to use version 1.6 of the electronic shipping services manifest files no later than January 7, 2013.

The Postal Service received three comments in response to the April 28, 2011 proposed rule, with some commenters addressing more than one issue. These comments are summarized as follows:

In general, commenters expressed support for the Postal Service's efforts to enhance its operational capability to track commercial parcels. Commenters were also generally in support of the proposal to provide end-to-end tracking, including confirmation of delivery, at no charge and a standardized service banner text.

Comment: One commenter recommends that the ZIP + 4 barcode construct be supported as an option for IMpb, prior to the implementation date, in order to assist mailers in meeting the January 7, 2013 requirement to place the ZIP + 4 code in the electronic shipping services manifest files.

Response: The ZIP + 4 barcode construct is currently supported and customers may use this construct to comply with the ZIP + 4 code requirement. However, the readability for this barcode is not yet optimal on our passive scanners and mechanized parcel sorters. For this reason the USPS encourages mailers to use available constructs that do not include the ZIP + 4 code. When using a barcode construct that includes the ZIP + 4 code, mailers shipping small packages must also ensure sufficient label space exists to print a longer barcode that meets specifications.

Comment: A commenter requested clarification on how the ZIP + 4 code requirement pertains to the Parcel Return Service (PRS) manifest. This commenter requests an explicit statement as to whether the ZIP + 4 code requirement would apply to PRS.

Response: The ZIP + 4 code requirement will not apply to PRS and will not be required in PRS manifests or the barcodes on PRS pieces. PRS pieces have a different processing model than other parcels. PRS pieces are addressed to unique ZIP Codes and are picked up at participating Post Offices, plants, or Network Distribution Centers.

Comment: Another commenter wished to confirm his understanding that mailers will have to provide the ZIP + 4 code or destination delivery address in the electronic shipping services manifest files by June 3, 2013 to obtain destination entry or presort pricing.

Response: This commenter is correct; mailers will be required to include the ZIP + 4 code or destination delivery address in the electronic manifest file to be eligible for destination entry or presort pricing. However, the effective date for this requirement has been changed to January 7, 2013.

Comment: A commenter asserted that full IMpb implementation cannot occur until the “Shipping Partner Events” are supported by the USPS product tracking system (PTS).

Response: The Postal Service understands the importance of supporting IMpb in the Shipping Partner Event files. On June 30, 2011, modifications were made to accommodate IMpb in the current version of the Shipping Partner Event file. To fully support IMpb, a new version of the Shipping Partner Event file and the corresponding Error/Warning file was implemented on August 28, 2011.

Comment: A commenter encouraged the USPS to enable version 1.6 of the electronic shipping services manifest files to accept legacy barcodes, because this would provide mailers an opportunity to work through transition issues prior to the implementation date.

Response: The Postal Service agrees and has received similar feedback from other mailers. In response, the Postal Service modified its systems on June 26, 2011 to accept the current USPS-approved barcode formats in the new electronic shipping services manifest files version 1.6.

Comment: Another commenter asked if mailers could obtain destination entry or presort pricing by using an IMpb and providing version 1.6 of the electronic shipping services manifest files, but without including the ZIP + 4 code or destination delivery address in the manifest.

Response: Until January 7, 2013, mailers who apply an IMpb, or a unique tracking barcode or extra services barcode to their parcels are eligible for destination entry or presort pricing. Mailers are not required to provide the ZIP + 4 code in the electronic file until January 7, 2013.

Comment: A commenter requested a summary of the changes required by January 22, 2012, and those required by June 4, 2012.

Response: On January 22, 2012, mailers will be required to apply a tracking or extra services barcode on all Parcel Select parcels and all other commercially shipped parcels (except Standard Mail) in order to receive presort or destination-entry pricing. Either an IMpb or one of the current USPS-approved unique tracking or extra services barcodes will fulfill this requirement. Mailers who are unable to modify their systems to apply tracking or extra services barcodes to their mailpieces will continue to receive presort or destination-entry pricing for parcels without barcodes until July 2, 2012. Effective July 2, 2012, the transition period for mailers to modify their systems will be over. To continue to receive Parcel Select or presort or destination-entry pricing, mailers must apply unique tracking or extra services barcodes to their parcels. Beginning on January 22, 2012, mailers using a PC Postage system must apply an IMpb to their parcels, use version 1.6 of the electronic shipping services manifest files, and include each destination ZIP + 4 code, or each destination delivery address in the file. To allow PC Postage mailers sufficient time to effect the necessary changes to their software and systems, the Postal Service will also provide an optional-use transitional period until July 2, 2012.

Comment: Another commenter asked if mailers are required to make any changes by June 3, 2013 if they are willing to forgo destination entry or presort pricing.

Response: Mailers (except mailers of Parcel Select parcels) who are willing to forgo presort or destination entry pricing will not be required to apply an IMpb to their parcels or use electronic shipping services manifest files version 1.6, even after January 7, 2013. All Parcel Select mailers will be required to use IMpb and version 1.6 of the electronic shipping services manifest file by January 7, 2013.

Comment: A commenter asked what type of barcode qualifies for Delivery Confirmation service at no charge as of January 22, 2012, and if mailers will be able to use the current USPS-approved Delivery Confirmation barcodes, with 2-digit Service Type IDs and unique serial numbers until June 3, 2013.

Response: All IMpb and unique tracking or Extra Services barcodes will qualify for end-to-end tracking, including confirmation of delivery, at no charge on all commercially shipped parcels (excluding Standard Mail and Package Services parcels) beginning on January 22, 2012. This includes parcels bearing the current USPS-approved barcodes with 2-digit service type codes and serial numbers that remain unique for 6 months. Mailers may use the current USPS-approved barcodes until January 7, 2013 to meet the barcode requirements to qualify for presort or destination entry pricing.

Comment: A commenter asked if electronic shipping services manifest files, for mailers using unique tracking barcodes, will be required on commercial parcels before June 3, 2013.

Response: To receive end-to-end tracking, including confirmation of delivery, at no charge, commercially shipped parcels bearing non-IMpb unique tracking barcodes or extra services barcodes must use either Version 1.3 or 1.4 of the electronic shipping services manifest files, or the new Version 1.6 file (or version 1.5 for existing customers using only this format). Mailers placing an IMpb on their parcels must use version 1.6 (or version 1.5 for existing customers using this format). Only programs that do not require a manifest file (such as MRS) will receive end-to-end tracking, including confirmation of delivery, at no charge without an electronic file.

Comment: A commenter asked if the required use of version 1.6 of the electronic shipping services manifest files by June 3, 2013 applies only to commercial parcels, and not to MRS. This commenter stated that permit holders never know when their customers may choose to use a MRS label.

Response: As is currently the case, MRS parcels bearing an IMpb will not be required to be accompanied by an electronic shipping service manifest file. However, when current (or future) programs or features require a manifest file, the electronic shipping services manifest file version 1.6 will be required. The Postal Service has also expressed its intent to assist Merchandise Return Service (MRS) and Business Reply Mail (BRM) parcel mailers in developing processes capable of generating unique tracking barcodes for their labels. Although the use of unique tracking barcodes will be optional for these mailers, the end-to-end tracking, including confirmation of delivery, at no additional charge should be a significant benefit to most mailers.

Comment: Another commenter asked if a mailer can apply an IMpb to their parcels without using either version 1.5 or 1.6 of the electronic shipping services manifest files.

Response: IMpb use requires version 1.5 or 1.6 of the electronic shipping services manifest files. Version 1.5 is no longer offered to new IMpb mailers, and is only available for mailers currently using this version. All new IMpb mailers must use version 1.6 of the electronic shipping services manifest files. The only exceptions for use of an electronic shipping services manifest files are for certain current ( e.g. MRS) and future programs or products that do not require a manifest.

Comment: A commenter asked how the Postal Service will differentiate between postage paid and postage due returns.

Response: The Postal Service has developed a number of unique 3-digit service type codes. In addition to various other capabilities, these new codes offer the capability to distinguish postage paid pieces from postage due returns.

Comment: A commenter asked how the tracking of returns using Delivery Confirmation service will work, and if any of the parcel return processes will change as a result of these new standards.

Response: In accordance with the new scanning policies, all parcels will receive acceptance, enroute, and delivered event scans. These additional event scans will appear in the mailer's extract files; and mailers will be able to track items online without additional fees. The processes for parcel return will not change as a result of these standards.

Comment: A commenter asked if Parcel Post will be eligible for Delivery Confirmation service at no charge.

Response: Parcel Post is generally classified as a retail product, and as such, is not eligible for end-to-end tracking, including confirmation of delivery, at no charge. Commercially-entered Parcel Post pieces, defined as those bearing a permit imprint, are also not eligible for end-to-end tracking, including confirmation of delivery, at no charge.

Comment: A commenter asked if the First-Class Mail commercials parcels that have moved to First-Class Package Service within the competitive product line will require different service type codes, and if Standard Mail parcels that may move to Parcel Select within the competitive product line will require different service type codes.

Response: The Postal Service does not plan to introduce different service type codes for the new competitive First-Class Package Service parcels, but it will define new service type codes for Parcel Select Lightweight, if the transition from Standard Mail parcels to Parcel Select occurs as planned.

Comment: A commenter asked if MRS mailers will still be able to access delivery status data from the Track & Confirm page on the USPS.com Web site, and if a data file of Delivery Confirmation dates by unique tracking number would be provided.

Response: Mailers will continue to have the ability to access delivery status information on USPS.com, and customer extract files will be provided for certified MRS customers who apply an IMpb or unique tracking or extra service barcodes to their MRS labels.

Comment: Another commenter asked if service type code 396 (which corresponds to no extra service) will be used for pre-printed MRS labels (since unique serial numbers cannot be used).

Response: Unique serial numbers will be required for IMpb and tracking or extra services barcodes, including MRS labels. It is possible to print unique serial numbers for pre-printed labels; many MRS and PRS customers do so currently. Service type code 396 may be used; but unique serial numbers are still required.

Comment: A commenter stated that required IMpb use by June 3, 2013 will negatively impact current Express Mail and Priority Mail volume, particularly those pieces sent by small and medium size mailers (many of which are postage meter customers). This commenter states that if the Postal Service adopts these new standards, postage meter customers will be placed in a distinct competitive disadvantage. The commenter opines that changes can be made to the proposed standards that would enable postage meter customers to continue to use the USPS.

Response: The Postal Service believes these new standards, including required use of an IMpb by January 7, 2013, to be equitable to all postage providers and that they do not favor server-based over distributed or client-based providers. This revision provides for a substantial implementation period. Once postage meter providers change their systems to enable the generation and manifesting of IMpb tracking and extra services barcodes, small and medium sized mailers using those systems will have the ability to create an IMpb and transmit electronic shipping services manifest files version 1.6 to the USPS. Those mailers who do not require tracking or extra services and do not wish to claim presort or destination entry pricing are not required to make any changes. In the proposed rule (75 FR 23749-23755) published April 28, 2011, the Postal Service stated “in consideration of the small and medium-size mailers primarily using postage meters, the Postal Service will consult with the meter and PC Postage industry to collaboratively agree on a date for these mailers to be required to use the IMpb.” The Postal Service will consider this comment during future consultations with the postage meter industry. The Postal Service also considers users of PC Postage stamp products to be in this mailer category and looks forward to their participation in this consultation process.

The standards described in this final rule Federal Register are subject to approval by the Board of Governors and to regulatory review by the Postal Regulatory Commission (PRC). The Postal Service will inform the mailing community through a DMM Advisory notice at the conclusion of this approval and review process.

The Postal Service hereby adopts the following changes to Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM), incorporated by reference in the Code of Federal Regulations. See 39 CFR 111.1.

Accordingly, 39 CFR part 111 is amended as follows:

Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This supplementary information section is arranged as follows:

EPA is making a determination that the Indianapolis area is attaining the 1997 annual PM 2.5 standard and that the area has met the requirements for redesignation under section 107(d)(3)(E) of the CAA. EPA is thus approving the request from IDEM to change the legal designation of the Indianapolis area from nonattainment to attainment for the 1997 annual PM 2.5 NAAQS. EPA is also taking several additional actions related to Indiana's PM 2.5 redesignation request, as discussed below.

EPA is approving Indiana's PM 2.5 maintenance plan for the Indianapolis area as a revision to the Indiana SIP (such approval being one of the CAA criteria for redesignation to attainment status). The maintenance plan is designed to keep the Indianapolis area in attainment of the 1997 annual PM 2.5 NAAQS through 2025.

EPA is approving 2006 emissions inventories for primary PM 2.5 , 1 NO X , and Sulfur Dioxide (SO 2 ), 2 documented in Indiana's May 31, 2011, PM 2.5 redesignation request supplemental submittal. These emissions inventories satisfy the requirement in section 172(c)(3) of the CAA for a comprehensive, current emission inventory.

Finally, EPA finds adequate and is approving 2015 and 2025 primary PM 2.5 and NO X MVEBs for the Indianapolis area. These MVEBs will be used in future transportation conformity analyses for the area.

The first air quality standards for PM 2.5 were promulgated on July 18, 1997, at 62 FR 38652. EPA promulgated an annual standard at a level of 15 micrograms per cubic meter (µg/m 3 ) of ambient air, based on a three-year average of the annual mean PM 2.5 concentrations at each monitoring site. In the same rulemaking, EPA promulgated a 24-hour PM 2.5 standard at 65 µg/m 3 , based on a three-year average of the annual 98th percentile of 24-hour PM 2.5 concentrations at each monitoring site.

On January 5, 2005, at 70 FR 944, EPA published air quality area designations and classifications for the 1997 annual PM 2.5 standard based on air quality data for calendar years 2001-2003. In that rulemaking, EPA designated the Indianapolis, IN area as nonattainment for the 1997 annual PM 2.5 standard.

On October 17, 2006, at 71 FR 61144, EPA retained the annual PM 2.5 standard at 15 µg/m 3 (2006 annual PM 2.5 standard), but revised the 24-hour standard to 35 µg/m 3 , based again on the three-year average of the annual 98th percentile of the 24-hour PM 2.5 concentrations. In response to legal challenges of the 2006 annual PM 2.5 standard, the U.S. Court of Appeals for District of Columbia Circuit (D.C. Circuit) remanded this standard to EPA for further consideration. See American Farm Bureau Federation and National Pork Producers Council, et al. v. EPA, 559 F.3d 512 (D.C. Cir. 2009). However, given that the 1997 and 2006 annual PM 2.5 standards are essentially identical, attainment of the 1997 annual PM 2.5 standard would also indicate attainment of the remanded 2006 annual standard. Since the Indianapolis area is designated as nonattainment only for the 1997 annual PM 2.5 standard, today's proposed action addresses redesignation to attainment only for this standard.

Fine particulate pollution can be emitted directly from a source (primary PM 2.5 ) or formed secondarily through chemical reactions in the atmosphere involving precursor pollutants emitted from a variety of sources. Sulfates are a type of secondary particulate formed from SO 2 emissions from power plants and industrial facilities. Nitrates, another common type of secondary particulate, are formed from combustion of NO X emissions from power plants, mobile sources, and other combustion sources.

The CAA sets forth the requirements for redesignating a nonattainment area to attainment. Specifically, section 107(d)(3)(E) of the CAA allows redesignation provided that: (1) The Administrator determines that the area has attained the applicable NAAQS; (2) the Administrator has fully approved the applicable SIP for the area under section 110(k) of the CAA; (3) the Administrator determines that the improvement in air quality is due to permanent and enforceable reductions in emissions resulting from the implementation of the applicable SIP, Federal emission control regulations, and other permanent and enforceable emission reductions; (4) the Administrator has fully approved a maintenance plan for the area meeting the requirements of section 175A of the CAA; and, (5) the state containing the area has met all requirements applicable to the area for purposes of redesignation under section 110 and part D of the CAA.

EPA is making a determination that the Indianapolis area has attained the 1997 annual PM 2.5 standard and that the area has met all other applicable redesignation criteria under CAA section 107(d)(3)(E). The basis for EPA's approval of the redesignation request is as follows:

EPA is making a determination that the Indianapolis area has attained the 1997 annual PM 2.5 NAAQS. An area may be considered to be attaining the 1997 annual PM 2.5 NAAQS if there are no violations, as determined in accordance with 40 CFR 50.7 and part 50, Appendix N, based on three complete consecutive calendar years of quality-assured air quality monitoring data. To attain this standard, the three-year average of annual means must not exceed 15.0 μg/m 3 at all relevant monitoring sites in the subject area. Under 40 CFR part 50, Appendix N 4.1, a year of PM 2.5 data meets completeness requirements when “at least 75 percent of the scheduled sampling days for each quarter has valid data.”

The redesignation request includes monitoring data showing attainment of the standard for the 2006-2008, 2007-2009, and 2008-2010 time periods. All of the PM 2.5 monitors in the Indianapolis area are located in Marion County. Table 1, below, provides a summary of the PM 2.5 annual air quality monitoring data for the years 2006-2010. Table 2, below, provides the three-year average of annual means for the 2006-2008, 2007-2009, and 2008-2010 time periods.

This supplementary information section is arranged as follows:

Indiana submitted a request for redesignation of the Evansville area to attainment for the 1997 annual PM 2.5 National Ambient Air Quality Standards (NAAQS) on April 3, 2008, supplemented by additional subsequent submittals on various dates including submittal of a replacement maintenance plan on April 8, 2011. On May 23, 2011, at 76 FR 29695, EPA published a notice of proposed rulemaking addressing these submittals. In the May 23 action, EPA first referred to EPA's prior final determination that the Evansville area had attained the 1997 annual PM 2.5 NAAQS (published November 27, 2009, at 74 FR 62243), and proposed to determine that the area continues to attain that standard. Second, EPA proposed to approve Indiana's 1997 annual PM 2.5 maintenance plan for the Evansville area as a revision to the Indiana SIP, subject to the proviso that EPA promulgate a final Transport Rule requiring power plant emission reductions substantially equivalent for purposes of maintaining the PM 2.5 standard in Evansville to those proposed in EPA's Transport Rule proposal. Third, EPA proposed to approve the 2005 emission inventory in Indiana's maintenance plan as satisfying the requirement of section 172(c)(3) for a comprehensive and accurate emissions inventory. Fourth, EPA proposed to find that, subject to final approval of the emissions inventory and the proviso set forth above with respect to EPA's proposed Transport Rule, Indiana meets the requirements for redesignation of the Evansville area to attainment of the 1997 PM 2.5 NAAQS under section 107(d)(3)(E) of the Clean Air Act. Finally, EPA proposed to approve the 2015 and 2022 Motor Vehicle Emission Budgets (MVEBs) for the Evansville area into the Indiana SIP. These proposals were generally contingent on EPA finalizing a Transport Rule which, for purposes of this action, was substantially equivalent to the Transport Rule that EPA proposed on August 2, 2010.

The first air quality standards for PM 2.5 were promulgated on July 18, 1997, at 62 FR 38652. EPA promulgated an annual standard at a level of 15 micrograms per cubic meter (μg/m 3 ), based on a three-year average of annual mean PM 2.5 concentrations. In the same rulemaking, EPA promulgated a 24-hour standard of 65 μg/m 3 , based on a three-year average of the 98th percentile of 24-hour concentrations. On October 17, 2006, at 71 FR 61144, EPA retained the annual average standard at 15 μg/m 3 but revised the 24-hour standard to 35 μg/m 3 , based again on the three-year average of the 98th percentile of 24-hour concentrations.

On January 5, 2005, at 70 FR 944, as supplemented on April 14, 2005, at 70 FR 19844, EPA designated the Evansville area as nonattainment for the 1997 PM 2.5 air quality standards. In that action, EPA defined the Evansville nonattainment area to include the entirety of Dubois, Vanderburgh, and Warrick Counties and portions of three other counties, specifically including Montgomery Township in Gibson County, Ohio Township in Spencer County, and Washington Township in Pike County. On November 13, 2009, at 74 FR 58688, EPA promulgated designations for the 24-hour standard set in 2006, designating the Evansville area as attaining this standard. In that action, EPA also clarified the designations for the NAAQS promulgated in 1997, stating that the Evansville area remained designated nonattainment for the 1997 annual PM 2.5 standard, but was designated attainment for the 1997 24-hour standard. Thus today's action does not address attainment of either the 1997 or the 2006 24-hour standards.

In response to legal challenges of the annual standard promulgated in 2006, the DC Circuit remanded this standard to EPA for further consideration. See American Farm Bureau Federation and National Pork Producers Council, et al. v. EPA, 559 F.3d 512 (D.C. Cir. 2009). However, given that the 1997 and 2006 annual standards are essentially identical, attainment of the 1997 annual standard would also indicate attainment of the remanded 2006 annual standard. Since the Evansville area is designated nonattainment only for the annual standard promulgated in 1997, today's action addresses redesignation to attainment only for this standard.

The notice of proposed rulemaking identifies multiple submittals that Indiana provided in support of its request for redesignation of the Evansville area. Given the significance of sulfates and nitrates in the Evansville area, several of these submittals focused on the sulfur dioxide (SO 2 ) and nitrogen oxides (NO X ) emissions from power plants and the regulations governing these emissions.

EPA proposed the Clean Air Interstate Rule (CAIR) on January 30, 2004, at 69 FR 4566, promulgated CAIR on May 12, 2005, at 70 FR 25162, and promulgated associated Federal Implementation Plans (FIPs) on April 28, 2006, at 71 FR 25328, in order to reduce SO 2 and NO X emissions and improve air quality in many areas across the eastern part of the United States. However, as a result of rulings by the Court of Appeals for the District of Columbia Circuit, the power plant emission reductions that have resulted from the development, promulgation, and implementation of CAIR, and the associated air quality improvement that has occurred in the Evansville area and elsewhere, cannot be considered permanent.

On August 2, 2010, EPA published its proposal of the Transport Rule, to address interstate transport of emissions with respect to the 1997 ozone and the 1997 and 2006 PM 2.5 NAAQS, to replace CAIR. ( See 75 FR 45210.) In that rulemaking action, EPA proposed to require substantial reductions of SO 2 and NO X emissions from electric generating units (egus) across most of the Eastern United States. Indeed, EPA's rulemaking notice proposing the Evansville redesignation expressed the view that the Transport Rule as proposed would require reductions of these emissions to levels well below the levels that led to attainment in the Evansville area. On this basis, EPA proposed to conclude that EPA's promulgation of a final Transport Rule would make permanent and enforceable the power plant emission reductions to which Evansville's air quality improvement were attributable, provided the final Transport Rule was substantially equivalent to the proposed rule for purposes of maintaining the PM 2.5 air quality standard in the Evansville area.

Final rulemaking for the Transport Rule, also known as the Cross-State Air Pollution Rule (CSAPR), was published on August 8, 2011, at 76 FR 48208. The discussion below addresses the question of whether CSAPR may be considered to be substantially equivalent to the proposed Transport Rule for purposes of maintaining the standard in the Evansville area.

EPA received two sets of comments on its proposal to redesignate Evansville to attainment for PM 2.5 . John Blair, on behalf of Valley Watch (“Valley Watch”), opposed the redesignation, and Joanne Alexandrovich, on behalf of the Vanderburgh County Health Department (“Vanderburgh County”), supported the redesignation. The following discussion summarizes the comments and provides EPA's responses.

Comment: Valley Watch states: “Monitors in the region have shown levels of PM 2.5 to be ‘moderate’ on many more days than they have been in the range considered ‘good’ by EPA in 2011.”

Response: The air quality index that is cited by the commenter is designed to characterize 24-hour average concentrations in terms such as “good” or “moderate” levels. This index is not designed to report the 1997 annual PM 2.5 values that are at issue in this redesignation, and is in fact a weak indicator of annual average concentrations. Furthermore, the air quality index that is the focus of the comment often relies on reporting from continuous instruments that, although capable of providing air quality information on a timely basis, may provide less reliable air quality information. For these reasons, and given the imprecise, non-quantitative nature of the information cited by the commenter, we conclude that it is not pertinent to the determination addressed in this rulemaking—whether the Evansville area is meeting the 1997 annual average PM 2.5.

As we have previously shown, based on comprehensive and quality-assured air monitoring data presented in the proposed and final determinations of attainment and in the proposed redesignation notice, the Evansville area has been meeting the 1997 annual average PM 2.5 standard since 2004 to 2006, and continues to meet that standard. The most recent air quality data available for 2011 is consistent with continued attainment. The information regarding the 24-hour values referred to by the commenter does not bear upon nor detract from EPA's determinations regarding the area's longstanding attainment of the 1997 annual standard.

Comment: Valley Watch claims that the recent air quality improvement “is more likely due to the fact that overall energy production in the region has been about 25% lower than previous years due to the deep recession * * * rather than permanent and enforceable emission limits.”

Response: EPA disagrees with the commenter's opinion regarding the cause of the Evansville area's attainment of the standard. The commenter is evidently referring to a recession that the National Bureau of Economic Research found to extend from December 2007 to June 2009. However, EPA determined that the Evansville area attained the standard before this period, as established by air quality data for 2004 to 2006 and for 2005 to 2007. As shown in Table 1 of the notice of proposed rulemaking (see 76 FR 29698, May 23, 2011), data for 2010 indicate that the area continues to attain the standard by a substantial margin, notwithstanding some economic recovery. Thus, as set forth in the proposal and in today's action, EPA continues to believe that the air quality improvement is largely attributable to substantial reductions in power plant emissions. CAIR mandated substantial reductions in power plant emissions. These requirements address emissions through 2011 and EPA has now promulgated CSAPR, which requires similar or greater reductions in the relevant areas in 2012 and beyond. Because the emission reduction requirements of CAIR are enforceable through the 2011 control period, and because CSAPR has now been promulgated to address the requirements previously addressed by CAIR and gets similar or greater reductions in the relevant areas in 2012 and beyond, EPA has determined that the emission reductions that led to attainment in the Evansville area can now be considered permanent and enforceable and that the requirement of Clean Air Act section 107(d)(3)(E)(iii) has now been met.

Comment: Valley Watch contends that some of the numerous power plants in the region near Evansville have indeed installed scrubbers for the control of SO 2, “but those reductions are not required by permanent and enforceable emission limits. The reductions are mainly undertaken to satisfy cap and trade programs like Clean Air Interstate Rule.” Valley Watch asserts, as a result, that the sources may choose to purchase credits and emit more.

Furthermore, Valley Watch notes that “CAIR was overturned by the DC Court of Appeals”, and so contends that the reductions that it cause cannot be considered permanent or enforceable. It also asserts that the “D.C. Circuit already held that CAIR does not require enforceable reductions in any particular state.”

Response: While EPA views CAIR as likely one of the motivations for the power plant emission reductions that it considers the primary cause for the air quality improvement in the Evansville area, EPA is not relying solely on CAIR as the basis for redesignating the Evansville area to attainment. As explained in the notice of proposed rulemaking, CAIR was ultimately remanded to EPA without vacatur. EPA has now responded to that remand with the promulgation of CSAPR. CAIR limits emissions through the end of the 2011 control periods, and the new Transport Rule limits emissions in 2012 and beyond. With these regulations, EPA is requiring a level of power plant emission control that exceeds the level of reductions that resulted in attainment in the Evansville area.

Several factors contribute to EPA's expectation that CSAPR will provide even better air quality in the Evansville area than has occurred to date. First, given the mandates under CSAPR, any utility that has already spent the hundreds of millions of dollars to install scrubbers will clearly find continued effective operation of these scrubbers to be far more cost-effective than disregarding this investment and either spending more hundreds of millions of dollars installing replacement scrubbers elsewhere or purchasing credits at a price equivalent to spending those hundreds of millions of dollars. In short, any utility in a state covered by CSAPR provisions related to PM 2.5 that has installed scrubbers is almost certain under CSAPR to retain the scrubbers and operate them effectively. Second, any action by a utility that increases its emissions, requiring the purchase of allowances, thereby necessitates a corresponding emission reduction by the utility that sells the allowances. Given the regional nature of particulate matter, this corresponding emission reduction will have an air quality benefit that will compensate at least in part for the impact of any emission increase from Evansville area utilities. Third, in response to the opinion of the Court of Appeals for the District of Columbia Circuit, CSAPR trading programs include assurance provisions to ensure that the necessary emission reductions occur within each covered state.

Comment: Valley Watch argues that, while the Transport Rule “is supposed to be finalized in a matter of weeks,” EPA has encountered delays in several of its rulemakings, and EPA may not rely on a rule that has not yet been promulgated.

Response: EPA stated in its notice of proposed rulemaking that it would not publish final rulemaking until the Transport Rule was made final. CSAPR has now been promulgated. EPA notes that, along with promulgation of CSAPR, EPA issued a supplemental notice of proposed rulemaking to include six additional states in the summer season NO X trading program. (See 76 FR 40662, published July 11, 2011.) EPA is not relying, in this redesignation, on reductions that would be achieved if that supplemental proposal is finalized as proposed.

Comment: Valley Watch states that “EPA has offered no analysis, under Clean Air Act 110(l), of what impact this redesignation would have on compliance with the 1997 and 2008 ozone NAAQS, the 2006 PM 2.5 NAAQS and the 2010 1-hour SO 2 and NO X NAAQS.”

Response: This redesignation does not relax any existing control requirements, nor does it affect any existing control requirements. On this basis, EPA concludes that this redesignation will not interfere with attainment or maintenance of any of these air quality standards.

Valley Watch attached comments dated March 27, 2008, that it submitted to Indiana during the State's comment period on a State proposal to request redesignation. Since these comments were summarized in Indiana's submittal, EPA has already considered them as part of that review process. Nevertheless, since the commenter has resubmitted these comments, EPA will provide responses to those comments as well.

Comment: Valley Watch commented that the air quality standard of 15 μg/m 3 is not protective of community health.

Response: Comments regarding the appropriateness or adequacy of the 1997 PM 2.5 air quality standard are not germane to this rulemaking. At issue here is whether the Evansville area meets the criteria in section 107(d)(3)(E) for being redesignated as attaining the 1997 annual average PM 2.5 air quality standard that was established in a prior rulemaking that cannot be challenged here.

Comment: Valley Watch reviews emission controls by power plants in the Evansville area. It claims that one plant (Gibson Station) is controlling only about 50 percent of the SO 2 emissions from three of its five units, and that another plant (Rockport Station) has no plans to control either NO X or SO 2 emissions until at least 2018.

Response: Data available on the Clean Air Markets public data repository show that emissions for all five units at Gibson Station declined by well more than 50 percent from 2002 to 2010, adding up to a reduction by over 80 percent. The dates when the commenter expects control of Rockport Station are similar to the dates by which a federal consent decree requires control, though other requirements may result in earlier installation of these controls. However, the commenter does not explain the relevance of these comments.

The relevant issues for this rulemaking are whether current emission control levels suffice for the area to attain the standard, whether the air quality improvement leading to attainment is attributable to permanent and enforceable emission reductions, and whether the area is assured of continuing to attain the standard. Redesignation is not contingent on achieving all possible emission controls. The emission controls that have occurred to date have sufficed for the Evansville area to attain the standard, EPA finds that the air quality improvement may be attributed to a permanent and enforceable set of emission reductions, and Indiana has demonstrated that sufficient control requirements are in place to assure that the Evansville area will maintain the standard.

Comment: Valley Watch states that Indiana should not use data from 2004 to 2006 and should instead wait to collect another year of data to see if air quality in Evansville is “clean and healthy.” The commenter claims that 13 percent of the data is missing in 2006 and 16 percent is missing in 2007, “mostly during periods when high levels of fine particles are historically formed.” Valley Watch states that, “if our design value was approaching the level recommended by [the Clean Air Science Advisory Committee] of 14 μg/m 3 , * * * data missing on days of high levels would not be such an issue.”

Response: EPA has examined and evaluated quality-assured data for more than four years beyond 2006 and concludes that the area continues to attain the standard. As a general matter, under 40 CFR part 50 Appendix N, data sets that include at least 75 percent of the scheduled data are deemed complete and may be considered to provide an adequate representation of PM 2.5 concentrations. This topic was addressed specifically for the Evansville area in EPA's determination of attainment and in the proposed redesignation. Furthermore, Valley Watch provided no analysis in support of its allegation that the data are unrepresentative. Data meeting the quality assurance requirements in EPA's regulations show that the area has been continuously in attainment with the 1997 annual average PM 2.5 standard since 2006. The design value for the area is now well below 14 μg/m 3 , so that Valley Watch's comment suggests that it must now concede that differences between actual data capture rates in the area and 100 percent data capture may be considered insignificant.

Comment: Valley Watch includes critical comments questioning the integrity of certain State and local officials.

Response: The comments do not raise issues relevant to redesignation, and are not germane to this rulemaking.

Comment: Vanderburgh County comments that it believes the State of Indiana has submitted a redesignation package that “meets all statutory, regulatory, and guidance requirements” for Evansville to be redesignated to attainment.

Response: EPA agrees.

Comment: Vanderburgh County contends that “redesignation should not be contingent on final promulgation of the [Transport Rule].” The commenter adds that the area was meeting the air quality standard by 2006, and disagrees with EPA's statement “that air quality monitoring between 2004 and 2006 ‘would reflect the benefits from EPA's development, proposal, and promulgation of CAIR.’ ” The commenter provides emissions data for power plants within 100 kilometers of Evansville and elsewhere in Indiana and Kentucky, to support a claim that attainment cannot be attributed to CAIR. The emissions data, derived from the EPA Clean Air Markets Web site from 1995 to 2010, suggest that regional power plant emissions of SO 2 were relatively constant from 2001 to 2006 and only declined significantly thereafter. The commenter believes that the emissions data indicate that NO X emissions steadily and significantly declined from 1998 to 2004 and then held relatively steady until declining again starting in 2009.

The commenter agrees that power plant emissions dominate air quality in the Evansville area. Indeed, the commenter finds that “PM 2.5 annual design values are highly correlated with the SO 2 and NO X emissions from coal fired EGUs located within 100 km of Evansville (R 2 coefficients ≉ 0.80).”

However, the commenter expresses doubt in the view that CAIR caused significant emission reductions by 2006, when the Evansville area came into attainment. The commenter expresses the view that the area's air quality improvement is attributable to power plant emission reductions resulting from the Acid Rain Program.

Response: EPA has now promulgated CSAPR, which limits emissions in the relevant area and will replace CAIR. As explained above, CAIR limits emissions through the end of the 2011 control periods, and CSAPR will limit emission in 2012 and beyond.

The commenter does well to consider power plant emissions data for a region that extends beyond the boundaries of the Evansville nonattainment area. Indeed, EPA's notice of proposed redesignation addressed emissions for 13 states including Indiana, and EPA continues to believe that it is appropriate to examine pertinent emissions trends in this broad area. The trends across this 13-state region are similar to those identified by the commenter in the less broad region.

In conjunction with its Transport Rule rulemaking, EPA conducted an extensive examination of pertinent emissions data and, because the Transport Rule was to replace CAIR, EPA evaluated air quality under a baseline that did not include CAIR. EPA's final Transport Rule analysis, which took into account comments received on the proposal, projected that the Evansville area would attain the annual PM 2.5 standard in 2012 even in the absence of reductions due solely to CAIR and not required by other Federal or state regulations or consent decrees). EPA did not conduct a direct assessment of whether the Evansville area would have attained in 2004 to 2006 in absence of CAIR, and any extrapolation from EPA's 2012 analysis is complicated by consideration of other emission controls mandated by 2012 ( e.g., by the settlement of enforcement cases and the imposition of state mandates) that are independent of CAIR and CSAPR that mostly occurred after Evansville attained the standard. Furthermore, the motivations for power plant emission reductions are difficult to discern. In any case, the promulgation of CSAPR makes it no longer necessary to determine what originally motivated the power plant emission reductions that yielded attainment. The CAIR emission reduction requirements limit emissions through 2011 and EPA has now promulgated CSAPR which requires similar or greater reductions in the relevant areas in 2012 and beyond. In particular, CSAPR requires reduction of these emissions to levels well below the levels that led to attainment of the 1997 annual PM 2.5 standard in the Evansville area.

EPA and the commenter agree that the air quality improvement is attributable to emission reductions that are enforceable and now permanently required. The requirements of the Acid Rain Program are permanent and enforceable and the requirements of CSAPR, which replaces CAIR and requires equivalent or greater reductions in the relevant areas, are also permanent and enforceable. Thus, the emission reductions that led to attainment in the Evansville area can be said to be permanent and enforceable emission reductions. As noted above, CSAPR, while not requiring identical reductions to CAIR, mandated sufficient reductions in the relevant areas to guarantee that any reductions originally associated with CAIR that may have been necessary for the Evansville area to demonstrate attainment are now permanently required.

EPA's proposal to redesignate the Evansville area to attainment was contingent in some respects on the final Transport Rule being substantially equivalent to the proposed Transport Rule with respect to air quality in the Evansville area. For example, EPA stated that it proposed to conclude that the air quality could be attributed to permanent and enforceable measures once EPA promulgated the final Transport Rule, provided EPA issued “final promulgation of a Transport Rule that is substantially equivalent to the proposed rule for purposes of maintaining the standard in the Evansville area”. EPA included a similar proviso in the review of Indiana's maintenance plan. Therefore, the following discussion compares the final against the proposed Transport Rule.

Table 1 shows the proposed and final annual NO X and annual SO 2 budgets for the 13 states that EPA had proposed to find significantly contribute to or interfere with maintenance of the 1997 annual PM 2.5 NAAQS in the Evansville area. EPA ultimately did not conclude that these states significantly contribute to, or interfere with, maintenance of these NAAQS in the Evansville area, because it determined that even in the absence of CAIR, the Evansville area would attain the standard in 2012. Nonetheless, EPA continues to believe that these 13 states are the most relevant with respect to Evansville area air quality.

This comparison supports EPA's conclusion that the final Transport Rule requires power plant emission reductions that are, for purposes of maintaining the PM 2.5 standard in Evansville, at least substantially equivalent to those proposed.

EPA continues to believe that the Evansville area meets the criteria of Clean Air Act section 107(d)(3)(E) for redesignation to attainment for the 1997 annual PM 2.5 air quality standard. First, EPA has determined that the air quality in the area meets the 1997 annual PM 2.5 standard. Second, with the approval today of a comprehensive emission inventory (in satisfaction of the requirement in section 172(c)(3)), EPA has fully approved the applicable implementation plan. Third, with the final promulgation of CSAPR, in conjunction with the Federal motor vehicle control program and other emission reductions, EPA believes that the air quality improvement in the Evansville area may be attributed to measures that are permanent and enforceable. Fourth, EPA believes that Indiana has provided a maintenance plan for the PM 2.5 standard through 2022 that meets the requirements of section 175A. Fifth, EPA believes that Indiana has met all pertinent planning requirements for the Evansville area under section 110 and Part D.

Therefore, EPA is taking several actions. EPA is approving Indiana's PM 2.5 emission inventory for the Evansville area as meeting the requirements of section 172(c)(3). Pursuant to section 175A, EPA is approving the State's maintenance plan as providing for maintenance through 2022. EPA is redesignating the Evansville area to attainment of the 1997 annual PM 2.5 air quality standard. Finally, EPA is establishing transportation conformity budgets for the area, specifically budgets for NO X of 2,628.35 tons per year in 2015 and 1869.84 tons per year in 2022 and budgets for direct emissions of PM 2.5 of 57.05 tons per year in 2015 and 53.83 tons per year in 2022.

Under the Clean Air Act, redesignation of an area to attainment and the accompanying approval of a maintenance plan under section 107(d)(3)(E) are actions that affect the status of a geographical area and do not impose any additional regulatory requirements on sources beyond those imposed by state law. A redesignation to attainment does not in and of itself create any new requirements, but rather results in the applicability of requirements contained in the Clean Air Act for areas that have been redesignated to attainment. Moreover, the Administrator is required to approve a SIP submission that complies with the provisions of the Clean Air Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, these actions:

• Are not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);

• Do not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq. );

• Are certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. );

• Do 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);

• Do not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

• Are not economically significant regulatory actions based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

• Are not significant regulatory actions subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

• Are not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and

• Do not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action 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 November 28, 2011. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action 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).)

40 CFR part 52 is amended as follows:

Regulated Entities. The Administrator determined that this action is subject to the provisions of Clean Air Act (CAA) section 307(d). See CAA section 307(d)(1)(V) (the provisions of section 307(d) apply to “such other actions as the Administrator may determine”). This final rule affects owners or operators of petroleum and natural gas systems. Regulated categories and entities may include those listed in Table 1 of this preamble:

Table 1 of this preamble is not intended to be exhaustive, but rather provides a guide for readers regarding facilities likely to be affected by this action. Table 1 of this preamble lists the types of facilities of which EPA is aware could be potentially affected by the reporting requirements. Other types of facilities not listed in the table could also be affected. To determine whether you are affected by this action, you should carefully examine the applicability criteria found in 40 CFR part 98, subpart W or the relevant criteria in the sections related to petroleum and natural gas systems. If you have questions regarding the applicability of this action to a particular facility, consult the person listed in the preceding FOR FURTHER INFORMATION CONTACT section.

What is the effective date? The final rule is effective on September 30, 2011. Section 553(d) of the Administrative Procedure Act (APA), 5 U.S.C. Chapter 5, generally provides that rules may not take effect earlier than 30 days after they are published in the Federal Register. EPA is issuing this final rule under section CAA 307(d)(1), which states: “The provisions of section 553 through 557 * * * of Title 5 shall not, except as expressly provided in this section, apply to actions to which this subsection applies.” Thus, section 553(d) of the APA does not apply to this rule. EPA is nevertheless acting consistently with the purposes underlying APA section 553(d) in making this rule effective on September 30, 2011. Section 5 U.S.C. 553(d)(3) allows an effective date less than 30 days after publication “as otherwise provided by the agency for good cause found and published with the rule.” As explained below, EPA finds that there is good cause for this rule to become effective on or before September 30, 2011, even though this will result in an effective date fewer than 30 days from the date of publication in the Federal Register .

The purpose of the 30-day waiting period prescribed in 5 U.S.C. 553(d) is to give affected parties a reasonable time to adjust their behavior and prepare before the final rule takes effect. That purpose, to provide affected parties a reasonable time to adjust to the rule before it comes into effect, is not necessary in this case, as this final rule avoids the need for affected parties to take action.

Currently, according to the provisions in 76 FR 22825 (April 25, 2011), owners and operators subject to 40 CFR part 98 may take advantage of automatic use of best available monitoring methods (BAMM) for parameters that cannot reasonably be measured according to the monitoring requirements in the rule through September 30, 2011. After September 30, 2011, owners and operators must follow all monitoring and quality assurance (QA) and quality control (QC) procedures in the rule unless the Administrator has approved using BAMM beyond that date. Finalizing this rule by September 30, 2011 enables owners and operators to automatically use BAMM through the end of 2011, without the need to request approval from the Administrator. If EPA were not to finalize this rule by September 30, 2011, owners and operators would have to comply with all monitoring and QA/QC requirements as of October 1, 2011, which is the precise situation that this final rule is trying to avoid. Accordingly, EPA finds good cause exists to make this rule effective on September 30, 2011, consistent with the purposes of 5 U.S.C. 553(d)(3).

Judicial Review. Under CAA section 307(b)(1), judicial review of this final rule is available only by filing a petition for review in the U.S. Court of Appeals for the District of Columbia Circuit (the Court) by November 28, 2011. Under CAA section 307(d)(7)(B), only an objection to this final rule that was raised with reasonable specificity during the period for public comment can be raised during judicial review. Section 307(d)(7)(B) of the CAA also provides a mechanism for EPA to convene a proceeding for reconsideration, “[i]f the person raising an objection can demonstrate to EPA that it was impracticable to raise such objection within [the period for public comment] or if the grounds for such objection arose after the period for public comment (but within the time specified for judicial review) and if such objection is of central relevance to the outcome of the rule.” Any person seeking to make such a demonstration to us should submit a Petition for Reconsideration to the Office of the Administrator, Environmental Protection Agency, Room 3000, Ariel Rios Building, 1200 Pennsylvania Ave., NW., Washington, DC 20460, with a copy to the person listed in the preceding FOR FURTHER INFORMATION CONTACT section, and the Associate General Counsel for the Air and Radiation Law Office, Office of General Counsel (Mail Code 2344A), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20004. Note, under CAA section 307(b)(2), the requirements established by this final rule may not be challenged separately in any civil or criminal proceedings brought by EPA to enforce these requirements.

The following acronyms and abbreviations are used in this document.

This preamble consists of four sections. The first section provides a brief history of 40 CFR part 98, subpart W (“subpart W”).

The second section of this preamble summarizes the revisions made to specific requirements for subpart W being incorporated into 40 CFR part 98 by this action. It also describes the major changes made to this source category since proposal and provides a brief summary of significant public comments and EPA's responses. Additional responses to significant comments can be located in the document “Mandatory Reporting of Greenhouse Gases—Petroleum and Natural Gas Systems, Revisions to Best Available Monitoring Methods: EPA's Response to Public Comments”.

The third section of this preamble provides a statement regarding the economic impacts of the final rule.

Finally, the last section discusses the various statutory and executive order requirements applicable to this rulemaking.

This action finalizes amendments to best available monitoring method (BAMM) provisions in 40 CFR part 98, subpart W. EPA published Subpart W—Petroleum and Natural Gas Systems of the Greenhouse Gas Reporting Rule on November 30, 2010, 40 CFR part 98, subpart W (75 FR 74458). Included in the final rule were new provisions that were added in response to comments on the proposal (75 FR 18608, April 12, 2010) allowing owners and operators the option of using BAMM for specified parameters in 40 CFR 98.233.

Following the publication of subpart W in the Federal Register , several industry groups sought reconsideration of several provisions in the final rule, including the provisions allowing BAMM. In a follow up action, EPA granted reconsideration and extended specific BAMM deadlines for 90 days in a rule that was signed on April 20, 2011 (76 FR 22825).

EPA then published a notice of proposed rulemaking to propose extending the time period for which owners and operators of facilities could use BAMM during 2011 without submitting a request to the Administrator for approval, as well as broadening the emissions sources for which BAMM could be used. EPA also proposed extending the deadline for requesting BAMM for beyond 2011. The proposal was published on June 27, 2011 (76 FR 37300). The public comment period for the proposed rule amendments ended on July 27, 2011. EPA did not receive any requests to hold a public hearing.

EPA is promulgating these rule amendments under its existing CAA authority, specifically authorities provided in CAA section 114.

As stated in the preamble to the 2009 final rule (74 FR 56260, October 30, 2009), CAA section 114 provides EPA broad authority to require the information mandated by Part 98 because such data would inform and are relevant to EPA's obligation to carry out a wide variety of CAA provisions. As discussed in the preamble to the initial proposal (74 FR 16448, April 10, 2009), CAA section 114(a)(1) authorizes the Administrator to require emissions sources, persons subject to the CAA, manufacturers of process or control equipment, and persons whom the Administrator believes may have necessary information to monitor and report emissions and provide such other information the Administrator requests for the purposes of carrying out any provision of the CAA. For further information about EPA's legal authority, see the preambles to the proposed and final rule, and Response to Comments Documents.

Subpart W of 40 CFR part 98 includes provisions allowing owners and operators of facilities to use BAMM in lieu of specified data input requirements for determining GHG emissions in certain circumstances for specified emissions sources. Methods that constitute BAMM are: supplier data; monitoring methods currently used by the facility that do not meet the specifications of a relevant subpart; engineering calculations; and/or other company records. When using BAMM, the owner or operator must use the equations and calculation methods set forth in 40 CFR 98.233, but may use BAMM to estimate the parameters in the equations as specified in the rule. Any obligation to report under 30 CFR 250.302 through 304 as applicable by owners or operators of facilities reporting under the offshore petroleum and natural gas production industry segment of subpart W is not affected if such owners or operators choose to use BAMM.

Well-related emissions (40 CFR 98.234(f)(2)). This group of emissions sources includes those well-related data that cannot reasonably be measured according to the monitoring and QA/QC requirements of subpart W, such as well testing, venting, and flaring. Sources that fall in this category may automatically use BAMM for calendar year 2011 without requesting approval from the Administrator.

Specified activity data (40 CFR 98.234(f)(3)). This group includes those activity data that cannot reasonably be obtained according to the monitoring and QA/QC requirements specified in subpart W, such as cumulative hours of venting, days, or times of operation. Sources that fall in this category may automatically use BAMM for calendar year 2011 without requesting approval from the Administrator.

Leak Detection and Measurement (40 CFR 98.234(f)(4)). This group includes those emissions sources that require leak detection and/or measurement such as the measurement of equipment leaks from valves and connectors that cannot reasonably be obtained. Sources that fall in this category may automatically use BAMM for calendar year 2011 without requesting approval from the Administrator.

Additional Sources under 40 CFR 98.234(f)(5)(iv). This category is applicable to emission sources not covered under the previous three categories and includes instances in which the facility owner or operator is facing unique or unusual circumstances, such as data collection methods that do not meet safety regulations, technical infeasibility such as a compressor that would not normally be shut down for maintenance during that calendar year rendering the installation of a port or meter difficult, or requirements that are counter to specific laws or regulations that render owners or operators of the facility unable to meet the requirements of subpart W. These examples are illustrative only; there could be additional circumstances which are unique or unusual under which the source could legitimately use BAMM. Sources that fall in this category may automatically use BAMM for calendar year 2011 without requesting approval from the Administrator.

Best available monitoring methods for use beyond December 31, 2011 for sources in 40 CFR 98.234(f)(2), (f)(3), (f)(4), and (f)(5)(iv). Owners and operators of emission sources covered in 40 CFR 98.234(f)(2), (f)(3), (f)(4), and (f)(5)(iv) may submit a notice of intent to EPA by December 31, 2011 indicating an intent to request BAMM for beyond 2011. Owners and operators who submit a BAMM request consistent with 40 CFR 98.234(f)(8)(ii) by March 30, 2012 who have also submitted a notice of intent by December 31, 2011 will automatically be granted BAMM through June 30, 2012, during which time EPA will review the BAMM request. If the BAMM request is for use of BAMM beyond June 30, 2012 and is approved by the Administrator, owners and operators would be allowed to use BAMM for the time period indicated in the EPA approval letter, but not beyond December 31, 2012 without submitting and obtaining the Administrator's approval of a subsequent request for additional time.

Owners and operators who submit such a notice of intent but do not follow up with a BAMM request by March 30, 2012 are not allowed to use BAMM for 2012. They will have been expected to follow all monitoring and QA/QC requirements in the rule as of January 1, 2012. Although EPA expects that it will be unlikely to be necessary, these owners and operators could still request BAMM for 2013 and beyond according to the procedures outlined in this preamble and rule.

To use BAMM beyond December 31, 2012 (or such other shorter period as provided in an approval letter), or any year thereafter, owners and operators must submit a new request to use BAMM by September 30th of the preceding year or such other time as indicated by an approval letter. The request will be reviewed according to the criteria outlined in 40 CFR 98.234(f)(8), and if the information provided is to the Administrator's satisfaction, approved.

The major changes and clarifications in 40 CFR 98.234(f) since the June 2011 proposal are identified in the following list. For a full description of the rationale for these and any other significant changes to 40 CFR 98.234(f) of subpart W, please see below, as well as the “Mandatory Reporting of Greenhouse Gases—Petroleum and Natural Gas Systems, Revisions to Best Available Monitoring Method Provisions: EPA's Response to Public Comments”. The changes are organized following the different sections of the subpart W regulatory text.

• EPA clarified the sources covered by BAMM for Leak Detection and Measurement in 40 CFR 98.234(f)(4) by including the statement that emission sources that can use BAMM are those for which leak detection/or measurement cannot reasonably be obtained.

• EPA clarified availability of BAMM for sources not listed in paragraph 40 CFR 92.234 (f)(2), (f)(3), and (f)(4) by including the statement in 40 CFR 98.234(f)(5)(iv) that such emission sources are those for which data cannot reasonably be obtained.

• EPA revised the provisions for the use of BAMM beyond 2011 by stating that EPA will approve BAMM for use for a maximum of one year. For subsequent years, owners and operators must again request to use BAMM.

• EPA clarified provisions for the use of BAMM beyond 2011 by replacing the term “facilities” with “owners and operators”.

• EPA clarified that the BAMM request must include a description of the associated unique or unusual circumstances (rather than extreme) for each emissions source for which the request has been submitted.

• EPA revised the approval criteria for the use of BAMM beyond December 31, 2011 to clarify that BAMM requests must clearly demonstrate why BAMM is needed, and must also include justifications for why the owner or operator cannot conform to requirements in subpart W.

• EPA revised the language in 40 CFR 98.234(f)(1) to clarify that owners and operators who submit a BAMM request after the deadlines finalized in this action must demonstrate unique or unusual circumstances unforeseen at the time of the associated BAMM deadline specified in the rule.

This section contains a brief summary of major comments and responses. EPA received seven sets of comments in response to the proposed revisions to the BAMM provisions. EPA's responses to additional comments can be found in the comment response document, “Mandatory Reporting of Greenhouse Gases—Petroleum and Natural Gas Systems, Revisions to Best Available Monitoring Method Provisions: EPA's Response to Public Comment”.

Comment: EPA received mixed comments on the expansion of the automatic BAMM coverage beyond the sources listed in 40 CFR 98.234(f)(2) and (f)(3), to sources listed in 40 CFR 98.234(f)(4) (Leak Detection and Measurement), as well as other sources under 40 CFR 98.234(f)(5)(iv). Most commenters supported the expansion, stating that the extension of automatic use of BAMM to sources for which leak detection and measurement are required as well as other sources subject to subpart W for 2011 would provide reporting entities time to fully implement the requirements of subpart W. A few commenters argued against expanding the use of automatic BAMM to all subpart W emissions sources in 2011 by stating that the extension was not appropriate for leak detection, because accurate information on leaking equipment lies at the core of subpart W and allowing BAMM for these measurements would undermine the utility of these data and obscure opportunities for facilities to both reduce emissions and save money. Further, commenters noted that the extension was not warranted because EPA did not provide a sufficient technical basis for such an extension.

Response: In this action, EPA is extending the automatic use of BAMM to the emission sources covered in 40 CFR 98.234(f)(2) through (4) and those covered in 98.234(f)(5)(iv) based on EPA's determination that this extension would assist reporters in the necessary preparations to come into full compliance with the rule. In a previous action (76 FR 22825, April 25, 2011), EPA amended the dates by which requests to use BAMM were to be submitted to the Agency. Based on the dates in that action, BAMM requests were to be submitted to the agency by July 31, 2011 for use of BAMM in calendar year 2011. To date, EPA has received over 200 submissions from owners and operators of facilities either notifying EPA of the intent to submit a BAMM request or providing EPA with the full BAMM request. Most of these 200 submissions contain information for more than one facility subject to the rule. In some cases, for example, a single submission of a notice of intent received by EPA covered over 75 facilities. All together, the submissions reflected either notifications of intent (NOIs) or requests for BAMM from over 1,900 facilities. This is over half of the 2,800 facilities that EPA originally expected to report under subpart W. The sheer number of requests received indicates that there is a significant need for BAMM for the 2011 reporting year.

Regarding commenters concern that there was no technical basis to allow use of BAMM for sources beyond 40 CFR 98(f)(2), (f)(3) and (f)(4), a memo to the docket entitled “Supplemental Data Submitted on BAMM” demonstrates by specific examples justification for the extension to additional emissions sources, at least for the 2011 reporting year.

Commenters also were concerned that by allowing the use of BAMM, EPA would “undermine the utility of these data and obscure opportunities for facilities to both reduce emissions and save money.” EPA recognizes that use of BAMM could result in some inconsistencies in how owners and operators calculate emissions for a specific facility. However, regulations for facility level monitoring for the petroleum and natural gas industry are a new and significant undertaking and will greatly improve the emissions estimates for this industry. For instance, although they are required to follow the calculation equations in the rule, owners and operators will have some flexibility in how they estimate the inputs to those equations. Nevertheless, although the input parameters are calculated using BAMM, the data obtained would be a significant improvement over current emissions estimation methods.

For example, current source-level emissions estimates for the petroleum and natural gas industry are primarily available through the Inventory of U.S. GHG Emissions. Although the national level GHG Inventory and the GHG Reporting Program are very different and the programs have different goals and different levels of coverage of industry emissions, an understanding of the quality and availability of source-specific data in the national GHG inventory is germane to the comments raised. The national GHG Inventory provides national level estimates and does not provide the level of granularity that will be available from the facility level GHG reports which will be available under the GHG Reporting Program. So, although facilities will be able to use BAMM, reporting facility-level data provides significant additional information on emissions in the industry above and beyond what is currently available.

Second, the methods used to estimate facility-level emissions are an improvement over the national-level methods. In the national GHG Inventory, EPA relies on predominantly national level statistics and default emissions factors from a 1996 study titled “ Methane Emissions from the Natural Gas Industry ”  1 . For example, in the national GHG Inventory, emissions from tanks are estimated using an emission factor per barrel of crude oil/condensate produced multiplied by the national volumes of crude oil/condensate produced. This emission factor was developed using outputs from 101 simulation runs of the API Tank model for certain types of crude/condensate input and separator pressure. However, this is not representative of the variation in crude oil/condensate qualities and separator pressure at oil and gas operations across the nation. Hence, although facilities may be able to use BAMM to estimate emissions from tanks, the emissions estimates reported using BAMM will nonetheless be an improvement over existing methods by providing additional information on the varying characteristics of oil and gas operations across the country, which is not available through the national inventory.

In summary, EPA has concluded that granting automatic use of BAMM without approval for 2011 will still provide EPA with improved data from the industry, while providing owners and operators sufficient time to perform the necessary steps to ensure full compliance with subpart W.

Comment: Several commenters argued against EPA's proposal to extend the deadline for requesting use of BAMM beyond December 31, 2011 stating that the proposed provisions would greatly undermine the data reported under subpart W. Further, commenters stated that the reporting community did not push for this revision and it is therefore unwarranted.

Response: In this action, EPA is finalizing, as proposed, the two-phase approach that results in an initial six-month extension of the date for requesting BAMM for 2012. The two-phase approach is similar to the process used under 40 CFR part 98 for subparts P, X, and Y. As indicated at proposal, this automatic extension would be necessary because under the rule, facilities are only granted automatic BAMM through December 31, 2011. For facilities that are requesting BAMM for beyond 2011, BAMM must be extended automatically to provide EPA the time to review thoroughly the BAMM requests submitted for a period beyond 2011, while ensuring that the requesting facilities are not out of compliance with the rule during that review process.

First and foremost, EPA notes that the 2010 final rule for subpart W allows requests for BAMM beyond 2011. 40 CFR 98.234(f)(8) provides for BAMM post-2011 if those requests were submitted by September 30, 2011. The extension of the deadline for BAMM beyond 2011 was necessary for the same reasons that extension of automatic BAMM was necessary for 2011; the substantial number of owners and operators requesting BAMM would require significant resources by reporters that EPA has concluded would be better applied to concentration on coming into compliance with the rule.

In addition, it is not accurate to say that industry did not request use of BAMM past 2011. For example, in its Petition for Reconsideration, the Interstate Natural Gas Association of America (INGAA) stated, “[t]here is no reasonable basis for * * * denying BAMM to a facility already subject to reporting, that confronts an unpredictable facility or operational issue ( e.g., low utilization) that precludes measurement, just because these events occur after September 30, 2011. These and other situations should be eligible for BAMM, and INGAA seeks reconsideration so EPA can offer BAMM to these otherwise stranded facilities and unaddressed future events.” Similarly, in its petition for reconsideration, the American Petroleum Institute (API) indicated that EPA should remove the September 30, 2011 deadline for requesting BAMM post-2011, relaying that BAMM should be considered for such time as there is a reasonable need for use of BAMM. Chesapeake Energy Corporation and the American Exploration and Production Council echoed similar needs to have BAMM beyond 2011 (and 2012). They indicated in their comments on this proposed rule that “EPA should anticipate that there may be some situations that are beyond companies' control, which would require additional BAMM beyond June 2012. For example, if there is insufficient supply of necessary monitoring equipment or if there are unexpected equipment manufacturing delays that prevent a company from installing that necessary monitoring equipment until late 2012, EPA should allow that company to use BAMM until the equipment can be delivered and installed.”

EPA has concluded that an initial six month extension of the September 30, 2011 deadline is necessary. Further, commenters did not provide any specific examples of how such an extension could undermine data quality. In fact, EPA has concluded that the additional six months will provide owners and operators additional time to visit their facilities and determine whether or not they actually need BAMM. EPA does not believe that all of the 1,900 plus facilities that have currently requested BAMM or filed notices of intent to apply for BAMM actually need BAMM, but rather they have submitted a request (or notice of intent) because they have not had sufficient time to fully evaluate their BAMM needs. A six-month extension of the deadline provides sufficient time for facilities to fully evaluate their needs and only submit genuine BAMM requests based on that need. Therefore, EPA has determined that this extension of the deadline for BAMM beyond 2011 is appropriate and will only approve BAMM requests that fulfill the requirements outlined in the content of request section of 40 CFR 98.234(f)(8).

Comment: Some commenters argued against the removal of the term “extreme” from 40 CFR 98.234(f)(8) and replacing it with “unique or unusual,” as was proposed, stating that this change would result in a wide expansion of the number of facilities that would request use of BAMM that were unwarranted. In contrast, several commenters argued against the inclusion of the terms “unique or unusual” and requested that EPA remove the terms from 40 CFR 98.234(f)(8) altogether. One commenter suggested replacing terms like “extreme” and “unique” with “good cause” because the complexity of the rule and the breadth of its application justify broader discretion in allowing BAMM than this text would appear to provide.

Response: EPA carefully evaluated the introductory text in 40 CFR 98.234(f)(8) and in this action has removed the term “extreme,” as proposed, in order to more fully clarify its intent of the types of circumstances for which BAMM could be used beyond 2011. EPA intended that use of BAMM post 2011 should only be allowed in limited and exceptional circumstances. As described in the 2010 final preamble, inasmuch as approximately fourteen months will have passed between signature of the final rule and January 1, 2012 (75 FR 74471, November 30, 2010). However the examples provided, “safety, a requirement being technically infeasible, or counter to other local, State or Federal regulations” are not “extreme” circumstances. Rather, we would consider BAMM for circumstances that were unexpected by EPA at the time of drafting the final rule, but which might not necessarily be “extreme” in practice. The Miriam Webster dictionary defines “extreme” as exceeding the ordinary, usual, or expected. Synonyms for extreme are “remotest”, “ultimate”, “outermost.” According to the Miriam Webster dictionary, the term “unique” can refer to distinctively characteristic, with synonyms such as individual, particular, and personalized. Unusual refers to circumstances that are “rare” or “uncommon.” The point of post-2011 BAMM was to target circumstances that are unique or unusual and something less than extreme.

EPA disagrees with the commenters who argued that we should remove the terms “unique or unusual”. EPA believes that the use of BAMM beyond December 31, 2011 should be limited to only unique or unusual circumstances because, as described above, by this time facilities will have had adequate time to take the necessary steps to bring their facilities into compliance with the rule, save for the few site-specific circumstances that are truly unique or unusual.

Comment: One commenter stated that EPA should only allow the use of BAMM beyond 2011 in one-year increments. The commenter was concerned that the proposed amendments relaxed the BAMM provisions and that if EPA were to amend the timelines for beyond 2011 BAMM, EPA should only permit alternative methods where facilities experience real, exigent circumstances. To this extent, they recommended that approval for BAMM be expressly time-limited.

Response: EPA agrees with the commenter that use of BAMM beyond December 31, 2011 should be for a limited period of time. As described above, EPA intends to approve the use of BAMM beyond 2011 only in cases that are unique or unusual. EPA agrees with the comments expressed by the commenter; a time limit for approving each BAMM ensures that the “unique or unusual” criteria continue to be met in subsequent years. Limiting approval to one year is consistent with the original purpose of BAMM, which was to provide a reasonable period of time during the period after subpart W came into effect to allow facilities to reasonably come into compliance with the rule. It is also important to be aware that EPA always had the right within the 2010 final rule to approve BAMM for only one year.

At the same time, the time limitation on BAMM approvals adds minimal burden for facilities requesting BAMM. If a facility already has received an approval for a BAMM request post-2011, then that the facility successfully demonstrated “unique or unusual” circumstances. If those same circumstances do not change, for example, the monitoring requirements in subpart W continue to lead to safety concerns for facility operators, the facility can reasonably expect that their future submissions would also be approved. It is also possible that EPA could learn from the BAMM requests received that a particular rule provision results in safety concerns for multiple facilities. In these circumstances, EPA may choose to provide an additional method(s) to estimate emissions from that emissions source in order to avoid the safety issues. Any additional methods would only be finalized after notice and comment. Approving BAMM for a limited time provides sufficient certainty for owners and operators, while ensuring that only those BAMM requests that reflect unique or unusual circumstances are approved.

Comment: Several commenters requested that EPA include a provision by which owners and operators who acquire new operations would be given automatic approval to use BAMM for a specified period of time after acquiring the new operations.

Response: EPA generally agrees that some facilities that acquire new operations may, for a limited period of time, need to use BAMM in order to fully comply with the rule. However, EPA does not agree that this would apply to all facilities that acquire new operations. Thus, there are no specific provisions in this action that would allow for owners or operators of facilities acquiring new operations to automatically be approved to use BAMM. EPA has concluded that the provisions outlined in the 2010 final rule, as amended by this action, allow facilities sufficient flexibility to be apply for the use of BAMM should the need arise.

For example, in some cases, if a facility acquires new operations that were already subject to subpart W, there would be no need to allow for use of BAMM for any period of time as a result of that acquisition. All operations would have been subject to subpart W from the beginning of the calendar year.

If a facility acquires new operations that were not previously subject to the GHG Reporting Program, there are options within the 2010 final rule that facilities may use to meet the requirements of the rule. In some cases, the facility will be able to estimate emissions per the calculation equations in the rule, and therefore no other provisions are required. If the facility cannot estimate emissions, the missing data procedures in 40 CFR 98.235 might be applicable. This approach would be reasonable because the data from the acquired operations could be considered missing, in that they had not been retained by the plant not subject to the rule in the beginning of the year. In this case, if the calculations can be undertaken in the current reporting year, or in the following year, but before the March 31st deadline, then missing data procedures might be used. Finally, if none of these existing rule options are viable, facilities can request BAMM under 40 CFR 98.234(f)(1). Such an example could be “unique or unusual” and therefore meet the requirements of 40 CFR 98.234(f)(1).

Comment: Two commenters requested that EPA amend the approval criteria for BAMM beyond 2011 to allow the use of BAMM until the next scheduled shutdown for circumstances where compliance would require shutdown of facilities or units that operate continuously.

Response: EPA agrees that the final rule did not intend for owners and operators to have to shut down facilities in order to install the necessary equipment and we have clarified in this action that the need to shutdown to install necessary equipment would be a valid reason for BAMM. As described in the preamble to the 2010 final rule, “[i]f a reporter requests an extension because equipment cannot be installed without a process unit shutdown, EPA is likely to approve such a request if the documentation clearly demonstrates why it is not feasible to install the equipment without a process unit shutdown * * *” EPA also noted that “[t]here are many locations where monitors can be installed without a process unit shutdown, because there is often some redundancy in process or combustion equipment or in the piping that conveys fuels, raw materials and products. For example, many facilities have multiple combustion units and fuel feed lines such that when one combustion unit is not operating they can obtain the needed steam, heat, or emissions destruction by using other combustion devices. Some facilities have multiple process lines that can operate independently, so one line can be temporarily shut down to install monitors while the facility continues to make the same product in other process lines to maintain production goals. If a monitor needs to be installed in a section of piping or ductwork, it can be possible in some cases to isolate a line without shutting down the process unit (depending on the process configuration, mode of operation, storage capacity, etc.). If the line or equipment location where a monitor needs to be installed can be temporarily isolated and the monitor can be installed without a full process unit shutdown, it is less likely EPA will approve an extension request.” So, if owners and operators can sufficiently demonstrate that installation of required equipment would require a shutdown, that could also be a valid reason for BAMM post 2011.

Under this provision, owners and operators are not required to use BAMM. Rather, this provision provides an alternative means of compliance in lieu of providing specified data input requirements for determining GHG emissions. Consequently, this provision is not expected to have a significant effect on the economy and an economic impact analysis is not required.

This action is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).

This action does not impose any new information collection burden. These amendments affect provisions in the rule related to BAMM. The final amendments reduce the administrative burden on industry by extending the time period by which owners and operators of facilities subject to subpart W may use BAMM without having to submit an application to EPA for approval to use BAMM in 2011. The Office of Management and Budget (OMB) has previously approved the information collection requirements contained in the existing regulations, 40 CFR part 98 subpart W (75 FR 74458, November 30, 2010), under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB control number 2060-0651. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

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

For purposes of assessing the impacts of this proposed rule on small entities, small entity is defined as: (1) A small business as defined by the Small Business Administration's regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of today's proposed rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. In determining whether a rule has a significant economic impact on a substantial number of small entities, the impact of concern is any significant adverse economic impact on small entities, since the primary purpose of the regulatory flexibility analyses is to identify and address regulatory alternatives “which minimize any significant economic impact of the rule on small entities.” 5 U.S.C. 603 and 604. Thus, an agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, or otherwise has a positive economic effect on all of the small entities subject to the rule.

As part of the process for finalization of the subpart W rule (75 FR 74458), EPA undertook specific steps to evaluate the effect of that final rule on small entities. Under that final rule for subpart W (75 FR 74458) EPA conducted a screening assessment comparing compliance costs to onshore petroleum and natural gas industry specific receipts data for establishments owned by small businesses. The results of that screening analysis, as detailed in the preamble to the final rule for subpart W (75 FR 74482), demonstrated that the cost-to-sales ratios were less than one percent for establishments owned by small businesses that EPA considered most likely to be covered by the reporting program. The results of that analysis can be found in the preamble to the final rule (75 FR 74485).

Based on this final action, owners and operators of certain facilities for which BAMM requests have been made according to the requirements in 40 CFR 98.234(f), are granted additional time to use BAMM during 2011 without being required to submit an application for approval to the Administrator. In addition, the final amendments in this action broaden the types of emission sources that owners and operators of affected facilities may use BAMM without being required to submit an application for approval from the Administrator. Finally, based on the amendments in this action, owners and operators who request use of BAMM for 2012 and beyond are granted additional time by which they would be required to submit their application to the Administrator for approval. We have therefore concluded that this action will relieve regulatory burden for all affected small entities.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531-1538, requires Federal agencies, unless otherwise prohibited by law, to assess the effects of their regulatory actions on State, local, and Tribal governments and the private sector. Federal agencies must also develop a plan to provide notice to small governments that might be significantly or uniquely affected by any regulatory requirements. The plan must enable officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates and must inform, educate, and advise small governments on compliance with the regulatory requirements.

The final rule amendments do not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any one year. Thus, the final rule amendments are not subject to the requirements of section 202 and 205 of the UMRA. This rule is also not subject to the requirements of section 203 of UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments.

This action does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132.

These amendments apply to an optional provision in the final rule for subpart W, which applies to petroleum and natural gas facilities that emit greenhouse gases. Few, if any, State or local government facilities would be affected. This regulation also does not limit the power of States or localities to collect GHG data and/or regulate GHG emissions. Thus, Executive Order 13132 does not apply to this action.

This action does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). The fine rule amendments in this action do not result in any changes to the current requirements of 40 CFR part 98, subpart W. The amendments proposed in this rule only apply to optional provisions in 40 CFR part 98 subpart W. Thus, Executive Order 13175 does not apply to this action.

Although Executive Order 13175 does not apply to this action, EPA sought opportunities to provide information to Tribal governments and representatives during the development of the rule for subpart W promulgated on November 30, 2010. A summary of the EPA's consultations with Tribal officials is provided in Sections VIII.D and VIII.F of the preamble to the 2009 final rule and Section IV.F of the preamble to the 2010 final rule for subpart W (75 FR 74485).

EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5-501 of the Executive Order has the potential to influence the regulation. This action is not subject to Executive Order 13045 because it does not establish an environmental standard intended to mitigate health or safety risks.

This action is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not a significant regulatory action under Executive Order 12866.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law No. 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

This action does not involve technical standards. Therefore, EPA did not consider the use of any voluntary consensus standards.

Executive Order 12898 (59 FR 7629, February 16, 1994) establishes Federal executive policy on environmental justice. Its main provision directs Federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

EPA has determined that this final rule will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not affect the level of protection provided to human health or the environment because it is a rule addressing information collection and reporting procedures.

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), 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 U.S. A major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2). This rule will be effective on September 30, 2011.

For the reasons discussed in the preamble, EPA proposes to amend 40 CFR part 98 as follows:

Regulated Entities. The Administrator determined that this action is subject to the provisions of Clean Air Act (CAA) section 307(d). See CAA section 307(d)(1)(V) (the provisions of section 307(d) apply to “such other actions as the Administrator may determine”). These are final changes to existing regulations. These amended regulations affect owners or operators of certain manufacturers of electronic devices. Regulated categories and examples of affected entities include those listed in Table 1 of this preamble.

Although Table 1 of this preamble lists the types of facilities that EPA is now aware could be potentially affected by this action, other types of facilities not listed in the table could also be affected. To determine whether you are affected by this action, you should carefully examine the applicability criteria found in 40 CFR part 98, subparts A and I. If you have questions regarding the applicability of this action to a particular facility or supplier, consult the person listed in the preceding FOR FURTHER INFORMATION CONTACT Section.

The final rule is effective on September 30, 2011. Section 553(d) of the Administrative Procedure Act (APA), 5 U.S.C. Chapter 5, generally provides that rules may not take effect earlier than 30 days after they are published in the Federal Register . EPA is issuing this final rule under section 307(d)(1) of the CAA, which states: “The provisions of section 553 through 557 * * * of Title 5 shall not, except as expressly provided in this section, apply to actions to which this subsection applies.” Thus, section 553(d) of the APA does not apply to this rule. EPA is nevertheless acting consistently with the purposes underlying APA section 553(d) in making this rule effective on September 30, 2011. Section 5 U.S.C. 553(d)(3) allows an effective date less than 30 days after publication “as otherwise provided by the agency for good cause found and published with the rule.” As explained below, EPA finds that there is good cause for this rule to become effective on September 30, 2011, even though this results in an effective date fewer than 30 days from date of publication in the Federal Register .

The purpose of the 30-day waiting period prescribed in 5 U.S.C. 553(d) is to give affected parties a reasonable time to adjust their behavior and prepare before the final rule takes effect. Where, as here, the revisions being made in this package provide flexibilities to sources covered by the reporting rule, a shorter effective date in such circumstances is consistent with the purposes of APA section 553(d), which provides an exception for any action that grants or recognizes an exemption or relieves a restriction. Accordingly, we find good cause exists to make this rule effective on September 30, 2011, consistent with the purposes of 5 U.S.C. 553(d)(3).

Judicial Review. Under section 307(b)(1) of the CAA, judicial review of this final rule is available only by filing a petition for review in the U.S. Court of Appeals for the District of Columbia Circuit (the Court) by November 28, 2011. Under CAA section 307(d)(7)(B), only an objection to this final rule that was raised with reasonable specificity during the period for public comment can be raised during judicial review. CAA section 307(d)(7)(B) also provides a mechanism for EPA to convene a proceeding for reconsideration, “[i]f the person raising an objection can demonstrate to EPA that it was impracticable to raise such objection within [the period for public comment] or if the grounds for such objection arose after the period for public comment (but within the time specified for judicial review) and if such objection is of central relevance to the outcome of the rule.” Any person seeking to make such a demonstration to us should submit a Petition for Reconsideration to the Office of the Administrator, Environmental Protection Agency, Room 3000, Ariel Rios Building, 1200 Pennsylvania Ave., NW., Washington, DC 20460, with a copy to the person listed in the preceding FOR FURTHER GENERAL INFORMATION CONTACT section, and the Associate General Counsel for the Air and Radiation Law Office, Office of General Counsel (Mail Code 2344A), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20004. Note, under CAA section 307(b)(2), the requirements established by this final rule may not be challenged separately in any civil or criminal proceedings brought by EPA to enforce these requirements.

The following acronyms and abbreviations are used in this document.

The first section of this preamble contains the basic background information about the origin of the amendments to the rule being made today. This section also discusses EPA's use of our legal authority under the Clean Air Act to collect data under the Greenhouse Gas Reporting Program (also referred to as 40 CFR part 98 or Part 98).

The second section of this preamble describes in detail the changes to subpart I that are being promulgated, and EPA's rationale for those changes. This section also presents a summary of, and EPA's responses to, the major public comments submitted on the proposed rule amendments, and significant changes, if any, made since proposal in response to those comments.

Finally, the last (third) section of the preamble discusses the various statutory and executive order requirements applicable to this rulemaking.

EPA finalized subpart I: Electronics Manufacturing of the Greenhouse Gas Reporting Rule on December 1, 2010 (40 CFR part 98, subpart I) (75 FR 74774) (subpart I). In that rule, among other provisions, EPA finalized two different methods for facilities that manufacture semiconductors wafers measuring 300 mm or less in diameter to calculate and report their fluorinated GHG emissions, depending on the facility's manufacturing capacity: (1) A method for those facilities that have an annual manufacturing capacity greater than 10,500 m 2 of substrate (hereinafter referred to as the “largest semiconductor manufacturing facilities”), and (2) a method for facilities that have an annual manufacturing capacity that is less than or equal to 10,500 m 2 of substrate (hereinafter referred to as “other semiconductor manufacturing facilities”). Pursuant to 40 CFR 98.93(a)(2)(ii), the largest semiconductor manufacturing facilities must calculate and report their emissions using a combination of default emission factors and directly measured recipe-specific emission factors. For the following four process types and sub-types, the largest semiconductor manufacturing facilities must calculate emissions using only the default emission factors:

• Chamber cleaning process type which includes the following three process sub-types:

—In-situ plasma chamber cleaning process sub-type.

—Remote plasma chamber cleaning process sub-type.

—In-situ thermal chamber cleaning process sub-type.

• Wafer cleaning process type.

For the plasma etching process type, the largest semiconductor manufacturing facilities are required to calculate emissions using only directly measured recipe-specific emission factors. This method is referred to as the Tier 2d method.

Pursuant to 40 CFR 98.93(a)(2)(1), other semiconductor manufacturing facilities must calculate and report their fluorinated GHG emissions using default emission factors for the following five process types and sub-types:

• Plasma etching process type.

• Chamber cleaning process type, which includes the following three process sub-types:

—In-situ plasma chamber cleaning process sub-type.

—Remote plasma chamber cleaning process sub-type.

—In-situ thermal chamber cleaning process sub-type.

• Wafer cleaning process type.

In the December 1, 2010 rule, EPA also included provisions in section 98.94(a) for all electronics manufacturing facilities to use and/or request the use of best available monitoring methods (BAMM) for a specific period of time in lieu of following the monitoring and Quality Assurance/Quality Control (QA/QC) requirements of subpart I for certain parameters that cannot reasonably be measured.

Following the publication of subpart I in the Federal Register , the Semiconductor Industry Association (SIA) sought reconsideration of several provisions in the final rule (See SIA petition available in Docket ID No. EPA-HQ-OAR-2009-0927). In particular, SIA raised concerns about the provisions related to the use of BAMM and also the individual recipe measurement approach, that is, the requirement that the largest facilities develop and use recipe-specific emission factors for etch processes. 1

In response to SIA's petition, EPA took two initial actions. First, on June 22, 2011 EPA granted reconsideration with respect to the deadlines contained in the subpart I BAMM provisions and published a final rule that extended three of the subpart I BAMM deadlines, relating to when owners and operators may use or request to use BAMM, from June 30, 2011 to September 30, 2011 (76 FR 36339). Second, also on June 22, 2011, EPA published a proposed rule to allow the largest semiconductor manufacturers to use the default utilization and by-product formation rates (default emission factors) already contained within subpart I in Tables I-3 and I-4 to estimate fluorinated GHG emissions for the plasma etching process type through December 31, 2012, instead of using directly measured recipe-specific emission factors for each individual recipe or set of similar recipes  2 (76 FR 36472). This proposed action also sought comment on whether certain BAMM deadlines should be extended, whether the largest semiconductor manufacturing facilities should be allowed to use default emission factors in lieu of recipe-specific emission factors through December 31, 2013, and on the verification requirement for facility specific engineering models used to apportion gas consumption (40 CFR 98.94(c)(2)).

EPA is promulgating these rule amendments under its existing CAA authority, specifically authorities provided in CAA section 114.

As stated in the preamble to the 2009 final Part 98 (74 FR 56260, October 30, 2009) and the Response to Comments on the Proposed Rule, Volume 9, Legal Issues, CAA section 114 provides EPA broad authority to require the information proposed to be gathered by this rule because such data would inform and are relevant to EPA's carrying out a wide variety of CAA provisions. As discussed in the preamble to the initial proposed part 98 (74 FR 16448, April 10, 2009), CAA section 114(a)(1) authorizes the Administrator to require emissions sources, persons subject to the CAA, manufacturers of control or process equipment, or persons whom the Administrator believes may have necessary information to monitor and report emissions and provide such other information the Administrator requests for the purposes of carrying out any provision of the CAA. For further information about EPA's legal authority, see the preambles to the 2009 proposed and final Part 98 rules and EPA's Response to Comments, Volume 9. 3

In this action, EPA is finalizing provisions to allow the largest semiconductor manufacturing facilities the option to calculate emissions using default emission factors already contained within subpart I, instead of recipe-specific emission factors, for the plasma etching process type for reporting years 2011, 2012, and 2013. In other words, through December 31, 2013, the largest semiconductor manufacturing facilities may use the Tier 2c  4 method to estimate fluorinated GHG emissions from etching and cleaning processes. This gives more time for EPA to work on various approaches SIA has proposed as alternatives to the recipe-specific approach. SIA is currently in the process of providing information to EPA for consideration and evaluation.

As EPA explained in the preamble to the June 22, 2011 proposed rule, SIA has identified three alternative methodologies that they are proposing for the Agency's consideration and for which they are currently collecting information to support their development: (1) Etch Process Subcategories and Default Emissions Factors; (2) Direct Estimation of Emissions Based on Use Allocation and Application of Abatement Unit Destruction and Efficiency (DRE); and (3) Stack Testing (75 FR 36472). For more information on the three options, please refer to SIA's letter (available in docket EPA-HQ-OAR-2009-0927).

Since publication of the proposed rule, SIA has continued to pursue the three options and provide EPA with supporting technical information and/or future work plans. Given the technical complexity of the three alternatives and based on the current status of their development, EPA has determined that more time is needed for SIA to continue to work on the alternative options, for EPA to fully assess them, and for the Agency to undertake rulemaking to revise subpart I as appropriate. Over the next approximately two and a half years, EPA plans to comprehensively evaluate the technical information that SIA provides on the methodologies, determine whether one or more of them should be included in subpart I as alternatives to the recipe-specific measurement approach for the largest semiconductor manufacturing facilities, and revise subpart I as appropriate, through a notice and comment rulemaking. It is EPA's intention to finalize a revision to subpart I that can be implemented by the largest semiconductor manufacturing facilities by January 1, 2014.

This action also extends two deadlines in the subpart I provisions related to the use of BAMM. First, EPA is extending the date by which an owner or operator subject to subpart I may, without submitting a request, use BAMM to estimate 2011 emissions from September 30, 2011 to December 31, 2011. EPA is extending the deadline to provide additional flexibility for any owner or operator that was unable to meet the February 28, 2011 deadline for submitting a request for the use of BAMM in 2011 for parameters other than recipe-specific emission factors. Second, EPA is extending the date by which an owner or operator may submit a request to extend the use of BAMM beyond December 31, 2011 from September 30, 2011 to October 17, 2011. EPA is extending the deadline to provide owners and operators additional time to prepare and submit the request. EPA has concluded that this flexibility is appropriate given that the effective date of this final rule, September 30, 2011, is the same as the date by which extension requests are required to be submitted to the Administrator. See Section II.B.2 below of this preamble for additional discussion on both of these topics.

Lastly, in this action, EPA is clarifying several aspects of the subpart I BAMM provisions. More specifically, EPA is clarifying that the subpart I BAMM provisions for estimating emissions beyond December 31, 2011 do not specify an end date to the period for which EPA may approve the use of BAMM. In addition, EPA is clarifying the distinction between the elements of the BAMM application and the approval criteria by which EPA will determine if a facility is approved to use BAMM to estimate emissions beyond December 31, 2011.

Under today's final rule, owners and operators applying to extend the use of BAMM beyond December 31, 2011 must submit a request to EPA no later than October 17, 2011. The BAMM extension provisions do not impose an end date: for example, they do not say that extensions are limited to 2012. EPA does not intend to approve the indefinite use of BAMM; all BAMM applications should specify the date on which the facility plans to cease the use of BAMM. However, EPA does understand that there are specific aspects of the final subpart I provisions for which compliance may not be reasonably feasible for certain facilities during the interim period addressed in this rulemaking and for which, in some cases, EPA is evaluating and considering other approaches. In particular, the establishment of an interim period through 2013 during which the largest facilities have the option of using the Tier 2c method  5 while the Agency considers longer-term alternatives may affect facilities' planning for compliance with other aspects of subpart I. In part, this is because the potential incorporation of alternative methods into subpart I could render certain aspects of the rule moot for some facilities, depending on the alternative adopted. For example, if EPA were to propose to revise subpart I to include a stack testing method, the Agency would also consider whether certain aspects of subpart I as currently written would be unnecessary to determine the emissions of facilities using that method. In addition, any revisions to subpart I to incorporate alternative methods likely would not be effective until 2014, meaning that facilities that are interested in moving toward alternatives and that are requesting BAMM for 2012 may need to consider whether their applications should include 2013 as well.

EPA has concluded that the existing subpart I BAMM provisions provide flexibility to address facilities' needs during this interim period as the Agency continues to consider longer-term alternatives. See Section II.A.2 and II.A.3 for additional discussion on this topic.

EPA is also clarifying the difference between the application requirements and the approval criteria for BAMM extensions in subpart I. The application requirements are contained in 40 CFR 98.94(a)(4)(ii), and the approval criteria appear in 40 CFR 98.94(a)(4)(iii). With regard to approval, the rule states, “To obtain approval, the owner or operator must demonstrate that by December 31, 2011 (or in the case of facilities that are required to calculate and report emissions in accordance with § 98.93(a)(2)(ii)(A), December 31, 2012), it is not reasonably feasible to acquire, install, or operate the required piece of monitoring equipment according to the requirements of this subpart.” Given today's final rule to allow the largest semiconductor manufacturing facilities to use default emission factors to estimate emissions for the plasma etching process type during an interim period, EPA doesn't anticipate receiving any requests for the use of BAMM for recipe-specific emission factors. If there are facilities that are unable to meet the requirements for other monitoring or QA/QC aspects of subpart I in 2012 or beyond, then they should apply for BAMM for the period they believe to be necessary and EPA will evaluate whether to allow the use of BAMM and for how long. In some instances, EPA anticipates that facilities will come into compliance with the requirements quickly; for others, EPA understands that facilities may wish to use BAMM while EPA considers alternatives. It is important to note that EPA does not anticipate approving the use of BAMM for current subpart I provisions beyond the time that EPA promulgates a final rule with alternative methodologies. As stated in previous paragraphs of this section, we anticipate issuing a revised rule by January 1, 2014.

EPA received comments from five entities. In general, all commenters supported EPA's proposal to allow the largest semiconductor manufacturing facilities to use default emission factors to estimate fluorinated GHG emissions for the plasma etching process type for 2011 and 2012, and requested that EPA extend the use of defaults through December 31, 2013. The comments are addressed in more detail below.

All five commenters strongly supported EPA's proposal to allow the largest semiconductor manufacturing facilities to use the Tier 2c Method  6 to calculate emissions for the years 2011 and 2012 in lieu of using the Tier 2d Method. 7 These commenters viewed the finalization of this flexibility provision as an important first step in addressing their technical feasibility, compliance cost, and data confidentiality concerns about subpart I. (One commenter provided accompanying detailed documentation to support each of the aforementioned concerns.) These same commenters also noted that allowing the use of the Tier 2c Method  8 in 2011 and 2012 provides more time for members of the industry to conduct ongoing work in support of various alternative approaches to estimating and reporting fluorinated GHG emissions for EPA to evaluate and consider. Some commenters referenced the three alternatives proposed by SIA as discussed in a letter dated May 26, 2011 (available in docket EPA-HQ-OAR-2009-0927). One commenter stated, “These alternatives [the SIA proposed alternatives], if adopted by EPA, will provide the largest semiconductor facilities a menu of GHG reporting options that will avoid the serious issues raised by the current subpart I, while providing comparable or better accuracy than the current rule.” Another commenter opined that the ongoing alternatives work could be done while still allowing facilities to report fluorinated GHG emissions in a manner that avoids feasibility and cost issues that the commenter believed were inherent to subpart I.

A few commenters asserted that because of feasibility, cost, and confidentiality issues, many facilities would need to file BAMM requests for developing or obtaining recipe-specific emission factors for the plasma etching process type. Several commenters supported the flexibility provisions because they provide uniform relief from BAMM petition requests, avoiding spending both facility and EPA resources to prepare and review BAMM requests on an individualized case basis.

Similarly, all commenters strongly supported extending the use of the Tier 2c Method  9 beyond December 31, 2012 through 2013. One commenter stated that it shared EPA's goal of finalizing any alternative approaches for estimating and reporting fluorinated GHG emissions for the 2013 reporting year. However, commenters argued that, given the technical complexities associated with development of alternatives to the Tier 2d Method, 10 additional time will be necessary for industry to test and collect data about the alternatives and for EPA to evaluate those alternatives. One commenter asserted that this extension would allow the facility to focus its resources on developing alternative emission estimation and reporting methods as opposed to diverting resources to an approach that it does not believe is workable.

Another commenter stated that it was critical to extend the time period in which default emission factors could be used to estimate emissions from all process types/sub-types. The commenter further stated that the current schedule to finalize a revised subpart I by the end of 2012 is aggressive and accelerated, and may result in a repeat of the shortcomings that led to the final subpart I published in December 2010 (75 FR 74774). The same commenter also expressed the opinion that it is important that the process of revising subpart I does not drag on interminably, but it is equally important that EPA has sufficient information to balance requirements, accuracy and precision of emission estimates, and costs. The commenter argued that allowing the use of the Tier 2c Method  11 through 2013 will allow EPA to find that balance.

In response to these comments received, EPA is finalizing a provision to allow the largest semiconductor manufacturing facilities the option to use, for an interim period, the default utilization and by-product formation rates already contained within subpart I, in Tables I-3 and I-4, to estimate fluorinated GHG emissions for the plasma etching process type instead of using directly measured recipe-specific emission factors. In addition, EPA agrees with commenters that the largest semiconductor manufacturing facilities should be allowed to use the default emission factors to estimate emissions from etch processes through December 31, 2013 ( i.e., use the Tier 2c Method  12 through 2013), and in this final rule is allowing the largest semiconductor manufacturing facilities to use default emission factors for reporting years 2011, 2012, and 2013. EPA has concluded that the additional year will provide more time for industry to continue to collect and analyze information for the development of SIA's three proposed alternatives, for EPA to evaluate and determine which alternatives may be included in a subsequent action, and for EPA to undertake a rulemaking, as appropriate. As EPA stated above, over the next approximately two and a half years, EPA plans to comprehensively evaluate the technical information that SIA provides on the methodologies, determine whether one or more of them should be included in subpart I as alternatives to the recipe-specific measurement approach for the largest semiconductor manufacturing facilities, and revise subpart I as appropriate. During the time in which this flexibility is being provided to industry, EPA expects SIA to continue to collect detailed information on the alternative methodologies that EPA plans to use to support its evaluation.

EPA believes this approach effectively balances the industry's request for flexibility with sufficient time for EPA to fully evaluate the information that SIA provides on the alternative methodologies to analyze the accuracy and precision of emission estimates, as well as burden. EPA believes that the time now allotted to working on the alternative options for estimating and reporting fluorinated GHG process emissions from semiconductor manufacturing is appropriate, and intends to finalize a revision to subpart I that can be implemented by the largest semiconductor manufacturing facilities by January 1, 2014.

EPA requested comment on whether to extend, until December 31, 2011, the period during which an owner or operator subject to subpart I may use BAMM to estimate 2011 emissions without submitting a request. Under the existing subpart I provisions, finalized on June 22, 2011 (76 FR 36339), to estimate emissions that occur from January 1, 2011 to September 30, 2011, owners and operators may use BAMM without submitting a request for approval to the EPA Administrator (40 CFR 98.94(a)(1)). EPA requested comment on whether to extend the date by which owners and operators may use BAMM without submitting a request for approval by the Administrator to December 31, 2011.

In addition, EPA also requested comment on whether to extend two other BAMM deadlines: the deadline by which an owner or operator may request the use of BAMM for recipe-specific emission factors in 2011 and the deadline for requesting use of BAMM for estimating emissions beyond December 31, 2011. Under the subpart I provisions finalized on June 22, 2011 (76 FR 36339), both deadlines are September 30, 2011 (40 CFR 98.94(a)(3)(i) and 40 CFR(a)(4)(i)).

EPA did not receive any comments in response to its requests. However, after evaluating comments received and further consideration of the time period between the effective date of this final rule and the date by which requests to extend the use of BAMM beyond December 31, 2011 must be submitted, EPA is extending two of the subpart I BAMM deadlines. First, EPA is extending until December 31, 2011 the time period during which an owner or operator may, without submitting a request, use BAMM to estimate emissions in 2011. EPA is extending the deadline to provide flexibility for any owner or operator that was unable to meet the February 28, 2011 deadline for submitting a request to use BAMM in 2011 for parameters other than recipe-specific emission factors. Given the short time between the publication of the final subpart I in December 2010 and February 28, 2011, there may have been some owners or operators that were unable to submit a request by the deadline. Second, EPA is extending the deadline by which an owner or operator may submit a request to use BAMM to estimate emissions beyond December 31, 2011 from September 30, 2011 to October 17, 2011. EPA has concluded that this flexibility of approximately two weeks is appropriate given that the effective date of this final rule, September 30, 2011, is the same date as the deadline for submitting a request to the Administrator to extend the use of BAMM beyond December 31, 2011. EPA anticipates that some owners and operators will submit requests for the use of BAMM beyond December 31, 2011, and that they may need additional time to prepare and submit the request, particularly in light of the clarifications that EPA provided in this notice about the subpart I BAMM provisions. EPA is not extending the deadline further than October 17, 2011 because sufficient time is needed for EPA to review and respond to the owner or operator before the beginning of the next reporting period on January 1, 2012.

EPA is not making any changes to the deadline for submitting a request to use BAMM for recipe-specific emission factors in 2011. Given today's final rule that allows the largest semiconductor manufacturing facilities to use the Tier 2c method  13 for three years, EPA does not anticipate receiving any requests for the use of BAMM for recipe-specific emission factors in 2011. If an owner or operator is unable to comply with the Tier 2d method, 14 then EPA anticipates that they will opt to use the Tier 2c method  15 as allowed by this final rule. Further, because EPA is also finalizing provisions today that allow the use of BAMM in 2011, without submitting a request, there should be no reason for an owner or operator to submit a BAMM request for recipe-specific factors in 2011.

This paragraph summarizes the final subpart I BAMM provisions. From January 1, 2011 through December 31, 2011, owners or operators subject to subpart I may use BAMM for any parameter that cannot reasonably be measured according to the monitoring and QA/QC requirements of subpart I without submitting, and obtaining approval from, the Administrator. Starting January 1, 2012, owners and operators must discontinue the use of BAMM and begin following all applicable monitoring and QA/QC requirements of subpart I unless they have submitted a request to extend the use of BAMM and EPA has approved that request. Owners and operators wishing to extend the use of BAMM to estimate emissions beyond December 31, 2011, must submit a request to the Administrator no later than October 17, 2011.

In the proposed rule, EPA included a request for comment on the verification requirement for facility-specific engineering models (§ 98.94(c)(2)). In particular, EPA requested specific information about whether the final rule requirement to meet the five percent verification was overly burdensome and if so, facility-specific examples to illustrate why. EPA also requested comment on whether existing equipment or instrumentation can be used to measure actual gas consumption, and the costs of using that equipment or instrumentation. In addition, we requested comment on the specific actions a facility would have to take to comply with the requirement, and the costs associated with those actions. Finally, we requested comment on other approaches that could be used to verify modeled gas consumption to a similar level of accuracy.

In response to these requests, EPA received many comments that the apportioning model verification requirement raises feasibility and cost issues for facilities. One commenter noted that they had previously raised feasibility and cost issues with continuous gas flow measurement, which is believed to be required for the verification requirement, when subpart I was initially proposed in April of 2009. While the commenter recognized that the April 2009 gas measurement requirements (74 FR 16448) differ from those for the apportioning model verification, it asserted that many of the same feasibility and cost issues apply. In addition, the commenter referred to the concern it expressed with the difficulty in apportioning gas usage in comments on the April 2010 proposed in subpart I (75 FR 74774).

Several commenters stated that facilities will need to install hardware and software to meet the verification requirements, and even with upgrades, it still may not be feasible to meet the verification requirement of less than 5 percent difference between the actual and modeled gas consumption. Another commenter elaborated further and stated that there are limitations in using an apportioning model that is based on nominal recipes because automated process controls used for many newer tools depend on potentially varying operating process parameters, and can result in differences between actual gas flow and nominal gas flow. Another commenter stated that gases have centralized distribution systems that supply multiple tools, and the systems do not typically have the ability to measure the amount of gas supplied to each individual tool. This commenter also asserted that while mass flow controllers (MFCs) are designed to control gas flow rate at precise levels, the MFCs do not log and integrate flow data over time to calculate consumption. Another commenter stated that of its 212 fluorinated GHG-using tool sets, 71 do not have adequate register space to collect the data required for gas allocation, and 15 do not have the ability to communicate with data collection systems. One commenter also stressed that collecting apportioning data for model verification would be technically infeasible for older tool sets.

One commenter expressed the opinion that the verification requirement was overly burdensome. Another commenter asserted that EPA incorrectly assumed in its Economic Impact Assessment that facilities already had the necessary hardware and infrastructure in place for model verification. The commenter stated that the capability is not currently in place and that based on an industry survey, industry will face costs of approximately $9 million in the first year and $29 million in all subsequent years to comply with the apportioning model verification requirement. The commenter stated that this is much higher than EPA's estimated total compliance costs of $2.9 million for the first year and $5.4 million for each subsequent year. One commenter estimated that the costs for one of its facilities to upgrade to meet the apportioning requirement, including the verification piece, would be $0.6 million, and $3.5 million in total company costs (not including software development and data collection and quantification labor costs). Another commenter stated that retrofitting a facility to meet apportioning requirements, in addition to the verification piece, is estimated to cost over $4 million.

For the above stated technical feasibility and cost reasons, and because gas apportionment as required in the current subpart I ( i.e., apportioning to defined process types/sub-types and recipes), may not be required if alternative emission calculation estimation methods ( e.g. , stack testing) are adopted in a future version of subpart I, several commenters requested that EPA provide temporary relief from the apportioning model verification requirement. (Several commenters also referenced supporting technical information and their BAMM petitions as evidence to support their claims against the apportioning model verification requirements. Two commenters provided excerpts of BAMM requests as part of their comments.) More specifically, these commenters proposed that EPA modify subpart I so as to not require facilities to meet the verification requirement in § 98.94(c)(2) for the time period during which the largest semiconductor facilities are allowed to use the Tier 2c method. 16 (Two commenters expressed the opinion that they should still be required to meet the repeatability requirements in § 98.94(c)(1) for apportioning models; another commenter stated that the verification should be delayed until further study can establish a more realistic target.) During this time, commenters noted alternative methods for verifying gas apportioning models will also be developed. Two commenters stated that if the relief for the apportioning model verification requirement was not granted, but the extension for using the Tier 2c Method  17 through 2013 was finalized, there would not be any mechanism to defer compliance with the apportioning model verification requirement while alternative emission estimation and reporting methods and apportioning methods are being worked through. These commenters stated their belief that BAMM would not be available for 2013.

One commenter described an alternative method to accomplish verification for apportioning gas consumption. The commenter explained that an allocation process to determine the percent of each gas type used in each process type/sub-type may be used. This percentage would then be applied to the total amount of each gas consumed to determine the amount of gas consumed for each process type/sub-type. The allocation process would be detailed in a facility site GHG monitoring plan and would be available for EPA review and inspection. The commenter further asserted that this process will be most relevant to etch process sub-types (which represent 15 percent to 35 percent of gas consumption at a facility). The commenter expressed the opinion that the allocation process provides adequate support for validating the gas allocation methodology. The commenter stated that they are working with other members of industry to develop alternatives to the apportioning model verification requirement, such as raising the current 5 percent verification level or specifying facility specific metrics on which an apportioning model must be based in a final regulation.

EPA appreciates the information provided by commenters on technical and cost issues associated with the apportioning model verification requirement. EPA also recognizes that if the Agency were to revise subpart I to include stack testing as an option for the largest semiconductor manufacturing facilities to estimate their fluorinated GHG emissions, an apportioning model as currently required in subpart I to apportion gas to different process types/sub-types and recipes, may not be required to estimate and report GHG emissions for facilities choosing the stack testing option. However, EPA did not propose to add any new methods to subpart I as part of the current rulemaking, and thus there was no need for the Agency to consider how such new methods might affect other aspects of the rule. Further, the Agency did not propose alternative methods for apportioning model verification, as it had not had an opportunity to evaluate alternatives. However, the BAMM process should be adequate for resolving facility's concerns about compliance with the apportioning model verification requirement during the interim period addressed by this rule. Therefore, EPA is not taking action today to amend the apportioning model verification requirement; however, EPA may consider doing so in future.

EPA believes that apportioning is a particularly important component in estimating emissions of fluorinated GHGs from electronics manufacturing. Emission estimates, as required to be calculated in subpart I, are based on consumption of fluorinated GHGs for specific process types/sub-types or recipes and assigned emission factors to each process type/sub-type or recipe. Hence, there are two main sources of error in emissions estimates: (1) Errors associated with emission factors, and (2) errors associated with the consumption of gas by process type/sub-type or recipe. An accurate and precise estimate of emissions does not only rely on using robust emission factors but also on accurate estimates of gas consumption.

EPA understands that there are multiple ways to monitor and model gas consumption. For this reason, in finalizing subpart I in December 2010, EPA provided flexibility for facilities to use different metrics for the engineering model to develop apportioning factors, and only required that the model be based on a quantifiable metric. Because of this flexibility, and to ensure consistency between reporting facilities, EPA required apportioning model verification. Nevertheless, EPA is sensitive to the issues raised by commenters about apportioning model verification and understands these issues may impact a facility's ability to comply. Therefore, if a facility is unable to meet the existing apportioning verification requirements in 40 CFR 98.94(c)(2), the owner or operator may use and/or apply for BAMM as discussed in the following paragraphs.

Under the existing subpart I BAMM provisions, a facility may use and/or apply to use BAMM to verify facility-specific engineering models as required under 40 CFR 98.94(c)(2). As finalized in today's rule, an owner or operatory may, without submitting and receiving approval from the Administrator , use BAMM in 2011 for verifying facility-specific engineering models. Owners and operators wishing to extend the use of BAMM beyond December 31, 2011 for apportioning model verification must submit a request for approval to the Administrator by October 17, 2011. As explained in Section II.A of this preamble, the BAMM extension provisions do not impose an end date: for example, they do not state that extensions are limited to 2012. A facility wishing to apply for BAMM for both 2012 and 2013 should include both years in its request. EPA does not anticipate approving the use of BAMM beyond the time that EPA promulgates a final rule with alternative methodologies ( i.e., January 1, 2014).

EPA only received a small number of requests, as compared the number of facilities expected to report under subpart I, to use BAMM to comply with the apportioning model verification requirements in 40 CFR 98.94(c)(2) during 2011. For this reason EPA has concluded that while some facilities are unable to meet the requirements for apportioning model verification, the problem is limited. Therefore, EPA believes that the BAMM process, which considers individual facilities' circumstances, is an appropriate mechanism for addressing concerns with this aspect of the rule through 2013.

EPA appreciates the alternative apportioning method to accomplish verification provided by one commenter. The Agency would like to work with the commenter to better understand the details of the method. In addition, EPA also understands that the industry will be working to develop alternative apportioning approaches as part of the development of alternatives to the recipe-specific factor method. EPA plans to undertake a comprehensive evaluation of those alternatives. The Agency may consider whether to propose an alternative approach for apportioning model verification in the future.

Although EPA's proposal did not include either a request for comment on the final subpart I provisions for monitoring abatement system uptime or a proposal for alternative methodologies, EPA received comments from four entities on the abatement system uptime provisions. In general, commenters asserted that facilities do not currently track uptime as required by the rule. These commenters proposed an alternative methodology for monitoring and calculating uptime based on the fraction of the time the abatement system is operating during the reporting year, as opposed to based on tracking time in which gas is flowing per the final subpart I requirements.

The comments that EPA received on abatement system uptime are outside the scope of the rule. Because EPA did not propose an alternative methodology for monitoring abatement system uptime, EPA is not taking action at this time to amend the requirements in the final subpart I provisions. However, the Agency intends to review concerns about the existing requirements for monitoring abatement system uptime and evaluate the alternative methodologies suggested by commenters. EPA may consider whether to propose an alternative approach to monitoring and estimating uptime for abatement systems in the future.

If a facility wishes to calculate and report controlled fluorinated GHG and N 2 O emissions from the use of abatement systems, and they are unable to meet the subpart I requirements for monitoring abatement system uptime, then they can use and/or apply for the use of BAMM. As finalized in today's rule, owners or operators may use BAMM for any parameter that cannot reasonably be measured according to the monitoring and QA/QC requirements of subpart I without submitting a request to and receiving approval from the Administrator through December 31, 2011. Owners and operators wishing to extend the use of BAMM to estimate emissions that occur beyond December 31, 2011 must submit a request to the Administrator no later than October 17, 2011 and receive approval from the Administrator. It is important to note that if a facility uses BAMM to comply with the requirements to monitor uptime, then the facility must estimate its emissions using the abatement system uptime calculation methodologies and equations in subpart I ( e.g., Equation I-15 of subpart I), but may use alternative means of estimating the inputs to those equations.

This action is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).

This action does not impose any new information collection burden. These amendments do not make any substantive changes to the reporting requirements in the subpart for which amendments are being proposed. The amendments to the reporting requirements reduce the reporting burden by allowing reporters to use default values instead of recipe-specific values for the three reporting years (2011, 2012, and 2013). In addition, this final rule extends two of the deadlines in the subpart I provisions related to best available monitoring methods. The Office of Management and Budget (OMB) has previously approved the information collection requirements contained in the existing regulations, 40 CFR part 98, subpart I (75 FR 74774, December 1, 2010), under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq . and has assigned OMB control number 2060-0650. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

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

For purposes of assessing the impacts of these amendments on small entities, small entity is defined as: (1) A small business as defined by the Small Business Administration's regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of these rule amendments on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. In determining whether a rule has a significant economic impact on a substantial number of small entities, the impact of concern is any significant adverse economic impact on small entities, since the primary purpose of the regulatory flexibility analyses is to identify and address regulatory alternatives “which minimize any significant economic impact of the rule on small entities.” 5 U.S.C. 603 and 604. Thus, an agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, or otherwise has a positive economic effect on all of the small entities subject to the rule.

As part of the process for finalization of the subpart I rule (75 FR 74774, December 1, 2010), EPA undertook specific steps to evaluate the effect of that final rule on small entities. Under that final rule for subpart I, EPA assessed the potential impacts of the final requirements on small entities using a sales test, defined as a ratio of total annualized compliance costs to firm sales. The results of that screening analysis, as detailed in the preamble to the final rule for subpart I, demonstrated that there are no significant impacts to a substantial number of small entities. The results of that analysis can be found in the preamble to the final rule (75 FR 74774).

The rule amendments will reduce the burden for the largest semiconductor manufacturing facilities by providing flexibility during the first three years of compliance. In addition, the rule provides additional flexibility to those facilities that are using and/or applying for the use of best available monitoring methods by extending two deadlines. The action does not impose any new requirements on regulated entities.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531-1538, requires Federal agencies, unless otherwise prohibited by law, to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Federal agencies must also develop a plan to provide notice to small governments that might be significantly or uniquely affected by any regulatory requirements. The plan must enable officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates and must inform, educate, and advise small governments on compliance with the regulatory requirements.

This action does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any one year. Thus, the rule amendments are not subject to the requirements of section 202 and 205 of the UMRA.

This rule is also not subject to the requirements of section 203 of UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments. Facilities subject to the rule include only manufacturers of microcomputers, semiconductors, photovoltaic devices, liquid crystal display units, and micro-electro-mechanical systems. None of the facilities known to undertake these activities is owned by a small government. Therefore, this action is not subject to the requirements of section 203 of the UMRA.

This action does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132.

These amendments apply directly to facilities that use and emit fluorinated GHGs in the manufacture of certain electronic devices. They do not apply to governmental entities because no government facilities undertake these activities. This regulation also does not limit the power of States or localities to collect GHG data and/or regulate GHG emissions. Thus, Executive Order 13132 does not apply to this action.

Although section 6 of Executive Order 13132 does not apply to this action, EPA did consult with State and local officials or representatives of State and local governments in developing subpart I promulgated on December 1, 2010. A summary of EPA's consultations with State and local governments is provided in Section VIII.E of the preamble to the 2009 final Part 98 (74 FR 56371).

This action does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). The rule amendments would not result in any additional requirements beyond what is currently required in 40 CFR part 98 subpart I. Thus, Executive Order 13175 does not apply to this action.

Although Executive Order 13175 does not apply to this action, EPA sought opportunities to provide information to tribal governments and representatives during the development of subpart I promulgated on December 1, 2010. A summary of EPA's consultations with tribal officials is provided in Sections VIII.E and VIII.F of the preamble to the 2009 final Part 98 (74 FR 56260) and Section IV.F of the preamble to the 2010 final rule notice for subpart I (75 FR 74814).

EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5-501 of the Executive Order has the potential to influence the regulation. This action is not subject to Executive Order 13045 because it does not establish an environmental standard intended to mitigate health or safety risks.

This action is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not a significant regulatory action under Executive Order 12866.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law No. 104-113 (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

This rulemaking does not involve technical standards. Any technical standards that are required under subpart I were already included in promulgation of the final subpart I provisions on December 1, 2011 (75 FR 74774). Therefore, EPA is not considering the use of any voluntary consensus standards in this action.

Executive Order 12898 (59 FR 7629, February 16, 1994) establishes Federal executive policy on environmental justice. Its main provision directs Federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

EPA has determined that this rule will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not affect the level of protection provided to human health or the environment because it is a rule addressing information collection and reporting procedures.

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), 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 U.S. prior to publication of the rule in the Federal Register . A major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2). This rule will be effective on September 30, 2011.

For the reasons stated in the preamble, title 40, chapter I, of the Code of Federal Regulations is amended as follows:

This is a synopsis of the Commission's Report and Order in CG Docket No. 03-123; WC Docket No. 05-196; WC Docket No. 10-191; FCC 11-123, adopted and released on August 4, 2011. The complete text of this document is available for inspection and copying during normal business hours in the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC 20554. The document may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone (800) 378-3160 or (202) 863-2893, facsimile (202) 863-2898, or via the Internet at http://www.bcpiweb.com. It is also available on the Commission's Web site at http://www.fcc.gov.

In addition to filing comments with the Office of the Secretary, a copy of any comments on the Paperwork Reduction Act information collection requirements contained herein should be submitted to Judith B. Herman, Federal Communications Commission, Room 1-B441, 445 12th Street, SW., Washington, DC 20554, or via the Internet to PRA@fcc.gov.

The Order contains new or modified information collection requirements. The Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and the Office of Management and Budget (OMB) to comment on the information collection requirements contained in this document, as required by the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. Public and agency comments are due 60 days after the date of publication of this document in the Federal Register . Comments should address: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; (b) the accuracy of the Commission's burden estimates; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology.

In addition, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment on how we might “further reduce the information collection burden for small business concerns with fewer than 25 employees.”

The Regulatory Flexibility Act of 1980, as amended (RFA), requires that a regulatory flexibility analysis be prepared for rulemaking proceedings, unless the agency certifies that “the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities.” The RFA generally defines “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).

In this Order, the Commission issues final rules to improve assignment of telephone numbers associated with iTRS. Specifically, these rules are targeted to address VRS, which allows individuals with hearing and speech disabilities to communicate using sign language through video equipment, and IP Relay, which allows these individuals to communicate in text using a computer. The final rules set forth in this Order will satisfy the objective of this proceeding: to encourage use of geographically appropriate local numbers, and ensure that the deaf and hard-of-hearing community has access to toll free telephone numbers that is equivalent to access enjoyed by the hearing community.

With regard to whether a substantial number of small entities will be affected by the requirements set forth in this Order, the Commission notes that only four providers affected by the Order meet the definition of a small entity. The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such firms having 1,500 or fewer employees. Currently, fifteen providers receive compensation from the Interstate TRS Fund for providing any form of TRS: American Network, AT&T Corp.; CSDVRS; CAC; GoAmerica; Hamilton Relay, Inc.; Hands On; Healinc; Kansas Relay Service, Inc.; Michigan Bell; Nordia Inc.; Snap Telecommunications, Inc; Sorenson; Sprint; and State of Michigan. Because only four of the providers affected by this Order are deemed to be small entities under the SBA's small business size standard, the Commission concludes that the number of small entities affected is not substantial. Moreover, given that all providers affected by the Order, including the four that are deemed to be small entities under the SBA's standard, are entitled to receive prompt reimbursement for their reasonable costs of compliance, the Commission concludes that the Order will not have a significant economic impact on these small entities. Therefore, we certify that requirements set forth in the Order will not have a significant economic impact on a substantial number of small entities.

The Commission will send a copy of the Order, including a copy of this Final Regulatory Flexibility Certification, to the Chief Counsel for Advocacy of the SBA. This final certification will also be published in the Federal Register .

The Commission will send a copy of this Report and Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act.

1. In this Order, we adopt rules to improve assignment of telephone numbers associated with Internet-based Telecommunications Relay Service (iTRS). These rules specifically address Video Relay Service (VRS), which allows individuals with hearing and speech disabilities to communicate using sign language through video equipment, and IP Relay, which allows these individuals to communicate in text using a computer. The final rules set forth in this Order reflect the objectives laid out in the iTRS Toll Free Notice 75 FR 67333, November 2, 2010: to promote the use of geographically appropriate local numbers, while ensuring that the deaf and hard-of-hearing community has access to toll free telephone numbers that is equivalent to access enjoyed by the hearing community. These objectives, and the rules to implement them, received strong support in the record. Reflecting that record in this Order, we adopt the rules as proposed.

2. In 2008, the Commission instituted a ten-digit numbering plan for iTRS in order to make access by deaf and hard-of-hearing people more functionally equivalent to access enjoyed by the hearing community, as required by section 225 of the Communications Act of 1934, as amended 73 FR 41286, July 18, 2008. The Commission sought to ensure that iTRS users can be reached via telephone, as hearing users can. As a result of that order, most deaf and hard-of-hearing iTRS users have obtained local telephone numbers. Nevertheless, some iTRS providers have continued to assign customers a toll free number in addition to a local number, even if the customer did not request a toll free number.

3. In the iTRS Toll Free Notice, the Commission proposed rules to align the use of local and toll free numbers by iTRS users more closely with the way that hearing users use local and toll free numbers. The Commission's goal was to ensure that an iTRS user's local number is used routinely as the primary telephone number that hearing users dial to reach the deaf or hard-of-hearing user via an iTRS provider, and that deaf and hard-of-hearing users employ for point-to-point calling with other deaf and hard-of-hearing users. In this Order, we adopt those proposed rules, and in doing so we advance the Commission's statutory responsibility to ensure that deaf and hard-of-hearing users are able to communicate in a manner that is “functionally equivalent” to the way in which hearing users communicate.

4. Authority. The Commission has authority, pursuant to sections 225 and 251(e) of the Communications Act of 1934, as amended (the Act), to adopt and implement a system for assigning iTRS users local numbers linked to the NANP. Section 225 requires the Commission to ensure that functionally equivalent TRS be available nationwide to the extent possible and in the most efficient manner, and directs the Commission to adopt regulations to govern the provision and compensation of TRS. Section 251 grants the Commission authority to oversee numbering administration in the United States. Adopting rules to govern the use of toll free numbers by iTRS providers in connection with iTRS services is a continuation of the implementation of the Commission's numbering plan, and is essential to the Commission's goal of making the numbering system used by deaf and hard-of-hearing individuals functionally equivalent to the system used by hearing individuals.

5. Ten-digit numbering plan. The Commission released the First Internet-based TRS Order on June 24, 2008, 73 FR 41286, July 18, 2008, in which it adopted a uniform numbering system for iTRS. Prior to the Commission's numbering plan, there was no uniform numbering system for iTRS, and iTRS users were reached at an IP address, a proxy or alias number, or a toll free number. With respect to toll free numbers, when a hearing user dialed the iTRS user's toll free number, the voice call was routed by the public switched telephone network (PSTN) to the provider that had subscribed to the number and assigned it to a user. Although that toll free number was not linked to a user-specific local number, the provider would translate the toll free number dialed by the hearing user to the iTRS user's IP address in the provider's database. However, until the First Internet-based TRS Order took effect, iTRS providers did not share databases, and therefore, the iTRS user and people calling that user were forced to use the service of the iTRS provider that gave the user the toll free number.

6. In the Second Internet-based TRS Order, released on December 19, 2008, 73 FR 79683, December 30, 2008, the Commission addressed issues raised in a Further Notice of Proposed Rulemaking 73 FR 41307, July 18, 2008, that accompanied the First Internet-based TRS Order. With respect to the use of toll free numbers, the Commission found that, to further the goals of the numbering system, “Internet-based TRS users should transition away from the exclusive use of toll free numbers,” and required all iTRS users to obtain “ten-digit geographically appropriate numbers, in accordance with our numbering system.” The Commission determined, among other things, that local numbers rather than toll free numbers should be used when an iTRS user contacted Public Safety Answering Points (PSAPs). Accordingly, the Commission required that a user's toll free number be mapped to the user's local, geographically appropriate number. Moreover, the Commission found that, because hearing telephone users are responsible for the costs of obtaining and using toll free numbers, functional equivalency dictates that the TRS Fund should not compensate providers for the use of toll free numbers by iTRS users.

7. iTRS Toll Free Issues. In August 2009, the Consumer and Governmental Affairs Bureau and the Wireline Competition Bureau (the Bureaus) released the Toll Free Clarification Public Notice to clarify the requirement, imposed in the Second Internet-based TRS Order, that any toll free number retained or acquired by an iTRS user must be directed to the user's local number in the Service Management System (SMS)/800 database, and that a toll free number and a local number should not be directed to the same Uniform Resource Identifier (URI) in the Internet-based TRS Numbering Directory (iTRS Directory). This action was taken to ensure that the use of toll free numbers by iTRS users would be functionally equivalent to the use of toll free numbers by hearing users. Additionally, the Public Notice acknowledged that certain point-to-point calls, as well as inbound dial-around calls, would require the use of a local number.

8. On September 10, 2009, CSDVRS, a provider of VRS, filed a petition for expedited reconsideration of the Toll Free Clarification Public Notice, claiming, among other things, that the Toll Free Clarification Public Notice violated the Administrative Procedure Act, impeded VRS interoperability, and undermined functional equivalency by eliminating the use of toll free numbers for point-to-point and dial-around calls. Subsequently, the TDI Coalition, which represents deaf and hard-of-hearing iTRS users, filed a Petition for Emergency Stay and a Request to Return to the Status Quo Ante. The TDI Coalition asked the Commission to stay certain portions of the Toll Free Clarification Public Notice, and to direct iTRS providers that had removed toll free numbers from the iTRS Directory to reinstate those numbers to avoid any disruption in service.

9. In response to TDI's concerns that certain point-to-point calls would not be completed, on December 4, 2009, the Bureaus waived the portion of the Toll Free Clarification Public Notice that stated that a toll free number and a local geographic number should not be directed to the same URI in the iTRS Directory. Also, the Bureaus directed iTRS providers that had removed working, assigned toll free numbers that did not point to the iTRS user's local number in the SMS/800 database, in accordance with the Toll Free Clarification Public Notice, to reinstate those toll free numbers to the iTRS Directory. The waiver was designed to give the Commission time to consider the CSDVRS petition for reconsideration as well as iTRS toll free issues generally. The Bureaus also recognized that it would take consumers and certain small businesses time to transition to geographically appropriate local numbers. The Bureaus have issued several extensions of this waiver.

10. iTRS Toll Free Notice. To address the issues raised in response to the Toll Free Clarification Public Notice and to generally improve assignment of telephone numbers associated with iTRS, the Commission issued the iTRS Toll Free Notice. In the Notice, the Commission found that the routine issuance and prevalence of toll free iTRS numbers presented concerns with respect to: (1) Lack of functional equivalency and consumer confusion; (2) emergency calling; (3) lack of number portability and impairment of full competition; (4) number conservation; and (5) costs to the TRS Fund. The Commission, pursuant to its authority under sections 225 and 251 of the Act, proposed rules to address the problems that are caused by the promotion and disproportionately high use of toll free numbers in connection with iTRS services.

11. The Commission emphasized in the iTRS Toll Free Notice that it was not seeking to prevent deaf or hard-of-hearing individuals from obtaining a toll free number, but rather to ensure that toll free numbers do not serve as default personal numbers. The Commission sought comment on ways to ensure that iTRS users who need toll free numbers for business purposes or who wish to obtain a toll free number for personal use are able to do so in the same manner as hearing users. Interested parties, including providers and consumer groups, commented on the iTRS Toll Free Notice and generally supported the Commission's proposed rules.

12. User-Selected Toll Free Use. In the iTRS Toll Free Notice, we proposed to prohibit iTRS providers, acting in the capacity of a user's default number provider, from routinely assigning a new toll free number to the user. We noted that consumer groups representing iTRS users supported this approach and agreed with the Commission on the need to limit or prohibit the distribution of toll free numbers by iTRS providers. The consumer groups continue to support this proposal. The TDI Coalition states that it supports the transition from toll free to geographically appropriate numbers, “as it will (1) reduce confusion, both for service providers and consumers, by making clear the responsibilities of the various parties, and (2) provide that the continued use of toll-free numbers, under specific circumstances, is not prohibited by the Commission.” The TDI Coalition further states that it “do[es] not condone the way some iTRS providers have pushed toll free numbers on consumers, and would prefer that in general, consumers use geographically appropriate ten-digit geographic NANP numbers.” No iTRS provider opposes this proposal. Indeed, CSDVRS—a VRS provider—comments that it “fully supports this measure as a means to meet the Commission's efforts to encourage the use of local ten-digit numbers, rather than toll free numbers.”

13. Sorenson Communications—the largest VRS provider—comments that it “does not automatically assign toll-free numbers to its default users, but instead offers consumers the option of obtaining a toll-free number in addition to their ten-digit local number.” Sorenson further states that “a default user must affirmatively request a toll-free number in order to receive one. Regardless of whether Sorenson or any other iTRS provider assigns toll free numbers “automatically,” we agree with the consumer groups that the widespread assignment of toll free numbers in addition to local numbers continues to cause problems for iTRS users. Therefore, based on the record and consistent with our proposal in the iTRS Toll Free Notice, we revise § 64.611 of the Commission's rules to prohibit iTRS providers from assigning or issuing toll free numbers to users. We expect that requiring an iTRS subscriber to pay for his or her toll free number, and to transfer an already assigned number to a toll free service provider or Responsible Organization (RespOrg) should the subscriber want to keep it, will significantly reduce the number of toll free numbers assigned by iTRS providers.

14. In its comments, Sorenson proposes that iTRS providers be allowed to assign toll free numbers in instances where geographically appropriate numbers are not available. Currently, when a geographically appropriate number is unavailable, an iTRS provider may assign the user a “geographically approximate” number, which is a ten-digit number as close to a user's rate center as possible. Sorenson claims, however, that for these iTRS users, “toll charges can result even for calls placed to the iTRS user by hearing persons—including health care providers, schools, governments and employers—located within the same local calling area.” Sorenson argues that the Commission should therefore waive its rules to permit the assignment of toll free numbers where geographically appropriate numbers are not available.

15. We disagree with Sorenson that a general waiver is appropriate. A general waiver allowing the assignment of toll free numbers where geographically appropriate numbers are not available would undermine the intent of this proceeding to promote the use of geographically appropriate numbers and to provide iTRS customers with access functionally equivalent to that enjoyed by hearing customers. Furthermore, Sorenson does not demonstrate that, where geographically appropriate numbers are not available, toll free numbers, rather than geographically approximate numbers, are necessary to avoid widespread harm to iTRS users. Once the rules we adopt today become effective, iTRS providers may request waivers on a case-by-case basis, where they believe that the assignment of geographically approximate numbers is an inadequate solution.

16. We also note that Jay Carpenter, member of the North American Numbering Council Future of Numbering Working Group, requests that the Commission postpone adopting any rules with respect to the distribution of toll free numbers for iTRS. Mr. Carpenter asserts that issues raised in the iTRS context with respect to toll free numbers are “symptomatic of a general need within the toll free telephone number industry.” Mr. Carpenter requests that we delay this proceeding for six months while the toll free industry has “vetted” a white paper drafted by the North American Numbering Council Future of Numbering Working Group. Although we applaud efforts made by the working group to address issues of the toll free industry, we find that issues raised in the instant proceeding regarding distribution of toll free numbers for iTRS are distinct and severable from those raised in the Commission's general toll free docket, CC Docket No. 95-155.

17. Continuing Use of and Access to Toll Free Numbers. In the iTRS Toll Free Notice, we stated that iTRS users should have the same access to toll free numbers that hearing users have, and that any iTRS user who wants to keep a toll free number that has been issued by an iTRS provider may do so. We proposed a rule requiring that at the user's request, an iTRS provider must facilitate the transfer of the user's toll free number to a direct subscription with a toll free service provider or RespOrg. Under this approach, the iTRS user would become a customer of the toll free service provider, and the iTRS provider that originally provided the toll free number would have no continuing role in administering that number. The consumer groups support this proposal, “so long as those measures do not cause undue disruption to consumer services.” We agree, and we expect that the rules we adopt in this Order can be implemented without significant disruption to the iTRS user. Accordingly, we adopt the rule we proposed in the iTRS Toll Free Notice, which will allow an iTRS user to maintain his or her toll free number by transferring such number to a toll free service subscription.

18. Sorenson asserts that the iTRS Toll Free Notice “does not propose, and should not be interpreted to propose, a prohibition of VRS providers acting as RespOrgs or interexchange carriers, or entering into sales and marketing relationships with RespOrgs or interexchange carriers.” Commission rules do not prohibit iTRS providers from serving as or entering into business relationships with RespOrgs or interexchange carriers. We emphasize, however, that any provision of toll free numbers by iTRS providers must be consistent with the rules that we adopt in this proceeding. Moreover, we will closely monitor the implementation of these rules to ensure that iTRS customers routinely use local numbers as their primary telephone numbers. We will take action, if necessary, to ensure that iTRS providers and other entities do not induce iTRS customers to obtain or maintain toll free numbers. For example, the provision by iTRS providers of toll free numbers or toll free calling at no charge to iTRS customers, or efforts by iTRS providers to market toll free numbers to iTRS customers, would contravene the Commission's goals in this proceeding.

19. No Support for Toll Free Numbers from TRS Fund. The Commission has previously concluded that the costs associated with assigning and providing to iTRS users toll free numbers are not compensable from the TRS Fund. Thus, should an iTRS user choose to transfer his or her toll free number from an iTRS provider to a toll free service provider (or obtain a toll free number directly from a toll free service provider or RespOrg), the user would assume responsibility for all costs associated with the toll free number.

20. The consumer groups agree that iTRS users should pay for their own toll free numbers. CSDVRS also agrees that iTRS users should pay for costs associated with toll free number subscription. Sorenson argues that “[r]equiring consumers to pay for toll-free service is likely to force at least some consumers to relinquish their access to toll-free numbers, thus degrading their service.” We disagree that requiring iTRS users to pay for toll free service would “degrade” service. Rather, this approach is consistent with the functional equivalency requirement of section 225 of the Act because it aligns toll free use by iTRS users with toll free use by hearing customers. We agree with Sorenson that if it is not economically worthwhile for an iTRS user to pay for his or her own toll free number, then he or she will likely relinquish the number. However, this economic decision is no different for deaf and hard-of-hearing users than for hearing consumers.

21. While CSDVRS agrees that iTRS users should be responsible for the costs associated with a toll free number, it suggests that “in the interests of maintaining equal access to the use of toll free numbers by deaf, hard-of-hearing, and deaf-blind individuals * * * the FCC set a minimum allowable price charged to an iTRS consumer for a toll free number at $9.95 per month.” We do not believe, however, that functional equivalency requires the establishment of a minimum allowable price for toll free service to iTRS users when there is no comparable minimum price for toll free service to hearing users. Accordingly, we decline to adopt CSDVRS's proposal.

22. Transfer of Toll Free Numbers. Section 251(e)(1) of the Act grants the Commission exclusive jurisdiction over “those portions of the North American Numbering Plan that pertain to the United States.” The Act also requires the Commission to “ensure the efficient, fair, and orderly allocation of toll-free numbers.” All telephone numbers are a public resource and neither carriers nor subscribers “own” their telephone numbers. Under the Commission's rules, toll free numbers are made available to end users on a first-come, first-served basis unless otherwise directed by the Commission. Several commenters state that in order to effectuate the transfer of the iTRS toll free numbers from the iTRS provider to the toll free service provider, the Commission must waive its first-come, first-served policy.

23. Section 52.111 of the Commission's rules authorizes the Commission to direct assignment of toll free numbers on a basis different than the usual first-come, first-served basis. Moreover, the Commission has authority to waive any provision of its rules for good cause shown. The Commission may exercise its discretion to waive a rule where particular facts would make strict compliance inconsistent with the public interest.

24. To fully implement the Commission's numbering system for iTRS users and to ensure that iTRS users have the same access to toll free numbers as hearing users, we waive the first-come, first-served rule for the limited purpose of enabling those iTRS users who wish to continue to use their existing toll free numbers to do so. Under the ordinary operation of the Commission's numbering rules, when an end user relinquishes a toll free number, that number is returned immediately to the number pool before it is reassigned. Accordingly, under the first-come, first-served rule, when a toll free number is transferred from an iTRS provider to a toll free service provider, the iTRS user may not be able to retain his or her toll free number because the number may be assigned to someone else. To prevent this potential disruption, we waive our first-come, first-served rule, § 52.111 of the Commission's rules, to allow iTRS users to transfer their existing toll free numbers to a toll free service provider. This limited waiver will remain in place during the one-year transition period that we establish in this Order and will thus expire one year after the effective date of this Order. By the time this waiver expires, all iTRS users who want to keep their existing toll free numbers will have had a reasonable opportunity to transfer those numbers to a direct subscription with a toll free service provider.

25. Toll Free Numbers in the iTRS Directory. We proposed in the iTRS Toll Free Notice that if a deaf or hard-of-hearing person obtains a toll free number from a toll free provider, the number would also be mapped to the user's local number in the iTRS Directory. This approach would allow such users to be reached at a toll free number both by other deaf and hard-of-hearing users on direct calls that are completely Internet-based, and by hearing users who “dial around” the user's default provider. The record supports this approach. Accordingly, we adopt the proposal in the iTRS Toll Free Notice and revise § 64.613 of our rules to require that iTRS providers ensure that the toll free number of a user associated with a geographically appropriate NANP number will be associated with the same URI as that geographically appropriate NANP number.

26. This requirement should eliminate problems involving service disruption when toll free numbers are not directly linked to the associated local numbers in the iTRS Directory. We note that Neustar—the administrator for the iTRS Directory—has recommended a process or mapping toll free numbers to local numbers through the Canonical Name (CNAME) Resource Record. Neustar's comments highlight that the mapping function is feasible. The Commission, through its contracting process, will determine the best method to implement its new iTRS toll free rules.

27. We find that adopting this rule addresses the concerns raised in CSDVRS's Petition for Expedited Reconsideration of the Toll Free Clarification Public Notice as well as the TDI Coalition's Petition for Emergency Stay and a Request to Return to the Status Quo Ante. CSDVRS and the TDI Coalition had expressed concern that the Commission's clarification that any toll free number retained or acquired by an iTRS user must be directed to the user's local number in the Service Management System (SMS)/800 database would cause service disruption and undermine functional equivalency for iTRS users. The specific requirement that a toll free number associated with a geographically appropriate NANP number be associated with the same URI as that geographically appropriate NANP number will alleviate any service disruption or problems completing point-to-point calls and therefore, we dismiss these petitions as moot.

28. Transition Period. In the iTRS Toll Free Notice, we proposed a one-year transition period to allow a reasonable period for consumer outreach and education to transition consumers from toll free numbers to local numbers. This proposal was unanimously supported in the record. Specifically, the TDI Coalition commented that the “Commission's proposed transition plan of one year is reasonable, and indeed, necessary.” CSDVRS also agrees with the Commission's one-year transition plan proposal, stating it will “allow ample time for providers to undertake consumer outreach and any necessary technological adjustments.” Sorenson also agrees.

29. Based on the record, we find that a one-year transition is appropriate. During this transition period, the Commission will work diligently to educate iTRS users about the transition plan. We expect that consumer groups and iTRS providers will do the same. We also agree with the consumer groups that this time can be used to allow iTRS users who wish to relinquish their toll free numbers to inform their family, friends and other correspondents that they must be called on their geographic numbers and allow those iTRS users who wish to maintain their toll free number to transition to a toll free subscribership. We therefore adopt the one-year transition period proposed in the iTRS Toll Free Notice. This transition period will expire one year after the effective date of the rules we adopt today. By that date, iTRS providers must remove from the iTRS Directory any toll free number that has not been transferred to a subscription with a toll free service provider and for which the user is the subscriber of record at the end of the transition period. iTRS providers must also, by the end of the transition period, ensure that the toll free number of a user that is associated with a geographically appropriate NANP number is associated with the same URI as that geographically appropriate NANP telephone number in the iTRS Directory.

30. Removing Non-Selected Toll Free Number from the iTRS Directory. In the iTRS Toll Free Notice, we emphasized that an important outcome of this proceeding was to “cleanse” the iTRS Directory of extra or unwanted toll free numbers at the end of the transition period. We proposed that any toll free numbers that have not been mapped to local numbers in the SMS/800 database by a toll free service provider be removed from the iTRS Directory at the end of the transition period. There is support in the record for removing such numbers from the iTRS Directory at the end of the transition period, and no commenter opposed this proposal. Thus, we adopt a rule requiring that iTRS providers, within one year after the effective date of this Order, remove from the iTRS Directory any toll free numbers that have not been mapped to local numbers in the SMS/800 database, and have not been mapped directly to a local number in the iTRS Directory by the iTRS provider.

31. The Commission also sought comment on whether it should establish a process whereby during the transition period, iTRS users who know that they do not want their toll free number(s) could request that those numbers be deleted from the iTRS Directory. Although we received no comment on this specific issue, we find that, should an iTRS user wish to relinquish his or her toll free number at any time during the one-year transition period, the iTRS provider should facilitate the request and delete the number from the iTRS directory. If the user makes an affirmative request, there should be no service disruption. Moreover, such a process will help cleanse the database on an ongoing basis. Thus, we adopt the proposal. We find that this clean-up of the iTRS Directory is not unduly burdensome. Moreover, it will provide the Commission with clearer indications of how relay services are being used to serve the deaf and hard-of-hearing community and the extent to which that community is using toll free numbers.

32. Consumer Outreach. The record in this proceeding reinforces the Commission's view that the success of the Commission's new iTRS toll free numbering rules will be enhanced by outreach efforts by consumer groups, as well as by iTRS providers and the Commission. We recognize that deaf and hard-of-hearing individuals may be accustomed to the current process for obtaining toll free numbers and that any change will require substantial education and outreach. We do not seek to impose overly burdensome obligations on any one sector involved, and seek instead to share the responsibilities, with the highest priority being to fully inform the iTRS community of the transition.

33. We agree with the consumer groups that the iTRS providers are on the “front line” of the outreach effort as they have the most interaction with iTRS users. However, there appears to be disagreement in the record as to whether iTRS providers should be responsible for providing toll free terms and conditions to users. The consumer groups want iTRS providers and toll free service providers to “fully inform the customers of the terms and conditions associated with the use of the toll free number.” Sorenson, on the other hand, argues that unless it “is the toll free consumer's chosen [toll free service] provider, Sorenson should not bear any responsibility for disclosing the terms and conditions associated with the service.”

34. Under the user notification rule we adopt, every iTRS provider must include certain information on its Web site as well as in any promotional materials. Providers must clearly explain, in layman's terms, the process by which a user may acquire a toll free number from a toll free service provider, or transfer a toll free number from an iTRS provider to a toll free service provider or RespOrg. The notification must include contact information for toll free service providers so that users may easily access necessary information. Such contact information will also be available from consumer groups and the Commission. iTRS providers must also provide information on how an iTRS user may request that his toll free numbers be linked to his ten-digit telephone numbers in the iTRS Directory.

35. The Commission will play a significant role in consumer outreach and education efforts. In the iTRS Toll Free Notice, the Commission had asked for comment on how to make information about the availability and use of toll free numbers available to iTRS users, such as fact sheets and Web sites. Commenting consumer groups recommend that iTRS providers' Web sites should “include contact information for the appropriate FCC consumer information portals to provide additional sources of information on the transition plan.” Moreover, CSDVRS suggests that “a central repository of information” be created on the Commission's Web site, along with a posting on all provider Web sites, “similar to that required for E911.” We find both to be useful suggestions. Thus, we conclude that providers must post on their Web sites contact information for toll free service providers. The Commission will also provide this information on its Web site. We encourage consumer groups also to provide this information.

36. Toll Free Waiver Order. Since December 2009, the Commission has waived the portion of the Toll Free Clarification Public Notice that stated that toll free numbers and ten-digit geographic numbers should not be directed to the same URI in the iTRS Directory. The Commission's waiver is set to expire today. We hereby extend the waiver, effective immediately, until February 6, 2012, to allow the rules set forth in this Order to become effective, including the necessary information collection approvals. We find that the rules, once effective, will achieve the policy goals of this proceeding and the Commission's iTRS numbering plan.

37. Accordingly, it is ordered that, pursuant to the authority contained in sections 1, 4(i), 4(j), 225, 251(e), and 255 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 225, 251(e), and 255, and § 1.3 of the Commission's rules, 47 CFR 1.3, this Report and Order is adopted, and that part 64 of the Commission's rules, 47 CFR part 64, is amended as set forth in Appendix A. The Report and Order shall become effective October 27, 2011 except for §§ 64.611(e)(2), 64.611(e)(3), 64.611(g)(1)(v), 64.611(g)(1)(vi), and 64.613(a)(3), which require approval by OMB under the PRA and which shall become effective after the Commission publishes a notice in the Federal Register announcing such approval and the relevant effective date(s).

38. It is further ordered that, pursuant to sections 1, 4(i), 4(j) and 251(e) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j) and 251(e), and §§ 1.3 and 52.111 of the Commission's rules, 47 CFR 1.3 and 52.111, a waiver of the Commission's first-come, first-served rule, 47 CFR 52.111, is granted for a period of one year after the effective date of this Order, to allow iTRS users to transfer their existing toll free numbers to new toll free subscribership.

39. It is further ordered that the Commission's requirement that toll free numbers and ten-digit geographic numbers not be directed to the same URI in the iTRS Directory is waived, effective upon release of this Report and Order, until February 6, 2012.

40. It is further ordered that, pursuant to sections 1, 2, 4(i), 4(j), 225, 251, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 154(j), 225, 251, 303(r), the Petition for Expedited Reconsideration filed by CSDVRS LLC on September 10, 2009, in CG Docket No. 03-123, CC Docket No. 98-67, and WC Docket No. 05-196 is dismissed as moot.

41. It is further ordered that, pursuant to sections 1, 2, 4(i), 4(j), 225, 251, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 154(j), 225, 251, 303(r), the Petition for Emergency Stay filed by the TDI Coalition in CG Docket No. 03-123, WC Docket No. 05-196 on October 27, 2009 and the Request for Return to the Status Quo Ante filed by the TDI Coalition in CG Docket No. 03-123 and WC Docket No. 05-196 on November 12, 2009 are dismissed as moot.

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

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 64 as follows:

This is a summary of document DA 11-1590, released September 22, 2011. The full text of document DA 11-1590 and copies of any subsequently filed documents in this matter will be available for public inspection and copying during normal business hours at the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington DC 20554. Document DA 11-1590 and copies of subsequently filed documents in this matter may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc. (BCPI), at Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. Customers may contact BCPI at its Web site, http://www.bcpiweb.com, by calling (800) 378-3160 or (202) 863-2893, by facsimile at (202) 863-2898, or via e-mail at http://www.bcpiweb.com.

Oppositions and Replies. Pursuant to § 1.429 of the Commission's rules, interested parties may file oppositions and replies to an opposition on or before the dates indicated on the first page of this document. Such pleadings may be filed using: (1) The Commission's Electronic Comment Filing System (ECFS); or (2) by filing paper copies. All filings should reference the docket number of this proceeding, CG Docket No. 10-51. The oppositions and replies filed in response to document DA 11-1590 will be available via the ECFS at: http://fjallfoss.fcc.gov/ecfs2/; you may search by docket number (CG Docket No. 10-51).

• Oppositions and replies may be filed electronically using the Internet by accessing the ECFS: http://fjallfoss.fcc.gov/ecfs2/. Filers should follow the instructions provided on the Web site for submitting comments. In completing the transmittal screen, ECFS filers should include their full name, U.S. Postal Service mailing address, and CG Docket No. 10-51.

• Parties who choose to file by paper must file an original and one copy of each filing. Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first class or overnight U.S. Postal Service mail. All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission.

• All hand-delivered or messenger-delivered paper filings for the Commission's Secretary must be delivered to FCC Headquarters at 445 12th St., SW., Room TW-A325, Washington, DC 20554. The filing hours are 8 a.m. to 7 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes or boxes must be disposed of before entering the building.

• Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743.

• U.S. Postal Service first-class, Express, and Priority mail must be addressed to 445 12th Street, SW., Washington, DC 20554.

This proceeding shall be treated as a “permit-but-disclose” proceeding in accordance with the Commission's ex parte rules. See 47 CFR 1.1200 et seq. Persons making ex parte presentations must file a copy of any written presentation or a memorandum summarizing any oral presentation within two business days after the presentation (unless a different deadline applicable to the Sunshine period applies). Persons making oral ex parte presentations are reminded that memoranda summarizing the presentation must: (1) List all persons attending or otherwise participating in the meeting at which the ex parte presentation was made; and (2) summarize all data presented and arguments made during the presentation. If the presentation consisted in whole or in part of the presentation of data or arguments already reflected in the presenter's written comments, memoranda or other filings in the proceeding, the presenter may provide citations to such data or arguments in his or her prior comments, memoranda, or other filings (specifying the relevant page and/or paragraph numbers where such data or arguments can be found) in lieu of summarizing them in the memorandum. Documents shown or given to Commission staff during ex parte meetings are deemed to be written ex parte presentations and must be filed consistent with § 1.1206(b) of the Commission's rules. In proceedings governed by § 1.49(f) of the rules or for which the Commission has made available a method of electronic filing, written ex parte presentations and memoranda summarizing oral ex parte presentations, and all attachments thereto, must be filed through the electronic comment filing system available for that proceeding, and must be filed in their native format ( e.g., .doc, .xml, .ppt, searchable .pdf). Participants in this proceeding should familiarize themselves with the Commission's ex parte rules.

To request materials in accessible formats for people with disabilities (Braille, large print, electronic files, audio format), send an e-mail to fcc504@fcc.gov or call the Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (tty).

The Commission will not send a copy of document DA 11-1590 pursuant to the Congressional Review Act, 5 U.S.C. 801(a)(1)(A), because it does not have an impact on any rules of particular applicability.

1. Notice is hereby given that the parties listed have petitioned the Commission for reconsideration and clarification of the Second Report and Order in CG Docket No. 10-51, FCC 11-118, published at 76 FR 47469, August 5, 2011. In the Second Report and Order, the Commission required that, as part of their initial iTRS certification applications and in annual updates, VRS providers describe the technology and equipment used to support their call center functions (including but not limited to automatic call distribution, routing, call setup, mapping, call features, billing for compensation from the Interstate TRS Fund (TRS Fund), and registration), and for each core call center function, state whether it is owned or leased, and from whom if leased or licensed, and provide proofs of purchase, license agreements, or leases; and (2) a list of all sponsorship or marketing arrangements and associated agreements relating to iTRS.

2. The Second Report and Order also adopted a requirement that, in order to receive certification from the Commission, which is necessary to be eligible to receive compensation from the TRS Fund, all iTRS providers must operate their own calling facilities and employ their own communication assistants. In addition, the Second Report and Order adopted a requirement that any VRS provider that is leasing an automatic call distribution (ACD) platform from an eligible provider or from a third-party non-provider must have a written lease for such ACD platform and must include a copy of such written lease with its application for certification, and that a VRS provider leasing an ACD platform from an eligible provider must locate the ACD platform on its own premises and must use its own employees to manage the ACD platform.

3. Providers currently eligible for compensation from the TRS Fund via a means other than Commission certification must apply for certification within 30 days after the rules adopted in the Second Report and Order become effective, and providers with Commission certifications expiring November 4, 2011 must apply for recertification after the rules become effective but at least 30 days prior to their expiration provided that the rules are effective by that date, or risk having to shut down their operations and being denied compensation from the TRS Fund. In light of these impending deadlines for initial and recertification applications, and to avoid waste, fraud, and abuse in the VRS program, the Commission finds that good cause exists in this instance to alter the comment periods specified in § 1.429 of the Commission's rules. See 47 CFR 1.3 (providing for suspension, amendment, or waiver of Commission rules, in whole or in part, for good cause shown, and on the Commission's own motion).

Listed below are the parties filing petitions for reconsideration and clarification of the Second Report and Order and Order in CG Docket No. 10-51:

Sorenson Communications, Inc. (September 6, 2011).

AT&T Services, Inc. (September 6, 2011).

This is a summary of the Commission's Backhaul Report and Order and Memorandum Opinion and Order (Backhaul R&O, Backhaul MO&O), FCC 11-120, adopted and released on August 9, 2011. The full text of this document 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 the Backhaul Report and Order and Memorandum Opinion and Order and related Commission documents may be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc. (BCPI), Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, (202) 488-5300 or (800) 387-3160, contact BCPI at its Web site: http://www.bcpiweb.com. When ordering documents from BCPI, please provide the appropriate FCC document number, for example, FCC 11-120. The complete text of the Backhaul Report and Order and Memorandum Opinion and Order is also available on the Commission's Web site at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-11-120A1.doc. Alternative formats (computer diskette, large print, audio cassette, and Braille) are available by contacting Brian Millin at (202) 418-7426, TTY (202) 418-7365, or via e-mail to bmillin@fcc.gov.

1. Broadband is indispensable to our digital economy, and wireless technology is an increasingly important source of broadband connectivity. A leading example of the role of wireless technology in connecting the nation to broadband is the impact and potential of point-to-point microwave systems. An essential component of many broadband networks—particularly in mobile wireless networks—microwave backhaul facilities are often used to transmit data between cell sites, or between cell sites and network backbones. Service providers' use of microwave links as a cost-effective alternative to traditional copper circuits and fiber optic links has been increasing. In certain rural and remote locations, microwave is the only practical high-capacity backhaul solution available.

2. A robust broadband ecosystem therefore relies, at least in part, on access to adequate and cost-efficient backhaul. In this Report and Order, we continue our efforts to increase flexibility in the use of microwave services licensed under our part 101 rules. The steps we take will remove regulatory barriers that today limit the use of spectrum for wireless backhaul and other point-to-point and point-to-multipoint communications. We also make additional spectrum available for wireless backhaul—as much as 650 megahertz—especially in rural areas, where wireless backhaul is the only practical middle mile solution. By enabling more flexible and cost-effective microwave services, the Commission can help accelerate deployment of fourth-generation (4G) mobile broadband infrastructure across America.

3. The Commission has licensed spectrum for microwave uses for most of its history. In 1996, the Commission consolidated its rules for most microwave point-to-point and point-to-multipoint services into a new part 101 of the Commission's rules. Two specialized microwave services in particular—the Broadcast Auxiliary Service (BAS) and the Cable TV Relay Service (CARS)—have not been consolidated into part 101. Part 101 includes the point-to-point Private Operational Fixed Service (POFS) and the Common Carrier Operational Fixed Service. The Commission's licensing regime for these two services requires frequency coordination and the filing of an application for each microwave link or path containing detailed information concerning the proposed operation.

4. On August 5, 2010, the Commission commenced this proceeding “to remove regulatory barriers to the use of spectrum for wireless backhaul and other point-to-point and point-to-multipoint communications.” In the NPRM, the Commission sought comment on allowing FS to share the 6875-7125 MHz and 12700-13200 MHz bands currently used by BAS and CARS. The Commission also proposed to eliminate the “final link” rule that prohibits broadcasters from using FS stations as the final radiofrequency (RF) link in the chain of distribution of program material to broadcast stations. The Commission further proposed to modify the part 101 minimum payload capacity rule to allow temporary operations below the minimum capacity under certain circumstances, which would enable FS links—particularly long links in rural areas—to maintain critical communications during periods of fading. In the final portion of the NPRM, the Commission sought comment on permitting FS licensees to coordinate and deploy multiple links—a primary link and “auxiliary” links. In the NOI, the Commission asked about relaxing efficiency standards in rural areas, permitting FS licensees to use smaller antennas, and other possible modifications to the part 101 rules, or other policies or regulations, to promote flexible, efficient and cost-effective provisions of wireless backhaul service.

5. Comments on the Wireless Backhaul NPRM/NOI were due October 25, 2010, and reply comments were due November 22, 2010. In addition, on June 7, 2011, the Wireless Telecommunications Bureau issued a public notice that provided additional analysis of the existing BAS and CARS operations in the 7 and 13 GHz bands and requested supplemental comment on issues relating to FS sharing in the 6875-7125 MHz and 12700-13200 MHz bands. Supplemental comments were due on June 27, 2011.

6. After a careful review of the comments, we conclude that it is feasible to authorize part 101 fixed stations in 650 megahertz in the 7 and 13 GHz bands, so long as we ensure that these operations do not conflict with TV pickup stations that support important electronic newsgathering functions. As we explain in further detail below, we will therefore permit FS facilities only in areas where TV pickup operations are not licensed. As discussed below, our actions will permit additional FS stations in areas covering more than half of the nation's land mass, where they may be used to provide additional service to about 10 percent of the population.

7. BAS and CARS stations fall into one of two categories: those that remain in one place (fixed) and those that move among different locations (mobile or temporary fixed). Mobile BAS and CARS include television pickup stations, which are authorized to transmit program material, orders concerning such program material and related communications from the scenes of events that occur in places other than a television studio to associated television stations. Under current rules, which were adopted in 2002, all FS and fixed BAS and CARS stations above 2110 MHz use the prior coordination notice procedure described in § 101.103(d) of the Commission's rules, but mobile and temporary fixed BAS and CARS may use faster informal coordination procedures. TV pickup stations in these bands are usually licensed either for a specified radius around a set of coordinates or for a television market.

8. The record indicates that it is not feasible to allow FS to share spectrum with mobile and temporary fixed TV pickup operations in areas where mobile and temporary fixed TV pickup operations are licensed. While BAS fixed and mobile operations share spectrum in the same geographic areas, the sharing that exists today would not be practicable if it were not guided by informal agreements among local market participants. Part 101 FS operators do not have the same incentive to accommodate the needs of TV pick-up operations, however, as few of them are involved in video newsgathering or video coverage of other live events. For that reason, if they were granted the same formal priority over TV pick-up operations that broadcasters' STL and ICR stations are entitled to claim under existing rules, FS operators could apply for spectrum that is presently used by TV pick-up operations—potentially precluding new TV pick-up operations and forcing existing operations to shut down. The National Spectrum Management Association (NSMA) points out that in bands that are already shared by BAS, CARS, and part 101 licensees, the bands are generally used for either fixed or mobile operations, but not both.

9. We also conclude that it is not feasible at this time to adopt a formal band segmentation plan to separate fixed and mobile operations into designated sub-bands of the 7 and 13 GHz bands, as requested by the Fixed Wireless Communications Coalition (FWCC) and Vislink, Inc. The several bands allocated for BAS and CARS today support a mix of fixed, temporary fixed, and mobile services, including airborne mobile, and comments submitted in this proceeding confirm that BAS and CARS users coordinate these services on an individual market basis, without benefit of a formal nationwide plan, to assign the different types of service (fixed, mobile, airborne) to specific band segments. A portion of the band used in one market for fixed operation may commonly be used for mobile operation in another. Thus, to avoid disrupting those arrangements, we would need to tailor any band segmentation approach that we adopted to the needs and conditions of individual markets. Since we could not adopt a uniform band plan throughout the nation and provide the same spectrum to FS throughout the nation, the value of such band segmentation would be quite limited.

10. For areas where TV pickup licenses are not authorized, however, we conclude that sharing between part 101 FS and fixed BAS operations is feasible. WTB staff conducted additional analysis to determine whether it would be feasible for those services to share spectrum if they were separated geographically. The analysis appears to indicate that, even if FS operations were totally excluded from the service areas of TV pickup stations and CARS facilities, there would be considerable areas where FS facilities could be licensed—54 percent of the land area in the 7 GHz band and 64 percent of the land area in the 13 GHz band—largely located in more rural areas, especially in the midwestern and western regions. For each band, FS facilities could serve about 10 percent of the population. Thus, opening the 7 and 13 GHz bands to FS operations could be of particular benefit in rural areas, where spectrum in the 7 and 13 GHz bands is largely vacant.

11. To avoid interference between FS operations and TV pickup operations, we prohibit FS paths from crossing the service areas of TV pickup authorizations and require FS to coordinate with all relevant licensees, including TV pickup authorizations, pursuant to the formal part 101 coordination procedures. EIBASS, the National Association of Broadcasters (NAB), and the Wireless Internet Service Providers Association (WISPA) believe that such an arrangement would be workable. We also note the presence of co-primary fixed satellite services (FSS) in these bands. FS applicants will be required to coordinate with and protect FSS licensees and applicants pursuant to the part 101 rules.

12. The FWCC and SBE remain concerned about potential interference issues, particularly given the ability of broadcasters to operate short-term without a license. Under our rules, broadcasters can operate certain BAS facilities on a short-term basis without prior authorization for up to 720 hours a year subject to various limitations, including the fact that such short-term operation is secondary to regularly authorized facilities. We believe that such operations can be accommodated by excluding FS from two 25-megahertz channels each in the 7 GHz band (6975-7025 MHz) and the 13 GHz band (13150-13200 MHz). Excluding FS from that spectrum nationwide will accommodate TV pickup stations covering events that occur outside the license areas of local BAS and CARS operations. For the 7 GHz Band, we choose to exclude the 6975-7025 MHz segment because excluding the middle of the band will allow for greater separation between FS transmit and receive frequencies. For the 13 GHz Band, we exclude 13150-13200 MHz because that spectrum is already reserved for television pickup operations in the top 100 markets. Furthermore, since such short-term operation is by definition secondary to other operations, broadcasters operating pursuant to § 74.24 have no right to claim interference protection from regularly authorized operations.

13. EIBASS and NAB propose additional conditions that we do not believe are necessary or appropriate. EIBASS asks that the Commission impose a requirement that the newcomer POFS station cannot degrade the noise threshold of any existing ENG-RO site by more than 0.5 dB. Although EIBASS's proposal may be an appropriate standard for evaluating a proposed FS facility, we decline to adopt it as part of our rules. Generally, in lieu of mandating specific interference criteria in our rules, we expect applicants and licensees to work out interference issues in the frequency coordination process. In addition, NAB asks that the Commission impose secondary status on FS operations in the 7 and 13 GHz Bands with respect to both existing and future BAS operations. We find that the rules we adopt fully protect existing BAS operations. With respect to future BAS operations, FS, BAS, and CARS will all be coprimary services required to protect pre-existing operations. We agree with NAB that there is an important public interest in broadcasters being able to report on breaking news events and emergency situations; but we also find there to be important public interests in the support that FS provides to vital broadband, public safety, and critical infrastructure uses.

14. We also find that FS operations would be compatible with fixed BAS operations. In 2002, the Commission amended Parts 74 and 78 of its rules to harmonize many of the rules governing BAS and CARS with rules that already applied to FS licensees under part 101, allowing the use of digital transmissions, and requiring all fixed station applicants, except for those proposing operations in the 1990-2110 MHz band, to provide affected licensees and contemporaneous applicants with 30-day prior notifications and an opportunity to participate in frequency coordination before filing their applications with the Commission. It applied part 101 frequency coordination procedures to fixed BAS and CARS, and it did so with wide support from the affected industries. It rejected the request of one participant, SBE, that fixed BAS and CARS be allowed to continue relying upon informal coordination procedures. The subsequent ongoing shift from analog to digital transmission has accelerated the erosion of technical distinctions between BAS, CARS, and part 101 FS, and the use of consistent procedures for fixed stations in all of those services has played a vital role in the Commission's efforts to accommodate the increasing demand for closely-packed microwave links in urban areas.

15. We will allow mobile TV pickup licensees to continue to use informal coordination procedures within their service areas. Given the urgency of electronic newsgathering operations and the long history of successful real-time frequency coordination provided by local coordinators, the Commission previously found that there was little potential that interference would result from its continued function without imposing the formality of § 101.103(d) procedures. In light of our decision not to allow FS within the service areas of mobile BAS/CARS stations, there is no reason to require those stations to use formal coordination procedures.

16. The rules we adopt today will open most of the 7 and 13 GHz bands to FS over more than half of the nation's land mass where 10 percent of the population lives, while applying geographic restrictions on FS in those bands to minimize the potential for interference between FS facilities and TV pickup stations. Specifically, as reflected in the rules in Appendix A, we will allow part 101 FS stations to share the 7 and 13 GHz bands subject to the following conditions:

(1) We will not allow FS stations in the 7 and 13 GHz bands to locate their paths within the service areas of any previously licensed co-channel TV pickup stations.

(2) We will require FS operators to coordinate any new fixed links with TV pickup stations within the appropriate coordination zones of any new fixed links.

(3) As we require in other bands that fixed BAS and CARS share with part 101 fixed services, we will require all fixed BAS, fixed CARS and part 101 FS stations in the 7 and 13 GHz bands to engage in the same frequency coordination process that we require of all part 101 services.

(4) We will also reserve two 25-megahertz channels for BAS and CARS in the 7 GHz band (6975-7125 MHz) and two 25-megahertz channels in the 13 GHz band (13150-13200 MHz) nationwide to accommodate TV pickup stations covering events that occur outside the license areas of local BAS and CARS operations.

17. Regarding the various alternative channelization plans proposed in the NPRM and the 7 and 13 GHz Public Notice, we have decided to retain the 25 megahertz bandwidth that presently applies to the 7 and 13 GHz bands, as this channel-width best conforms to existing operations in the band. We recognize that FWCC recommends a mix of 10, 20, and 30 megahertz channels similar to those available in other FS bands and asserts that such alignment will result in more readily available equipment. As FWCC and others have recognized, however, allowing 10 and 30 megahertz channels in a band with many pre-existing 25 megahertz channels would preclude operation on multiple 25 megahertz channels, resulting in wasted spectrum. Many commenters recommend retaining a band plan based on the 25 megahertz channel bandwidth in order to prevent such wasted spectrum. To provide for a mix of larger and smaller channel-widths, we adopt an alternative proposal suggested by FWCC and permit FS to utilize 5, 8.33, and 12.5 megahertz channels.

18. We also adopt WISPA's proposal to allow 50 megahertz channels in the 13 GHz Band. Since the 50 megahertz channels will be created from two 25 megahertz channels, we do not see any inefficiency that would result from 50 megahertz channels. We do not authorize 50 megahertz channels in the 7 GHz Band because of the limited amount of spectrum available in that band.

19. In addition, as proposed in the NPRM, we apply the existing FS minimum capacity and loading requirements to FS operators in the 6875-7125 and 12700-13200 bands. We do not propose to apply those requirements to operations that are authorized under Parts 74 and 78, and we maintain the existing exemption from the capacity and loading requirements of part 101 for transmitters carrying digital video motion material. With respect to the remaining proposed technical rules for FS operation, we shall apply the same technical parameters that currently apply in the Upper 6 GHz band to the adjacent 6875-7125 MHz band, as proposed in the NPRM, because those bands are contiguous and should be able to use similar equipment. As noted above, we believe that applying the rules currently applicable in the Upper 6 GHz band to the 6875-7125 MHz band will facilitate equipment development and provide consistency to FS licensees. Specifically, we will apply: (1) A maximum frequency tolerance of 0.005 percent; (2) a maximum transmitter power of +55 dBw; (3) the antenna standards currently applicable to Upper 6 GHz Band stations authorized after June 1, 1997, to the 6875-7125 MHz band; (4) the capacity and loading requirements contained in § 101.141(a)(3) of the Commission's rules; and (5) the 17 kilometer minimum path length requirement of § 101.143. We retain the rules that are already applicable to the 12700-13000 MHz band, with the exception of applying the minimum payload capacity and loading requirements that currently apply in the 11 GHz band to the 12700-13150 MHz band. Finally, with the addition of part 101 fixed services in the BAS bands, we believe it is necessary for our ULS database to include all fixed receive locations. We therefore will require BAS TV pickup licensees to record their stationary receive-only sites in ULS.

20. We do not believe that allowing FS sharing in these bands will inhibit geographic expansion of BAS and CARS operations because, as a practical matter, these services have not been expanding geographically in recent years. Only one new BAS TV pickup license has been granted in the 7 GHz and 13 GHz bands in the past two years. Moreover, FWCC reports that BAS and CARS path and channel licensing, respectively, in the 13 GHz band have dropped sharply in the last decade. Furthermore, 50 megahertz of spectrum in each band will remain exclusively for BAS and CARS use, and BAS and CARS applicants will have co-primary status and the ability to apply for new facilities in the shared portions of the bands. We also note that development of new technologies could provide broadcasters with new mechanisms to support of their electronic newsgathering functions in the future. In light of this record, we reject SBE's argument that FS should not be allowed in the 7 and 13 GHz Bands because of a need to preserve spectrum for geographic expansion of BAS and CARS.

21. We find that permitting fixed microwave operations in the 7 and 13 GHz bands will benefit operators and consumers alike and that these benefits outweigh any potential costs, which our rules have been designed to eliminate. Our actions today will enable these spectrum bands to be used more intensively for wireless backhaul, public safety, and other critical uses supported by microwave without limiting their use for BAS or CARS. With this additional spectrum available for their use, fixed microwave operators can establish more links in a given geographic area and increase the capacity of existing links, which in turn will facilitate deployment of wireless broadband services. Although it would be difficult to quantify with precision the benefits of opening the 7 and 13 GHz bands to FS, we find that those benefits outweigh the at most minimal cost of our actions.

22. As a final matter, we reject SBE's allegation that we prejudged the decision to allow FS operations in these bands. We have carefully considered the issues raised concerning sharing between FS and mobile and temporary fixed BAS and CARS, analyzing the record received in response to the NPRM, as well as the record received in response to the Bureau's 7 and 13 GHz Comment Public Notice. As discussed in detail above, the rules we adopt today are clearly responsive to issues and concerns raised in this record.

23. In the NPRM, the Commission sought comment on eliminating the “final link” rule, which prohibits broadcasters from using part 101 stations as the final radiofrequency (RF) link in the chain of distribution of the program material to broadcast stations. In other words, the rule prevents the private FS stations from transmitting one type of content (“program material”) to one type of business (broadcasters) at one particular point in the transmission chain (the final RF link). The Commission questioned the sense of maintaining regulatory restrictions based on content as broadcasters and other microwave users move to digital-based systems. It expressed the belief that other existing rules would ensure productive use of spectrum and prevent broadcasters from crowding other FS licensees out of the band. The Commission also asked whether there were alternatives that could facilitate broadcaster access to FS spectrum while retaining the prohibition under certain circumstances.

24. As proposed in the NPRM, we herein eliminate the “final link” rule. Our action removes from our rules an artificial distinction based solely on the type of content provided and directed solely at one type of business, and is consistent with our decision to allow FS to share in the 7 and 13 GHz BAS and CARS bands. We believe it makes little sense to maintain restrictions based on content as both FS licensees and broadcasters move to digital technologies. Furthermore, FS licensees do not object to elimination of the rule so long as FS is granted access to BAS and CARS spectrum in the 7 and 13 GHz bands, an action we are also taking in this Report and Order. Although AT&T expresses concern about the effect of eliminating the rule on spectrum availability, it does not object to legitimate broadcaster use of FS spectrum that is compatible with existing uses. While broadcasters have different opinions about the value of eliminating the rule, they support doing so.

25. We find that there are significant benefits, and no costs, to eliminating the final link rule. We note that no commenter has identified any cognizable harm that would result from eliminating rule. With increasing adoption of digital technologies, the final link rule has become an outdated regulation that imposes unnecessary costs on broadcasters. In some instances, it may have required broadcasters to build two different, largely redundant, systems: One system to carry program material to the transmitter site, and a separate system to handle other data. Eliminating the rule will provide tangible benefits to broadcasters, by reducing unnecessary duplication of systems and facilities and enabling them to operate more efficiently. In such light, we find the benefits of eliminating the final link rule to be significant.

26. Section 101.141(a)(3) of the Commission's rules establishes minimum payload capacities (in terms of megabits per second) for various channel sizes in certain part 101 bands. The underlying purpose of the rule is to promote efficient frequency use. Requiring links to carry a set amount of traffic (expressed in megabits/second) ensures that licensees will actually use facilities they apply for. Although the Commission has never quantified the time period over which licensees must comply with those standards, the industry has generally construed the payload requirements as applying whenever the link is in service.

27. On May 8, 2009, Alcatel-Lucent, Dragonwave, Inc. Ericsson, Inc., Exalt Communications, FWCC, Harris Stratex Networks and Motorola (“Petitioners”) filed a request for interpretation of the Commission's rules. Petitioners asked the Bureau to interpret § 101.141(a)(3) of the Commission's rules to permit data rates to drop for brief periods below the minimum payload capacity specified in the rules, so long as the values mandated by the rules were maintained both in normal operation and on average. In the NPRM, the Commission determined that a rule change was needed to implement the policy interpretation sought in the FWCC Request because the policy interpretation was inconsistent with the plain language of the current rule, which has been interpreted to require compliance with the minimum payload capacity at all times when a system is in operation. The Commission concluded that it would be in the public interest to commence a rulemaking proceeding to facilitate the use of adaptive modulation. It noted that “[a]llowing carriers to operate below the current efficiency standards for short periods when it is necessary to maintain an operational link, without a need for waiver, could enable carriers to save on costs and enhance reliability of microwave links.” The Commission also recognized the benefits of allowing communications to be maintained during adverse propagation conditions.

28. The Commission expressed a concern that the standard proposed in the FWCC Request, i.e., requiring compliance with the efficiency standards “on average” and “during normal operation,” would give licensees too much latitude to deploy inefficient systems. The Commission proposed a rule under which “the minimum payload capacity requirements must be met at all times, except during anomalous signal fading, when lower capacities may be utilized in order to maintain communications.” Finally, the Commission asked whether it should specify a minimum amount of time a link should be operational or a minimum efficiency standard below which an FS station may not fall.

29. We conclude that it is in the public interest to amend our rules to facilitate the use of adaptive modulation. Most commenters agree that allowing the use of adaptive modulation will have significant benefits, including (1) Maintaining data throughput better than the zero rate that would otherwise be caused by a fade; (2) continuing to handle critical traffic when the link would otherwise cease to operate; and (3) maintaining network synchronization without the need for a time-consuming reboot. EIBASS, the only party that opposes allowing adaptive modulation, argues that any attempt to define by rule the conditions that justify adaptive modulation would open “a Pandora's box.” As discussed below, however, we believe that it is possible to craft rules that allow use of adaptive modulation while maintaining spectrum efficiency.

30. Parties disagree about the protections that will be necessary to ensure that adaptive modulation will not be abused by operators that might seek to save money by operating inefficient links. Supporters of adaptive modulation recognize that there is a potential for abuse and offer a variety of proposals to address that problem. Several of them support the Commission's proposed rule language. FWCC opposes specifying a minimum percentage availability as a prerequisite for adaptive modulation because writing a minimum number into the rules will allegedly limit the freedom of link designers to specify parameters appropriate to a particular objective. It asks the Commission to impose one of several general conditions designed to maximize licensee flexibility. On the other hand, Aviat Networks, Comsearch, Motorola, Sprint, and Verizon argue that the rules should specify a minimum percentage of time when the link would be available, in order to allow use of modulations below the minimum payload capacity. Several parties propose a requirement that paths using adaptive modulation be designed to be available 99.995% or 99.999% of the time while complying with the minimum payload capacity, while FWCC and Motorola propose using a 99.95% standard.

31. In an ex parte filing, Verizon argues that a 99.95% standard would undermine the Commission's goal in this proceeding to maximize the opportunity for fixed services to share existing bands. In particular, Verizon asserts that a 99.95% standard would create improper incentives to use smaller and lower performance antennas, which would significantly decrease spectral efficiency and increase the deployment costs and interference to future microwave licensees. Verizon also contends that a lower standard would increase the potential for interference conflicts among wireless backhaul licensees.

32. We determine that applying a 99.95% standard strikes the appropriate balance between providing operators with the flexibility to address anomalous fading conditions while maintaining spectral efficiency. Specifically, we will require applicants seeking permission to use modulations below the minimums established in § 101.141(a)(3) of the Commission's rules to design their paths to be available at modulations compliant with the minimum payload capacity at least 99.95% of the time. In other words, applicants will have to design their paths to operate in full compliance with the capacity and loading requirements for all but 4.38 hours out of the year. A quantitative standard will provide an objective means for determining compliance with the rules and eliminate some disputes. We are concerned that under FWCC's proposal, as well as the Commission's proposal in the NPRM, there would be insufficient safeguards to prevent the deployment of inefficient systems. While we understand FWCC's concern about providing sufficient flexibility to applicants, we do not believe that a 99.95% standard would be overly restrictive, because most paths are designed to a standard of at least 99.95% availability.

33. We decline to apply the 99.999% standard, as Verizon and others advocate, because it would not provide meaningful relief, as it would only anticipate 5.26 minutes a year of impaired operations for a link. With a 99.999% standard, an applicant would be required to build a more expensive system designed to operate through severe weather, which could make deployment cost-prohibitive in some instances. By way of hypothetical, consider a single link in the 6 GHz band that would require 10-foot antennas with a 99.999% standard instead of 6-foot antennas under the 99.95% standard. The total cost increase over a ten-year period in this hypothetical example could exceed $100,000. Furthermore, most systems use multiple links. We believe that the increased reliability and cost savings adaptive modulation will make possible under a 99.95% standard outweigh the marginal costs of a small temporary reduction in spectral efficiency. Therefore, we find the 99.95% standard to be in the public interest.

34. We reject Verizon's arguments that a 99.95% design standard will lead to increased interference or provide improper incentives to deploy inefficient systems. A temporary drop in a data rate, by itself, does not increase interference to other operators. Furthermore, we adopt a series of safeguards designed to protect existing systems. We adopt the NPRM's proposal to require licensees that plan to use adaptive modulation to indicate their intent in prior coordination notices. We agree with FWCC and AT&T that such a requirement will help the industry catch possible abuses and address any potential issues through the coordination process before the facilities are authorized. We will also require applicants to apply for all modulations they intend to use as part of their authorizations. Under the rule we adopt today, adaptive modulation can only be used during periods of anomalous signal fading, and the use must be necessary to allow licensees to maintain communications. Furthermore, systems must be designed to operate in full compliance with our existing capacity and loading requirements for all but 4.38 hours out of the year. Finally, we require applicants to use good engineering practice in determining the percentage of time a system can operate in compliance with the capacity and loading requirements. As suggested by FWCC, we will not dictate the use of a specific engineering model to determine availability but presume that use of Telecommunications Industry Association Bulletin TSB 10-F to determine availability is consistent with good engineering practice.

35. To the extent Verizon is concerned about the increased use of smaller antennas, we note that our rules already contain protections designed to minimize interference from smaller antennas. Section 101.115(b) of the Commission's rules establishes directional antenna standards designed to maximize the use of microwave spectrum while avoiding interference between operators. More specifically, the Commission's rules set forth certain requirements, specifications, and conditions pursuant to which FS stations may use antennas that comply with either the more stringent performance standard in Category A (also known as Standard A) or the less stringent performance standard in Category B (also known as Standard B). In general, the Commission's rules require a fixed microwave operator using a Category B antenna to upgrade if its antenna causes interference problems that would be resolved by the use of a Category A antenna. Thus, if adaptive modulation allows a licensee to use a Category B antenna, but that antenna would cause interference to (or receive interference from) another operation, the other operator can require the licensee to upgrade to a Category A antenna if the upgrade would resolve the interference issue. This rule applies even when the use of the Category B antenna precedes use by the other licensee.

36. Further, we decline to grant Verizon's request that we establish additional equipment-based restrictions on adaptive modulation—including requiring all licensees to operate at no less than two-thirds of the minimum payload capacity values established in § 101.141(a)(3). We believe that the time-based design standard for link availability, along with the other safeguards in the rule we adopt today, will adequately prevent the proliferation of inefficient systems and find that imposing additional requirements would limit licensee flexibility and place undue regulatory burdens on licensees. Finally, we reject Verizon's proposal to limit the transmit power and power spectral density when using non-compliant modulations to no more than 3 dB greater than the values of the worst-case (highest total signal power, highest power density) values of the available compliant modulations. An applicant can specify multiple emissions/modulation schemes, but they all must have the same EIRP unless they license separate paths. The gains realized from the use of adaptive modulation are related to the lower receiver threshold with lower order modulation schemes, not by using higher power with lower order modulation.

37. We will not require licensees to log instances when they use adaptive modulation or to include that information in station records. We are establishing the minimum availability standard as a path design requirement, not as an operational requirement. We believe that the best time to enforce the rule is before equipment is deployed, not after. Once an operator has made the investment required to deploy adequate equipment in a well-designed link, it should have every incentive to operate that equipment consistent with the design standard. It is possible, of course, that unusual weather conditions could require some operators to use adaptive modulation for longer intervals than our design standard specifies. However, we see no reason to penalize operators for events that are beyond their control. In that context, we believe that the burden imposed by requiring the logging of adaptive modulation episodes would outweigh any potential benefit of the information.

38. We conclude that allowing licensees to use adaptive modulation will confer substantial benefits on operators and their customers, while imposing minimal, if any, cost. Adaptive modulation will allow operators to maintain critical links during fade conditions, decreasing the number of microwave service outages they experience, and the detrimental impacts that these outages may cause for consumers. Furthermore, by reducing service outages, use of adaptive modulation may permit operators to avoid costs and delays associated with reinitializing service. The rules we adopt are designed to appropriately restrict use of adaptive modulation to provide fixed microwave operators additional flexibility to deal with adverse conditions while ensuring that their systems continue to be operated efficiently.

39. In the NPRM, the Commission sought comment on a proposal to permit greater reuse of scarce microwave resources by permitting FS licensees to coordinate and deploy multiple links—a primary link and “auxiliary” links. The idea had its origin in a petition filed by Wireless Strategies, Inc. (WSI) asking the Commission to issue a declaratory ruling “confirming that a Fixed Service licensee is permitted to simultaneously coordinate multiple links whose transmitter elements collectively comply with the Commission's antenna standards and frequency coordination procedures.” Although the Commission denied WSI's petition for declaratory ruling, determining that WSI's requested interpretation was inconsistent with its current rules, it found WSI's concept to be “worthy of further consideration.”

40. Generally, the concept of auxiliary stations rests on the fact that a point-to-point microwave transmitter typically radiates energy outward in a keyhole-shaped signal pattern. This signal pattern precludes other stations from sharing the same spectrum in that area, if placement of the new transmitter would interfere with the original licensee's ability to receive its signal at its downlink station. The auxiliary stations proposal contemplates placement of multiple smaller transmitters within the signal pattern of the main link.

41. The Commission sought to clarify debate on the merits of the proposal by proposing specific rule changes intended to capture WSI's underlying concept, while preserving existing part 101 practices, policies and expectations to the greatest extent possible. Accordingly, the Commission sought comment on allowing FS licensees to deploy auxiliary stations under the following conditions, among others:

• Each auxiliary station would be required to operate on the same frequencies as the main licensed link.

• Auxiliary stations would not be allowed to cause any incremental interference to other primary links, i.e., they would not be allowed to cause any more interference to other primary stations than the main link would cause.

• Auxiliary stations would be secondary in status and would have no right to claim protection from interference from any primary stations.

• Auxiliary stations would have to be coordinated in advance with other licensees and applicants pursuant to the frequency coordination process specified in § 101.103 of the Commission's rules.

• Auxiliary stations would not be subject to the loading, antenna standards or minimum path length requirements that apply to main links.

42. In seeking comments on those proposals, we asked commenters to provide (1) Estimates of how many systems they contemplated operating with auxiliary stations, (2) information on whether such systems would typically be deployed in urban or rural areas, (3) the types of uses to which such systems would be put, (4) the distances they contemplated between the auxiliary stations and their main links, and (5) the relative amounts of traffic that they expected to carry on main links versus the auxiliary links. We also asked commenters to discuss the possibility that services where geographic area licensing already exists—such as the Local Multipoint Distribution Service, the 24 GHz Service, or operations in the 38.6-40.0 GHz band (39 GHz band)—might provide a more reasonable way of accommodating any need for auxiliary stations.

43. Most commenters oppose the proposal to allow auxiliary stations. They argue that auxiliary stations will increase congestion, cause greater interference, and create opportunities for gaming/manipulation that would be detrimental to competition and efficient deployment of microwave facilities. Supporters contend that auxiliary stations could result in more efficient use of spectrum and could support a variety of innovative uses.

44. We decline to adopt at this time our proposal to allow use of auxiliary stations in FS bands. We lack a sufficient basis for concluding that auxiliary stations could coexist with FS stations without causing interference to primary FS stations. Moreover, we are concerned that adopting the auxiliary stations proposal would create a perverse incentive for applicants to propose excessive power for their primary transmitters, wasting spectrum in an effort to stake out as much territory as possible for auxiliary stations. Finally, using upper microwave bands such as LMDS, 24 GHz, and 39 GHz appears to be a viable alternative for the type of operations contemplated under the auxiliary station proposal.

45. Proponents of auxiliary stations largely operate on the premise that FS spectrum is “wasted,” particularly in urban areas. We disagree with this premise because there is already extensive reuse of FS spectrum. It is even possible to re-use a frequency at exactly the same location, under existing procedures.

46. As mentioned above, there is an insufficient record for us to conclude that auxiliary stations can coexist with existing microwave operations without causing interference. We reject, however, the argument that auxiliary stations should not be allowed solely because authorizing them would cause further congestion to spectrum that is already congested. If auxiliary stations could coexist with other microwave operations, we would view the ability to use spectrum more intensively as a positive development.

47. Most opponents of the auxiliary stations concept argue that it would be inefficient to intermix frequency division duplex (FDD) currently used in the microwave bands and time division duplex (TDD) operations, as WSI proposes. Comsearch points out that intermixing FDD and TDD increases the types of potential interference that may occur, including direct interference between sites, co-site interference, and reflective interference. In response, WSI relies on the ability of smart antennas to adapt an antenna pattern and use spectrum more efficiently. As noted by EIBASS, however, WSI has not provided any detailed information concerning the physically small, phased-array microwave antenna that it asserts would be suitable for auxiliary stations. Indeed, WSI has allegedly ignored requests from SBE and NSMA for credible proof of the performance that WSI ascribes to that antenna.

48. Furthermore, while WSI has repeatedly claimed that TDD-style auxiliary station operations would use spectrum more efficiently than existing FDD-style microwave operations, it has offered insufficient analysis of how auxiliary stations would co-exist with existing microwave operations. In the NPRM, the Commission had emphasized its intention to avoid interference to existing operations and “maintaining the reliability and integrity of existing systems.” Furthermore, the proposal to require prior coordination for auxiliary stations and to make auxiliary stations secondary to existing primary links does not adequately address the potential for interference but instead could result in situations where incumbent microwave licensees could face the costly and time-consuming process of identifying and resolving complex interference issues.

49. An additional consideration is that adopting the auxiliary stations proposal could create a perverse incentive for applicants to propose excessive power for their primary transmitters, creating a more diffuse antenna pattern, and thus precluding other microwave operators from coordinating spectrum or operating in that larger area. In the NPRM, the Commission sought comment on that issue. EIBASS, San Mateo, and Verizon point to a prior coordination notice submitted by OEM as an example of how auxiliary stations could result in an inefficient use of spectrum and preclude frequency sharing. Furthermore, several licenses issued to WSI proposed the same very high EIRP level of 84.7 dBm. The proponents of auxiliary stations have not adequately explained these circumstances, or proposed any ways in which the Commission could prevent or counteract manipulation of the auxiliary stations mechanism in this manner. Thus, we remain concerned about the compatibility of auxiliary stations with existing operations.

50. Another reason we decline to authorize auxiliary stations in FS bands is that such operations can be accommodated in several upper microwave bands for which the Commission has issued geographic area licenses, including Local Multipoint Distribution Service (LMDS) 24 GHz, and 39 GHz, in which licensees may freely deploy links as they see fit.

51. While we do not authorize auxiliary stations in existing FS bands today, we encourage proponents of the auxiliary stations concept to continue working with other interested stakeholders to develop the concept. We note that proponents of the auxiliary stations concept believe that auxiliary stations would support such varied uses as the provision of backhaul, telecommunications support for small intelligent data centers, and rural telemedicine applications. We believe proponents of auxiliary stations should take advantage of the opportunities presented by 24 GHz, LMDS, and 39 GHz bands to develop and deploy auxiliary stations. To the extent parties believe further testing is needed to develop the auxiliary stations concept, we encourage those parties to cooperate in testing and development efforts, to develop a better factual record regarding the interaction of potential auxiliary station configurations with existing incumbent microwave systems, and with microwave applicants yet to come.

52. In the Memorandum Opinion and Order, we address various other proposals offered in response to the NOI that we do not intend to consider further at this time, either because the proposals lack specificity, are outside the scope of this proceeding, were previously considered by the Commission, or are not ripe for consideration at this time.

53. TIA recommends that the Commission consider harmonizing its approach to the 27.5-28.35 GHz Local Multipoint Distribution Service (LMDS) band with recent proposals by the Radio Advisory Board of Canada (RABC). TIA says that Canada has designated that band for Local Multipoint Communications Systems (LMCS), a service similar to LMDS. In an effort to maximize use of the currently underutilized LMCS spectrum, the RABC has proposed to apply site-based licensing in the band, with technical rules that favor frequency division duplex operations on bandwidths ranging from 10 to 50 megahertz. TIA argues that harmonizing U.S. rules with Canada's would establish a broader market for equipment and services, thus improving the band's market potential through economies of scale. NSMA also supports this proposal.

54. We decline to take any action on this proposal at this time. No current LMDS licensee supports the proposal. Furthermore, most LMDS licensees have received an extension until June 1, 2012 to demonstrate buildout. While LMDS licensees can deploy point-to-point services, the majority of deployments that have been reported to the Commission at this time have involved point-to-multipoint services. We believe it would be premature to undertake the type of review contemplated by TIA and NSMA before current licensees have had an opportunity to build out their systems under the existing rules.

55. Sirius XM suggests that the Commission encourage use of the 2.3 GHz Wireless Communications Service (WCS) band for wireless backhaul operations because it would present substantially fewer interference concerns to adjacent licensees than the mobile operations. In 2010, the Commission adopted technical rules for the 2.3 GHz band that would allow WCS licensees to offer mobile broadband services while limiting the potential for harmful interference to incumbent services operating in adjacent bands such as Sirius XM. In response, Sirius XM and other parties filed petitions for reconsideration asking, among other things, that the Commission reconsider several technical rules that were adopted. Given that the issue of the appropriate technical rules for the 2.3 GHz band is currently pending in WT Docket No. 07-293, we decline to consider it in the instant proceeding.

56. DTV Norwich, LLC (DTV Norwich), a licensee in the Multichannel Video Distribution and Data Service (MVDDS), asks the Commission to allow MVDDS licensees to utilize higher power to provide point-to-point services. MVDDS is a fixed wireless terrestrial service at 12.2-12.7 GHz that may be used to provide one-way digital fixed non-broadcast service, including one-way direct-to-home/office wireless service. MVDDS is authorized on a co-primary, non-harmful interference basis with incumbent Direct Broadcast Satellite Service (DBS) providers and on a co-primary basis with non-geostationary satellite orbit fixed-satellite service (NGSO FSS) stations. MVDDS is licensed on a geographic area basis according to Nielsen's 2002 Designated Market Areas and several FCC-defined areas.

57. DTV Norwich argues that MVDDS point-to-point operations at higher power levels may be possible without causing interference to DBS and NGSO FSS. According to DTV Norwich, however, “at existing power levels, the point-to-point path `hops' would simply be too short to be economically viable.”

58. DTV Norwich's proposal lacks sufficient specificity to be worthy of further consideration at this time. The Commission adopted rules for MVDDS based on the extensive record of the MVDDS rule-making proceeding, which included a congressionally mandated independent analysis of potential MVDDS interference to DBS. These rules include detailed frequency coordination procedures, interference protection criteria, and limitations on signal emissions, transmitter power levels, and transmitter locations. The rules limit the effective isotropic radiated power (EIRP) for MVDDS stations to 14.0 dBm per 24 megahertz (−16.0 dBW per 24 megahertz). To accommodate co-primary DBS earth stations, an MVDDS licensee shall not begin operation unless it can ensure that the equivalent power flux density (EPFD) from a proposed transmitting antenna does not exceed the applicable EPFD limit at any DBS subscriber location.

59. Under these circumstances, DTV Norwich's proposal is far too general to warrant further consideration. The Commission found that the power limits and other technical requirements would ensure that any interference caused to DBS customers will not exceed a level that is considered permissible. Furthermore, the Commission also contemplated that MVDDS service providers might petition for waiver(s) of the technical rules, and required that the petitioning party must “submit an independent technical demonstration of its equipment and technology.” In denying petitions to reconsider the power limits, the Commission reiterated that MVDDS providers may seek waivers of the general MVDDS limits. DTV Norwich's proposal, if considered as a waiver request, would not meet that standard because it does not provide any technical analysis to support its claims. Indeed, DTV Norwich does not identify the power levels it wishes to use. For the reasons listed above, we decline to consider DTV Norwich's proposal.

60. Sprint recommends that the Commission develop more specific technical rules governing the use of spectrum masks above 15 GHz, which would allow for less variance in the interpretation of the Commission's rules by equipment vendors and enable more frequencies to be used while also reducing interference. Sprint also asks that the Commission establish maximum power limits based on the link distance for the bands above 15 GHz. No other commenter responded to this suggestion. We decline to take action at this time because (1) Sprint has not made a concrete showing that there is a problem requiring Commission intervention, and (2) Sprint does not offer specific proposals for changes to our rules. We reserve the right to consider the matter further if additional information is brought to our attention.

61. XO Communications (XO) expresses concern “that substantial portions of spectrum are made available to the public in a manner that neither promotes * * * efficient spectrum use nor captures the value of this spectrum for the United States Treasury.” XO contends that making “these frequencies available to interested parties at virtually no cost on a first-come, first-served basis * * * undercut[s] the value of existing LMDS spectrum licenses.” XO suggests that the Commission should consider changing its procedures for licensing point-to-point services to promote more efficient spectrum use by implementing a licensing regime under which mutually exclusive applications would be accepted and resolved through competitive bidding, or alternatively, applying spectrum usage fees, and by making changes to the Universal Licensing System (ULS) database. XO argues that adopting competitive bidding or spectrum fees would give licensees greater economic incentives to use their spectrum fully and efficiently. XO also states that the microwave link information provided in the ULS database for LMDS spectrum relative to the more extensive technical information provided for common carrier point-to-point microwave links may discourage customers from seeking to lease LMDS spectrum and that we should make changes to the ULS to place users of LMDS and common carrier microwave spectrum on an equal footing.

62. We are not persuaded that we should adopt XO's proposed changes to our licensing procedures for point-to-point services at this time. XO has provided no factual basis upon which to decide that the existing frequency coordination-based licensing regime, under which we accept applications for each microwave link or path, leads to inefficient use of this spectrum or is otherwise no longer in the public interest. While we recognize that accepting mutually exclusive applications that are resolved through competitive bidding is often an efficient way to assign licenses, we do not believe that the spectrum coordination regime for point-to-point services currently in effect, which does not result in the acceptance of mutually exclusive applications, has failed thus far either to promote efficient spectrum use or capture its value. We note, further, that the Commission may continue to use licensing schemes and other means to avoid mutual exclusivity if public interest goals are met. Moreover, we decline to implement XO's proposal to impose fees for the use of this spectrum. As the Commission has previously noted in other proceedings, we may lack the authority to impose certain user fees. Finally, to the extent that XO seeks to eliminate what it sees as an “economic disparity” between common carrier microwave spectrum and existing LMDS spectrum, we observe as an initial matter that there are significant differences between these spectrum bands. To the extent that XO's proposals regarding possible changes to the ULS are motivated by its desire to lease its LMDS spectrum for point-to-point uses, we are unaware of any obstacles that would prevent an LMDS licensee such as XO from making additional detailed technical information available to potential users seeking to lease spectrum for point-to-point use.

63. PCIA states that “local regulations continue to be a significant barrier to the collocation of antennas on existing towers” and recommends that the Commission examine its authority to streamline the collocation review process by restricting the ability of local authorities to review the placement of wireless antenna. We deny PCIA's request. In 2000, the Commission determined that section 332(c)(7) of the Communications Act provides state and local governments with the authority to regulate the placement, construction, and modification of carrier hub sites and relay antennas. PCIA is asking the Commission to modify this decision. PCIA, however, has not presented any change of circumstances, legal precedent, or statutory authority to support this change, so we see no reason to revisit the Commission's decision in the 2000 OTARD Report and Order.

64. XO states that some carriers violate section 251(c)(6) of the Communications Act by hindering XO's efforts to expand its collocation facilities at incumbent LEC central offices to include microwave transmission equipment. XO contends that “the Commission should expressly confirm that the collocation of microwave transmission facilities as proposed by XO was one of the arrangements contemplated by section 251(c)(6) of the [Communication] Act.” We find that the limited information provided by XO on this issue does not provide us with a sufficient basis upon which to act at this time. This decision does not preclude XO from filing a more complete submission as it deems appropriate.

65. FiberTower suggests that the Commission utilize the Universal Service Fund to make wireless backhaul available to qualifying areas and for qualifying purposes. In February of 2011, the Commission proposed to revise the Universal Service Fund. In that item, the Commission asked whether it should modify the universal service rules to provide additional support for middle mile costs and what effect would middle mile support have on incentives for small carriers to develop regional networks that provide lower cost, higher capacity backhaul capability. Given that the issue of providing Universal Service funding for wireless backhaul service is currently pending in the Universal Service proceeding, we decline to address this issue in this proceeding but are incorporating FiberTower's comments into the record of WC Docket No. 10-90.

66. NSMA argues that in determining whether 24 GHz, 39 GHz, and LMDS licensees have offered substantial service, the Commission fails to positively consider “basic and important steps that lead to successful band utilization * * *” It gives the following examples of such activity: (1) Spending significant resources producing Requests for Proposals (RFPs) to develop equipment in its band; (2) utilizing the Secondary Markets rules to offer spectrum leases throughout the license area; (3) submitting proposals to carrier, government or enterprise customers that rely upon utilizing the wide-area license; and/or (4) building several links, but has not yet met the safe harbor criterion (typically four links per million of population). NSMA asks the Commission to “track and credit” such activities.

67. We see no need to modify our substantial service rules and policies. NSMA's arguments ignore one of the Commission's overriding purposes of buildout requirements: Providing “a clear and expeditious accounting of spectrum use by licensees to ensure that service is indeed being provided to the public.” The Wireless Telecommunications Bureau has correctly rejected substantial service showings based on preparatory activities of the type described by NSMA where there is no actual service being provided to the public. We emphasize, however, that safe harbors are merely one means of demonstrating substantial service, and given an appropriate showing, a level of service that does not meet a safe harbor may still constitute substantial service. Furthermore, we will evaluate all substantial service showings that do not meet an established safe harbor on a case-by-case basis.

68. We recognize that there are other pending matters and proceedings relating to wireless backhaul that are not addressed in this item. Those matters and proceedings include: (1) A petition for rulemaking asking that the 7125-8500 MHz band be allocated for non-Federal use and allotted for FS use, (2) a petition for rulemaking asking that conditional authority be authorized throughout the 23 GHz band and change the mechanism for coordinating operation with the National Telecommunications Information Administration (NTIA), and (3) a request made in this proceeding to revise the Commission's policy of allowing a satellite earth station to coordinate for the full 360-degree azimuth range of the earth station even when it is communicating with only one satellite in a limited segment of the band. We will address these issues separately or in future orders in this proceeding.

69. Paperwork Reduction Analysis: This document contains new information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. While we did not seek comment on the information collection requirements in the NPRM, we are seeking comments now. The information collection will be submitted to the Office of Management and Budget (OMB) for review under section 3507(d) of the PRA. OMB, the general public, and other Federal agencies are invited to comment on the new or modified information collection requirements contained in this proceeding. In addition, we note that pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment on how the Commission might further reduce the information collection burden for small business concerns with fewer than 25 employees.

70. Final Regulatory Flexibility Analysis of the Report and Order: Because we amend the rules in this Report and Order, we have included this Final Regulatory Flexibility Analysis (FRFA). This present FRFA conforms to the Regulatory Flexibility Act (RFA). Accordingly, we have prepared a Final Regulatory Flexibility Analysis concerning the possible impact of the rule changes contained in the Report and Order on small entities.

In this Report and Order, we adopt three changes to our rules involving microwave stations. First, we allow fixed service (FS) stations to operate in the 6875-7125 MHz and 12700-13150 MHz bands. Second, we eliminate the prohibition on broadcasters using part 101 stations as the final radiofrequency (RF) link in the chain of distribution of program material to broadcast stations. Third, we amend our minimum payload capacity rule to facilitate the use of adaptive modulation to allow licensees to maintain communications by briefly reducing the rate at which they send data.

With respect to the first action, we anticipate that demand for fixed service spectrum will increase substantially as it is increasingly used for wireless backhaul and other important purposes. The 6875-7125 MHz and 12700-13150 MHz bands are currently assigned to television pickup, television studio-transmitter links, television relay stations, television translator relay stations, and mobile-only CARS. Assigning this spectrum to the fixed service will provide additional spectrum that will be used for wireless backhaul and other critical applications, while protecting other existing services in these bands.

Second, § 101.603(a)(7) of the Commission's rules, commonly known as the “final link” rule, prohibits broadcasters from using part 101 stations as the final radiofrequency (RF) link in the chain of distribution of program material to broadcast stations. The rule ensures that private operational fixed stations are used for private, internal purposes and prevents broadcasters from causing congestion when part 74 Broadcast Auxiliary Service (BAS) frequencies are available. In light of the increasing use of digital technologies, we conclude that the “final link” rule may no longer serve its intended purpose and may in fact inhibit the full use of part 101 spectrum. As broadcasters and other microwave users move to digital-based systems, we conclude it does not make sense to distinguish between program material and other types of content transmitted using digital technologies. Furthermore, the rule may impose additional costs by requiring broadcasters to build two different systems: one system to carry program material to the transmitter site and a separate system to handle other data. In light of the extensive sharing between BAS and FS of the same bands, we believe it is appropriate to provide broadcasters with additional flexibility to use the FS bands. We therefore eliminate this rule.

Third, we amend our part 101 technical rules to facilitate the use of adaptive modulation, which is a process that reduces the data rate of a microwave link in order to maintain communications. Section 101.141(a)(3) of the Commission's rules establishes minimum payload capacities (in terms of megabits per second) for various channel sizes in certain part 101 bands. The underlying purpose of the rule is to promote efficient frequency use. Although the Commission has never quantified the time period over which licensees must comply with those standards, the industry has generally construed the payload requirements as applying whenever the link is in service. Fixed service links, especially long links, are subject to atmospheric fading: a temporary drop in received power caused by changes in propagation conditions. Fading leads to an increase in errors and sometimes to a complete loss of communications. One way to combat fading is by briefly reducing the data rate, which requires a temporary change in the type of modulation, a process called “adaptive modulation.” The use of adaptive modulation may reduce the minimum payload capacity below the value specified in the rule for a short time, although this still represents an increase over the otherwise zero level during the fade. Adaptive modulation has public interest benefits of allowing communications to be maintained during adverse propagation conditions. Given the critical backhaul and public safety applications of fixed service stations, we find this benefit to be significant. By allowing this level of flexibility in our efficiency standards, we hope to provide carriers with a way to lower their costs yet still use the spectrum efficiently. This rule change will allow licensees to take advantage of the benefits of adaptive modulation while ensuring efficient use of the spectrum.

The action is authorized pursuant to sections 1, 2, 4(i), 7, 201, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, and 333 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 157, 201, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, and 333, and section 706 of the Telecommunications Act of 1996, as amended, 47 U.S.C. 1302.

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

Small Businesses, Small Organizations, and Small Governmental Jurisdictions. Our action may, over time, affect small entities that are not easily categorized at present. We therefore describe here, at the outset, three comprehensive, statutory small entity size standards. First, nationwide, there are a total of approximately 27.5 million small businesses, according to the SBA. In addition, a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” Nationwide, as of 2007, there were approximately 1,621,315 small organizations. Finally, the term “small governmental jurisdiction” is defined generally as “governments of cities, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” Census Bureau data for 2011 indicate that there were 89,476 local governmental jurisdictions in the United States. We estimate that, of this total, as many as 88,506 entities may qualify as “small governmental jurisdictions.” Thus, we estimate that most governmental jurisdictions are small.

Wireless Telecommunications Carriers (except satellite). The appropriate size standard under SBA rules is for the category Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. Census Bureau data for 2007, which now supersede data from the 2002 Census, show that there were 3,188 firms in this category that operated for the entire year. Of this total, 3,144 had employment of 999 or fewer, and 44 firms had employment of 1,000 employees or more. Thus under this category and the associated small business size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities that may be affected by our proposed action.

Fixed Microwave Services. Microwave services include common carrier, private-operational fixed, and broadcast auxiliary radio services. At present, there are approximately 31,549 common carrier fixed licensees and 89,633 private and public safety operational-fixed licensees and broadcast auxiliary radio licensees in the microwave services. Microwave services include common carrier, private-operational fixed, and broadcast auxiliary radio services. They also include the Local Multipoint Distribution Service (LMDS), the Digital Electronic Message Service (DEMS), and the 24 GHz Service, where licensees can choose between common carrier and non-common carrier status. The Commission has not yet defined a small business with respect to microwave services. For purposes of the IRFA, the Commission will use the SBA's definition applicable to Wireless Telecommunications Carriers (except satellite)— i.e., an entity with no more than 1,500 persons is considered small. For the category of Wireless Telecommunications Carriers (except Satellite), Census data for 2007, which supersede data contained in the 2002 Census, show that there were 1,383 firms that operated that year. Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more than 100 employees. Thus under this category and the associated small business size standard, the majority of firms can be considered small. The Commission notes that the number of firms does not necessarily track the number of licensees. The Commission estimates that virtually all of the Fixed Microwave licensees (excluding broadcast auxiliary licensees) would qualify as small entities under the SBA definition.

Radio Broadcasting. The subject rules and policies potentially will apply to all AM and FM radio broadcasting licensees and potential licensees. A radio broadcasting station is an establishment primarily engaged in broadcasting aural programs by radio to the public. Included in this industry are commercial, religious, educational, and other radio stations. Radio broadcasting stations which primarily are engaged in radio broadcasting and which produce radio program materials are similarly included. However, radio stations that are separate establishments and are primarily engaged in producing radio program material are classified under another NAICS number. The SBA has established a small business size standard for this category, which is: firms having $7 million or less in annual receipts. According to BIA/Kelsey, MEDIA Access Pro Database on January 13, 2011, 10,820 (97%) of 11,127 commercial radio stations have revenue of $7 million or less. Therefore, the majority of such entities are small entities. We note, however, that many radio stations are affiliated with much larger corporations having much higher revenue. Our estimate, therefore, likely overstates the number of small entities that might be affected by any ultimate changes to the rules and forms.

Television stations. The SBA defines a television broadcasting station as a small business if such station has no more than $14.0 million in annual receipts. Business concerns included in this industry are those “primarily engaged in broadcasting images together with sound.” The Commission has estimated the number of licensed commercial television stations to be 1,390. According to Commission staff review of the BIA Kelsey Inc. Media Access Pro Television Database (BIA) as of January 31, 2011, 1,006 (or about 78 percent) of an estimated 1,298 commercial television stations in the United States have revenues of $14 million or less and, thus, qualify as small entities under the SBA definition. The Commission has estimated the number of licensed noncommercial educational (NCE) television stations to be 391. We note, however, that, in assessing whether a business concern qualifies as small under the above definition, business (control) affiliations must be included. Our estimate, therefore, likely overstates the number of small entities that might be affected by our action, because the revenue figure on which it is based does not include or aggregate revenues from affiliated companies. The Commission does not compile and otherwise does not have access to information on the revenue of NCE stations that would permit it to determine how many such stations would qualify as small entities.

In addition, an element of the definition of “small business” is that the entity not be dominant in its field of operation. We are unable at this time to define or quantify the criteria that would establish whether a specific television station is dominant in its field of operation. Accordingly, the estimate of small businesses to which rules may apply do not exclude any television station from the definition of a small business on this basis and are therefore over-inclusive to that extent. Also, as noted, an additional element of the definition of “small business” is that the entity must be independently owned and operated. We note that it is difficult at times to assess these criteria in the context of media entities and our estimates of small businesses to which they apply may be over-inclusive to this extent.

This Report and Order contains new information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. It will be submitted to the Office of Management and Budget (OMB) for review under section 3507(d) of the PRA. OMB, the general public, and other Federal agencies are invited to comment on the new or modified information collection requirements contained in this proceeding. In addition, we note that pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment on how the Commission might further reduce the information collection burden for small business concerns with fewer than 25 employees.

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.

As noted above, this Report and Order (1) allows fixed service stations to operate in the 6875-7125 and 12700-13150 MHz bands, (2) eliminates the prohibition on broadcasters using part 101 stations as the final radiofrequency (RF) link in the chain of distribution of the program material to broadcast stations, (3) and amends our minimum payload capacity rule to facilitate the use of adaptive modulation to allow licensees to maintain communications by briefly reducing the rate at which they send data. These actions would provide additional options to all licensees, including small entity licensees. Such actions will serve the public interest by making additional spectrum available for fixed service users, providing additional flexibility for broadcasters to use microwave spectrum, and allowing communications to be maintained during adverse propagation conditions. The rules could therefore open up beneficial economic opportunities to a variety of spectrum users, including small businesses.

Generally, the alternative approach would be to maintain the existing rules. If the rules were not changed, the 6875-7125 MHz and 12700-13150 MHz bands would remain unavailable for fixed service use. Given the increasing demand for part 101 spectrum for backhaul and other uses, not making that spectrum available would make it increasingly difficult to meet the demand for microwave facilities. If the prohibition on broadcasters using part 101 stations as the final radiofrequency (RF) link in the chain of distribution of the program material to broadcast stations is not eliminated, broadcasters will be limited to using Broadcast Auxiliary Service spectrum for that purpose, and may have to build two separate microwave systems using different frequencies. Such an alternative would be inadequate to meet the demands of licensees and is therefore less than ideal. If no BAS spectrum is available, broadcasters will have to pay to prepare a request for waiver to access part 101 spectrum and await action on that waiver request before they can begin operation. Such expense and delay may be particularly harmful to small businesses.

With respect to our proposal to amend our minimum capacity payload rule to facilitate adaptive modulation, if our rules are not amended to facilitate the use of adaptive modulation, licensees will be unable to fully use technology to maintain critical communications during signal fades. An alternative to the adaptive modulation proposal made in the NPRM would be to allow compliance with the efficiency standards “on average” and “during normal operation.” We believe that standard would give licensees too much latitude to deploy inefficient systems that would be inconsistent with good engineering practices.

None.

71. Accordingly, it is ordered, pursuant to sections 1, 2, 4(i), 7, 201, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, 333 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 157, 201, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, and 333, and section 706 of the Telecommunications Act of 1996, as amended, 47 U.S.C. 1302, that this Report and Order is hereby adopted.

72. It is further ordered that the rules adopted herein will become effective 30 days after the date of publication in the Federal Register , except for § 74.605, which contains new or modified information collection requirements that require approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA) and will become effective after the Commission publishes a notice in the Federal Register announcing such approval and the relevant effective date.

73. It is further ordered that the Comments of FiberTower Corporation filed on October 25, 2010 shall be inserted into the record of WC Docket No. 10-90.

74. It is further ordered that the Commission shall send a copy of this Report and Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

75. 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 Memorandum Opinion and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

For the reasons discussed in the preamble, the Federal Communications Commission hereby amends 47 CFR parts 74 and 101 as follows:

Background and Purpose

All urine specimens collected under the DOT drug testing regulation, 49 CFR Part 40, must be collected using chain-of-custody procedures that incorporate the use of the CCF promulgated by the Department of Health and Human Services (HHS). On November 17, 2009, HHS published a proposal to revise the CCF [74 FR 59196]. In their proposal, HHS stated that the CCF is used for the Federal workplace drug testing program, but also pointed out that DOT “* * *requires its regulated industries to use the Federal CCF” [74 FR 59196]. Because many of the commentors to the HHS proposal were transportation industry employers, Consortia/Third-party Administrators (C/TPAs), and associations, the Department was confident the commentors understood the new CCF would be used in the DOT-regulated program. All the comments submitted were thoroughly reviewed by HHS and taken into consideration in fashioning the new CCF. The Department worked closely with HHS on the new CCF. HHS announced the new CCF in the Federal Register [75 FR 41488]. The CCF became effective date of October 1, 2010.

However, because of the short time frame between the HHS publication of the new CCF and its October 1, 2010 effective date, the Department did not have an opportunity to propose a rulemaking and therefore issued an Interim Final Rule (IFR) on September 27, 2010 [75 FR 59105] authorizing DOT-regulated employers to also begin using the new CCF on October 1, 2010. The Department sought comments only on the actual implementation of the new CCF, and not on the form itself because HHS already sought and received comments on the form and its use because many of the commentors to the HHS proposal were transportation industry employers, C/TPAs, and associations. In the IFR, the Department made minor procedural amendments to the regulation to merely reflect the changes HHS made to the revised CCF, and clarified how collectors, laboratories, and medical review officers (MROs) must use the new form in the DOT regulated context. There were 15 comments from four commentors.

The Department is also making a technical amendment to address an omission in the rule text of a final rule published on August 16, 2010 [75 FR 49850]. Specifically, we had removed the requirement in § 40.121(d) for the MRO to complete continuing education units to satisfy the requalification training requirement but we failed to amend the definition of “Continuing education” in § 40.3 to reflect this change. We do so in this Final Rule.

The following part of the preamble discusses comments to each of the amended rule text sections.

The Department added a new § 40.14 to put into one section the information employers or their C/TPAs have been routinely providing collectors or should have been providing collectors; information such as, the reason for the test, whether the test is to be conducted under direct observation, the MRO name and address, and employee information ( e.g., name and SSN or ID number), etc. All of this information would need to be provided in Step 1 of the CCF. Since a new Step 1-D was added to the CCF to specify which DOT Agency regulates the employee's safety-sensitive function, we included this among the information the employer or its C/TPA must provide to the collector.

One commentor, a large laboratory with many collection sites, concurred with the requirement for employers or C/TPAs to ensure the collector has the necessary information to complete Step 1. The commentor went on to say that it relied on the employer or C/TPA to pre-mark the demographic information ( e.g., test reason, testing authority) in Step 1 since its collection sites don't keep employer-specific CCFs at their sites and the employee may not know this information. When the employer pre-marks this information, this helps ensure the information is completed correctly. The Department agrees. In the event Step 1 is not pre-marked, the employer would need to ensure the information is provided to the collector.

Two commentors, apparently from the same collection site, were concerned that requiring the employer to provide the DOT Agency information would be confusing for the employers and that not knowing this information would delay the testing process. They stated “* * * there are many instances when the employer has no idea if their donor is DOT or non-DOT” and “When inquiring of employers' DER to supply this information the majority of the responses are 'I don't know!' The Department also received several telephonic requests for clarification since October 1 in which collectors questioned how they would know this information if the employer didn't know it themselves.

The Department believes the collector should never be put in a situation to determine the DOT Agency that regulates an employee's safety-sensitive functions. This is the employer's responsibility. Furthermore, the Department was surprised to hear that any employer currently regulated by DOT would not know which DOT Agency regulates it. We can only surmise this is a rare occurrence and there is no reason to believe it is a systemic problem. Perhaps it was because the employer forgot the specific abbreviation of its respective regulator: Federal Motor Carrier Safety Administration (FMCSA); Federal Aviation Administration (FAA); Federal Railroad Administration (FRA); Federal Transit Administration (FTA); Pipeline and Hazardous Materials Safety Administration (PHMSA); and the United States Coast Guard (USCG). 1 Nevertheless, not knowing this fundamental concept raised serious concerns and compliance questions. For example: Is the employer subject to the DOT's drug and alcohol testing regulations? If the employer is covered by the DOT regulations, then other questions arise. Is the employer testing its employees at the proper random testing rates? Is the employer conducting post-accident tests when required? Is the employer providing the correct educational material to its employees as required by the DOT regulations? Is the employer appropriately filling-out and submitting Management Information System (MIS) reports?

In response to the comment that employers do not know which DOT Agency regulates them or their employees' safety-sensitive functions, we encourage employers and their C/TPAs to review the guidance documents available to them on our site http://www.dot.gov/odapc and affirm their regulating DOT Agency. The Department is also providing the following to assist employers and C/TPAs with understanding these critical elements:

Covered employee: A person who operates (i.e., drives) a Commercial Motor Vehicle (CMV) with a gross vehicle weight rating (gvwr) of 26,001 or more pounds; or is designed to transport 16 or more occupants (to include the driver); or is of any size and is used in the transport of hazardous materials that require the vehicle to be placarded.

Covered employee: A person who performs hours of service functions at a rate sufficient to be placed into the railroad's random testing program. Categories of personnel who normally perform these functions are locomotive engineers, trainmen, conductors, switchmen, locomotive hostlers/helpers, utility employees, signalmen, operators, and train dispatchers.

Covered employee: A person who performs flight crewmember duties, flight attendant duties, flight instruction duties, aircraft dispatch duties, aircraft maintenance or preventive maintenance duties; ground security coordinator duties; aviation screening duties; and air traffic control duties. Note: Anyone who performs the above duties directly or by contract for a part 119 certificate holder authorized to operate under parts 121 and/or 135, air tour operators defined in 14 CFR part 91.147, and air traffic control facilities not operated by the Government are considered covered employees.

Covered employee: A person who performs a revenue vehicle operation; revenue vehicle and equipment maintenance; revenue vehicle control or dispatch (optional); Commercial Drivers License non-revenue vehicle operation; or armed security duties.

Covered employee: A person who performs on a pipeline or liquefied natural gas (LNG) facility an operation, maintenance, or emergency-response function.

Covered employee: A person who is on board a vessel acting under the authority of a license, certificate of registry, or merchant mariner's document. Also, a person engaged or employed on board a U.S. owned vessel and such vessel is required to engage, employ or be operated by a person holding a license, certificate of registry, or merchant mariner's document.

Employers and their C/TPAs that may have DOT Agency-specific questions can find the DOT Agency drug and alcohol program manager contact information at http://www.dot.gov/odapc/oamanagers.html.

In paragraph (f)(4) of this section, we added the DOT Agency to the items an employer must instruct the collector to note on the CCF. There were no comments to this section.

In paragraph (b) of this section, we changed the date after which an expired CCF is not to be used and in paragraph (c)(3) of this section, we permitted employers to preprint the box of the DOT Agency under whose authority the test will occur. There were two comments to this section. One commentor thanked the Department for authorizing the use of the old CCF until September 30, 2011, stating the year-long transition to the new CCF would provide employers and their service agents ample time to deplete their stock of old CCFs. The other commentor pointed out that the old CCF expires November 30, 2011, and suggested that the inadvertent use of the old CCF be permitted until this date. The Department agrees with the commentor about extending the use of the old CCF until November 30, 2011 so that it coincides with the form's actual expiration date. We have amended the rule text to reflect this change, so that the use of an old CCF would be a flaw that would require correction after November 30, 2011.

In paragraph (e) of this section we revised the rule text to provide the collector with specific instructions on completing Step 2 of the CCF. One commentor concurred with this change. The same commentor asked for clarification that a collector's failure to note the DOT Agency in Step 1-D was not a flaw that would require the collector to contact the DER to obtain the missing information. See our response to § 40.209.

In paragraph (a) of this section we made a nomenclature change from “laboratory copy” to “Copy 1”. One commentor agreed with this change. The commentor wondered if DOT wanted laboratories to document the DOT Agency information from the CCF into their systems. We neither proposed that, nor will we require that.

We revised paragraphs (a)(2)(i) and (ii), and (e)(1) of this section to require the laboratory to include the numerical values for the drug(s) or drug metabolite(s) in their report to the MRO. One commentor agreed with this change. The commentor wondered if DOT wanted laboratories to report the DOT Agency information from the CCF to the MRO. We neither proposed that, nor will we require that.

In paragraph (c) of this section we revised the rule text with specific instructions to the MRO on completing Step 6 of Copy 2 of the CCF. There were no comments to this section.

In paragraph (c)(10) of this section we required the MRO to indicate the DOT Agency on their written report to the employer if the DOT Agency is noted on the CCF. There were two comments to this change. One commentor asked for clarification on what action a MRO is to take if the DOT Agency is not noted on the CCF. The other commentor disagreed with the MRO including the DOT Agency on the result report to the employer for the following reasons: (1) The absence of the DOT Agency being marked on the CCF is not a flaw requiring corrective action, (2) some service agents may view the absence of the DOT Agency information as an item that requires corrective action by the collector, (3) there is no current requirement for the service provider's information system to capture this data element, (4) some service agents may view this change as a requirement for the laboratory to include the DOT Agency information on their electronic reports to the MRO, and (5) the DOT Agency information would be on the employer's copy of the CCF.

Regarding the comment asking for clarification on what action a MRO is to take if the DOT Agency is not noted on the CCF, the MRO is not to delay the medical review process and report the verified result to the employer. As we said in the IFR, “* * *the laboratory and MRO should note that the testing authority box was not checked and continue with processing, testing, verifying, and reporting the specimen result, as appropriate”. [75 FR 59106] Regarding the comment to not including the DOT Agency on the result report to the employer, we agree that the designation adds nothing to the employer's knowledge of the test outcome. We have removed the requirement from the rule text.

In paragraph (f) of this section, we revised the rule text on how a MRO is to document split specimen test results. There were no comments to this section.

In paragraph (d)(2) of this section we revised the rule text on how a MRO is to document a “Refusal to Test”. There were no comments this section.

In paragraph (d)(2)(i) of this section we revised the rule text on how a MRO is to complete Step 6 on Copy 2 of the CCF when recording a “Refusal to Test”. There were no comments to this section.

In paragraph (d)(2) of this section we made a nomenclature change from “laboratory copy” to “Copy 1”. In paragraph (d)(3) we revised the time period during which the use of an expired form would not cause the test to be canceled. One commentor did “* * *not believe that use of an expired CCF should result in a cancelled test—especially in a post-accident testing situation.” The commentor suggests, as they did in an earlier comment, that use of the old CCF be permitted until its expiration date of November 30, 2011 and that use after that date be considered a “correctable flaw”. See our response to § 40.45.

We revised paragraph (b)(1) of this section to say that omitting the DOT Agency in Step 1-D of the CCF would be an administrative mistake that would not result in the cancellation of a test and would not require corrective action. One commentor, a large laboratory, agreed that omitting the DOT Agency in Step 1-D of the CCF should be a mistake that would not require corrective action. Another commentor, a national association, asked for clarification on what documentation a collector, laboratory, MRO or other person administering the drug testing process must maintain when the DOT Agency was not identified on the CCF.

Another commentor, a large third party administrator, wanted to bring a discrepancy to our attention. Specifically, the commentor noticed a discrepancy between the title of this section in the IFR “What procedural problems do not result in the cancellation of a test and do not require corrective action?” and the title of this section in the 2001 final rule [66 FR 41954] “What procedural problems do not result in the cancellation of a test and do not require correction?”

Regarding the comment asking for clarification on documenting the omission of the DOT Agency in Step 1-D, we believe the plain language of the rule text is self explanatory. Nevertheless, we will point out that laboratories and MROs should document this omission as they have been documenting similar omissions (the transposition of an employee's social security number or employer ID number) in the past. As we stated in the IFR, “* * *the laboratory and MRO should note that the testing authority box was not checked and continue with processing, testing, verifying, and reporting the specimen result, as appropriate”. Furthermore, there is no requirement for the collector to provide a ‘memorandum for record' to anyone after the fact to indicate the DOT Agency. The regulation requires the employer to provide this information to the collector and the information is to be recorded on the CCF. As a reminder to MROs and employers, it is important for you to know the regulating DOT Agency since there may be DOT Agency specific requirements you must fulfill ( e.g., reporting medical qualifications or non-negative results to a DOT Agency). Not complying with a DOT Agency's regulatory requirement because the DOT Agency want not indicated on the CCF does not mitigate your regulatory responsibilities.

The Department would also like to remind employers, C/TPAs and collectors that although omitting the DOT Agency on the CCF would not cancel the test or require corrective action, this type of error may subject them to enforcement action under DOT Agency regulations or action under the Public Interest Exclusion if it becomes a recurring issue.

Regarding the comment about the typographical discrepancy, the commentor is correct. However, we will leave the title of this section as printed in the IFR, because we believe it reads better and reflects the intent expressed in the 2001 preamble. [66 FR 41948]

In paragraph (l) of this section we made a nomenclature change from “laboratory copy” to “Copy 1”. One commentor asked for guidance on whether transmitting only Copy 1 to the laboratory is still applicable since collectors are being instructed by the laboratory to fax the MRO copy to a fax server at the lab.

In this section, the Department only changed the nomenclature from “laboratory copy” to “Copy 1”. The requirement for collectors to send Copy 1 to the laboratory did not change.

The statutory authority for this rule derives from the Omnibus Transportation Employee Testing Act of 1991 (49 U.S.C. 102, 301, 322, 5331, 20140, 31306, and 54101 et seq. ) and the Department of Transportation Act (49 U.S.C. 322).

This final rule is not significant for purposes of Executive Order 12866 or the DOT's regulatory policies and procedures. The rule finalizes the authorization and procedures for using the new CCF for DOT-required drug tests and makes a technical amendment to correct an inadvertent oversight in a previous rulemaking. This rule does not increase costs on regulated parties because it authorizes regulated employers to continue using the old CCF for an additional fourteen months, until November 30, 2011. After this date, the revised CCF must be used. This allows employers to use their current supply of old CCFs rather than discarding them. The rule does not impose new burdens on any parties. While small entities are among those who may use the revised CCF, the Department certifies, under the Regulatory Flexibility Act, that this rule does not have a significant economic impact on a substantial number of small entities.

The Department finds good cause to make this rule final immediately upon publication. The basis of this determination is that, under the present interim final rule, drug tests recorded on the old version of the CCF would have to be cancelled beginning October 1, 2011. Laboratories and other program participants commented that because of the large numbers of old forms still being used, this date would result in large numbers of cancellations of otherwise valid tests. By making this rule change effective before October 1, the Department will prevent this unfortunate result and allow program participants to further exhaust stocks of the old version of the form for another four months. This will make program administration considerably smoother.

Accordingly, the Interim Final Rule amending 49 CFR part 40 which was published at 75 CFR 59105 on September 27, 2010, is adopted as final with the following changes:

Under 49 U.S.C. 30141(a)(1)(A), a motor vehicle that was not originally manufactured to conform to all applicable FMVSS shall be refused admission into the United States unless NHTSA has decided that the motor vehicle is substantially similar to a motor vehicle originally manufactured for importation into and sale in the United States, certified under 49 U.S.C. 30115, and of the same model year as the model of the motor vehicle to be compared, and is capable of being readily altered to conform to all applicable FMVSS. Where there is no substantially similar U.S.-certified motor vehicle, 49 U.S.C. 30141(a)(1)(B) permits a nonconforming motor vehicle to be admitted into the United States if its safety features comply with, or are capable of being altered to comply with, all applicable FMVSS based on destructive test data or such other evidence as the Secretary of Transportation decides to be adequate.

Under 49 U.S.C. 30141(a)(1), import eligibility decisions may be made “on the initiative of the Secretary of Transportation or on petition of a manufacturer or importer registered under [49 U.S.C. 30141(c)].” The Secretary's authority to make these decisions has been delegated to NHTSA. The agency publishes notices of eligibility decisions as they are made.

Under 49 U.S.C. 30141(b)(2), a list of all vehicles for which import eligibility decisions have been made must be published annually in the Federal Register . On October 1, 1996, NHTSA added the list as an appendix to 49 CFR part 593, the regulations that establish procedures for import eligibility decisions (61 FR 51242). As described in the notice, NHTSA took that action to ensure that the list is more widely disseminated to government personnel who oversee vehicle imports and to interested members of the public. See 61 FR 51242-43. In the notice, NHTSA expressed its intention to annually revise the list as published in the appendix to include any additional vehicles decided by the agency to be eligible for importation since the list was last published. See 61 FR 51243. The agency stated that issuance of the document announcing these revisions will fulfill the annual publication requirements of 49 U.S.C. 30141(b)(2). Ibid.

Executive Order 12866, “Regulatory Planning and Review” (58 FR 51735, October 4, 1993), provides for making determinations about whether a regulatory action is “significant” and therefore subject to Office of Management and Budget (OMB) review and to the requirements of the Executive Order. The Executive Order defines a “significant regulatory action” as one that is likely to result in a rule that may:

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

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

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

(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order. This rule will not have any of these effects and was not reviewed under Executive Order 12866. It is not significant within the meaning of the DOT Regulatory Policies and Procedures. The effect of this rule is not to impose new requirements. Instead it provides a summary compilation of decisions on import eligibility that have already been made and does not involve new decisions. This rule will not impose any additional burden on any person. Accordingly, the agency believes that the preparation of a regulatory evaluation is not warranted for this rule.

We have not conducted an evaluation of the impacts of this rule under the National Environmental Policy Act. This rule does not impose any change that would result in any impacts to the quality of the human environment. Accordingly, no environmental assessment is required.

Pursuant to the Regulatory Flexibility Act, we have considered the impacts of this rule on small entities (5 U.S.C. Sec. 601 et seq. ). I certify that this rule will not have a significant economic impact upon a substantial number of small entities within the context of the Regulatory Flexibility Act. The following is our statement providing the factual basis for the certification (5 U.S.C. Sec. 605(b)). This rule will not have any significant economic impact on a substantial number of small businesses because the rule merely furnishes information by revising the list in the Code of Federal Regulations of vehicles for which import eligibility decisions have previously been made. Accordingly, we have not prepared a Final Regulatory Flexibility Analysis.

Executive Order 13132 requires NHTSA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” Executive Order 13132 defines the term “Policies that have federalism implications” to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” Under Executive Order 13132, NHTSA may not issue a regulation that has federalism implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, or NHTSA consults with State and local officials early in the process of developing the regulation.

This rule will have no 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 as specified in Executive Order 13132. Thus, the requirements of section 6 of the Executive Order do not apply to this rule.

The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires agencies to prepare a written assessment of the costs, benefits and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually. This rule will not result in additional expenditures by State, local or tribal governments or by any members of the private sector. Therefore, the agency has not prepared an economic assessment pursuant to the Unfunded Mandates Reform Act.

Under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ), a person is not required to respond to a collection of information by a Federal agency unless the collection displays a valid OMB control number. This rule does not impose any new collection of information requirements for which a 5 CFR part 1320 clearance must be obtained. DOT previously submitted to OMB and OMB approved the collection of information associated with the vehicle importation program in OMB Clearance No. 2127-0002.

Pursuant to Executive Order 12988, “Civil Justice Reform,” we have considered whether this rule has any retroactive effect. We conclude that it will not have such an effect.

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:

Under the National Technology and Transfer and Advancement Act of 1995 (Pub. L. 104-113), “all Federal agencies and departments shall use technical standards that are developed or adopted by voluntary consensus standards bodies, using such technical standards as a means to carry out policy objectives or activities determined by the agencies and departments.” This rule does not require the use of any technical standards.

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

This rule is not subject to Executive Order 13045 because it is not “economically significant” as defined under Executive Order 12866, and does not concern an environmental, health, or safety risk that NHTSA has reason to believe may have a disproportionate effect on children.

NHTSA finds that prior notice and opportunity for comment are unnecessary under 5 U.S.C. 553(b)(3)(B) because this action does not impose any regulatory requirements. This rule merely revises the list of vehicles not originally manufactured to conform to the FMVSS that NHTSA has decided to be eligible for importation into the United States since the last list was published in September, 2010.

In addition, so that the list of vehicles for which import eligibility decisions have been made may be included in the next edition of 49 CFR parts 572 to 599, which is due for revision on October 1, 2011, good cause exists to dispense with the requirement in 5 U.S.C. 553(d) for the effective date of the rule to be delayed for at least 30 days following its publication.

In consideration of the foregoing, Part 593 of Title 49 of the Code of Federal Regulations is amended as follows: