We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2011-1092; Directorate Identifier 2011-NM-111-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

The Transport Canada Civil Aviation (TCCA), which is the aviation authority for Canada, has issued Canadian Airworthiness Directive CF-2011-10, dated May 13, 2011 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Bombardier has issued Service Bulletins 700-1A11-35-010 (for Model BD-700-1A11 airplanes) and 700-35-011 (for Model BD-700-1A10 airplanes), both Revision 01, both dated February 1, 2011. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

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

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

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

Based on the service information, we estimate that this proposed AD would affect about 39 products of U.S. registry. We also estimate that it would take about 10 work-hours per product to comply with the basic requirements of this proposed AD. The average labor rate is $85 per work-hour. Required parts would cost about $0 per product. Where the service information lists required parts costs that are covered under warranty, we have assumed that there will be no charge for these parts. As we do not control warranty coverage for affected parties, some parties may incur costs higher than estimated here. Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $33,150, or $850 per product.

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

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

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

For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:

We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2011-1094; Directorate Identifier 2011-NM-070-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

We received reports that inspections of the wing center section revealed defective, misapplied, or missing secondary fuel vapor barrier on the center fuel tank. The secondary fuel barrier is applied external to the fuel tank walls, which are subject to cabin pressure to provide a secondary means to contain fuel and fuel vapors. When the secondary fuel barrier is applied satisfactorily, it protects the pressurized cabin areas from fuel leaks and fumes. If the secondary fuel barrier is defective, fuel or fumes can leak through fastener holes or cracks in the structure and pass into the passenger compartment. There have been no reports from operators of fuel leaks or fumes in the passenger compartment. We are proposing this AD to detect and correct defective surfaces and insufficient thickness of secondary fuel barrier, which could allow fuel leaks or fumes into the pressurized cabin, and allow fuel or fuel vapors to come in contact with an ignition source, which could result in a fire or an explosion.

On June 10, 2005, the FAA issued AD 2005-13-15, Amendment 39-14152 (70 FR 36486, June 24, 2005), applicable to certain Boeing Model 737-200, -200C, -300, -400, -500, -600, -700, -700C, -800, and -900 series airplanes, which requires a one-time detailed inspection for discrepancies of the secondary fuel vapor barrier of the wing center section, and related investigative and corrective actions if necessary. That AD was prompted by reports that the secondary fuel vapor barrier was not applied correctly to, or was missing from, certain areas of the wing center section. The actions required by that AD are intended to prevent fuel or fuel vapors from leaking into the cargo or passenger compartments and coming into contact with a possible ignition source, which could result in fire or explosion.

We reviewed Boeing Service Bulletins 757-57-0060, Revision 2, dated May 24, 2007 (for Model 757-200, 757-200PF, and 757-200CB series airplanes); and 757-57-0061, Revision 1, dated May 24, 2007 (for Model 757-300 series airplanes). These service bulletins describe procedures for, depending on airplane configuration, inspecting for discrepancies and insufficient coverage of the secondary fuel barrier, determining the thickness of the secondary fuel barrier, and corrective actions if necessary. Discrepancies include missing, peeled, non-continuous, or non-transparent secondary fuel barrier; small air bubbles, air pockets, blister-like areas, or solid particles in the secondary fuel barrier; fillet sealant, primer, corrosion-inhibiting compound or other finishes applied to the top of the secondary fuel barrier; missing fillet (cap) seals; or areas of secondary fuel barrier whose thickness is less than or greater than specified limits; or areas not having a transparent quality that makes it possible to see a crack in the structure; or areas not having a minimum application coverage area. Corrective actions include repairing the secondary fuel barrier, including removal and reapplication, if needed; or applying more secondary fuel barrier, as needed.

We are proposing this AD because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of these same type designs.

This proposed AD would require accomplishing the actions specified in the service information described previously, except as discussed under “Differences Between the Proposed AD and the Service Information.”

Although Boeing Service Bulletin 757-57-0060, Revision 2, and Boeing Service Bulletin 757-57-0061, Revision 1, both dated May 24, 2007, specify to send the inspection results to the manufacturer, this proposed AD would not require any report. Boeing Service Bulletin 757-57-0060, Revision 2, and Boeing Service Bulletin 757-57-0061, Revision 1, both dated May 24, 2007, refer to a “detailed visual inspection” for discrepancies and insufficient coverage of the secondary fuel barrier. We have determined that the procedures in the service bulletin should be described as a “detailed inspection.” Note 1 has been included in this AD to define this type of inspection.

We estimate that this proposed AD affects 619 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:

We estimate the following costs to do any necessary repairs that would be required based on the results of the proposed inspection. We have no way of determining the number of aircraft that might need these repairs:

According to the manufacturer, some of the costs of this proposed AD may be covered under warranty, thereby reducing the cost impact on affected individuals. We do not control warranty coverage for affected individuals. As a result, we have included all costs in our cost estimate.

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

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

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

For the reasons discussed above, I certify this proposed regulation:

(1) Is not a “significant regulatory action” under Executive Order 12866,

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

(3) Will not affect intrastate aviation in Alaska, and

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

Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:

We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2011-1095; Directorate Identifier 2010-NM-241-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

Transport Canada Civil Aviation (TCCA), which is the airworthiness authority for Canada, has issued Canadian Airworthiness Directive CF-2010-25, dated August 3, 2010 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Bombardier has issued Service Bulletin 605-24-002, dated December 07, 2009, and Service Bulletin 605-24-004, dated January 18, 2010. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

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

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

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

Based on the service information, we estimate that this proposed AD would affect about 69 products of U.S. registry. We also estimate that it would take about 6 work-hours per product to comply with the basic requirements of this proposed AD. The average labor rate is $85 per work-hour. Required parts would cost about $347 per product. Where the service information lists required parts costs that are covered under warranty, we have assumed that there will be no charge for these costs. As we do not control warranty coverage for affected parties, some parties may incur costs higher than estimated here. Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $59,133, or $857 per product.

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

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

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

For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:

We invite you to submit any written data, views, or arguments regarding this proposed AD. Send your comments to the address listed under the caption ADDRESSES . Include the docket number “FAA-2010-0517, Directorate Identifier 2009-SW-73-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments.

We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed rulemaking. Using the search function of our docket Web site, you can find and read the comments to any of our dockets, including the name of the individual who sent or signed the comment. You may review the DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477-78).

You may examine the docket that contains the proposed AD, any comments, and other information on the Internet at http://www.regulations.gov or in person at the Docket Operations office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Operations office (telephone (800) 647-5527) is located in Room W12-140 on the ground floor of the West Building at the street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

A number of service documents and ADs have been issued relating to the ERB on these and similar model helicopters. AD 82-17-03, issued July 30, 1982 (47 FR 35469, August 16, 1982), requires a puck-to-disc inspection of rotor brake, part number (P/N) 76363-09101-101, and modification of the ERB system including, among other modifications, installation of a warning relay by following Sikorsky Customer Service Bulletin No. 76-66-10B, dated November 25, 1981. AD 2003-04-15, issued February 14, 2003 (68 FR 8994, February 27, 2003), requires inspecting certain rotor brake discs for cracks that resulted from improper heat treating of the disc. This document proposes adopting a new AD for the Sikorsky Model S-76A helicopters with a different part-numbered ERB. This proposal would require, within 120 days, modifying the ERB by installing and operationally testing the parts contained in an ERB warning relay kit (P/N 76070-55023-011), an ERB circuit modification kit (P/N 76070-55033-012), and an ERB modification kit (P/N 76070-55207-011) for helicopters with ERB, P/N 76363-09100-012. This proposal is prompted by a reported incident of a fire occurring in an ERB installed on a Model S-76A helicopter in Brazil. The actions specified by this proposed AD are intended to prevent overheating of the ERB assembly, ignition of the ERB hydraulic fluid, a fire in the main gearbox area, and subsequent loss of control of the helicopter.

We have reviewed the following documents from Sikorsky:

• Customer Service Bulletin No. 76-66-10B, Revision 1, pages 2-8, dated July 30, 1981, and Revision 2, pages 1 and 9-13 dated November 25, 1981 (CSB), specifies installing an ERB warning relay kit;

• Customer Service Notice 76-113, dated June 1, 1983 (CSN), which specifies installing an ERB circuit breaker and modification kit; and

• ASB No. 76-66-48B, Revision B, dated July 8, 2009, which specifies a one-time installation of an ERB modification kit containing two other kits and several modifications.

• RFM Supplement No. 41, dated September 6, 2005, which revises the information in the basic RFM normal and emergency procedures sections when the ERB system is modified.

This unsafe condition is likely to exist or develop on other helicopters of the same type design. Therefore, the proposed AD would require modifying the ERB by installing the parts contained in a warning relay system modification kit, part number (P/N) 76070-55023-011; a circuit modification kit, P/N 76070-55033-012; and a manifold, relay box, junction box, right-hand relay panel, and wiring harness modification kit, P/N 76070-55207-011. The proposed AD would also require operationally testing the ERB system after each modification. The proposed AD would also require inserting changes contained in a supplement into the RFM.

These actions would be required to be accomplished in accordance with specified portions of the service information described previously.

We estimate that this proposed AD would affect 180 helicopters of U.S. registry. It would take about 38 work hours per helicopter to perform the modifications and operational tests at an average labor rate of $85 per work hour. Required parts would cost $13,300 per helicopter. Based on these figures, we estimate the total cost impact of the proposed AD on U.S. operators would be $2,975,400 for the fleet.

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

For the reasons discussed above, I certify that the proposed regulation:

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

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

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

We prepared a draft economic evaluation of the estimated costs to comply with this proposed AD. See the AD docket to examine the draft economic evaluation.

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

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

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

We invite you to submit any written data, views, or arguments regarding this proposed AD. Send your comments to the address listed under the caption ADDRESSES . Include the docket number “FAA-2011-1115, Directorate Identifier 2010-SW-011-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments.

We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed rulemaking. Using the search function of our docket web site, you can find and read the comments to any of our dockets, including the name of the individual who sent or signed the comment. You may review the DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477-78).

You may examine the docket that contains the proposed AD, any comments, and other information on the Internet at http://www.regulations.gov or in person at the Docket Operations office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Operations office (telephone (800) 647-5527) is located in Room W12-140 on the ground floor of the West Building at the street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

This document proposes adopting a new AD for the Sikorsky Model S-92A helicopters. This proposal would require revising the Operating Limitations section, Part 1, Section 1, Weight Limits, of the Sikorsky Model S-92A RFM with the following statement “Performance credit for above specification engine power margin is prohibited.” Engine power margin is determined through power assurance checks. Previous flight manual revisions allowed for the use of above specification engine power margin as shown in the circled area of Figure 1 of this AD. The use of above-specification engine power margin is now being prohibited. Sikorsky has published various RFM revisions correcting the charts in Parts I and IV of the RFM. If those revisions have previously been incorporated into the RFM, the RFM revision specified by this proposed AD would not be required. The RFM revisions, all dated April 9, 2008, are as follows:

This proposal is prompted by the manufacturer's analysis of engine data that revealed the data was inaccurate in dealing with available engine power margin. The actions specified by this proposed AD are intended to prevent the use of inaccurate performance data in calculating maximum gross weight by revising the Operating Limitations section of the RFM.

This unsafe condition is likely to exist or develop on other helicopters of the same type design. Therefore, the proposed AD would require inserting a limitation into the Operating Limitation section of the RFM prohibiting the use of power margin percentage credit in calculating gross weight and inserting the revisions into the Operating Limitations, Part 1, Section 1, of Sikorsky RFM SA S92A-RFM-002, -003, -004, -005, and -006.

We estimate that this proposed AD would affect 37 helicopters of U.S. registry, and the proposed actions would take about 1 work hour per helicopter to insert the revisions into the RFM at an average labor rate of $85 per work hour. Parts costs are not associated with this AD. Based on these figures, we estimate the total cost impact of the proposed AD on U.S. operators would be $3,145.

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

For the reasons discussed above, I certify that the proposed regulation:

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

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

3. Will not affect intrastate aviation in Alaska to the extent that it justifies making a regulatory distinction; and

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

We prepared an economic evaluation of the estimated costs to comply with this proposed AD. See the AD docket to examine the draft economic evaluation.

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

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

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

Comments Invited

We invite you to submit any written data, views, or arguments regarding this proposed AD. Send your comments to the address listed under the caption ADDRESSES . Include the docket number “FAA-2011-1113, Directorate Identifier 2009-SW-53-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments.

We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed rulemaking. Using the search function of our docket Web site, you can find and read the comments to any of our dockets, including the name of the individual who sent or signed the comment. You may review the DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477-78).

You may examine the docket that contains the proposed AD, any comments, and other information on the Internet at http://www.regulations.gov or in person at the Docket Operations office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Operations office (telephone (800) 647-5527) is located in Room W12-140 on the ground floor of the West Building at the street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

This document proposes adopting a new AD for the Sikorsky Model S-92A helicopters. This proposal would require inspecting each blade for mislocated aluminum wire mesh in the blade skin. This proposal is prompted by the discovery that blades were manufactured with aluminum wire mesh mislocated, leaving portions of the graphite torque tube (spar) region unprotected from a lightning strike. This condition can exist on both the upper and lower blade skin airfoils. The actions specified by this proposed AD are intended to detect mislocated blade wire mesh to prevent spar delamination and loss of the blade tip cap during a lightning strike leading to blade imbalance, loss of a blade, and subsequent loss of control of the helicopter.

We have reviewed Sikorsky Special Service Instructions SSI No. 92-021A, dated October 21, 2009 (SSI), which specifies inspecting the blade for mislocated blade wire mesh. Two options are identified in the SSI. One option is to conduct an eddy current inspection and the other option is to conduct a visual inspection after sanding to determine if there is mislocated wire mesh.

This unsafe condition is likely to exist or develop on other helicopters of the same type design. Therefore, the proposed AD would require inspecting each blade to determine if the wire mesh is mislocated and replacing the blade with an airworthy blade if the wire mesh is mislocated. The actions would be required to be done by following the service information described previously.

We estimate that this proposed AD would affect 44 helicopters of U.S. registry. There are 486 suspect blades worldwide, and we assume 29 percent (141) of those blades may be on helicopters of U.S. registry. We estimate that inspecting a blade for mislocated wire mesh would take about 4 work hours per blade, assuming all operators opt to do the blade sanding inspection rather than the eddy current inspection, at an average labor rate of $85 per work hour. Required parts would cost about $13,000 for each blade repaired by the manufacturer or $180,000 for each new blade. The total cost of the proposed AD for U.S. operators would be $3,215,940, assuming 51 blades are found with mislocated wire mesh, and assuming 36 of those blades are replaced with blades repaired by the manufacturer and 15 blades are replaced with new blades.

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

For the reasons discussed above, I certify that the proposed regulation:

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

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

3. Will not affect intrastate aviation in Alaska to the extent that it justifies making a regulatory distinction; and

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

We prepared a draft economic evaluation of the estimated costs to comply with this proposed AD. See the AD docket to examine the draft economic evaluation.

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

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

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

1. In this Notice of Proposed Rulemaking (NOPR), the Federal Energy Regulatory Commission (Commission) proposes, pursuant to sections 301(b) and 307(a) of the Federal Power Act (FPA), 1 to amend its regulations to require each regional transmission organization (RTO) and independent system operator (ISO) to electronically deliver to the Commission, on an ongoing basis, data related to the markets that it administers. Ongoing electronic delivery of data relating to physical and virtual offers and bids, market awards, resource outputs, marginal cost estimates, shift factors, financial transmission rights (FTR), internal bilateral contracts, and interchange pricing will facilitate the Commission's development and evaluation of its policies and regulations and will enhance Commission efforts to detect anti-competitive or manipulative behavior, or ineffective market rules, thereby helping to ensure just and reasonable rates.

2. Wholesale electricity markets have witnessed tremendous change in recent years. In the decades after the 1935 enactment of the FPA, the industry was characterized by self-sufficient, vertically integrated utilities. Most utilities built their own generation, transmission, and distribution facilities and sold electricity to their own wholesale and retail customers. During this time, the Commission regulated jurisdictional entities' rates through traditional cost-based ratemaking. Cost-based rate regulation ensures that rates are just and reasonable by administratively determining an entity's cost of providing service. Changes in national policy and other forces led to increased coordination and competition in the late 1960s and 1970s, 2 and the enactment of the Public Utility Regulatory Policies Act (PURPA). 3 The 1980s and early 1990s experienced an increased adoption of market-based ratemaking and wholesale power sales competition to promote efficiency and to lower wholesale power prices. 4

3. National policy fostered further market evolution by encouraging increased competition among generators through the Energy Policy Act of 1992 (EPAct 1992). 5 Specifically, EPAct 1992 eased regulatory restrictions so that independent and affiliate generators could more easily enter, and compete in, wholesale electricity markets. EPAct 1992 also expanded the Commission's authority to address undue discrimination in transmission access in order to promote wholesale competition. In subsequent orders, the Commission found that the availability of transmission service enhances competition in power markets, by increasing power supply options of buyers and power sales options of sellers, and leads to lower rates for consumers. 6 By the mid-1990s, the Commission had determined that additional measures were needed to address undue discrimination in transmission access and issued Order Nos. 888 7 and 889, 8 which required “open access” transmission service. In doing so, the Commission explained that its action “remove[s] impediments to competition in the wholesale power marketplace and * * * bring[s] more efficient, lower cost power to the Nation's electricity customers.”  9 The Commission subsequently issued Order No. 890, 10 to further remedy undue discrimination and thereby remove barriers to competition.

4. In addition to addressing undue discrimination in transmission access, Order No. 888 encouraged the formation of ISOs. The Commission posited that “ISOs have great potential to assist us and the industry to help provide regional efficiencies, to facilitate economically efficient pricing, and, especially in the context of power pools, to remedy undue discrimination and mitigate market power.”  11 To facilitate ISO formation and foster independent operation of the transmission grid, the Commission suggested that utilities should voluntarily transfer operating control of their transmission facilities to an ISO. Four years later, in Order No. 2000, 12 the Commission encouraged the voluntary formation of RTOs to administer the transmission grid on a regional basis. To date, the Commission has approved six RTOs and ISOs: PJM Interconnection, L.L.C. (PJM); New York Independent System Operator, Inc. (NYISO); Midwest Independent Transmission System Operator, Inc. (Midwest ISO); ISO New England Inc. (ISO-NE); California Independent System Operator Corporation (CAISO); and Southwest Power Pool, Inc. (SPP). Together, these six RTOs and ISOs serve more than half of the United States' wholesale electricity demand. 13

5. The wholesale electricity markets operated by Commission-approved RTOs/ISOs have evolved since their inception and will likely continue to do so as advances in technology usher in additional competing resources, computational efficiencies, new products, and new types of market participants. Today, for example, market participants include independent generating resources, storage devices, demand response and energy efficiency providers, marketers and traders, vertically integrated utilities, power marketing administrations, municipalities and cooperatives, among others.

6. Substantial changes also have occurred with respect to the manner in which electricity is bought and sold. For example, when the IntercontinentalExchange (ICE) was established in 2000, the vast majority of electricity sales transacted on ICE contained requirements for physical delivery. Electricity bought or sold without requirements for physical delivery is commonly referred to as a financial electricity product. Beginning in 2004, the volume of financial electricity products bought and sold on ICE eclipsed that of electricity bought and sold on ICE with physical delivery requirements. The financial electricity product volumes on ICE also surpassed electricity volumes reported to the Commission through Electric Quarterly Reports (EQR) in several markets. 14 Given that financial electricity products commonly settle using published prices from Commission-jurisdictional markets, changes in the prices of physical electricity products impact the values of both physical and financial electricity products.

7. Recognizing the importance of information relating to market trading and market oversight, the Commission issued Order No. 2001  15 and Order No. 697, 16 establishing reporting requirements for entities selling under market-based rates. As one keen observer stated, in this regard, “[i]nformation is the key to a viable electricity market and to preventing market manipulation.”  17 In addition, the Energy Policy Act of 2005 (EPAct 2005)  18 gave the Commission expanded authority to address market manipulation, 19 including the ability to assess civil fines and seek criminal penalties. 20

8. Independent market monitoring by RTO/ISO market monitoring units (MMU) is an important means to evaluate market developments and to identify and deter market abuses and manipulation. In Order No. 2000, the Commission identified market monitoring as a basic function of an RTO. 21 The Commission refined its approach to MMUs in a 2005 policy statement and in Order No. 719. 22 In the 2005 Policy Statement, the Commission outlined tasks for MMUs to perform in order to enhance the competitive structure of RTO/ISO markets. 23 Subsequently, in Order No. 719, the Commission further clarified requirements for MMU functions, independence, and information sharing. 24

9. The Commission has acknowledged that MMUs perform a vital and necessary function in market oversight  25 but that they do not supplant the Commission's authority. 26 Rather, MMUs are designed to provide the Commission with an additional means of detecting market power abuses, market design flaws, and opportunities for improvements in market efficiency. 27

10. In this NOPR, the Commission proposes to revise its regulations to require each RTO and ISO to electronically deliver to the Commission, on an ongoing, non-public basis, data related to the markets that it administers; namely, data relating to physical and virtual offers and bids, market awards, resource outputs, marginal cost estimates, shift factors, FTRs, internal bilateral contracts, and interchange pricing. To facilitate such ongoing, electronic delivery, the Commission proposes that each RTO and ISO use automated electronic procedures to provide this data.

11. The Commission is statutorily obligated to ensure that sales of electricity in wholesale markets are made at just and reasonable rates, 28 and to address market manipulation in connection with the purchase or sale of electricity subject to the Commission's jurisdiction. 29 Toward that end, section 301(b) of the FPA provides that the Commission shall at all times have access to and the right to inspect and examine all accounts and records of public utilities. 30 In this NOPR, and pursuant to its authority under section 301(b), the Commission proposes to seek ongoing electronic delivery of data including accounts and records of the RTOs/ISOs, which are public utilities.

12. Moreover, the Commission also has authority pursuant to section 307(a) of the FPA to investigate any facts, conditions, practices, or matters it may deem necessary or proper to determine whether any person, electric utility, transmitting utility, or other entity may have violated or might violate the FPA or the Commission's regulations, or to aid in the enforcement of the FPA or the Commission regulations, or to obtain information about wholesale power sales or the transmission of power in interstate commerce. 31

13. As markets continue to evolve with increased levels of sophistication, the Commission must continue to evaluate the type of data necessary to ensure just and reasonable rates. The Commission's market monitoring and surveillance capabilities and associated data requirements must keep pace with market developments and evolve along with the markets. Further, the Commission's evaluation of the market rules, regulations, and policies should be informed by the data collection proposed herein. Electronic delivery of the types of data proposed herein will help to bring the Commission's access to RTO/ISO data in sync with the types and levels of activity in those markets and help to ensure that rates are just and reasonable.

14. Most of the data discussed in this NOPR are already collected and stored by the RTOs/ISOs in order to administer their markets. To the extent that an RTO/ISO does not already collect specific data, the Commission is not proposing to require either the collection of such data from market participants or its electronic delivery to the Commission. The Commission also proposes that key identifiers and other descriptive details necessary to understand the data be included in the data electronically delivered to the Commission. Finally, the Commission proposes that each RTO/ISO electronically deliver the data to the Commission using a common transfer method and format ( i.e., Secure File Transfer Protocol and XML), which are described below. The Commission is not proposing that each RTO/ISO aggregate or materially modify the data prior to electronic delivery to the Commission. 32

15. This NOPR proposes to require an automated data delivery process, in part, to minimize any burden on RTOs/ISOs. The Commission currently can request this data from individual RTOs and ISOs on an ad hoc basis. Such recurrent, periodic data requests may require more Commission and RTO/ISO resources than the proposed electronic delivery of this data using an automated process.

16. Although the six RTOs/ISOs have developed different wholesale electricity market designs, there are many similarities in the data that they use to administer these markets. Generally speaking, market participants with their own supply resources or with supply resources under contract submit energy supply offers indicating the price at which they are willing to supply various quantities of energy. Load-serving entities submit demand bids indicating the price at which they are willing to buy various quantities of energy. The supply offers pass through market power screens. These screens are used to determine whether the resources can affect the market price and whether the offers should be mitigated. If an energy supply offer triggers the application of mitigation, it is replaced with a mitigated energy supply offer. Generally, mitigated energy supply offers are calculated using estimated marginal cost data, which approximate generators' costs under different conditions. 33

17. Similar to the process for submitting energy offers and bids, market participants with their own supply resources or with supply resources under contract also submit offers to provide ancillary services and capacity services. 34 These offers typically indicate a price at which a market participant is willing to provide the service and, like the energy supply offers discussed above, are subject to mitigation when appropriate.

18. Entities with or without physical assets or load obligations may also submit “virtual” supply offers and demand bids in the RTO/ISO day-ahead markets. These virtual offers and bids contribute to price formation in RTO/ISO markets. Further, entities located outside of the RTO/ISO footprint may submit supply offers and demand bids in the form of interchange offers and bids.

19. The RTOs/ISOs match the above-described inputs through an intricate process designed to use the lowest-cost resources to meet demand. 35 This process yields pricing signals through locational marginal pricing (LMP) that determine which supply offers and demand bids are selected (and which would also inform long-term planning, e.g., decisions on whether to enter and exit markets). Supply offers that are selected are required to provide a specific amount of service. For example, resources that are selected in the day-ahead energy market will be given an energy market award that specifies the amount of energy a particular resource is financially obligated to supply. These market awards are determined by each resource's supply offer and the corresponding day-ahead LMP. Finally, the RTO/ISO provides dispatch instructions for resources in real time. Real-time compensation is determined by the dispatch instructions, metered output, and the corresponding LMP.

20. LMP is comprised of three components: The system-wide price of energy, transmission line losses, and the congestion charge. The congestion charge component of LMP is calculated using shift factors when modeled flows are above the intended physical capability of given transmission facilities. A shift factor reflects the positive or negative percentage effect that a one-megawatt change in generation output or demand will have on an identified constraint. These shift factors are used to create a dispatch strategy that is consistent with physical and other reliability constraints. In other words, shift factors allow RTOs/ISOs to manage transmission constraints through congestion charge price signals that relate to a generator's or load's influence on a specific constraint.

21. Prices in the RTO/ISO day-ahead markets and real-time balancing markets can be volatile depending on market conditions. Products designed to hedge RTO/ISO price volatility have provided valuable tools for RTO/ISO market participants to secure predictable revenue streams or reduce price risk associated with generation costs. These price hedging tools have evolved concurrently with changes in wholesale electricity markets.

22. In the RTO/ISO markets, market participants can limit price risk using several tools, notably, virtual offers and bids, FTRs, and internal bilateral contracts. Virtual offers and bids (collectively, virtuals) allow market participants the opportunity, among other things, to transfer price risk between day-ahead and real-time markets within an RTO/ISO. When virtuals are scheduled in the day-ahead market, the financial commitment is established at published day-ahead prices, and virtuals are automatically liquidated with the opposite buy/sell position, in most cases at real-time prices. Virtuals are not backed by physical assets. If a load-serving entity determines that it might need to purchase supply from real-time markets, 36 the load-serving entity could use virtuals to “lock-in” a day-ahead price.

23. FTRs provide market participants with a mechanism to hedge transmission costs under LMP-based market designs. In general, load-serving entities in RTOs/ISOs are allocated either FTRs or transmission rights convertible into FTRs. This allocation is often based on usage during an historical period. Allocated FTRs are limited to load-serving entities and to those who funded construction of specific transmission facilities. Other FTRs are auctioned, and such FTRs generally can be purchased by creditworthy entities. Moreover, FTRs can be resold outside of the RTO/ISO auction and allocation procedures. Transactions occurring outside of the RTO/ISO allocation and auction procedures are commonly referred to as secondary market transactions.

24. Finally, internal bilateral contracts allow market participants to hedge energy costs under LMP-based market designs. In RTOs/ISOs, market participants can enter into bilateral agreements and use the RTO/ISO to perform settlement functions. These internal bilateral contracts typically rely on a bilaterally negotiated price rather than the potentially more volatile RTO/ISO LMP-based energy price, and they allow market participants the opportunity to transfer risks relating to energy costs among market participants. Thus, a load-serving entity may enter into an internal bilateral contract with a supplier to settle its energy costs at a predetermined rate rather than at the applicable LMP. If the market participant reports this internal bilateral contract to the RTO/ISO, the RTO/ISO would then account for this agreement in its settlement process.

25. RTO/ISO price-hedging products have been created outside of the RTO/ISO markets as well. Electricity futures were first traded on NYMEX in March 1996. 37 Electricity futures, which are traded on organized exchanges, and electricity forwards, which are traded outside of organized exchanges, are transactions that typically specify a quantity of physical electricity to be delivered at a specific time and place in the future at an agreed-upon price. 38 A generation owner can sell output from its facility at a pre-determined price by entering into futures or forward transactions even as the RTO/ISO price varies.

26. In recent years, other products for hedging RTO/ISO prices have developed, such as electricity swaps. Swaps are similar to electricity futures and forwards, but swaps are financial transactions that do not require physical delivery. Electricity swaps can be bought or sold at a given “fixed” price and subsequently settle at a “floating” published daily electricity price; this is typically referred to as a “fixed-for-floating” swap. Swaps can act as a hedge when used alongside physical electricity sales, by guaranteeing the generation owner an agreed upon price, notwithstanding fluctuation in the published electricity price. Specifically, if the published daily electricity price is higher than the agreed upon price, the generation owner pays the difference to the counter-party to the swap but still receives the agreed upon price. 39 This effectively guarantees a predictable revenue stream to the generation owner. RTO/ISO posted prices are one of the commonly referenced settlement values used in electricity swaps.

27. To the extent that any market participant is willing to manipulate the market, that market participant would have an incentive to manipulate RTO/ISO prices that are used to settle values for electricity products, including financial products such as electricity swaps. The likelihood of an attempt at market manipulation can be reduced if the perceived cost of manipulation exceeds the perceived benefit. For example, a market participant may wish to drive up an RTO/ISO price because that market participant also holds an electricity swap that benefits from a higher RTO/ISO price. In that vein, the market participant may offer supply into the RTO/ISO market at levels above its own marginal costs, driving up an RTO/ISO price by requiring a higher-priced unit to be selected. That market participant would receive less revenue from the RTO/ISO due to the lost sales opportunity from its own higher-priced offer not being selected. However, in this example, the market participant may be able to more than offset the reduction in revenue through the benefit of its electricity swap associated with the higher RTO/ISO price.

28. Given the history of electricity markets it regulates, the Commission expects that such markets will continue to evolve, that new physical and financial products will be formed, and that increasingly complex manipulative or other anti-competitive strategies may be created.

29. To keep pace with market developments, the Commission is proposing to establish ongoing, electronic delivery of data from each RTO and ISO to enhance its market monitoring and surveillance efforts. By seeking electronic delivery of the data outlined in this NOPR, the Commission does not seek to displace or modify any of the existing market monitoring functions performed by MMUs. Nor do we intend our proposal to be perceived as an implicit criticism of the MMUs' performance. Instead, this data will help the Commission detect anti-competitive or manipulative behavior, or ineffective market rules, and thus help ensure just and reasonable rates.

30. Among other objectives, the Commission will use the data it proposes to receive as part of automated screens and other analyses designed to detect attempts to manipulate RTO/ISO pricing for the purpose of benefiting products that settle using RTO/ISO pricing and to detect abuses involving interchange transactions. Supply offer, demand bid, virtual, and FTR data will assist the Commission in understanding how market participants are positioning themselves in RTO/ISO markets. For example, market participants attempting to move RTO/ISO settlement pricing might offer supply into the RTO/ISO market at uncompetitive prices. Likewise, market participants could target specific LMP prices using virtual offers and bids. Because congestion impacts are often spread across many price nodes (and result in many different LMPs) through shift factors, these virtual offers and bids need not be placed at the specific price node for which a market participant might be attempting to move the LMP. Estimated marginal cost and shift factor data will enhance the Commission's ability to identify such behavior that may be designed to impact RTO/ISO pricing. Moreover, interchange pricing data will assist the Commission's efforts to identify anomalous or uneconomic electricity interchange schedules; electricity schedules between markets that are not consistent with pricing signals could be a source of market inefficiency or raise other anti-competitive concerns.

31. Securing data concerning the markets that the RTOs/ISOs administer is part of the Commission's broader effort to enhance its market monitoring and surveillance capabilities. Specifically, in a recently issued NOPR on Commission access to electronic tag (e-Tag) data, 40 the Commission proposed to make e-Tag data available to the Commission to assist in monitoring the market and preventing manipulation, among other things. In yet another NOPR, the Commission proposed to require additional contract and transaction data from those who file EQRs and to extend the EQR filing requirements to wholesale market participants which fall outside the Commission's FPA section 205 jurisdiction. 41 The Commission stated that these proposals would strengthen the Commission's ability to identify potential exercises of market power or manipulation. We believe that the same is true here.

32. Utilizing the data the Commission proposes to receive in this NOPR and the two NOPRs addressed above could greatly enhance the Commission's market monitoring and surveillance capabilities. The data will permit the Commission to improve its screening of market participants for illicit behavior, making such conduct more difficult to mask. In addition, the data the Commission proposes to collect in these NOPRs could provide a better picture of legitimate market activity and lessen the possibility that market monitoring and surveillance screens will result in error.

33. In overseeing wholesale electricity markets, the Commission evaluates, in response to submissions or on its own motion, existing market designs and the effectiveness of market rules. The Commission proposes to use RTO/ISO market data to more effectively carry out these functions. Electronic delivery of this data will enable the Commission to better identify ineffective market rules and better inform Commission policies and decision-making, and thus help prevent anti-competitive behavior and ensure just and reasonable rates.

34. We believe that electronic delivery of RTO/ISO market data will provide the Commission with empirical information that will augment ongoing industry outreach in determining the effectiveness of the Commission-approved market rules and the efficiency of existing market designs in producing just and reasonable rates. Electronic delivery of the market data sought would allow the Commission to perform better ongoing analysis as markets evolve and new resources begin participating in these markets. For example, the market data sought should enable the Commission to assess both the scheduling practices of renewable resources and how renewable energy schedules compare with actual real-time performance. Because of its unique position, the Commission will be able to perform such analysis across the RTO/ISO markets. This cross-market analysis will enhance the Commission's ongoing efforts to assess the performance of different market designs and rules.

35. In seeking electronic delivery of this data, the Commission emphasizes that it does not seek to displace existing MMU efforts to evaluate market rules and market designs nor is it proposing to modify any of the market monitoring functions performed by MMUs. Rather, the Commission is seeking to augment the assessments currently being performed by MMUs, thus strengthening the Commission's regulatory capabilities through the ongoing electronic delivery of RTO/ISO market data.

36. As part of this rulemaking, the Commission proposes to require ongoing electronic delivery of, the data ( e.g., the information to be included in the datasets) described below. The Commission invites comment on these data requirements:

1. Supply offers and demand bids for energy and ancillary services —The Commission is proposing that RTOs/ISOs provide their data on supply offers and demand bids submitted to RTO/ISO markets. This dataset would include all offers and bids for energy and ancillary services. This dataset would also include offers and bids submitted for interchange transactions, as well as those submitted without economic consideration, i.e., self schedules.

2. Virtual offers and bids —The Commission is proposing that RTOs/ISOs provide their data on virtual supply offers and virtual demand bids submitted to RTO/ISO markets.

3. Energy/ancillary service awards —The Commission is proposing that RTOs/ISOs provide their data on market awards for energy and ancillary services. This dataset would include the quantity and price of all market awards for energy and ancillary services. The dataset would also identify resources that are self-scheduled.

4. Capacity market offers, designations, and prices —For RTOs/ISOs with centralized capacity markets, the Commission is proposing to require RTOs/ISOs to provide their data on capacity offers as well as capacity market outcomes or designations. This dataset would identify capacity resources, the amount of procured capacity, and the applicable capacity market price.

5. Resource output —The Commission is proposing that RTOs/ISOs provide their data on resource output data used in market settlements. This dataset would include details used in market settlements, including RTO/ISO dispatch instructions ( i.e., the output that a dispatched resource is expected to produce in real-time) for energy or ancillary services, or whether resources are operating at self-scheduled output levels, and measured output levels.

6. Marginal cost estimates —The Commission is proposing that RTOs/ISOs provide their data on marginal cost estimates; such estimates are typically generated for the potential replacement of supply offers in market power mitigation procedures. This dataset would include all marginal cost estimates that have been developed, and not just those estimates that were used to generate mitigated supply offers. The Commission is seeking just the resulting marginal cost estimates themselves, however, and is not proposing that RTOs/ISOs provide the inputs that allow for calculation of those estimates. Further, the Commission is not seeking other operating information regarding individual generators' actual costs, revenues, or profits.

7. Day-ahead shift factors —The Commission is proposing that RTOs/ISOs provide their data on shift factors calculated for use in the day-ahead market. This would include generation shift factors, which are factors to be applied to a generator's expected change in output to determine the amount of flow contribution that that change in output will impose on an identified transmission facility or flowgate, and load shift factors, which are factors to be applied to a load's expected change in demand to determine the amount of flow contribution that that change in demand will impose on an identified transmission facility or flowgate. This dataset would not be limited to binding constraints, but should also include all shift factors calculated to address non-binding constraints.

8. FTR data —The Commission is proposing that RTOs/ISOs provide their data on FTR transactions that may not be publicly posted in all RTO/ISO markets. Specifically, the Commission is proposing that RTOs/ISOs provide data detailing how all FTRs and allocated rights were acquired, either through RTO/ISO allocation or auction procedures; data detailing whether the acquired allocation positions were converted from positions that collect auction revenue into positions that collect congestion revenue; and data detailing secondary market transactions to the extent that they are available to the RTO/ISO.

9. Internal Bilateral Contracts —The Commission is proposing that RTOs/ISOs provide their data on the settlement of internal bilateral contracts for energy.

10. Pricing data for interchange transactions —The Commission is proposing that RTOs/ISOs provide their data on pricing information for scheduled interchanges. Scheduled interchanges include any transaction between two or more Balancing Authority Areas. To enhance the Commission's market monitoring and surveillance efforts, the Commission is proposing that eTag IDs be included, when applicable, in addition to other interchange pricing details and transaction identification.

37. The data that the Commission is proposing to receive electronically in this NOPR are limited to physical and virtual offers and bids, market awards, resource outputs, marginal cost estimates, shift factors, FTRs, internal bilateral contracts, and interchange pricing. These datasets would include descriptive information such as market participant names, unique identifiers, pricing points, and other information that the Commission considers necessary and appropriate to understand and analyze the data described in this NOPR. Markets are not static, however, and, as markets continue to evolve, the Commission may initiate a new rulemaking process in the future to reassess the data necessary for its market monitoring and surveillance efforts and for its policy and decision-making needs.

38. The Commission proposes that RTOs/ISOs be required to electronically deliver the data discussed in this NOPR to the Commission within seven days after each RTO/ISO creates the datasets in a market run or otherwise. For example, day-ahead offers and bids, market awards, resource outputs, day-ahead shift factors, internal bilateral contracts, and day-ahead interchange pricing data would be required to be electronically delivered within seven days after the completion of each day-ahead market run. Real-time offers and bids and real-time interchange pricing data would be required to be electronically delivered within seven days after the completion of each real-time market run. For data that are updated less frequently, including capacity market results, estimated marginal costs, and FTR data, each RTO/ISO would be expected to electronically deliver that data within seven days after it is created or updated by the RTO/ISO. For the initial delivery of data under this proposal, however, the Commission proposes that each RTO/ISO would be required to electronically deliver all such data forty-five days after the effective date of any final rule in this proceeding. Finally, if the RTO/ISO makes later corrections to the data (after they have been delivered to the Commission), the RTO/ISO would be expected to electronically deliver the corrected data to the Commission within seven days after the correction has been made. The Commission invites comments with respect to the timeframe in which the data described in this NOPR should be electronically delivered to the Commission.

39. The Commission proposes to locate the requirement to electronically deliver this data on an ongoing basis within section 35.28(g) of our regulations. Further, the Commission proposes to direct each RTO/ISO to submit a compliance filing amending its open access transmission tariff to reflect this requirement within forty-five days after the effective date of any final rule in this proceeding.

40. In order to facilitate the Commission's efforts described above, the Commission is proposing to require each RTO and ISO to use consistent formatting and delivery methods to electronically deliver the data described in this NOPR to the Commission. Consistent formatting and delivery methods will enable the Commission to develop routine data procedures to link RTO/ISO and other market data, thus enabling automated analytic techniques.

41. In regard to data formatting, the Commission is proposing to require that any data outlined in this NOPR be in an XML format that is consistent for all RTOs/ISOs when electronically delivered to the Commission. As stated above, the Commission is not proposing that each RTO/ISO materially modify the data prior to electronic delivery to the Commission. 42

42. In Order No. 714, 43 the Commission adopted XML format for entities to use when making tariff related filings, based upon industry agreement. 44 XML is also commonly used by RTOs/ISOs to deliver data to market participants through Open Access Same-Time Information Systems (OASIS) and other purposes. Data not formatted in XML may also be extracted directly from a database into an XML-formatted file using automated procedures. However, the Commission also recognizes that XML, which was adopted by the industry as the most effective format to use when electronically filing tariffs, may not be the preferred format to use when electronically delivering RTO/ISO data. Accordingly, we seek comment on this issue.

43. In regard to the data delivery method, the Commission is proposing that each RTO and ISO use a secure data delivery method to provide data to the Commission due to the commercially-sensitive nature of the market data described in this NOPR. Specifically, the Commission is proposing that any RTO/ISO market data be electronically delivered using the Secure File Transfer Protocol (SFTP). Delivery by SFTP is similar to delivery by File Transfer Protocol or “FTP,” a widely-used file-sharing protocol; except that all communications transmitted using SFTP are encrypted. Access to the server where the data is electronically delivered will only be granted to each applicable RTO and ISO and to the Commission.

44. Accordingly, and as part of our consideration of the range of possible formats and delivery methods that RTOs/ISOs may use to electronically deliver data to the Commission, the Commission invites comments with respect to efficient and secure ways to provide the Commission with RTO/ISO data. The Commission also invites comment on the time and resources that may be needed by RTOs/ISOs for the initial implementation and ongoing compliance with the proposed requirements of this rule. Finally, the Commission invites comment on whether a phased implementation approach should be undertaken, and, if so, what a potential phased approach should entail.

45. Much of the information that the Commission expects to receive in this proposal is, by its nature, commercially-sensitive. 45 Disclosure of such information could result in competitive harm to market participants and the market as a whole. 46 Accordingly, the Commission proposes that the data sought in this proceeding is to be kept non-public and not be made publicly available, 47 except as may be directed by the Commission, or a court with appropriate jurisdiction. 48

46. To the extent the data collected pursuant to this rulemaking are used, for example, to support proposed market rule changes, the analysis relied upon by the Commission will be publicly available except that confidential market information and other protected or confidential information will remain non-public. Also, the Commission may direct its staff to publicly issue a staff report outside of a rulemaking proceeding with similar protections for confidential or otherwise protected information.

47. The collections of information contained in this proposed rule have been submitted to the Office of Management and Budget (OMB) for review under section 3507(d) of the Paperwork Reduction Act of 1995, 44 U.S.C. 3507(d). The Commission solicits comments on the Commission's need for this information, whether the information will have practical utility, the accuracy of the provided burden estimates, ways to enhance the quality, utility, and clarity of the information to be collected, and any suggested methods for minimizing respondents' burden, including the use of automated information techniques. Respondents subject to the filing requirements of this rule will not be penalized for failing to respond to these collections of information unless the collections of information display a valid OMB Control number.

48. The proposed rule does not require market participants other than the RTOs/ISOs to report information to the Commission.

49. The Commission's estimated reporting burden related to the proposed rule in Docket RM11-17-000 follow.

50. The Commission recognizes that there will be an initial implementation burden associated with providing the Commission with RTO/ISO data. This includes submitting a compliance filing to the Commission, which the Commission estimates as a burden of 7 hours per RTO/ISO, and implementing a process to automatically upload data to an SFTP site for Commission use (including development, testing and production). The Commission estimates a burden of 1040 hours per RTO/ISO for the development, testing and production of an automated process to provide the Commission with the data described in this NOPR. In this regard, though, RTO/ISO markets have already developed capabilities necessary to handle RTO/ISO data in an automated manner. For instance, through their Open Access Same-time Information Systems (OASIS), RTOs/ISOs already make certain market data publically available in XML format using automated procedures. Likewise, some RTOs/ISOs have developed procedures similar to those proposed in this NOPR to deliver data to their MMUs.

51. For the recurring effort involved in electronically delivering RTO/ISO data to the Commission, the Commission anticipates that the additional burden associated with this rule will be minimal. Any recurring burden would be associated with addressing updates to RTO/ISO data as the data that they process changes and due to occasional errors in the data handling or data upload process.

1. Under section 215 of the Federal Power Act (FPA), 1 the Commission proposes to approve proposed Reliability Standards PRC-006-1 (Automatic Underfrequency Load Shedding) and EOP-003-2 (Load Shedding Plans). The proposed Reliability Standards were developed and submitted for approval to the Commission by the North American Electric Reliability Corporation (NERC), which the Commission certified as the Electric Reliability Organization (ERO) responsible for developing and enforcing mandatory Reliability Standards. 2 The proposed Reliability Standards establish design and documentation requirements for automatic underfrequency load shedding (UFLS) programs, which are meant to arrest declining frequency and assist recovery of frequency following underfrequency events and provide last resort system preservation measures.

2. The Commission proposes to approve the related Violation Risk Factors (VRFs) and Violation Severity Levels (VSLs), implementation plan, and effective date proposed by NERC. The Commission also proposes to approve the retirement of the currently effective Reliability Standards PRC-007-0, PRC-009-0, and EOP-003-1, and the NERC-approved Reliability Standard PRC-006-0.

3. The Commission seeks comments from NERC and other interested persons on specific issues concerning the proposed Reliability Standards.

4. An interconnected electric power system must balance load and generation in order to maintain frequency within a reliable range. 3 The balance between generation and load within an interconnected electric power system is shown in the frequency of the system. 4 Underfrequency protection schemes are drastic measures employed if the system frequency falls below a specified value. 5 The Blackout Report provides the following explanation:

5. UFLS programs are designed for each defined area or system, and they are commonly implemented with devices installed on the distribution side of the power system. 7 Factors considered in developing a UFLS program include: (1) Underfrequency set point, (2) minimum amount of load to shed, and (3) what load and at what locations to shed.

6. The underfrequency set point is the frequency at which a specified load will disconnect from the system in a UFLS program. 8 Separately, generators have their own underfrequency set points, which will disconnect them from the system if the frequency drops to a certain value, thus protecting them from damage. 9 Underfrequency set points for load shedding are set above the frequencies at which generators disconnect. 10 This is done to prevent losing additional resources that would exacerbate the imbalance between resources and demand, resulting in further frequency declines. UFLS programs initiate at a specified point to shed the first load block, and if necessary additional load blocks at other lower set points, to arrest system frequency decline prior to the loss of additional resources. 11

7. Once a frequency threshold  12 is identified, the balance of resources and demand to be maintained to prevent the system from reaching that frequency threshold is determined. UFLS programs use validated models of the power system, which consist of mathematical representations of static (e.g., transformers and transmission lines) and dynamic (e.g., generators and motor loads) components of the power system aggregated to simulate how the system performs during system operations. 13 Models are validated, typically, by comparing actual system operations against simulated system operations to ensure the simulated system operations are within a defined and acceptable margin of tolerance relative to actual system operations. Inaccurate power system models may result in a UFLS program that does not perform as desired, thus undermining the reliability objective of UFLS.

8. A UFLS program is designed to shed sufficient load to arrest system frequency decline without shedding too much load such that frequency increases above 60 Hz. If a UFLS program is not effective, either because of invalid power system models or miscoordination of the UFLS program with entities inside and outside of the intended island, it may not achieve the reliability objective of preventing cascading outages. This, in turn, could further undermine reliability and recovery of the Bulk-Power System during a system emergency. 14

9. The amount of load to disconnect is the amount of load shed at each underfrequency set point, typically expressed in megawatts or percent of system peak load or both. 15

10. In addition to determining the amount of load to disconnect based on validated power system models, a UFLS program identifies what loads to shed and their locations. Therefore, in deciding what specific loads to shed, consideration is given to whether the load is critical (e.g., hospitals, police stations, or fire stations). These loads would typically not be included in a UFLS program.

11. Section 215 of the FPA requires a Commission-certified ERO to develop mandatory and enforceable Reliability Standards, which are subject to Commission review and approval. Once approved, the Reliability Standards may be enforced by the ERO, subject to Commission oversight, or by the Commission independently. 16

12. Pursuant to section 215 of the FPA, the Commission established a process to select and certify an ERO  17 and, subsequently, certified NERC as the ERO. 18 On March 16, 2007, the Commission issued Order No. 693, approving 83 of the 107 Reliability Standards filed by NERC, including Reliability Standards PRC-007-0, PRC-009-0, and EOP-003-1. 19 The Commission neither approved nor remanded NERC-approved Reliability Standard PRC-006-0 in Order No. 693. 20

13. NERC-approved Reliability Standard PRC-006-0 addresses the development of a regional UFLS program that is used as a last resort to preserve islanding operation following a major system event on the Bulk-Power System that could otherwise cause the island system frequency to collapse. PRC-006-0 requires regional reliability organizations to develop, coordinate, document and assess UFLS program design and effectiveness at least every five years. In Order No. 693, the Commission determined neither to approve nor remand this “fill-in-the-blank” Reliability Standard because the regional procedures had not been submitted, and the Commission held that it would not propose to approve or remand PRC-006-0 until the ERO submitted the additional information. 21

14. Reliability Standard PRC-007-0 requires transmission owners, transmission operators, load serving entities (LSEs) and distribution providers to provide, and annually update, their underfrequency data to facilitate the regional reliability organization's maintenance of the UFLS program database.

15. Reliability Standard PRC-009-0 requires that the performance of a UFLS system be analyzed and documented following an underfrequency event by requiring the transmission owner, transmission operator, LSE and distribution provider to document the deployment of their UFLS systems in accordance with the regional reliability organization's program.

16. Reliability Standard EOP-003-1 addresses load shedding plans and requires that balancing authorities and transmission operators operating with insufficient transmission and/or generation capacity have the capability and authority to shed load rather than risk a failure of the system. It includes requirements to establish plans for automatic load shedding for underfrequency or undervoltage, manual load shedding to respond to real-time emergencies, and communication with other balancing authorities and transmission operators.

17. On March 31, 2011, NERC filed a petition seeking Commission approval of proposed Reliability Standards PRC-006-1 and EOP-003-2 and requesting the concurrent retirement of the currently effective Reliability Standards PRC-007-0, PRC-009-0, and EOP-003-1 and NERC-approved Reliability Standard PRC-006-0. 22 NERC requests an effective date for PRC-006-1 and EOP-003-2 of one year following the first day of the first calendar quarter after applicable regulatory approvals with respect to all Requirements of the proposed Reliability Standards except Parts 4.1 through 4.6 of Requirement R4 of PRC-006-1. With respect to Parts 4.1 through 4.6 of Requirement R4 of PRC-006-1, NERC requests an effective date of one year following the receipt of generation data as would be required in draft Reliability Standard PRC-024-1  23 but no sooner than one year following the first day of the first calendar quarter after applicable regulatory approvals of PRC-006-1.

18. Proposed Reliability Standard PRC-006-1 would apply to planning coordinators, “UFLS entities,”  24 and transmission owners that “own Elements identified in the UFLS program established by the Planning Coordinators.” NERC states that the primary purpose of the proposed Reliability Standard is the establishment of design and document requirements for UFLS programs that arrest declining frequency and assist recovery of frequency following system events leading to frequency degradation.

19. NERC states that PRC-006-1 satisfies the Commission's criteria, set forth in Order No. 672, for determining whether a proposed Reliability Standard is just, reasonable, not unduly discriminatory or preferential and in the public interest. 25

20. According to NERC, PRC-006-1 is designed to achieve a specific reliability goal by establishing design and documentation requirements for automatic UFLS programs to arrest declining frequency, assist recovery of frequency following underfrequency events and provide last resort system preservation measures. NERC contends that PRC-006-1 contains a technically sound method to achieve its reliability goal by establishing a framework for developing, designing, assessing and coordinating UFLS programs, and that PRC-006-1 is clear and unambiguous regarding what is required and who is required to comply with the Reliability Standard.

21. NERC states that PRC-006-1 does not reflect “best practices” without regard to implementation cost. 26 NERC contends that it achieves a specific reliability goal of establishing design and documentation requirements for automatic UFLS programs to arrest declining frequency and assist recovery following underfrequency events, and that UFLS programs provide last resort system preservation measures by shedding load during system disturbances that result in substantial imbalance between load and generation. NERC also maintains that PRC-006-1 does not aim at a “lowest common denominator” but instead establishes common performance characteristics that all UFLS programs must meet to effectively protect Bulk-Power System reliability. 27

22. NERC states that PRC-006-1 does not include any differentiation in requirements based on entity size, though it provides the opportunity for planning coordinators to consider input from smaller entities when developing the UFLS program. NERC further explains that PRC-006-1 would apply throughout North America, with variances for entities within the Western Electricity Coordinating Council (WECC) and the Quebec Interconnections.

23. As proposed by NERC, PRC-006-1 has 14 requirements and 19 sub-requirements, summarized as follows:

Requirement R1: Requires each planning coordinator to develop and document criteria to identify portions of the bulk electric system that may form islands.

Requirement R2: Requires each planning coordinator to identify the islands to serve as a basis for designing its UFLS program. Sub-Requirements 2.1, 2.2, and 2.3 serve as a checklist of items that the entity must consider when identifying islands.

Requirement R3: Requires each planning coordinator to develop a UFLS program, including notification of and a schedule for implementation by the UFLS entities within its area, that meets the specific performance characteristics set forth in sub-Requirements 3.1 through 3.3 in simulations of underfrequency conditions resulting from an imbalance of up to 25 percent within the identified island.

Requirement R4: Requires each planning coordinator to conduct and document a UFLS design assessment at least once every five years that determines through dynamic simulation whether the UFLS program design meets the performance characteristics in Requirement R3 for each island identified in Requirement R2, with sub-Requirements 4.1 through 4.7 specifying items that the simulation must model.

Requirement R5: Requires each planning coordinator to coordinate its UFLS design with all other planning coordinators whose areas or portions of whose areas are also part of the same identified island through specific actions identified in Requirement R5.

Requirement R6: Requires each planning coordinator to maintain a UFLS database containing data necessary to model its UFLS program for use in event analyses and assessments of the UFLS program at least once each calendar year, with no more than 15 months between maintenance activities.

Requirement R7: Requires each planning coordinator to provide its UFLS database to other planning coordinators within its Interconnection within 30 calendar days of request.

Requirement R8: Requires each UFLS entity to provide data to its planning coordinator(s) according to the format and schedule specified by the planning coordinator(s) to support maintenance of the UFLS database.

Requirement R9: Requires each UFLS entity to provide automatic tripping of load in accordance with the UFLS program design and schedule for application determined by its planning coordinator(s) in each planning coordinator area in which it owns assets.

Requirement R10: Requires each transmission owner to provide automatic switching of its existing capacitor banks, transmission lines, and reactors to control overvoltage as a result of underfrequency load shedding if required by the UFLS program and schedule for application determined by the planning coordinator(s) in each planning coordinator area in which the transmission owner owns transmission.

Requirement R11: Requires each planning coordinator, in whose area a bulk electric system islanding event results in system frequency excursions below the initializing set points of the UFLS program, to conduct and document an assessment of the event within one year of event actuation that evaluates the performance of the UFLS equipment (sub-Requirement 11.1), and the effectiveness of the UFLS program (sub-Requirement 11.2).

Requirement R12: Requires each planning coordinator, in whose islanding event assessment (Requirement R11) UFLS program deficiencies are identified, to conduct and document a UFLS design assessment to consider the identified deficiencies within two years of event actuation.

Requirement R13: Requires each planning coordinator, in whose area a bulk electric system islanding event occurred that also included the area(s) or portions of area(s) of other planning coordinator(s) in the same islanding event and that resulted in system frequency excursions below the initializing set points of the UFLS program, to coordinate its event assessment (in accordance with Requirement R11) with all other planning coordinators whose areas or portions of whose areas were also included in the same islanding event by either: (i) Conducting a joint event assessment per Requirement R11 among the planning coordinators whose areas or portions of whose areas were included in the same islanding event; or (ii) conducting an independent event assessment per Requirement R11 that reaches conclusions and recommendations consistent with those of the event assessments of the other planning coordinators whose areas or portions of whose areas were included in the same islanding event; or (iii) conducting an independent event assessment per Requirement R11 and where the assessment fails to reach conclusions and recommendations consistent with those of the event assessments of the other planning coordinators whose areas or portions of whose areas were included in the same islanding event, identifying differences in the assessments that likely resulted in the differences in the conclusions and recommendations and report these differences to the other planning coordinators whose areas or portions of whose areas were included in the same islanding event and to the ERO.

Requirement R14: Requires the planning coordinator to respond to written comments submitted by UFLS entities and transmission owners within its planning coordinator area following a comment period and before finalizing its UFLS program, indicating in the written response to comments whether changes will be made or reasons why changes will not be made to the UFLS program, including a schedule for implementation (sub-Requirement 14.1) and the UFLS design assessment (sub-Requirement 14.2).

24. Proposed Reliability Standard EOP-003-2 would apply to balancing authorities and transmission operators. NERC states that EOP-003-2 makes minimal changes to EOP-003-1 by removing references to UFLS, which NERC describes as redundant in light of proposed Reliability Standard PRC-006-1, and instead focuses proposed Reliability Standard EOP-003-2 on undervoltage conditions.

25. Pursuant to section 215(d)(2) of the FPA, the Commission proposes to approve Reliability Standard PRC-006-1 and EOP-003-1 as just, reasonable, not unduly discriminatory or preferential, and in the public interest. The Commission believes that the UFLS program addressed in the proposed Reliability Standards is important to arresting declining frequency and assisting recovery of frequency following system events that lead to system instability, which can result in a blackout. The Commission finds that the proposed Reliability Standards are necessary for reliability because UFLS is used in extreme conditions to stabilize the balance between generation and load after an electrical island has been formed, dropping enough load to allow frequency to stabilize within the island. Reliability Standard PRC-006-1, in conjunction with the conforming changes to EOP-003-2, provides last resort Bulk-Power System preservation measures by establishing the first national Reliability Standard of common performance characteristics that all UFLS programs must meet. In addition, the Commission proposes to approve the related VRFs and VSLs, implementation plan, and effective date proposed by NERC. Finally, the Commission proposes to approve the retirement of the currently effective Reliability Standards PRC-007-0, PRC-009-0, and EOP-003-1, and the NERC-approved Reliability Standard PRC-006-0.

26. The Commission addresses or seeks comments from the ERO and other interested persons on aspects of the proposed Reliability Standards. Specifically, we address or seek comments on the following issues: (A) Impact of resources not connected to the bulk electric system; (B) validation of power system models used to simulate ULFS programs; (C) scope of UFLS events assessments; (D) impact of generator owner trip settings outside of the UFLS program; (E) UFLS program coordination with other protection systems; (F) identification of island boundaries in UFLS programs; (G) automatic load shedding in PRC-006-1 and manual load shedding in EOP-003-2; (H) elimination of balancing authority responsibilities in EOP-003-2; and (I) the “Lower VSL” for Requirement R8 and the “Medium” VRF for Requirement R5 of PRC-006-1. These issues also apply to the corresponding Requirements in the requested regional variance for WECC in PRC-006-1.

27. As described above, UFLS programs are designed to maintain balance between resources and load in a defined area (e.g., an Interconnection, Regional Entity area, or planning coordinator area). When a resource is lost, load exceeds supply causing frequency to decrease below its scheduled value (e.g., 60 Hz in the United States). Conversely, a loss of load or excess supply can result in higher frequencies than scheduled, resulting in an overfrequency condition. As a last resort, UFLS programs are initiated during extreme underfrequency conditions to reestablish balance by shedding load at predetermined frequencies and times to prevent system-wide blackouts.

28. Requirement R2 of PRC-006-1 requires planning coordinators to identify islands to serve as a basis for designing UFLS programs. Requirement R3 addresses performance characteristics for UFLS programs. Requirement R4 requires each planning coordinator to conduct and document the assessment of its UFLS design and determine if the UFLS program meets the performance characteristics in Requirement R3 for each island identified in Requirement R2.

29. The simulations outlined in Requirement R4 all concern individual generating units greater than 20 MVA gross nameplate rating or generating plants/facilities greater then 75 MVA “connected to the bulk electric system.” However, some generation that meets the 20 MVA and 75 MVA criteria is not connected to bulk electric system facilities. Accordingly, those resources not connected to bulk electric system facilities would not be modeled pursuant to Requirement R4. However, a resource not connected to the bulk electric system may serve load designed to be shed in a UFLS program. The Commission is concerned that failure to account for resources not connected to the bulk electric system in a planning coordinator's UFLS program could result in the planning coordinator being unaware of how such resources respond to underfrequency conditions. If the planning coordinator is unaware of how these facilities have responded, it may plan to shed more load than is required for an area's frequency to return to normal. This could lead to an unintended overfrequency condition if the plan is carried out in the operating timeframe. These conditions, in turn, could lead the plan to violate the performance characteristics specified in Requirement R3.

30. The performance characteristics identified in Requirement R3 provide acceptable parameters for developing UFLS programs that are designed to restore balance between resources and load. However, the Commission is concerned that generation resources or facilities that are not connected to the bulk electric system may not be considered during the development of UFLS programs.

31. The Commission seeks comments from the ERO and other interested persons as to whether and how all resources required for the reliable operation of the bulk electric system, including resources not connected to bulk electric system facilities, are considered in the development of UFLS programs under Requirements R3 and R4.

32. Power systems consist of static components (e.g., transformers and transmission lines) and dynamic components (e.g., generators and motor loads). Mathematical representations of these components are aggregated to create an area's power system model. Power system planners  28 and system operators base decisions on simulations, both static and dynamic, using area power system models to meet requirements in both Commission-approved planning and operational Reliability Standards. 29

33. Requirements R4 and R11 of PRC-006-1 require applicable entities to use dynamic simulations to design and assess the effectiveness of UFLS programs. As previously discussed, UFLS programs are designed to provide last resort system preservation measures by: (1) Arresting declining frequency; and (2) assisting recovery of frequency following underfrequency events. Dynamic simulations that do not accurately represent the power system can result in an UFLS program that is ineffective.

34. The Commission believes that the UFLS program design requirements established in Requirement R2 and the required assessments established in Requirements R4 and R11 of PRC-006-1 are generally acceptable and include improvements above the current Reliability Standards. Accordingly, the Commission believes that the language in the proposed Requirements is appropriate.

35. Requirement R11 of PRC-006-1 requires planning coordinators to conduct assessments after a “BES islanding event results in system frequency excursion below the initializing set points of the UFLS program.” The Commission is concerned whether the phrase “BES islanding event” could be interpreted to mean that a planning coordinator only has to assess an event if it meets both of the following requirements: (1) System frequency excursions fall below the initializing set point for UFLS; and (2) bulk electric system islands form within the Interconnection. If the frequency falls below the initializing UFLS set point but islands do not form (e.g., because the event was not severe enough to isolate portions of the Interconnection, or UFLS or other protection systems failed to operate properly to form islands), an assessment of the performance of the UFLS program for this event is still useful because it can determine if the UFLS program operated as expected.

36. The Commission seeks clarification from the ERO regarding what actions must planning coordinators take under Requirement R11 if an event results in system frequency excursions falling below this initializing set point for UFLS but without the formation of a bulk electric system island.

37. Requirements R5 and R13 of PRC-006-1 require planning coordinators that share identified islands to coordinate UFLS program design and event assessment. The options for coordinating designs of UFLS programs in Requirement R5 include: (1) Developing a common program; (2) conducting a joint UFLS design assessment among the planning coordinators whose area or portions of whose areas are part of the same identified island; or (3) conducting an independent design assessment and, in the event the UFLS design assessment fails to meet Requirement R3, identify modifications to the UFLS program(s) to meet Requirement R3 and report these modifications as recommendations to the other planning coordinators.

38. The options for coordinating event assessments in Requirement R13 include: (1) Conducting a joint event assessment per Requirement R11 among planning coordinators whose areas were affected; (2) conducting an independent event assessment per Requirement R11 that reaches conclusions and recommendations consistent with other planning coordinators whose areas were affected; or (3) conducting an independent event assessment per Requirement R11 and where the assessment fails to reach conclusions and recommendations consistent with those of the other planning coordinators whose areas were affected by the same islanding event, identify differences in the assessments and report these differences to the other affected planning coordinators. The Commission seeks comments from the ERO and other interested persons as to whether the differences should be subsequently reported to the reliability coordinator for resolution in the event that the process does not resolve differences in the assessments.

39. The Commission believes that Requirements R5 and R13 provide flexibility in coordinating UFLS design programs and event assessments among planning coordinators whose areas fall within the same island or whose areas are affected by the same event. Accordingly, the Commission believes that the language in the proposed Requirements is appropriate.

40. Requirement R11 of Reliability Standard PRC-006-1 requires a planning coordinator to perform an island event assessment within one year of an event. If the planning coordinator identifies program deficiencies, Requirement R12 requires the planning coordinator to conduct and document UFLS design assessments, which are meant to consider the deficiencies, within two years of an event. The Commission is concerned that this time frame may be too long since it appears that island event assessments and consideration of deficiencies could reasonably be conducted in a much shorter time frame. Under NERC's proposal, deficiencies could remain within a UFLS program for two years from an event exposing the Bulk-Power System to instability, uncontrolled separation and cascading outages should a frequency event occur that the UFLS program mishandles. NERC provided no explanation of its basis for the proposed two-year time frame.

41. The Commission asks the ERO and other interested persons what the basis is for proposing a two-year time frame. In addition, the Commission seeks clarification from the ERO as to how soon after event actuation would an entity need to implement corrections in response to any deficiencies identified in the event assessment under Requirement R11.

42. Requirements 4.1 through 4.7 of Reliability Standard PRC-006-1 are intended to capture the effects of generators that trip prior to UFLS initiation. As previously discussed, a generator trip normally creates an imbalance between resources and load causing system frequency to decline. Some generators may need to disconnect from the system prior to reaching underfrequency set points to protect their components from permanent damage. If this loss occurs during a system event, the generator can no longer provide a response to assist in arresting frequency decline. This resource loss also counteracts the response provided by other resources to arrest frequency decline, increasing the likelihood of instability, uncontrolled separation, and cascading outages.

43. We agree that planning coordinators should consider generators that trip prior to underfrequency set points when developing their UFLS programs. The Commission seeks comments from the ERO and other interested persons on how generation losses outside of the UFLS set points (i.e., generators having trip settings prior to the UFLS underfrequency set points) should be accounted for in UFLS programs (e.g., generator owners who trip outside of the UFLS set points could procure load to shed to account for the loss in generation).

44. Recommendation 21C of the Blackout Report addresses the coordination of protection systems. 30 The recommendation states that NERC shall “determine the goals and principles needed to establish an integrated approach to relay protection for generators and transmission lines and the use of underfrequency and undervoltage load shedding (UFLS and UVLS) programs. An integrated approach is needed to ensure that at the local and regional levels, these interactive components provide an appropriate balance of risks and benefits in terms of protecting specific assets and facilitating overall grid survival.”  31 Accordingly, an integrated approach requires coordination of all types of protection systems (e.g., UFLS, UVLS), internally and externally to an entity's area, to be responsive to the Blackout Report.

45. While PRC-006-1 requires coordination of UFLS programs among planning coordinators in Requirements R5, R7, and R13, it does not appear to capture the same level of coordination with other protection systems as in Requirement R1.2.8 of PRC-006-0. 32 The Commission seeks comments from NERC and other interested persons on whether and how coordination with other protection systems is or is not achieved under the new requirements.

46. Requirement R1 of PRC-006-1 directs planning coordinators to develop criteria to select areas that may form islands based on historical events and system studies. Historical events and system studies provide planning coordinators with the data necessary to determine where islands will occur based on the physics of the system. Requirement R2.3 clarifies that islands identified in Requirement R1, which span two or more Regional Entity areas, should be broken up such that each Regional Entity area forms an island. Requirement R2.3 allows planning coordinators to “adjust the island boundaries to differ from the Regional Entity area boundaries by mutual consent where necessary” to preserve contiguous island boundaries that better reflect simulations. The Commission agrees that identifying island boundaries based on where they are likely to occur due to system characteristics, as opposed to maintaining rigid Regional Entity area boundaries, should result in more effective UFLS programs. Accordingly, the Commission encourages cooperation among entities to create UFLS programs that set island boundaries based on where separations are expected to occur during an underfrequency event.

47. In its petition, NERC states that the Requirements allow planning coordinators to “select islands including interconnected portions of the bulk electric system in adjacent Planning Coordinator areas and Regional Entity areas, without the need for coordinating this selection with Planning Coordinators in neighboring regions.”  33 Requirement R2.3 of PRC-006-1, however, requires “mutual consent” to adjust island boundaries from Regional Entity boundaries. The Commission seeks clarification from the ERO concerning the required degree of cooperation and/or “mutual consent” between planning coordinators under the proposed Reliability Standard in order for island boundaries to be set so that, while deviating from Regional Entity boundaries, they better approximate actual island separation boundaries.

48. Proposed Reliability Standard PRC-006-1 requires automatically shedding predetermined amounts of load if frequency declines to the UFLS set point in order to rebalance resources and demand and prevent frequency decline that might cause instability, uncontrolled separation, or cascading outages. Proposed Reliability Standard EOP-003-2 requires manual load shedding plans, which may be employed in addition to the automatic load shedding in the UFLS program, or to mitigate other reliability issues. If load allocated to be shed automatically is also planned for manual load shedding, then that load resource would be double-counted. Once load is disconnected from the system, either automatically or manually, it cannot be used again to arrest frequency decline. In the event that a load resource is double-counted and removed during automatic UFLS, the manual load shedding cannot be completed if called upon. Even if additional load is located and shed to compensate for this missing load, the system would be put into an un-studied state and could have unpredicted, negative responses. Accordingly, resources allocated to each type of load shedding (i.e., automatic and manual) should not overlap.

49. There are no requirements in PRC-006-1 to coordinate automatic load shedding by UFLS and manual load shedding under EOP-003-2. The Commission seeks comments from the ERO and other interested persons on how the coordination of automatic and manual load shedding is considered in light of the fact that the proposed Reliability Standards do not explicitly require coordination.

50. Requirements R2, R4, and R7 of the currently-effective Reliability Standard EOP-003-1 apply to transmission operators and balancing authorities. Proposed Reliability Standard EOP-003-2 proposes to eliminate balancing authorities from Requirements R2, R4, and R7.

51. Under the proposed modification, balancing authorities would no longer: (i) Establish plans for automatic load shedding for underfrequency or undervoltage conditions (Requirement R2); (ii) consider factors (including frequency, rate of frequency decay, voltage level, rate of voltage decay, or power flow levels) in designing an automatic undervoltage load shedding scheme (Requirement R4); and (iii) coordinate automatic load shedding throughout its area with underfrequency isolation of generating units, tripping of shunt capacitors, and other automatic actions that will occur under abnormal frequency, voltage, or power flow conditions (Requirement R7). In its petition, NERC explains that balancing authorities were deleted from Requirements R2 and R4 “because the frequency related aspects of these requirements were removed, leaving only consideration of automatic undervoltage load shedding in these two requirements.”  34 NERC's petition, however, does not explain why balancing authorities were removed from Requirement R7. Moreover, given that balancing authorities would no longer be subject to Requirements R2, R4, and R7 of EOP-003-2 and are not listed as applicable entities in PRC-006-1, the proposed Reliability Standards do not preserve these existing balancing authority responsibilities.

52. The Commission seeks clarification from the ERO as to why these existing balancing authority responsibilities were not incorporated into Reliability Standards PRC-006-1 or EOP-003-2. The Commission also seeks comments from the ERO and other interested persons as to why balancing authorities should not be informed of UFLS program plans that directly impact balancing authority functions.

53. NERC states that each primary requirement in PRC-006-1 and EOP-003-2 is assigned a Violation Risk Factor (VRF) and Violation Severity Level (VSL) and that these elements support the determination of an initial value range for the Base Penalty Amount regarding violations of requirements in Commission-approved Reliability Standards, as defined in the ERO Sanction Guidelines.

54. The Commission proposes to approve the VRFs and VSLs in PRC-006-1 and EOP-003-2. However, the Commission seeks comments from the ERO and other interested persons regarding one proposed VSL and one proposed VRF for PRC-006-1.

55. The “Lower VSL” assignment for Requirement R8 in PRC-006-1 applies when a UFLS entity fails to provide data to its planning coordinator for 5 to 10 calendar days following the schedule specified by the planning coordinator. Requirement R8 of PRC-006-1 does not include a 5-day grace period for providing data to planning coordinators. Accordingly, the subject VSL assignment may be inconsistent with the Commission's VSL Guideline 3. The guideline states that a VSL “should not appear to redefine or undermine the requirement.”  35 The five-day grace period implicit in the proposed VSL appears to be inconsistent with this guideline. In addition, the proposed VSL creates a compliance issue. Specifically, it is unclear where a UFLS entity falls in the VRF and VSL matrices if it fails to provide data to its planning coordinator within 1 to 5 days of its scheduled date.

56. The VRF for Requirement R5, which requires planning coordinators to coordinate their UFLS program design with other planning coordinators whose area is in part of the same identified island, is proposed as “Medium.” NERC states that Requirement R5 is “not related to similar reliability goals in other standards.”  36 However, coordination of load shedding plans is required in a similar manner in Requirement R3 of currently effective Reliability Standard EOP-003-1, 37 which includes a VRF of “High.” The lack of coordination of UFLS programs among planning coordinators within the same identified island could lead to ineffective UFLS operations and further cascading outages within the island when UFLS is activated.

57. Guideline 3 of the Commission's VRF Guidelines states that “[a]bsent justification to the contrary, the Commission expects the assignment of Violation Risk Factors corresponding to Requirements that address similar reliability goals in different Reliability Standards would be treated comparably.”  38 The Commission seeks clarification from the ERO why coordination of load shedding plans is a “High” VRF for transmission operators and balancing authorities in EOP-003-2 but NERC proposes a “Medium” VRF for planning coordinators in, PRC-006-1.

58. NERC requests an effective date for PRC-006-1 and EOP-003-2 of one year following the first day of the first calendar quarter after applicable regulatory approvals with respect to all Requirements of the proposed Reliability Standards except Parts 4.1 through 4.6 of Requirement R4 of PRC-006-1. With respect to Parts 4.1 through 4.6 of Requirement R4 of PRC-006-1, NERC requests an effective date of one year following the receipt of generation data as required in Reliability Standard PRC-024-1, 39 but no sooner than one year following the first day of the first calendar quarter after applicable regulatory approvals of PRC-006-1.

59. NERC contends that the proposed implementation plan is not excessively long and allows sufficient time for entities to transition and install the necessary processes to become compliant. NERC maintains that the one year phase-in for compliance provides planning coordinators sufficient time: (1) To develop, modify, or validate (to determine that an existing program meets required performance characteristics) existing UFLS programs; and (2) to establish a schedule for implementation, or validate a schedule for completion of program revisions already in progress. Moreover, NERC states that transmission owners and distribution providers will comply with the schedule determined by planning coordinators but no sooner than the effective date of the standard.

60. The Commission proposes to accept the implementation plan and effective date proposed by the ERO for PRC-006-1 and EOP-003-2. However, the Commission seeks comments from the ERO and other interested persons about any potential reliability gaps that may occur during the development and implementation of PRC-024-1, such as how the planning coordinators will adequately determine and apply UFLS simulations and plans in the absence of generator trip settings.

61. The Office of Management and Budget (OMB) regulations require that OMB approve certain reporting and recordkeeping (collections of information) imposed by an agency. 40 Upon approval of a collection(s) of information, OMB will assign an OMB control number and expiration date. Respondents subject to the filing requirements of this rule will not be penalized for failing to respond to these collections of information unless the collections of information display a valid OMB control number.

62. The Commission is submitting these reporting and recordkeeping requirements to OMB for its review and approval under section 3507(d) of PRA. Comments are solicited on the Commission's need for this information, whether the information will have practical utility, the accuracy of provided burden estimate, ways to enhance the quality, utility, and clarity of the information to be collected, and any suggested methods for minimizing the respondent's burden, including the use of automated information techniques.

63. This Notice of Proposed Rulemaking proposes to approve Reliability Standards PRC-006-1 and EOP-003-2, which would replace currently effective Reliability Standards PRC-007-0, PRC-009-0, EOP-003-1 and NERC-approved Reliability Standard PRC-006-0. 41 As noted previously, Reliability Standard PRC-006-0 was never approved by the Commission, and therefore has never been mandatory and enforceable. On the other hand, Reliability Standards PRC-007-0 and PRC-009-0 were approved by the Commission and are currently mandatory and enforceable. Because Proposed Reliability Standard PRC-006-1 incorporates the requirements from Reliability Standards PRC-006-0, PRC-007-0, and PRC-009-0 some of the existing requirements will become mandatory and enforceable (where previously they were voluntary), while others continue to be so. To properly account for the burden on respondents, the Commission will treat the burden resulting from NERC-approved Reliability Standard PRC-006-0 as essentially new to the industry, even though it is likely that most applicable entities have already been complying. 42

64. The reporting requirements in proposed Reliability Standard EOP- 003-2 are virtually the same as those in currently effective Reliability Standard EOP-003-1. The difference is that proposed Reliability Standard EOP-003-2 proposes to eliminate balancing authorities from Requirements R2 and from Measure M1. 43 This requirement and measure deal with establishing and documenting automatic load shedding plans.

65. Public Reporting Burden: Our estimate below regarding the number of respondents is based on the NERC compliance registry as of 7/29/11. According to the NERC compliance registry, there are 72 planning coordinators and 126 balancing authorities. The individual burden estimates are based on the time needed to gather data, run studies, and analyze study results to design or update the UFLS programs. Additionally, documentation and the review of UFLS program results by supervisors and management is included in the administrative estimations. These are consistent with estimates for similar tasks in other Commission approved standards.

Total Annual Hours for Collection: (Compliance/Documentation) = 11,286 hours.

Total Reporting Cost for Planning Coordinators: = 11,520 hours @ $120/hour = $1,382,400.

Total Record Retention Cost for Planning Coordinators: 1,152 hours @ $28/hour = $32,256.

Total Reporting and Record Retention Cost Savings for Balancing Authorities: = (1,260 hours @ $120/hour) + (126 hours @ $28/hour) = $154,728.

Total Annual Cost (Reporting + Record Retention)   46 : = $1,414,656−$154,728 = $1,259,928.

Title: Mandatory Reliability Standards for the Bulk-Power System.

Action: Proposed Collection FERC-725A.

OMB Control No.: 1902-0244.

Respondents: Businesses or other for-profit institutions; not-for-profit institutions.

Frequency of Responses: On occasion.

Necessity of the Information: This proposed rule proposes to approve the requested modifications to Reliability Standards pertaining to automatic underfrequency load shedding. The proposed Reliability Standards help ensure the reliable operation of the bulk electric system by arresting declining frequency and assisting recovery of frequency following system events leading to frequency degradation.

Internal Review: The Commission has reviewed the proposed Reliability Standards and made a determination that its action is necessary to implement section 215 of the FPA. These requirements, if accepted, should conform to the Commission's expectation for UFLS programs as well as procedures within the energy industry.

66. Interested persons may obtain information on the reporting requirements by contacting the following: Federal Energy Regulatory Commission, 888 First Street, NE. Washington, DC 20426 [ Attention: Ellen Brown, Office of the Executive Director, e-mail: DataClearance@ferc.gov, phone: (202) 502-8663, fax: (202) 273-0873].

67. For submitting comments concerning the collection(s) of information and the associated burden estimate(s), please send your comments to the Commission and to the Office of Management and Budget, Office of Information and Regulatory Affairs, Washington, DC 20503 [ Attention: Desk Officer for the Federal Energy Regulatory Commission, phone: (202) 395-4638, fax: (202) 395-7285]. For security reasons, comments to OMB should be submitted by e-mail to: oira_submission@omb.eop.gov. Comments submitted to OMB should include Docket Number RM11-20 and OMB Control Number 1902-0244.

68. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement for any action that may have a significant adverse effect on the human environment. 47 The Commission has categorically excluded certain actions from this requirement as not having a significant effect on the human environment. Included in the exclusion are rules that are clarifying, corrective, or procedural or that do not substantially change the effect of the regulations being amended. 48 The actions proposed here fall within this categorical exclusion in the Commission's regulations.

69. The Regulatory Flexibility Act of 1980 (RFA)  49 generally requires a description and analysis of final rules that will have significant economic impact on a substantial number of small entities. The RFA mandates consideration of regulatory alternatives that accomplish the stated objectives of a proposed rule and that minimize any significant economic impact on a substantial number of small entities. The Small Business Administration's (SBA) Office of Size Standards develops the numerical definition of a small business. 50 The SBA has established a size standard for electric utilities, stating that a firm is small if, including its affiliates, it is primarily engaged in the transmission, generation and/or distribution of electric energy for sale and its total electric output for the preceding twelve months did not exceed four million megawatt hours. 51

70. Proposed Reliability Standard PRC-006-1 proposes to establish design, assessment, and documentation requirements for automatic UFLS program. It will be applicable to planning coordinators and entities that are responsible for the ownership, operation, or control of UFLS equipment. Proposed Standard EOP-003-2 proposes to remove balancing authorities from having to comply with R2 and M1 of the standard. Comparison of the NERC compliance registry with data submitted to the Energy Information Administration on Form EIA-861 indicates that perhaps as many as 8 small entities are registered as planning coordinators and 18 small entities are registered as balancing authorities. The Commission estimates that the small planning coordinators to whom the proposed Reliability Standard will apply will incur compliance and recordkeeping costs of $157,184 ($19,648 per planning coordinator) associated with the Standard's requirements. The small balancing authorities will receive a savings of $154,728 ($8,596 per balancing authority). Accordingly, proposed Reliability Standards PRC-006-1 and EOP-003-2 should not impose a significant operating cost increase or decrease on the affected small entities.

71. Based on this understanding, the Commission certifies that these Reliability Standards will not have a significant economic impact on a substantial number of small entities. Accordingly, no regulatory flexibility analysis is required.

72. The Commission invites interested persons to submit comments on the matters and issues proposed in this notice to be adopted, including any related matters or alternative proposals that commenters may wish to discuss. Comments are due December 27, 2011. Comments must refer to Docket No. RM11-20-000, and must include the commenter's name, the organization they represent, if applicable, and their address in their comments.

73. The Commission encourages comments to be filed electronically via the eFiling link on the Commission's Web site at http://www.ferc.gov. The Commission accepts most standard word processing formats. Documents created electronically using word processing software should be filed in native applications or print-to-PDF format and not in a scanned format. Commenters filing electronically do not need to make a paper filing.

74. Commenters that are not able to file comments electronically must send an original of their comments to: Federal Energy Regulatory Commission, Secretary of the Commission, 888 First Street, NE., Washington, DC 20426.

75. All comments will be placed in the Commission's public files and may be viewed, printed, or downloaded remotely as described in the Document Availability section below. Commenters on this proposal are not required to serve copies of their comments on other commenters.

76. In addition to publishing the full text of this document in the Federal Register , the Commission provides all interested persons an opportunity to view and/or print the contents of this document via the Internet through the Commission's Home Page ( http://www.ferc.gov ) and in the Commission's Public Reference Room during normal business hours (8:30 a.m. to 5 p.m. Eastern time) at 888 First Street, NE., Room 2A, Washington, DC 20426.

77. From the Commission's Home Page on the Internet, this information is available on eLibrary. The full text of this document is available on eLibrary in PDF and Microsoft Word format for viewing, printing, and/or downloading. To access this document in eLibrary, type the docket number excluding the last three digits of this document in the docket number field.

78. User assistance is available for eLibrary and the Commission's Web site during normal business hours from the Commission's Online Support at 202-502-6652 (toll free at 1-866-208-3676) or e-mail at ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-8371, TTY (202) 502-8659. E-mail the Public Reference Room at public.referenceroom@ferc.gov.

1. On March 31, 2011, the North American Electric Reliability Corporation (NERC) filed a petition seeking approval of Table 1, footnote `b' of four Reliability Standards: Transmission Planning: TPL-001-1—System Performance Under Normal (No Contingency) Conditions (Category A), TPL-002-1b—System Performance Following Loss of a Single Bulk Electric System Element (Category B), TPL-003-1a—System Performance Following Loss of Two or More Bulk Electric System Elements (Category C), and TPL-004-1- System Performance Following Extreme Events Resulting in the Loss of Two or More Bulk Electric System Elements (Category D). 1 Pursuant to section 215(d)(4) of the Federal Power Act (FPA)  2 , the Commission proposes to remand the proposed Table 1, footnote b. As discussed below, the Commission believes that the proposed Reliability Standard does not meet the statutory criteria for approval that it be just, reasonable, not unduly discriminatory or preferential, and in the public interest. 3 The Commission seeks comments on its proposal.

2. Section 215 of the FPA requires a Commission-certified Electric Reliability Organization (ERO) to develop mandatory and enforceable Reliability Standards, which are subject to Commission review and approval. Approved Reliability Standards are enforced by the ERO, subject to Commission oversight, or by the Commission independently.

3. Pursuant to section 215 of the FPA, the Commission established a process to select and certify an ERO  4 and, subsequently, certified NERC as the ERO. 5 On March 16, 2007, the Commission issued Order No. 693, approving 83 of the 107 Reliability Standards filed by NERC, including Reliability Standard TPL-002-0, Table 1, footnote ‘b.’  6 In addition, pursuant to section 215(d)(5) of the FPA, 7 the Commission directed NERC to develop modifications to 56 of the 83 approved Reliability Standards, including footnote ‘b’ of Reliability Standard TPL-002-0. 8

4. Currently-effective Reliability Standard TPL-002-0a addresses Bulk-Power System planning and related system performance for single element contingency conditions. Requirement R1 of TPL-002-0a requires that each Planning Authority and Transmission Planner “demonstrate through a valid assessment that its portion of the interconnected transmission system is planned such that the Network can be operated to supply projected customer demands and projected Firm Transmission Services, at all demand levels over the range of forecast system demands, under the contingency conditions as defined in Category B of Table I.”  9 Table I identifies different categories of contingencies and allowable system impacts in the planning process. With regard to system impacts, Table I further provides that a Category B (single) contingency must not result in cascading outages, loss of demand or curtailed firm transfers, system instability or exceeded voltage or thermal limits. With regard to the clause regarding loss of demand, current footnote ‘b’ of Table 1 states:

5. In Order No. 693, the Commission stated that it believes that the transmission planning Reliability Standard should not allow an entity to plan for the loss of non-consequential firm load in the event of a single contingency. 10 The Commission directed the ERO to develop certain modifications, including a clarification of Table 1, footnote ‘b’. The Commission stated that:

On February 2, 2011, President Barack Obama issued Executive Order (E.O.) 13563, “Improving Regulation and Regulatory Review” (76 FR 3821). One of the provisions in the new Executive order is the affirmation of retrospective reviews of existing significant regulations. As one step in implementing the new Executive order, FDA published a notice in the Federal Register on April 27, 2011 (76 FR 23520), entitled “Periodic Review of Existing Regulations; Retrospective Review Under E.O. 13563.” In that document, FDA announced that it is conducting a review of its existing regulations to determine, in part, whether they can be made more effective in light of current public health needs and to take advantage of and support advances in innovation that have occurred since those regulations took effect. Under E.O. 13563, and under the Department of Health and Human Services' Plan for Retrospective Review of Existing Rules, FDA will consider strengthening, complementing, or modernizing rules where necessary or appropriate.

As FDA conducts its retrospective review of regulations, the Agency will take into account the following factors:  1

• Whether an action will have a positive impact on innovation in an area of public health, safety, or delivery of or access to care;

• Whether the public health benefits of an action have been realized;

• Whether the public or regulated community view modification or revocation of a regulation as important and have offered useful comments and suggestions for change;

• Whether the impact and effectiveness of a regulation has changed or been superseded by changes in conditions or advances in scientific or technological information;

• Whether there are significant, unresolved issues with implementation or enforcement; and

• How long the regulation has been in effect and whether it has been subject to prior reviews.

The first rule FDA is reviewing under E.O. 13563 is the Bar Code Final Rule. The Agency plans to reassess its costs and benefits and to determine if the Bar Code Final Rule should be modified to take into account changes in technology that have occurred since the rule went into effect in 2004.

In the Federal Register of March 14, 2003 (68 FR 12500), FDA published a proposed rule (Bar Code Proposed Rule) that would require certain human drug product labels and biological product labels to have a linear bar code that would contain, at a minimum, the drug's National Drug Code (NDC) number. In the Federal Register of February 26, 2004 (69 FR 9120), the Agency finalized the proposed rule (§§ 201.25 and 610.67 (21 CFR 201.25 and 610.67)). As discussed in the preamble to the Bar Code Proposed Rule, the rule was intended to help reduce the number of medication errors that occur in hospitals and other health care settings (68 FR 12500 at 12501 through 12502). FDA envisioned that bar codes would be part of a system, along with bar code scanners and computerized databases, that would enable health care professionals to check whether they are giving the right drug (in the right dose and via the right route of administration) to the right patient at the right time ( Id. at 12501).

The events that led FDA to propose requiring bar codes are described in the preamble to the Bar Code Proposed Rule. In brief, medication errors are known to be a serious public health problem and can occur at several points from the time a health care provider prescribes the drug to a patient to the time when the patient receives the drug. The use of bar codes on drug products was expected to significantly reduce medication errors. Bar codes also can complement other efforts to reduce medication errors, such as computer physician order entry (CPOE) systems (where a physician enters orders electronically into a computer instead of writing the order on paper, and subsequently the order can be checked against the patient's electronic records for possible drug interactions, overdoses, and patient allergies) and retail pharmacy-based computer systems that use a bar-coded NDC number to verify that a consumer's prescription is being dispensed with the correct drug. FDA refers readers to the preamble to the Bar Code Proposed Rule should they wish to obtain details on the events, recommendations, meetings, and literature that shaped the proposed rule.

In the preamble to the Bar Code Proposed Rule, the Agency discussed in detail the challenge of requiring the use of linear bar codes, which, while enabling hospitals to buy scanning equipment with the confidence that their purchased equipment would not be rendered obsolete by new technology, could affect future technological innovation (68 FR 12500 at 12508 through 12510). Comments received related to a public meeting on bar coding, presented an array of differing opinions on the issue of whether to require a specific technology (68 FR 12500 at 12508). Given the complexity of the issues, FDA requested in the Bar Code Proposed Rule comment concerning alternatives that could replace or be used in conjunction with the linear bar code such as another symbol, standard, or technology ( Id. at 12510 and 12529).

In response to the Bar Code Proposed Rule, FDA received comments including those opposing the use of linear bar codes or asking the Agency to consider other technologies or to eliminate any reference to linear bar codes in the final rule. Such comments primarily argued that selecting a symbology or standard would inhibit technological innovation. Comments opposed to a linear bar code requirement generally advocated the following alternatives: (1) Two-dimensional symbologies, (2) the European Article Number/Uniform Code Council (EAN/UCC) system generally, (3) radio frequency identification (RFID) chips, or (4) no standard or symbology at all (69 FR 9120 at 9136).

Ultimately, FDA determined that, based on data and public comment, a linear bar code requirement was appropriate (Id. at 9137 through 9138). In the preamble to the Bar Code Final Rule, the Agency addressed comments concerning alternatives to the linear bar code and stated that, while it believed that linear bar codes were an established, cost-effective, widely used and easily recognized technology, it also acknowledged that linear bar codes have several disadvantages. For example, linear bar codes may take up more label space than alternative technologies and may encode less data compared to other technologies. Thus, if more data need to be encoded on the packaging or labeling for any other reason (such as to allow tracking and tracing of drug products through the drug distribution system), a linear bar code might prove too limiting (Id. at 9137). FDA also stated that, although it had decided to preserve the linear bar code requirement, it would consider revising the rule to accommodate newer technologies as they become more mature and established (Id. at 9137 through 9138).

Since FDA issued the Bar Code Final Rule, advances in alternative technologies have occurred. In addition, it has become increasingly clear from industry, health care providers, and other FDA initiatives, that certain FDA-regulated products present unique bar coding concerns. For example, the Agency has since learned that certain vaccines present unique challenges in the bar coding context, particularly with respect to compliance with recordkeeping and mandatory adverse event reporting requirements that are specific to the administration of childhood vaccines. 2

In recognition of these challenges, in the Federal Register of August 11, 2011 (76 FR 49772), FDA announced the availability of a final guidance document entitled “Guidance for Industry: Bar Code Label Requirements—Questions and Answers”  3 . This guidance amended and superseded the final guidance of the same title dated October 2006, by incorporating a revised response to question 12 (Q12), which pertains to the use of alternate coding technologies for vaccines. The Agency explained in the Federal Register notice announcing the final guidance that it believes alternative technology such as two-dimensional symbology has advanced, allowing the Agency to reconsider the use of such technology. Accordingly, it will now consider requests from vaccine manufacturers who request to use alternate coding technologies, such as two-dimensional symbology, that encode lot number and expiration date information, for an exemption under § 201.25(d)(1)(ii) to the linear bar code requirement. FDA limited the scope of its revised response to Q12 to vaccines because of the mandatory reporting concerns specific to these products as described in the guidance.

FDA recognizes, however, that since alternative technologies continue to advance, it may now be feasible for these technologies to address other stakeholder coding needs in other contexts and for other products. For example, under section 505D of the Federal Food, Drug, and Cosmetic Act (the FD&C Act) (21 U.S.C. 355e), FDA is developing standards for identification, validation, authentication, and tracking and tracing of prescription drugs. The goal of this initiative is to implement a system to further ensure patient safety and to improve the security of the drug supply chain against counterfeit, diverted, subpotent, substandard, adulterated, misbranded, or expired drugs. In March 2010, FDA issued a guidance that discusses a standard for uniquely identifying prescription drug packages using a Standardized Numerical Identifier (SNI). 4 In the guidance, the Agency did not specify the means of incorporating the SNI onto the package. However, the guidance recognizes that the SNI is a flexible standard that can be encoded into a variety of machine-readable forms of data carriers, such as two-dimensional bar codes, alternate coding systems, and RFID. Thus, the guidance leaves options open while technologies for securing the supply chain continue to be identified, and standards making use of SNI are developed. Similarly, while FDA recognizes that the underlying primary goals of the Bar Code Final Rule and section 505D of the FD&C Act are different, the Agency wants to leave options open with respect to how the same technology may be used for both purposes.

FDA is announcing the establishment of a public docket to provide an opportunity for interested persons to share information, research, and ideas on the effectiveness of the current regulation and the need, maturity, and acceptability of alternative technologies for the identification, including the unique identification, of drugs and biological products. FDA will use the information received to assess coding technologies in relation to current bar code requirements and other initiatives.

FDA is requesting comments and supporting information on (1) bar code labeling standards for drugs and biological products and (2) the identification of current alternative technologies for use by industry and others.

To facilitate this discussion, FDA sets forth some questions in the following paragraphs. These questions, which are not meant to be exhaustive, are provided to stimulate public comments that will help FDA evaluate the Bar Code Final Rule and the accommodation of alternative technologies to the linear bar code requirement (§ 201.25). The public is encouraged to address these and/or other related questions.

The Agency encourages responses to the following questions about the costs and benefits of any alternative to the linear bar code. FDA also encourages you to provide as much detail and context as possible in your responses. Furthermore, the Agency specifically invites small businesses to provide information about the potential impact of alternatives to the linear bar code.

1. Is there a need for alternative technologies to the linear bar code? Does the current linear bar code requirement meet the current needs of the health care industry and health care providers?

2. How has product coding technology changed since FDA issued the Bar Code Final Rule on February 26, 2004? Please provide information about the maturity, degree of adoption, cost, and ease of use of coding technologies that may be considered as alternatives or in addition to the linear bar code.

3. What factors other than those listed in question 2 should FDA take into account in considering technologies alternative to or in addition to the linear bar code?

4. What technologies or coding systems warrant FDA's consideration as alternatives to the linear bar code? In your response, the Agency particularly invites comments on the following issues for each technology identified:

A. What is the current state of development and availability of the alternative technology?

B. Would adoption of this technology as an alternative to the linear bar code further reduce medication errors in hospitals and health care settings? Please provide supporting data, if available.

C. Would adoption of this alternative technology advance public health protections? If so, how? If supporting data exist, please provide this information.

5. Does the adoption of this alternative technology have implications for other FDA or Department of Health and Human Services initiatives ( e.g., SNI)?

6. Have you used the linear bar code for authentication or tracking and tracing of prescription drugs?

A. If so, how?

B. Please describe any successes or challenges that you have encountered in adopting linear bar code technology for this purpose.

C. If not, which if any alternative technologies could reduce medication errors while also serving other functions?

7. For hospitals and other health-care facilities that have adopted bar code technologies using linear bar codes:

A. What difficulties did you encounter in adopting the technology?

B. How have productivity and operating costs changed?

C. What differences have you seen in medical outcomes?

D. What problems have you experienced with the technology?

8. For hospitals and other health-care facilities that have adopted alternative technologies or non-linear coding:

A. What difficulties did you encounter in adopting the technology?

B. How have productivity and operating costs changed?

C. What differences have you seen in medical outcomes?

D. What problems have you experienced with the technology?

9. For hospitals and other health-care facilities that have not adopted bar code technologies using linear bar codes:

A. Do you plan to adopt the technology within the next 12 months?

B. If you do not plan to adopt the technology, please explain what factor(s) most influenced the decision not to adopt it.

10. How would technology adoption have proceeded since 2004 had the Bar Code Final Rule not gone into effect?

11. What are hospitals' and other health-care facilities' forecasts for technology adoption once incentives in the Economic Stimulus Act of 2008 (Pub. L. 110-185) are no longer in effect?

12. Would there be an economic impact on those parties who may not be subject to the bar code requirement but who nonetheless may use or adopt or have adopted bar code technology ( e.g., hospitals, clinics, public health agencies, and health care providers)? Please use the following questions to guide your responses.

A. Current practices. Describe your current practice(s) at your institution with respect to those products that are required to be labeled with a bar code under §§ 201.25 and 610.67. Have you encountered any barriers to your ability to use technology at your institution?

B. Using an alternative to the linear bar code. If an alternative to the linear bar code could be placed on the label of at least some of your products, what impact, if any, would that have on your current practice(s)? How would you change your practices, if at all?

C. Expenses. What unplanned expenses, if any, would you incur, if an alternative to the linear bar code could be placed on the label of at least some of your products? If you could foresee using an alternative to the linear bar code, would you modify operations in your facility, and if so, how?

D. Adverse event reporting and recalls. Have you encountered challenges/successes in drug identification or reporting with respect to products that contain a bar code on their labels? If so, please describe them. Would an alternative to the linear bar code have an impact on your recall management or adverse event reporting, and if so, how?

13. Are there other parties whose economic interests we should consider?

Interested persons may submit to the Division of Dockets Management (see ADDRESSES ) either electronic or written comments regarding this document. It is only necessary to send one set of comments. It is no longer necessary to send two copies of mailed comments. Identify comments with the docket number found in brackets in the heading of this document. Received comments may be seen in the Division of Dockets Management between 9 a.m. and 4 p.m., Monday through Friday.

Please allow sufficient time for mailed comments to be timely received by the due dates in the event of delivery delay. Comments must be received by these dates to be considered. We request that comments be identified clearly as an “initial” comment or a “reply” comment. Initial comments may address any issue raised in this notice. Initial comments will be made available electronically, online at http://www.regulations.gov, or for public inspection in the Division of Dockets Management (see ADDRESSES ). To allow sufficient opportunity for interested persons to prepare and submit any reply comments, late-filed initial comments will not be considered. Reply comments must address only matters raised in initial comments and must not be used to present new arguments, contentions, or factual material that is not responsive to the initial comments. To be considered, reply comments must identify which initial comments they are replying to, and which specific issues(s) are being addressed. We will not consider comments received during the reply comment period that do not identify the specific issue(s) raised during the initial comment period on which the reply comment is based. It is the Agency's intent to comply with Executive Order 13563 as quickly as possible, so we will not look favorably on requests for extensions of the comment period.

Comments previously submitted to the Division of Dockets Management for the following docket will also be considered by FDA and do not need to be resubmitted: “Draft Guidance for Industry: Bar Code Label Requirements (Question 12 Update)” (75 FR 54347 September 2010; Docket No. FDA-2010-D-0426).

Background

On August 24, 2006, the Treasury Department and the IRS published in the Federal Register (71 FR 50007) a notice of proposed rulemaking under section 1363 (REG-158677-05), relating to the applicability of the special banking rules to banks that are S corporations within the meaning of section 1361(a)(1) of the Internal Revenue Code.

The Treasury Department and the IRS received written comments on the proposed regulation from various interested parties. The Treasury Department and the IRS have decided to withdraw the proposed regulation.

Accordingly, under the authority of 26 U.S.C. 7805, the notice of proposed rulemaking (REG-158677-05) that was published in the Federal Register on August 24, 2006 (71 FR 50007) is withdrawn.

Public Participation and Request for Comments

We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted without change to http://www.regulations.gov and will include any personal information you have provided.

If you submit a comment, please include the docket number for this rulemaking (USCG-2011-0118), indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation. You may submit your comments and material online (via http://www.regulations.gov ) or by fax, mail, or hand delivery, but please use only one of these means. If you submit a comment online via http://www.regulations.gov, it will be considered received by the Coast Guard when you successfully transmit the comment. If you fax, hand deliver, or mail your comment, it will be considered as having been received by the Coast Guard when it is received at the Docket Management Facility. We recommend that you include your name and a mailing address, an e-mail address, or a telephone number in the body of your document so that we can contact you if we have questions regarding your submission.

To submit your comment online, go to http://www.regulations.gov, click on the “submit a comment” box, which will then become highlighted in blue. In the “Document Type” drop down menu select “Proposed Rule” and insert “USCG-2011-0118” in the “Keyword” box. Click “Search” then click on the balloon shape in the “Actions” column. If you submit your comments by mail or hand delivery, submit them in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying and electronic filing. If you submit comments by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period and may change the rule based on your comments.

To view comments, as well as documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, click on the “read comments” box, which will then become highlighted in blue. In the “Keyword” box insert “USCG-2011-0118” and click “Search.” Click the “Open Docket Folder” in the “Actions” column. You may also visit the Docket Management Facility in Room W12-140 on the ground floor of the Department of Transportation West Building, 1200 New Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. We have an agreement with the Department of Transportation to use the Docket Management Facility.

Anyone can search the electronic form of 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 a Privacy Act notice regarding our public dockets in the January 17, 2008, issue of the Federal Register (73 FR 3316).

We do not now plan to hold a public meeting. But you may submit a request for one using one of the four methods specified under ADDRESSES . Please explain why you believe a public meeting would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the Federal Register.

In this rule the Coast Guard proposes to revise the list of permanent safety zones at 33 CFR 165.506, established for fireworks displays at various locations within the geographic boundary of the Fifth Coast Guard District. For a description of the geographical area of the Fifth District and subordinate Coast Guard Sectors—Captain of the Port Zones, please see 33 CFR 3.25. Currently there are 73 permanent safety zones that are established for annually recurring fireworks displays within the geographic boundaries of the Fifth Coast Guard District.

The Coast Guard proposes to revise the list of permanent safety zones at 33 CFR 165.506, established for fireworks displays, by adding 3 new locations, deleting 2 previously established locations and modifying 19 previously established locations within the geographic boundary of the Fifth Coast Guard District. This rule will increase the total number of permanent safety zones to 74 locations for fireworks displays within the boundary of the Fifth Coast Guard District.

This rule proposes to add 3 new safety zone locations to the permanent safety zones listed in 33 CFR 165.506. The new safety zones include locations at: North Atlantic Ocean, Atlantic City, NJ; Great Wicomico River, Mila, VA; and Cockrell's Creek, Reedville, VA.

The 19 previously established safety zone locations proposed for modification by this rule are: Severn River and Spa Creek, Annapolis, MD; Baltimore Inner Harbor, Patapsco River, MD, (2 locations); Patuxent River, Calvert County, MD; Chesapeake Bay, Chesapeake Beach, MD; Potomac River, Charles County, MD; Potomac River, Charles County, MD near Mount Vernon; Potomac River, National Harbor, MD; Miles River, St. Michaels, MD; Tred Avon River, Oxford, MD; Upper Potomac River, Alexandria, VA; Anacostia River, Washington, DC; Potomac River, Prince William County, VA; North Atlantic Ocean, Ocean City, NJ; Chesapeake Bay, Norfolk, VA; North Atlantic Ocean, Virginia Beach, VA (2 locations); Pamlico River, Washington, NC; and Motts Channel, Banks Channel, Wrightsville Beach, NC. Safety zone modifications include revision to dates and minor changes to coordinates that define safety zone boundaries.

The Coast Guard typically receives numerous applications for fireworks displays in these general areas. Previously, a temporary safety zone was established on an emergency basis for each display. This limited the opportunity for public comment. Establishing permanent safety zones through notice and comment rulemaking provides the public the opportunity to comment on the safety zone locations, size, and length of time the zones will be enforced.

Each year organizations in the Fifth Coast Guard District sponsor fireworks displays in the same general location and time period. Each event uses a barge or an on-shore site near the shoreline as the fireworks launch platform. A safety zone is used to control vessel movement within a specified distance surrounding the launch platforms to ensure the safety of persons and property. Coast Guard personnel on scene may allow boaters within the safety zone if conditions permit.

The Coast Guard would publish notices in the Federal Register if an event sponsor reported a change to the listed event venue or date. In the case of inclement weather the event usually will be conducted on the day following the date listed in the Table to § 165.506. Coast Guard Captains of the Port would give notice of the enforcement of each safety zone by all appropriate means to provide the widest dissemination of notice among the affected segments of the public. This would include publication in the Local Notice to Mariners and Marine Information Broadcasts. Marine information and facsimile broadcasts may also be made for these events, beginning 24 to 48 hours before the event. Fireworks barges or launch sites on land used in the locations stated in this rulemaking would also display a sign labeled “FIREWORKS—DANGER—STAY AWAY”* * * The sign would be affixed to the port and starboard side of the barge or mounted on a post 3 feet above ground level when on land and in close proximity to the shoreline facing the water. This sign provides on scene notice that the safety zone is or will be enforced on that day. The sign will be diamond shaped, 4 feet by 4 feet with a 3-inch orange retro-reflective border. The word “DANGER” shall be 10-inch black block letters centered on the sign with the words “FIREWORKS” and “STAY AWAY” in 6 inch black block letters placed above and below the word “DANGER” respectively on a white background. There would also be a Coast Guard patrol vessel on scene 30 minutes before the display is scheduled to start until 30 minutes after its completion to enforce the safety zone.

The enforcement period for these proposed safety zones is from 5:30 p.m. to 1 a.m. local time. However, vessels may enter, remain in, or transit through these safety zones during this timeframe if authorized by the Captain of the Port or designated Coast Guard patrol personnel on scene, as provided for in 33 CFR 165.23.

This rule is being proposed to provide for the safety of life on navigable waters during the events and to give the marine community the opportunity to comment on the proposed zone locations, size, and length of time the zones will be active.

The Coast Guard proposes to revise the regulations at 33 CFR 165.506 by adding the following 3 permanent safety zone locations.

The waters of the North Atlantic Ocean within a 500 yard radius of the fireworks barge located at latitude 39°20′58″ N, longitude 074°25′58″ W, near the shoreline at Atlantic City, NJ.

All waters of the Great Wicomico River located within a 420 foot radius of the fireworks display at approximate position latitude 37°50′31″ N, longitude 076°19′42″ W near Mila, Virginia.

All waters of Cockrell's Creek located within a 420 foot radius of the fireworks display at approximate position latitude 37°49′54″ N, longitude 076°16′44″ W near Reedville, Virginia.

The Coast Guard proposes to revise regulations at 33 CFR 165.506 by modifying 19 existing permanent safety zone locations. The following table shows where these 19 existing permanent safety zones are listed within the Table to 33 CFR 165.506 and describes the revisions that are being made to these safety zones.

The Coast Guard proposes to amend regulations at 33 CFR 165.506 by disestablishing the following 2 permanent safety zones. All coordinates listed for the following safety zones reference Datum NAD 1983.

We developed this proposed rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on 13 of these statutes and executive orders.

This NPRM has not been designated a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Executive Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders.

We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation is unnecessary. This finding is based on the short amount of time that vessels would be restricted from the zones, and the small zone sizes positioned in low vessel traffic areas. Vessels would not be precluded from getting underway, or mooring at any piers or marinas currently located in the vicinity of the proposed safety zones. Advance notifications would also be made to the local maritime community by issuing Local Notice to Mariners, Marine information and facsimile broadcasts so mariners can adjust their plans accordingly. Notifications to the public for most events will usually be made by local newspapers, radio and TV stations. The Coast Guard anticipates that these safety zones will only be enforced 2 to 3 times per year.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule, if promulgated, will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities some of which may be small entities: The owners and operators of vessels intending to transit or anchor in the proposed safety zones during the times these zones are enforced.

These proposed safety zones will not have a significant economic impact on a substantial number of small entities for the following reasons: The enforcement period will be short in duration and, in many of the zones, vessels can transit safely around the safety zones. Generally, blanket permission to enter, remain in, or transit through these safety zones will be given except during the period that the Coast Guard patrol vessel is present. Before the enforcement period, we will issue maritime advisories widely.

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

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed under FOR FURTHER INFORMATION CONTACT . The Coast Guard will not retaliate against small entities that question or complain about this proposed rule or any policy or action of the Coast Guard.

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

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

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

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

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

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

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

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

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

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

We have analyzed this proposed rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have made a preliminary determination that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. A preliminary environmental analysis checklist supporting this preliminary determination is available in the docket where indicated under ADDRESSES . This proposed rule involves implementation of regulations within 33 CFR Part 165 that establish safety zones on navigable waters of the United States, and, therefore paragraph (34)(g) of figure 2-1 applies. These safety zones are enforced for the duration of the fireworks displays, which are launched from or adjacent to navigable waters of the United States and may have potential for negative impact on the safety or other interest of waterway users and shore side activities in the event area. The category of activities includes fireworks launched from barges at or near the shoreline that generally rely on the use of navigable waters as a safety buffer. We seek any comments or information that may lead to the discovery of a significant environmental impact from this proposed rule.

For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 165 as follows:

On May 5, 2011, we published a notice in the Federal Register (76 FR 25650) announcing our intent to establish one or more negotiated rulemaking committees to develop proposed regulations under the HEA. In addition, we announced our intent to develop these proposed regulations by following the negotiated rulemaking procedures in Section 492 of the HEA.

The notice also announced a series of three regional hearings at which interested parties could comment on the topics suggested by the Department and suggest additional topics for consideration for action by the negotiating committees. We also held four public roundtable discussions to complement the regional hearings. The hearings and roundtables were held in: Nashville, Tennessee (roundtable only); Tacoma, Washington; Chicago, Illinois; and Charleston, South Carolina. We invited parties to comment and submit topics for consideration in writing as well. (Transcripts from the regional hearings can be found at http://www2.ed.gov/policy/highered/reg/hearulemaking/2011/hearings.html. Written comments may be viewed through the Federal eRulemaking Portal at http://www.regulations.gov. Instructions for finding comments are available on the site under “How to Use Regulations.gov” in the Help section. Individuals can enter docket ID ED-2011-OPE-0003 in the “Enter Keyword or ID” search box to locate the appropriate docket.) Regulatory Issues: After consideration of the information received at the regional hearings, in the roundtable discussions, and in writing, we have decided to establish a negotiating committee to address teacher preparation program issues in Title II of the HEA and in the Teacher Education Assistance for College and Higher Education (TEACH) Grant Program authorized by Title IV of the HEA.

We list the topics the committee is likely to address in the Committee Topics section, below.

We intend to select negotiators for the committee who represent the interests significantly affected by the topics proposed for negotiations. In so doing, we will follow the requirement in Section 492(b)(1) of the HEA that the individuals selected must have demonstrated expertise or experience in the relevant subjects under negotiation. We will also select individual negotiators who reflect the diversity among program participants, in accordance with Section 492(b)(1) of the HEA. Our goal is to establish a committee that will allow significantly affected parties to be represented while keeping the committee size manageable.

The committee may create subgroups on particular topics that may involve additional individuals who are not members of the committee. Individuals who are not selected as members of the committee will be able to attend the meetings, have access to the individuals representing their constituencies, and participate in informal working groups on various issues between the meetings. The committee meetings will be open to the public.

The Department has identified the following constituencies as having interests that are significantly affected by the topics proposed for negotiations. The Department plans to seat as negotiators individuals from organizations or groups representing these constituencies:

• Postsecondary students, including legal assistance organizations that represent students.

• Teachers.

• Financial aid administrators at postsecondary institutions.

• Business officers and bursars at postsecondary institutions.

• Admissions officers at postsecondary institutions.

• State officials, including officials with teacher preparation program approval agencies, State teacher licensing boards, higher education executive officers, chief State school officers, State attorneys general, and State data system administrators.

• Institutions that offer teacher preparation programs, including schools of education.

○ Institutions of higher education eligible to receive Federal assistance under Title III, Parts A, B, and F, and Title V of the HEA, which include Historically Black Colleges and Universities, Hispanic-Serving Institutions, American Indian Tribally Controlled Colleges and Universities, Alaska Native and Native Hawaiian-Serving Institutions, Predominantly Black Institutions, and other institutions with a substantial enrollment of needy students as defined in Title III of the HEA.

○ Two-year public institutions of higher education.

○ Four-year public institutions of higher education.

○ Private, non-profit institutions of higher education.

○ Private, for-profit institutions of higher education.

• Operators of programs for alternative routes to teacher certification.

• Accrediting agencies.

• Students enrolled in elementary and secondary education, including parents of students enrolled in elementary and secondary education.

• School and local educational agency officials, including those responsible for hiring teachers and evaluating teacher performance.

The goal of the committee is to develop high-quality proposed regulations that reflect a final consensus of the committee. Consensus means that there is no dissent by any member of the negotiating committee, including the committee member representing the Department. An individual selected as a negotiator will be expected to represent the interests of their organization or group. If consensus is reached, all members of the organization or group represented by a negotiator are bound by the consensus and are prohibited from commenting negatively on the resulting proposed regulations. The Department will not consider any such negative comments that are submitted by members of such an organization or group.

Nominations should include:

• The name of the nominee, the organization or group the nominee represents, and a description of the interests that the nominee represents.

• Evidence of the nominee's expertise or experience in the subject, or subjects, to be negotiated.

• Evidence of support from individuals or groups of the constituency that the nominee will represent.

• The nominee's commitment that he or she will actively participate in good faith in the development of the proposed regulations.

• The nominee's contact information, including address, phone number, fax number, and e-mail address.

For a better understanding of the negotiated rulemaking process, nominees should review The Negotiated Rulemaking Process for Title IV Regulations, Frequently Asked Questions at http://www.ed.gov/policy/highered/reg/hearulemaking/hea08/neg-reg-faq.html prior to committing to serve as a negotiator.

Nominees will be notified whether or not they have been selected as negotiators as soon as the Department's review process is completed.

The topics the committee is likely to address are as follows:

• The requirements for institutional and program report cards on the quality of teacher preparation (Section 205(a) of the HEA);

• The requirements for State report cards on the quality of teacher preparation (Section 205(b) of the HEA);

• The standards to ensure reliability, validity, and accuracy of the data submitted in report cards on the quality of teacher preparation (Section 205(c) of the HEA);

• The criteria used by States to assess the performance of teacher preparation programs at higher education institutions in the State, the identification of low-performing programs (Section 207(a) of the HEA), and the consequences of a State's termination of eligibility of a program (Section 207(b) of the HEA);

• The definition of the term “high quality teacher preparation program” for the purpose of establishing the eligibility of an institution to participate in the TEACH Grant program (Section 420L(1) of the HEA);

• The definition of the term “high quality professional development services” for the purpose of establishing the eligibility of an institution to participate in the TEACH Grant program (Section 420L(1) of the HEA); and

• The service and repayment obligations for the TEACH Grant Program (Subpart E of 34 CFR 686).

These topics are tentative. Topics may be added or removed as the process continues.

The committee will meet for three sessions on the following dates:

Session 1: January 18-20, 2012.

Session 2: February 27-29, 2012.

Session 3: April 3-5, 2012.

The first and second day of each session will begin at 9 a.m. and end around 5 p.m. The final day of each session will begin at 9 a.m. and end at 12 p.m.

The meetings will be held at the U.S. Department of Education at: 1990 K Street, NW., Eighth Floor Conference Center, Washington, DC 20006.

Accessible Format: Individuals with disabilities can obtain this document in an accessible format ( e.g., braille, large print, audiotape, or compact disc) by contacting the contact person under FOR FURTHER INFORMATION CONTACT.

Electronic Access to This Document: The official version of this document is the document published in the Federal Register. Free internet access to the official edition of the Federal Register and the Code of Federal Regulations is available via the Federal Digital System at: http://www.gpo.gov/fdsys. At this site you can view this document, as well as all other documents of this Department published in the Federal Register, in text or Adobe Portable Document Format (PDF). To use PDF, you must have Adobe Acrobat Reader, which is available free at this site.

You may also access documents of the Department published in the Federal Register by using the article search feature at http://www.federalregister.gov. Specifically, through the advanced search feature at this site, you can limit your search to documents published by the Department.

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket No. 11-159, adopted October 7, 2011, and released October 11, 2011. The full text of this document is available for public inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 12th Street, SW., Washington, DC 20554. This document will also be available via ECFS ( http://www.fcc.gov/cgb/ecfs/ ). (Documents will be available electronically in ASCII, Word 97, and/or Adobe Acrobat.) This document may be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 1-800-478-3160 or via e-mail www.BCPIWEB.com. To request this document in accessible formats (computer diskettes, large print, audio recording, and Braille), send an e-mail to fcc504@fcc.gov or call the Commission's Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY). This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Provisions of the Regulatory Flexibility Act of 1980 do not apply to this proceeding. Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts (other than ex parte presentations exempt under 47 CFR 1.1204(a)) are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1208 for rules governing restricted proceedings.

For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

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

Public Comments

We will accept written comments and information during this reopened comment period on our proposed critical habitat for Lepidium papilliferum that was published in the Federal Register on May 10, 2011 (76 FR 27184), our DEA of the proposed designation, and the amended required determinations provided in this document. We will consider information and recommendations from all interested parties. We are particularly interested in comments concerning:

(1) The reasons why we should or should not designate habitat as “critical habitat” under section 4 of the Act, including whether there are threats to the species from human activity, the degree to which threats from human activity can be expected to increase due to the designation, and whether that increase in threats outweighs the benefit of designation such that the designation of critical habitat may not be prudent.

(2) Specific information on:

(a) The amount and distribution of Lepidium papilliferum habitat;

(b) What areas occupied at the time of listing and that contain features essential to the conservation of Lepidium papilliferum should be included in the designation and why;

(c) The habitat components (primary constituent elements) essential to the conservation of the species, such as specific soil characteristics, plant associations, or pollinators, and the quantity and spatial arrangement of these features on the landscape needed to provide for the conservation of the species;

(d) What areas not occupied at the time of listing are essential for the conservation of the species, if any, and why; and

(e) Special management considerations or protections that the features essential to the conservation of Lepidium papilliferum may require, including managing for the potential effects of climate change.

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

(4) Any reasonably foreseeable economic, national security, or other relevant impacts that may result from designating any area that may be included in the final designation. We are particularly interested in any impacts on small entities, and the benefits of including or excluding areas from the proposed designation that are subject to these impacts.

(5) Information on whether the benefits of an exclusion of any particular area outweigh the benefits of inclusion under section 4(b)(2) of the Act, after considering both the potential impacts and benefits of the proposed critical habitat designation. Under section 4(b)(2) of the Act, we may exclude an area from critical habitat if we determine that the benefits of such exclusion outweigh the benefits of including that particular area as critical habitat, unless failure to designate that specific area as critical habitat will result in the extinction of the species. We are considering the possible exclusion of areas under private ownership, in particular, as we anticipate the benefits of exclusion may outweigh the benefits of inclusion in those areas. We therefore request specific information on:

(a) The benefits of including any specific areas in the final designation and supporting rationale,

(b) The benefits of excluding any specific areas from the final designation and supporting rationale, and

(c) Whether any specific exclusions may result in the extinction of the species and why (see “Consideration of Impacts Under Section 4(b)(2) of the Act,” below).

(6) The use of Public Land Survey System quarter-quarter sections to delineate the proposed critical habitat designation. We used quarter-quarter sections in this proposed rule because they are the most-commonly-used minimum size and method for delineating land ownership boundaries within the range of Lepidium papilliferum.

(7) The projected and reasonably likely impacts of climate change on Lepidium papilliferum and on the critical habitat areas we are proposing.

(8) Whether we could improve or modify our approach to designating critical habitat in any way to provide for greater public participation and understanding, or to better accommodate public concerns and comment.

(9) Information on the extent to which the description of economic impacts in the DEA is reasonable and accurate.

(10) The likelihood of adverse social reactions to the designation of critical habitat, as discussed in the DEA, and how the consequences of such reactions, if likely to occur, would relate to the conservation and regulatory benefits of the proposed critical habitat designation.

If you submitted comments or information on the proposed rule (76 FR 27184) during the initial or extended comment period (76 FR 39807) that was open from May 11 through September 9, 2011, please do not resubmit them. We will incorporate them into the public record as part of this comment period, and we will fully consider them in the preparation of our final determination. Our final determination concerning critical habitat will take into consideration all written comments and any additional information we receive during all comment periods. On the basis of public comments, we may, during the development of our final determination, find that areas proposed are not essential, are appropriate for exclusion under section 4(b)(2) of the Act, or are not appropriate for exclusion.

You may submit your comments and materials concerning the proposed rule or DEA by one of the methods listed in ADDRESSES . We request that you send comments only by the methods described in ADDRESSES .

If you submit a comment via http://www.regulations.gov, your entire comment—including any personal identifying information—will be posted on the Web site. We will post all hardcopy comments on http://www.regulations.gov as well. If you submit a hardcopy comment that includes personal identifying information, you may request at the top of your document that we withhold this information from public review. However, we cannot guarantee that we will be able to do so.

Comments and materials we receive, as well as supporting documentation we used in preparing the proposed rule and DEA, will be available for public inspection on http://www.regulations.gov at Docket No. FWS-R1-ES-2010-0071, or by appointment, during normal business hours, at the U.S. Fish and Wildlife Service, Idaho Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT ). You may obtain copies of the proposed rule and the DEA on the Internet at http://www.regulations.gov at Docket Number FWS-R1-ES-2010-0071, or by mail from the Idaho Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT ).

It is our intent to discuss only those topics directly relevant to the designation of critical habitat for Lepidium papilliferum in this document. For more information on previous Federal actions concerning L. papilliferum, refer to the proposed designation of critical habitat published in the Federal Register on May 10, 2011 (76 FR 27184). For more information on L. papilliferum or its habitat, please refer to the final listing rule published in the Federal Register on October 8, 2009 (74 FR 52014), which is available online at http://www.regulations.gov at Docket No. FWS-R1-ES-2010-0071 or from the Idaho Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT ).

On May 10, 2011, we published a proposed rule to designate critical habitat for Lepidium papilliferum (76 FR 27184). We proposed to designate as critical habitat approximately 23,374 hectares (57,756 acres) in four units in Ada, Elmore, Payette, and Owyhee Counties in Idaho. We announced a 60-day comment period in that proposed rule, scheduled to close on July 11, 2011. On June 1, 2011, we received a request from the Governor of Idaho seeking a 60-day extension of the comment period so that the State of Idaho may coordinate comments between the State agencies that may be affected by critical habitat, and to allow adequate time for citizens to provide input on the proposed critical habitat designation. In response to this request, on July 7, 2011, we announced in the Federal Register an extension of the comment period for an additional 60 days, until September 9, 2011 (76 FR 39807).

Section 3 of the Act defines critical habitat as the specific areas within the geographical area occupied by a species, at the time it is listed in accordance with the Act, on which are found those physical or biological features essential to the conservation of the species and that may require special management considerations or protection, and specific areas outside the geographical area occupied by a species at the time it is listed, upon a determination that such areas are essential for the conservation of the species. If the proposed rule is made final, section 7 of the Act will prohibit destruction or adverse modification of critical habitat by any activity funded, authorized, or carried out by any Federal agency. Federal agencies proposing actions affecting critical habitat must consult with us on the effects of their proposed actions, under section 7(a)(2) of the Act.

Section 4(b)(2) of the Act requires that we designate or revise critical habitat based upon the best scientific data available, after taking into consideration the economic impact, impact on national security, or any other relevant impact of specifying any particular area as critical habitat. We may exclude an area from critical habitat if we determine that the benefits of excluding the area outweigh the benefits of including the area as critical habitat, provided such exclusion will not result in the extinction of the species.

When considering the benefits of inclusion for an area, we consider the additional regulatory benefits that area would receive from the protection from adverse modification or destruction as a result of actions with a Federal nexus (activities conducted, funded, permitted, or authorized by Federal agencies), the educational benefits of mapping areas containing essential features that aid in the recovery of the listed species, and any benefits that may result from designation due to State or Federal laws that may apply to critical habitat.

When considering the benefits of exclusion, we consider, among other things, whether exclusion of a specific area is likely to result in conservation; the continuation, strengthening, or encouragement of partnerships; or implementation of a management plan.

In the case of Lepidium papilliferum, the benefits of critical habitat include public awareness of the presence of the species and the importance of habitat protection, and, where a Federal nexus exists, increased habitat protection for L. papilliferum due to protection from adverse modification or destruction of critical habitat. In practice, situations with a Federal nexus exist primarily on Federal lands or for projects undertaken by, or with the authorization or permission of, Federal agencies. We are considering the possible exclusion of areas under private ownership from the designation of critical habitat for L. papilliferum, as we anticipate the benefits of exclusion may outweigh the benefits of inclusion in those areas.

The final decision on whether to exclude any areas will be based on the best scientific data available at the time of the final designation, including information obtained during the comment period and information about the economic impact of designation. Accordingly, we have prepared a draft economic analysis (DEA) concerning the proposed critical habitat designation, which is available for review and comment (see ADDRESSES section).

The DEA identifies and analyzes the potential economic impacts associated with the proposed critical habitat designation for Lepidium papilliferum. The DEA describes the economic impacts of all potential conservation efforts for L. papilliferum; some of these costs will likely be incurred regardless of whether we designate critical habitat. The economic impact of the proposed critical habitat designation is analyzed by comparing scenarios both “with critical habitat” and “without critical habitat.” The “without critical habitat” scenario represents the baseline for the analysis, considering protections already in place for the species (e.g., under the Federal listing and other Federal, State, and local regulations). The baseline, therefore, represents the costs incurred regardless of whether critical habitat is designated. The “with critical habitat” scenario describes the incremental impacts associated specifically with the designation of critical habitat for the species. In other words, these incremental impacts would not occur but for the designation.

These incremental impacts produce the costs that we consider in the final designation of critical habitat when evaluating the benefits of excluding particular areas under section 4(b)(2) of the Act. The analysis looks retrospectively at baseline impacts incurred since the species was listed, and forecasts both baseline and incremental impacts likely to occur if we finalize the proposed critical habitat designation.

As described above, the DEA separates conservation measures into two distinct categories according to “without critical habitat” and “with critical habitat” scenarios. The “without critical habitat” scenario represents the baseline for the analysis, considering protections otherwise afforded to the species (e.g., under the Federal listing and other Federal, State, and local regulations). The “with critical habitat” scenario describes the incremental impacts specifically due to designation of critical habitat for the species. In other words, these incremental conservation measures and associated economic impacts would not occur but for the designation. Conservation measures implemented under the baseline (without critical habitat) scenario are described qualitatively within the DEA, but economic impacts associated with these measures are not quantified. Economic impacts are only quantified for conservation measures implemented specifically due to the designation of critical habitat (i.e., incremental impacts). For a further description of the methodology of the analysis, see Chapter 2, “Framework for the Analysis,” of the DEA.

The DEA provides estimated costs of the foreseeable potential economic impacts of the proposed critical habitat designation for Lepidium papilliferum over the next 20 years, from 2012 through 2031. We determined that this 20-year timeframe was the appropriate period for analysis because the availability of land-use planning information becomes very limited for most activities beyond that timeframe. The DEA identifies potential incremental costs as a result of the proposed critical habitat designation; these are those costs attributed to critical habitat over and above those baseline costs attributed to listing and other regulatory protections. The DEA quantifies economic impacts of L. papilliferum conservation efforts associated with the following categories of activity: (1) Wildfire and invasive nonnative species management; (2) commercial and residential development; (3) utility and transportation activities; and (4) livestock use. The most visible effect to L. papilliferum and its habitat from livestock use is through localized trampling impacts; however, as stated in the final listing rule, under current management conditions we do not consider this activity to represent a significant threat to the species. Although the final listing rule evaluated recreation as a possible minor threat to the species, this does not appear to be a major factor impacting either L. papilliferum or its habitat. We therefore do not anticipate any measurable economic impact of critical habitat designation for this species on recreation, and this activity was not considered in the draft economic analysis.

Approximately 95 percent of the proposed critical habitat area is on public lands (roughly 86 percent is Federal land managed by the Bureau of Land Management (BLM)). Of this, 8 percent is State land, 2 percent is County land (Payette, Ada, Owyhee, and Elmore counties, Idaho), and the remaining 5 percent covers privately owned lands. Commercial and residential develop could result in the loss of Lepidium papilliferum populations, as well as indirect losses through the development of infrastructure that allows greater access to the habitat (e.g., off-road vehicles, human-ignited wildfires) and habitat fragmentation. Although no development has taken place within the proposed critical habitat areas since publication of the proposed rule, portions of the critical habitat area are adjacent to urban and rural development, or within the Interstate 84 corridor, increasing the probability that the areas may be subject to future development.

The most significant biological threats to the species are related to increased frequency of wildfire, combined with the invasion of nonnative annual grasses. The invasion of nonnative annual grasses provides a continuous source of fuel, which directly contributes to a dramatic increase in natural fire frequency. Conservation measures related to wildfire and nonnative species have been incorporated into a Conservation Agreement being implemented by the BLM, which applies to 86 percent of the proposed critical habitat area. Rights-of-way and pipeline activities, particularly those related to utilities and transportation activities, became subject to section 7 consultation in 2009, when the species was listed under the Act, and actions are already being reviewed to evaluate potential impacts to the species related to equipment operation or construction within areas occupied by the species. A review of our consultation records indicates that no project modifications have been required to date, either because the activities were not within Lepidium papilliferum habitat, or conservation measures were incorporated into project designs to avoid impacts to the species or its habitat.

The draft economic analysis concludes that critical habitat designation is not likely to affect levels of economic activity or conservation measures being implemented within the proposed critical habitat area. Unless changes occur to existing conservation measures or the management of land use activities, the incremental impacts of critical habitat designation would be limited to the additional administrative costs of section 7 consultations for Federal agencies, associated with considering the potential for adverse modification of critical habitat. These costs are estimated to be $14,200 annually, or $161,000 over a 20-year period, based on the present value discounted at seven percent.

Because approximately 86 percent of the proposed critical habitat area is Federal land managed by the BLM, the proposed critical habitat designation is unlikely to generate economic impacts beyond administrative costs of section 7 consultation. Additionally, a binding Conservation Agreement has been developed to address the conservation needs of this species on BLM land, and BLM already consults with us under section 7 of the Act to ensure their activities do not jeopardize the continued existence of the species. The BLM intends to continue to manage these lands for conservation of Lepidium papilliferum, by implementing the specific conservation measures identified in Chapter 3 of the draft economic analysis. In addition, project proponents and land managers are aware of the species' presence throughout its range, and the need to consult with the Service for projects that have a Federal nexus that may affect the species. We believe activities on private lands are unlikely to have a Federal nexus or be subject to section 7 consultation, based on a review of our consultation records to date. However, in the case that private lands may possibly be subject to a Federal permit or funding source in the future (e.g., U.S. Department of Agriculture, Natural Resources Conservation Service programs or Federal permitting of alternative energy projects), the DEA underestimates potential administrative costs due to critical habitat designation in the 5 percent of proposed critical habitat that overlaps the private lands. However, we have no information indicating that any such activity will occur on private lands in the foreseeable future.

In conclusion, the Service does not foresee a circumstance in which critical habitat designation will change the outcome of future section 7 consultations. Any conservation measures implemented to minimize impacts to the species would very likely be sufficient to also minimize impacts to critical habitat. Therefore, we do not believe any additional conservation measures would be needed solely to minimize impacts to critical habitat. Based on this reasoning, we also do not anticipate critical habitat designation to result in any appreciable incremental economic benefits. Any economic benefits related to conservation activities would flow from the listing of the species, rather than the designation of critical habitat, and would fall within the economic baseline.

As we stated earlier, we are soliciting data and comments from the public on the DEA, as well as all aspects of the proposed rule and our amended required determinations. We may revise the proposed rule or supporting documents to incorporate or address information we receive during the public comment period. In particular, we may exclude an area from critical habitat if we determine that the benefits of excluding the area outweigh the benefits of including the area, provided the exclusion will not result in the extinction of the species.

In our May 10, 2011, proposed rule (76 FR 27184), we indicated that we would defer our determination of compliance with several statutes and executive orders until the information concerning potential economic impacts of the designation and potential effects on landowners and stakeholders became available in the DEA. We have now made use of the DEA data to make these determinations. In this document, we affirm the information in our proposed rule concerning Executive Order (E.O.) 12866 (Regulatory Planning and Review), E.O. 12630 (Takings), E.O. 13132 (Federalism), E.O. 12988 (Civil Justice Reform), E.O. 13211 (Energy, Supply, Distribution, and Use), the Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq. ), the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ), the National Environmental Policy Act (42 U.S.C. 4321 et seq. ), and the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951). However, based on the DEA data, we are amending our required determination concerning the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ).

Under the Regulatory Flexibility Act, as amended by the Small Business Regulatory Enforcement Fairness Act (5 U.S.C. 802(2)), whenever an agency is required to publish a notice of rulemaking for any proposed or final rule, it must prepare and make available for public comment a regulatory flexibility analysis that describes the effect of the rule on small entities (i.e., small businesses, small organizations, and small government jurisdictions). However, no regulatory flexibility analysis is required if the head of an agency certifies the rule will not have a significant economic impact on a substantial number of small entities. Based on our DEA of the proposed designation, we provide our analysis for determining whether the proposed rule would result in a significant economic impact on a substantial number of small entities. Based on comments we receive, we may revise this determination as part of our final rulemaking.

According to the Small Business Administration, small entities include small organizations, such as independent nonprofit organizations; small governmental jurisdictions, including school boards and city and town governments that serve fewer than 50,000 residents; and small businesses (13 CFR 121.201). For example, small businesses include manufacturing and mining concerns with fewer than 500 employees, wholesale trade entities with fewer than 100 employees, retail and service businesses with less than $5 million in annual sales, general and heavy construction businesses with less than $27.5 million in annual business, special trade contractors doing less than $11.5 million in annual business, and agricultural businesses with annual sales less than $750,000. To determine if potential economic impacts to these small entities are significant, we considered the types of activities that might trigger regulatory impacts under this designation as well as types of project modifications that may result. In general, the term “significant economic impact” is meant to apply to a typical small business firm's business operations.

To determine if the proposed designation of critical habitat for Lepidium papilliferum would affect a substantial number of small entities, we considered the number of small entities affected within particular types of economic activities, such as commercial and residential development. In order to determine whether it is appropriate for our agency to certify that this rule would not have a significant economic impact on a substantial number of small entities, we considered each industry or category individually. In estimating the numbers of small entities potentially affected, we also considered whether their activities have any Federal involvement. Critical habitat designation will not affect activities that do not have any Federal involvement; designation of critical habitat only affects activities conducted, funded, permitted, or authorized by Federal agencies. In areas where L. papilliferum is present, Federal agencies already are required to consult with us under section 7 of the Act on activities they fund, permit, or implement that may affect the species. If we finalize this proposed critical habitat designation, consultations to avoid the destruction or adverse modification of critical habitat would be incorporated into the existing consultation process.

In the DEA, we evaluated the potential economic effects on small entities resulting from implementation of conservation actions related to the proposed designation of critical habitat for Lepidium papilliferum. As estimated in Chapter 4 of the DEA, incremental impacts of the proposed designation are limited to additional incremental costs of time spent by the Service, Federal action agency, and any third parties in section 7 consultation over and above time spent on the jeopardy analysis component of the consultation. Small entities may participate in section 7 consultation as a third party (the primary consulting parties being the Service and the Federal action agency); therefore, it is possible that the small entities may spend additional time considering critical habitat during section 7 consultation for L. papilliferum. These incremental administrative impacts are the only potential incremental impacts of critical habitat designation that may be borne by small entities. Some of the forecast consultations for L. papilliferum may involve third parties, such as ranchers, energy companies (for pipeline projects), or developers. The maximum annualized incremental impact to such third parties is anticipated to total $2,810 between 2012 and 2031; such costs are expected to be distributed between multiple third parties. While $2,810 is expected to represent the maximum total cost annually, the potential third party cost for each individual consultation is anticipated to be significantly less, on the order of $260 to $1,750 depending on the consultation type. Small entities are consequently anticipated to bear a relatively low cost impact as a result of the designation of critical habitat for L. papilliferum. We do not believe this designation will have a significant impact on these small entities or affect a substantial number of them. Please refer to Appendix A of the DEA of the proposed critical habitat designation for a more detailed discussion of potential economic impacts.

In summary, we have considered whether the proposed designation would result in a significant economic impact on a substantial number of small entities. Information for this analysis was gathered from the Small Business Administration, stakeholders, and the Service. For the above reasons and based on currently available information, we certify that if promulgated, the proposed designation would not have a significant economic impact on a substantial number of small business entities. Therefore, an initial regulatory flexibility analysis is not required.

The primary authors of this notice are the staff members of the Idaho Fish and Wildlife Office, Pacific Region, U.S. Fish and Wildlife Service.

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

Section 4(b)(3)(A) of the Act (16 U.S.C. 1531 et seq. ) requires that we make a finding on whether a petition to list, delist, or reclassify a species presents substantial scientific or commercial information indicating that the petitioned action may be warranted. We are to base this finding on information provided in the petition, supporting information submitted with the petition, and information otherwise available in our files. To the maximum extent practicable, we are to make this finding within 90 days of our receipt of the petition, and publish our notice of the finding promptly in the Federal Register .

Our standard for substantial scientific or commercial information within the Code of Federal Regulations (CFR) with regard to a 90-day petition finding is “that amount of information that would lead a reasonable person to believe that the measure proposed in the petition may be warranted” (50 CFR 424.14(b)(1)). If we find that substantial scientific or commercial information was presented, we are required to promptly conduct a species status review, which we subsequently summarize in our 12-month finding.

We received a petition, dated April 9, 2010, from the Pacific Legal Foundation (PLF), representing the Coalition of Labor Agriculture, and Business (COLAB), Property Owners Association of Riverside County, and M. Lou Marsh, M.D., on April 12, 2010, to remove the coastal California gnatcatcher from the Federal List of Endangered and Threatened Wildlife (List) under the Act (PLF 2010, pp. 1-9). The petition clearly identifies itself as such and included the requisite identification information for the petitioner(s), as required in 50 CFR 424.14(a). This finding addresses the petition.

The coastal California gnatcatcher has been the subject of numerous Federal Register publications since its inclusion as a category two candidate species in 1982 (47 FR 58454, December 30, 1982; Service 2010, p. 3) (see http://ecos.fws.gov/speciesProfile/profile/speciesProfile.action?spcode=B08X ). On March 22, 1991, the Service published a 90-day finding addressing seven petitions to list five species as threatened or endangered, including three petitions pertaining to the coastal California gnatcatcher (56 FR 12146), and concluded that substantial information was presented to indicate that listing might be warranted. This finding led to the September 17, 1991, publication of a proposed rule to list the coastal California gnatcatcher as endangered; the public comment period for this proposed rule lasted 6 months, until March 16, 1992 (56 FR 47053). The proposed rule also constituted our 12-month finding, which the proposed rule referred to as the “final finding”, on the petition.

On September 22, 1992, the Service reopened the public comment period on the proposed rule to list the coastal California gnatcatcher as endangered for an additional 30 days, from September 22, 1992, until October 22, 1992, and notified the public that we needed extra time to obtain and review the information regarding the taxonomy of the coastal California gnatcatcher (57 FR 43686). On March 30, 1993, the Service published a final rule to list the coastal California gnatcatcher as a threatened species (58 FR 16742). In that rule, we did not designate critical habitat, because we had determined that designating critical habitat for the gnatcatcher was not prudent.

On March 30, 1993, the same day that the final listing rule published in the Federal Register , we also published a proposed rule to adopt a special rule under section 4(d) of the Act (16 U.S.C. 1531 et seq. ) to allow for the take of the coastal California gnatcatcher (58 FR 65088). On December 10, 1993, the Service published in the Federal Register a final rule adopting the special rule concerning take of the coastal California gnatcatcher (58 FR 65088). The special rule is codified in the Code of Federal Regulations (CFR) at 50 CFR 17.41(b).

In a Memorandum Opinion and Order filed in the U.S. District Court for the District of Columbia on May 2, 1994 ( Building Industry Association of Southern California et al. v. Babbitt ), the Court vacated the listing determination for the coastal California gnatcatcher, stating the Secretary of the Interior should have made available the raw data that formed the basis of Dr. Jonathan Atwood's report (Atwood 1991) that concluded subspecies recognition for the coastal California gnatcatcher. We subsequently made these data available to the public for review and comment on June 2, 1994, for a period of 60 days, until August 1, 1994 (59 FR 28508). On June 16, 1994, the Court reinstated the threatened status for the coastal California gnatcatcher until the public could review and comment on the raw data analyzed by Atwood.

Before the comment period for the June 2, 1994, Federal Register publication ended, we extended that public comment period (59 FR 38426, July 28, 1994), and we subsequently extended it two more times, on August 26, 1994 (59 FR 44125), and October 25, 1994 (59 FR 53628). Therefore, the public comment period on data pertaining to the subspecific taxonomy of the coastal California gnatcatcher lasted from June 2, 1994, until December 1, 1994. Further, on December 27, 1994, we reopened the public comment period on those data for an additional 30 days, until January 26, 1995 (59 FR 66509).

On March 27, 1995, the Service published in the Federal Register (60 FR 15693) an extensive review of the Atwood data (including independent scientific analyses of the Atwood data) received during the public comment periods concerning the subspecies classification of the coastal California gnatcatcher. We affirmed our earlier determination that the coastal California gnatcatcher is a valid subspecies (58 FR 16742, March 30, 1993; 58 FR 65088, December 10, 1993) and affirmed the coastal California gnatcatcher's threatened status under the Act.

On February 8, 1999, the Service published in the Federal Register (64 FR 5957) a notice of determination that it was prudent to designate critical habitat for the coastal California gnatcatcher. We subsequently published a proposed rule to designate critical habitat for the coastal California gnatcatcher (65 FR 5945; February 7, 2000); announced a reopening of comment period and availability of a draft economic analysis for the February 7, 2000, proposed rule (65 FR 40073; June 29, 2000); and published a final rule designating critical habitat for the coastal California gnatcatcher (65 FR 63679; October 24, 2000).

In response to a June 11, 2002, court ruling from the U.S. District Court for the Central District of California ( Building Industry Association of Southern California et al. v. Norton ), the Service published a proposed rule to revise designated critical habitat for the coastal California gnatcatcher on April 24, 2003 (68 FR 20228). In this proposed rule, the Service reconsidered the economic impacts associated with designating any particular area as critical habitat, announced that we were considering whether the listing of the coastal California gnatcatcher should be amended as a DPS in light of a study by Zink et al. (2000) questioning the genetic distinctiveness of the coastal California gnatcatcher, and opened a 60-day period for public comments (68 FR 20228). On April 8, 2004, the Service published two documents related to the coastal California gnatcatcher: The first reopened the public comment period on the proposed determination of a DPS of the coastal California gnatcatcher (69 FR 18515), and the second was a notice of availability of draft economic analysis and a public hearing on the proposed April 24, 2003, designation of critical habitat (69 FR 18516). The Service published its final rule concerning the revised designation of critical habitat on December 19, 2007 (72 FR 72009), for the coastal California gnatcatcher. In that Federal Register publication, we announced that we were continuing to evaluate whether the current listing of the coastal California gnatcatcher as a subspecies under the Act should be retained or changed.

In 2010, we completed a 5-year status review of the coastal California gnatcatcher (Service 2010, pp. 1-51). After analyzing all available information, including Zink et al. (2000), we recommended no change in its threatened status and indicated that we would not pursue delineation of a DPS for the coastal California gnatcatcher (Service 2010, p. 36; http://ecos.fws.gov/docs/five_year_review/doc3571.pdf ). With a recommendation of no change in threatened status, the coastal California gnatcatcher maintains its recovery priority number of 9C, based on the taxon's status as a subspecies facing a high degree of threat with a low recovery potential.

For information on the biology and life history of the coastal California gnatcatcher, see the 2010 coastal California gnatcatcher 5-year review (Service 2010, pp. 6-11).

Under section 3(16) of the Act, we may consider for listing any species, including subspecies, of fish, wildlife, or plants, or any DPS of vertebrate fish or wildlife that interbreeds when mature (16 U.S.C. 1532(16)). Such entities are considered eligible for listing under the Act (and, therefore, are referred to as listable entities), should we determine that they meet the definition of an endangered or threatened species.

Section 4 of the Act (16 U.S.C. 1533) and its implementing regulations at 50 CFR 424 set forth the procedures for adding a species to, or removing a species from the List. A species may be determined to be an endangered or threatened species due to one or more of the five factors described in section 4(a)(1) of the Act:

(A) The present or threatened destruction, modification, or curtailment of its habitat or range;

(B) Overutilization for commercial, recreational, scientific, or educational purposes;

(C) Disease or predation;

(D) The inadequacy of existing regulatory mechanisms; or

(E) Other natural or manmade factors affecting its continued existence.

We must consider these same five factors in delisting a species. We may delist a species according to 50 CFR 424.11(d) if the best available scientific and commercial data indicate that the species is neither endangered nor threatened for the following reasons:

(1) The species is extinct;

(2) The species has recovered and is no longer endangered or threatened; or

(3) The original scientific data used at the time the species was classified were in error.

In making this 90-day finding, we evaluated whether information regarding the coastal California gnatcatcher, as presented in the petition and other information available in our files, is substantial, thereby indicating that the petitioned action may be warranted. The petition did not assert that the coastal California gnatcatcher is extinct, nor do we have information in our files indicating that the coastal California gnatcatcher is extinct. The petition did not assert that the coastal California gnatcatcher has recovered and is no longer endangered or threatened, nor do we have information in our files indicating the coastal California gnatcatcher has recovered. The petition also did not contain any information regarding threats to the coastal California gnatcatcher. We recently completed a 5-year status review in which we determined that the threats found at the time of listing remain, and we recommended that the coastal California gnatcatcher retain its threatened status (Service 2010, pp. 11-35). The petition asserts that the original scientific data used at the time the coastal California gnatcatcher was listed as Threatened under the Act were in error. Our evaluation of the information included with the petition is presented below.

The petitioners claim the coastal California gnatcatcher is not a valid subspecies and request we remove the coastal California gnatcatcher from the List. The petitioners present an unpublished literature review prepared for the Pacific Legal Foundation by Dr. Matthew A. Cronin (2009, in litt. pp. 1-18), which reviewed “* * * post-listing studies to explain why the subspecies classification for the California gnatcatcher is no longer tenable” (PLF 2010, p. 4). The petition presented two published journal articles, Zink et al. (2000, pp. 1394-1405) and Skalski et al. (2008, pp. 199-220), supporting three issues of concern raised by Cronin (2009, in litt. pp. 1-18). The issues of concern raised by Cronin and stated in the petition are:

(1) “Zink et al. (2000, pp. 1394-1405) determined that Atwood's observed morphological characteristic changes are not representative of genetic differentiation, which differentiation could support a subspecies classification. The Zink study's conclusion is all the more significant given that Atwood was a co-author. In their paper, Zink and Atwood expressly state that P. californica should have no subspecies.

(2) Skalski et al. (2008, pp. 199-220) determined that Atwood's statistical analyses were seriously flawed because Atwood's supposed diagnostic characters support a geographic cline, not a distinct break in character distribution markers, which could support a subspecies classification.

(3) Skalski et al. (2008, pp. 199-220) determined that Atwood's data sets were confounded: many of Atwood's specimens may not have been representative of wild gnatcatchers.”

The first issue presented by the petitioners refers to Zink et al. (2000, pp. 1394-1405), which asserts that the morphological differences ( i.e., plumage coloration, body size) identified by Atwood (1988, pp. iii-vii, 1-74; 1991, pp. 118-133) do not represent genetic differentiation that supports subspecies classification. Zink et al. (2000, p. 1399) examined variation within the mitochondrial (mt) mtDNA control region and three mtDNA genes of the coastal California gnatcatcher and concluded the genetic information does not support recognition of the coastal California gnatcatcher as a subspecies. Zink et al. (2000) does not state that Polioptila californica should have no subspecies, but instead suggests that currently recognized subspecies may not be equivalent to ecologically significant units.

As a result of uncertainty in the subspecies status of the coastal California gnatcatcher raised by Zink et al. (2000, pp. 1394-1405), in 2003 and 2004 the Service solicited public comments on a proposed determination of a DPS for the coastal California gnatcatcher (68 FR 20228; 69 FR 18515). Public comments received in 2004 on this issue were highly polarized, though most expressed concern with the validity or usefulness of redefining the coastal California gnatcatcher as a DPS. Some commenters advocated delisting the coastal California gnatcatcher and asserted that the application of the DPS policy was inappropriate. They argued that the information presented by Zink et al. (2000, pp. 1394-1405) challenging the subspecies classification for the coastal California gnatcatcher superseded over 100 years of previously published taxonomic treatments recognizing morphological distinctiveness to varying degrees within the greater California gnatcatcher taxon, including (Brewster 1881, p. 103; Brewster 1902, p. 210; Thayer and Bangs 1907, p. 138; Grinnell 1926, p. 496; Grinnell 1928, p. 227; van Rossem 1931, p. 35; Hellmayr 1934, p. 508; AOU 1957, p. 451; Miller et al. 1957, pp. 204-205; Mayr and Paynter 1964, pp. 449-450; Atwood 1988, p. 61; Atwood 1991, p. 127; Phillips 1991, p. 25; Mellink and Rea 1994, p. 53; Howell and Webb 1995, p. 578). However, many public commenters advocated the retention of the coastal California gnatcatcher as a listed subspecies and questioned if information from one scientific publication was sufficient to overrule information from multiple, previously published, scientific papers that acknowledge the distinctiveness of the coastal California gnatcatcher and lend support to its retention as a listed subspecies. The Service also received comments from peer-reviewers, the majority of which cautioned against putting too much weight on Zink et al.' s (2000) conclusions and questioned whether the analysis by Zink et al. (2000, pp. 1394-1405) supported a change of the coastal California gnatcatcher's subspecific status (2000, pp. 1394-1405).

In 2004, the Service also convened a panel of seven Federal scientists (five Service biologists not associated with the listing of the coastal California gnatcatcher, one Smithsonian Institute biologist, and one National Park Service biologist) to discuss and evaluate how well scientific evidence supports the following statements:

(1) The coastal California gnatcatcher ( Polioptila californica californica ) is a valid subspecies.

(2) The coastal California gnatcatcher is discrete (substantially divergent in physical, physiological, ecological, genetic, or behavioral characters) from other portions of the species.

(3) Loss of the coastal California gnatcatcher would represent a significant diminution of the species as a whole (in terms of evolutionary legacy or range of biological characteristics represented within the species).

(4) The coastal California gnatcatcher is neither a valid subspecies nor a discrete and significant portion of the species.

(5) The mtDNA evidence presented by Zink et al. (2000) alone constitutes sufficient information to overturn the existing taxonomy.

Overall, panelists supported retaining the coastal California gnatcatcher as a subspecies under the Act for reasons including (but not limited to):

(1) “There is evidence showing the coastal California gnatcatcher differs in several morphological characters from gnatcatcher populations farther south (body plumage color, tail length, amount of white in tail, and brownish plumage in females). All authorities have recognized it as a distinct taxon based on its physical appearance since it was first described. While some doubt has been cast on recent analyses of morphological data by Atwood (1991), problems with that analysis do not invalidate previous and subsequent morphological work (Grinnell 1926, van Rossem 1931, Mellink and Rea 1994).” (VanderWerf, in litt. 2004, p. 1).

(2) Although Zink et al. (2000) concluded that mitochondrial DNA does not support the existence of a subspecies of Polioptila californica, “mtDNA represents only a single genetic marker among many potential markers that could provide an indication of population subdivision, subspecies, or local adaptation. Other molecular markers with higher mutation rates may reveal more recent patterns of divergence and would be more likely to show population differentiation, such as nuclear genetic markers, which might be linked to selected traits and would be expected to evolve more rapidly than mtDNA. None of these other markers have been investigated” (VanderWerf, in litt. 2004, pp. 1-2).

(3) “Phylogenetic reconstructions and taxonomic determinations should be, and usually are, based on a variety of morphological, genetic (including nuclear and mtDNA), and behavioral evidence.” (VanderWerf, in litt. 2004, p. 2).

(4) “Patterns in mtDNA variations can be extremely variable and may or may not have anything to do with the patterns seen in nuclear markers, or with morphological, ecological, physiological, or behavioral data, and therefore are often not reflective of important differences between species, subspecies or populations. Patterns of genetic variation can be totally different from, and uninformative about, important adaptive differences between taxa (Crandall et al. 2000). Besides the California gnatcatcher, there are many examples in which mtDNA evidence failed to detect documented differences in morphology, nuclear DNA and ecological adaptation, including the Common raven (Omland et al. 2000), Orchard oriole (Baker et al. 2003), Florida grasshopper sparrow (Bulgin et al. 2003), and Swamp sparrows (Greenberg et al. 1998).” (VanderWerf, in litt. 2004, p. 2).

(5) “The most comprehensive review of available mtDNA data was conducted by Funk and Omland (2003), who found that 23 percent of 2,319 species showed evidence of paraphyly or polyphyly based on mtDNA (sharing of mtDNA haplotypes among species), and they concluded that the causes of this must be understood to avoid erroneous phylogenetic interpretations.” (VanderWerf, in litt. 2004, p. 2).

(6) “Loss of the coastal California gnatcatcher would substantially decrease the species' range and, since it occurs in a somewhat different habitat type from other populations, would diminish the ecological range of characteristics present in the species. Although the adaptive significance of the morphological differences has not been investigated, it is possible they represent important adaptations to the local environment, and that their loss would diminish the species evolutionary legacy.” (VanderWerf, in litt. 2004, pp. 1-2).

(7) “Zink et al. (2000) provide some interesting information on the evolutionary history of [gnatcatcher] populations, but the argument that the California gnatcatcher is not distinct from other populations is based on a single genetic character, mtDNA, and this is a far too narrow and limited technique for making determinations of taxonomic validity. Most features of an organism are determined by multiple (nuclear) genes, not by mtDNA. Taxonomists and other biologists interested in evolutionary units cannot ignore available data on other aspects of the genome and physical and ecological characters (Crandall et al. 2000). Under the very narrow criterion of Zink et al. (2000) few subspecies would be valid, and many full species would not be recognized, despite abundant and definitive data that they are no longer capable of interbreeding with other species (Avise 2004).” (VanderWerf, in litt. 2004, pp. 2-3).

The panel concluded that the scientific evidence: (1) Substantially supports that the coastal California gnatcatcher is a valid subspecies; (2) substantially supports that the coastal California gnatcatcher is discrete from other portions of the species; (3) substantially supports that the loss of the coastal California gnatcatcher would represent a significant diminution of the species as a whole; (4) offers little support for the assertion that the coastal California gnatcatcher is neither a valid subspecies nor a discrete and significant portion of the species; and (5) displays little support that the mtDNA evidence presented by Zink et al. (2000, pp. 1394-1405) alone constitutes sufficient information to overturn the existing taxonomy. The panel also noted that further decision on the status of the taxon should wait for analyses of a variety of morphological, genetic (including nuclear and mtDNA), and behavioral evidence.

In 2005, Edwards et al. (p. 6552) asserted that nuclear genes, not mtDNA, should have priority in determining avian species delimitation. Additionally, Haig and Winker (2010, pp. 172, 174) asserted the best approach for subspecies recognition is to include multiple characters (mtDNA, nuclear DNA, morphology) and that reliance on a single locus with unique properties, such as mtDNA, may not accurately reflect the genetic differences among populations due to random genetic effects (Funk et al. 2007, pp. 1287-1288).

We acknowledge that the taxonomic classification of the coastal California gnatcatcher has been the subject of considerable scientific debate. The Service also addresses the information presented by Zink et al. (2000) in a recent 5-year review for the coastal California gnatcatcher (Service 2010, pp. 4-5). Species experts have recognized the coastal California gnatcatcher as a distinct taxon based on its physical appearance since it was first described, and the taxon is recognized as a distinct subspecies by the American Ornithologists Union (AOU 1957, p. 451). Some doubt has been cast on analyses of morphological data by Atwood (1991, pp. 118-133) ( e.g., Cronin 1997, p. 663), but problems with those analyses do not invalidate previous and subsequent morphological work (Grinnell 1926, pp. 493-500; van Rossem 1931, pp. 36-37; Phillips 1991, pp. 25-26; Mellink and Rea 1994, pp. 50-62). Analysis by Zink et al. (2000, p. 1402) suggested that the northern population of California gnatcatchers does not appear to be unique, and that not all recognized subspecies equate to evolutionary significant units, although they were unable to expressly state that P. californica should have no subspecies, as claimed in the petition. We concluded in our 5-year review (Service 2010, pp. 4-5), that Zink et al. (2000, pp. 1394-1405) was insufficient to disregard the existing taxonomic status of the coastal California gnatcatcher and the information from multiple scientific papers that support subspecies classification of P.c. cali-fornica. We affirm that conclusion here. We conclude that the information and analysis in Zink et al. 2000 does not present substantial information that the current subspecies taxonomic classification of the coastal California gnatcatcher may be in error.

The second issue presented by the petitioners refers to Skalski et al. (2008, pp. 199-220) and the assertion that the statistical analyses applied to the morphological data (collected by Atwood in determining the subspecies status of the coastal California gnatcatcher) were not appropriate statistical techniques for determining subspecific species classification. The issue Skalski et al. (2008, pp. 199-220) raises concerns the use of numerous tests of equality of sample means, cluster analysis, and discriminant analysis (Atwood 1991; Atwood, in litt. 1994; Link and Pendleton, in litt. 1994; McDonald et al., in litt. 1994; Messer, in litt. 1994, Newton, in litt. 1994), which supported the subspecies classification. Skalski et al. (2008, pp. 199-220) assert these analyses are subject to high rates of false positives (Type I error) and therefore determination of classification as a subspecies should be based on analyses designed to detect specific alternative hypotheses, such as step and spline regression, while being insensitive to the sample location distributions (Skalski et al. 2008, p. 217).

We examined this paper and determined the statistical analysis conducted by Skalski et al. (2008, pp. 210-212), a spline regression model using the log-length of the white spot on the sixth rectrix (tail feather) of the California gnatcatcher, was a new interpretation of old data and examined only one character, as an example of the statistical analysis of the 31 that Atwood (1988, pp. iii-vii, 1-74; 1991, 118-133) analyzed in his research. Skalski's analysis of this character, in contrast to Atwood's analysis, did not detect variation in the character consistent with subspecific designations within the California gnatcatcher. However, the Service concludes the results of this restrictive analysis do not present substantial evidence supporting potential revision of the subspecific taxonomic classification of the coastal California gnatcatcher. While the issue of concern raised by Skalski et al. (2008, pp. 199-220) and the petitioners relates to the validity of the statistical technique used, and we acknowledge that application of different statistical methods may yield different conclusions, the study's application of alternative methods of data analyses is limited. Without further analysis of additional characters, few conclusions can be made as to the appropriate taxonomic classification of the coastal California gnatcatcher. The current information does not provide substantial information that the current subspecies taxonomic classification of the coastal California gnatcatcher may be in error.

We previously analyzed the statistical technique utilized to determine subspecific classification of the coastal California gnatcatcher and addressed this topic in a publication in the Federal Register that determined that the conclusions reached by Atwood (1991) were reasonable and were largely consistent with five other independent and alternative scientific analyses (Link and Pendleton, in litt. 1994; Atwood, in litt. 1994; McDonald et al., in litt. 1994; Messer, in litt. 1994, Newton, in litt. 1994) that were received at that time and support 30° north latitude as the southern subspecific boundary of P.c. californica (60 FR 15698; March 27, 1995). We continue to agree that Atwood's conclusions are reasonable because they are based on scientifically sound methodology that represents the best available scientific and commercial data available (60 FR 15699; March 27, 1995), as required in 50 CFR 424.11(d).

The final issue presented by the petitioners also refers to Skalski et al. (2008, pp. 199-220) and their assertion that “foxing” (the change in feather color associated with time after preparation of the specimen) of museum specimens might have biased Atwood's original and subsequent analysis of phenotypic characters, including plumage brightness (Atwood 1988, pp. iii-vii, 1-74; 1991, 118-133), by confounding the specimen's year of collection with measures of brightness of plumage. Significantly, Skalski et al. (2008) did not reexamine the specimens evaluated by Atwood, but instead constructed scatterplot diagrams that compared the area of specimen collection (latitude) with time (year) collected.

Mellink and Rea (1994, pp. 50-62), in their analyses of coastal California gnatcatcher taxonomy, collected samples from the field and specimens from museums for comparison of genetic differences. The petition argues that the study skins analyzed by Mellink and Rea (1994) were also subject to foxing. However, Mellink and Rea (1994, pp. 52-53) excluded samples that were worn, damaged, or soiled to eliminate discrepancies among samples and concluded that within this species, foxing is “* * * slight and seems restricted largely to the gray underparts, with little or no apparent change in brown areas.”

Additionally, as mentioned under the second issue presented by the petitioners, five independent statistical analyses were conducted and submitted to the Service, in response to a request for public comment (59 FR 28508, 59 FR 38426, 59 FR 44125, 59 FR 53628, 59 FR 66509). These analyses (Link and Pendleton, in litt. 1994; Atwood, in litt. 1994; McDonald et al., in litt. 1994; Messer, in litt. 1994; Newton, in litt. 1994) as well as Mellink and Rea (1994) were addressed in the March 27, 1995, Federal Register publication (60 FR 15693) announcing our determination that the coastal California gnatcatcher is a valid subspecies and affirming the coastal California gnatcatcher's threatened status under the Act (60 FR 15695). In that document, we concluded that there was no justification to support a claim that Atwood's 1991 data were incomplete, censored, or otherwise inadequate. Furthermore, we concluded that the analysts of the five independent reviews of Atwood's 1991 data took adequate care to remove potential effects of confounding of specimen age and collection area (60 FR 15695; March 27, 1995).

We conclude that the petitioner did not present substantial new information regarding the subspecific status of the coastal California gnatcatcher. The genetic information provided in the petition (Zink et al. 2000) and assertions of improper statistical analyses (Skalski et al. 2008) have been the focus of several Service (Service 2010) and independent scientific reviews (Link and Pendleton, in litt. 1994; Atwood, in litt. 1994; McDonald et al., in litt. 1994; Messer, in litt. 1994; Newton, in litt. 1994; Mellink and Rea 1994; VanderWerf, in litt. 2004) and the Service has concluded that the information is insufficient to support reclassification (see Service 2010, pp. 1-51). Issues regarding morphological analyses and specimen quality have also been considered by the Service and by numerous other taxonomic examinations, all of which support the subspecific status of the coastal California gnatcatcher (Grinnell 1926, pp. 493-500; van Rossem 1931, pp. 36-37; Phillips 1991, pp. 25-26; Mellink and Rea 1994, pp. 50-62). We hereby reaffirm our determination and recognition of the coastal California gnatcatcher as a distinct taxon, at the rank of subspecies as Polioptila californica californica.

In summary, the petition does not present substantial information to support a finding that the removal of the coastal California gnatcatcher from the List of Endangered and Threatened Wildlife may be warranted on the ground that the coastal California gnatcatcher is not a valid subspecies.

The petition presents an unpublished review by Cronin (2009, pp. 1-18) contending that subspecies classification for the coastal California gnatcatcher is not reasonable. The review discusses articles by Skalski et al. (2008, pp. 1394-1405) and Zink et al. (2000), that provide analyses of Atwood's (1991) data. We previously reviewed Atwood's data (1988 and 1991) and concluded that Atwood's conclusion that the coastal California gnatcatcher is a valid subspecies is adequately supported (60 FR 15693, March 27, 1995). We also convened a panel of experts in 2004 to consider the Zink et al. (2000) study. The panel concluded that Zink et al. (2000) offers little and insufficient support for reconsidering the coastal California gnatcatcher's subspecies classification. Our recent status review also concluded that the coastal California gnatcatcher represents a valid subspecies (Service 2010, pp. 1-51).

The petitioners also assert that the Service should overturn the classification of the coastal California gnatcatcher as a subspecies due to inappropriate techniques used in Atwood's (1991) statistical analysis of morphological data and present a review and interpretation of two journal articles in support of their claim. The Service reviewed the articles and determined that they do not present new information; instead they consist of an incomplete interpretation of old data. Moreover, the concerns raised by petitioners regarding “foxing” and the statistical technique utilized to analyze the data, were previously considered and rejected in our March 27, 1995, Federal Register publication affirming that the coastal California gnatcatcher meets the definition of a “species” under the Act (60 FR 15693), a Service status review (Service 2010, pp. 1-51), and a peer-reviewed journal (Mellink and Rea 1994, pp. 50-62).

Morphological variation within the California gnatcatcher species has been recognized as an indicator of the distinctiveness of populations and subspecific groups by numerous biologists, publications, and the AOU before and after Atwood's conclusion that the coastal California gnatcatcher is a valid subspecies (Brewster 1881, p. 103; Brewster 1902, p. 210; Thayer and Bangs 1907, p. 138; Grinnell 1926, p. 496; Grinnell 1928, p. 227; van Rossem 1931, p. 35; Hellmayer 1934, p. 508; AOU 1957, p. 451; Miller et al. 1957, pp. 204-205; Paynter 1964, pp. 449-450; Atwood 1988, p. 61; Atwood 1991, p. 127; Phillips 1991, p. 25; Mellink and Rea 1994, p. 53; Howell and Webb 1995, p. 578). Thus, we conclude that the best information available indicates that the coastal California gnatcatcher is a valid subspecies and that the original scientific data evaluated and methods of analysis used at the time of listing were not in error as suggested by the petitioners.

The sole focus of the petition is the contention that the coastal California gnatcatcher is not a valid subspecies and therefore should be delisted. Petitioners do not provide any information related to the other relevant factors that the Service considers when reviewing proposals to list or delist a species, including the factors provided under subsection 4(a)(1) of the Act. The information in Service files, including our recent 5-year review of the species (Service 2010, pp. 1-51), confirms that threats to the coastal California gnatcatcher remain.

We have reviewed the petition, as well as the literature cited in the petition, and we have evaluated that information and information in our files. Based on this review and evaluation, we find that the petition does not present substantial scientific or commercial information to indicate that removal of the coastal California gnatcatcher from the List may be warranted. Although we will not commence a status review in response to this petition, we will continue to monitor the population status and trends of the coastal California gnatcatcher, potential threats to the coastal California gnatcatcher, and ongoing management actions that might be important with regard to the conservation of the coastal California gnatcatcher across its range.

Because we conclude that the coastal California gnatcatcher is a valid subspecies under the Act, we are no longer considering whether to propose its reclassification to a DPS under the Act. This document reaffirms our recognition of the coastal California gnatcatcher as a subspecies. We encourage interested parties to continue to gather data that will assist with the conservation of the subspecies. If you wish to provide information regarding the coastal California gnatcatcher, you may submit your information or materials to the Field Supervisor, Carlsbad Fish and Wildlife Office (see ADDRESSES ), at any time.

A complete list of references cited is available on the Internet at http://www.regulations.gov and upon request from the Carlsbad Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT ).

The primary authors of this notice are the staff members of the Carlsbad Fish and Wildlife Office.

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

Specifications, as referred to in this proposed rule, are the combined suite of commercial and recreational catch levels established for one or more fishing years. The specification process also allows for the modification of a select number of management measures, such as closure thresholds, gear restrictions, and possession limits. The Council's process for establishing specifications relies on provisions within the Fishery Management Plan (FMP) and its implementing regulations, as well as requirements established by the Magnuson-Stevens Act. Specifically, section 302(g)(1)(B) of the Magnuson-Stevens Act states that the Scientific and Statistical Committee (SSC) for each Regional Fishery Management Council shall provide its Council ongoing scientific advice for fishery management decisions, including recommendations for acceptable biological catch (ABC), preventing overfishing, maximum sustainable yield, and achieving rebuilding targets. The ABC is a level of catch that accounts for the scientific uncertainty in the estimate of the stock's defined overfishing level (OFL). The Council's SSC met on May 26 and 27, 2011, to recommend ABCs for the 2012 Atlantic mackerel (mackerel) and butterfish specifications, and the 2012-2014 Illex and longfin squid specifications.

The FMP's implementing regulations require the involvement of a monitoring committee in the specification process for each species. Since the Magnuson-Stevens Act requirements for the SSC to recommend ABC became effective, the monitoring committees' role has largely been to recommend any reduction in catch limits from the SSC-recommended ABCs to offset management uncertainty, and to recommend other management measures ( e.g., gear and/or possession restrictions) needed for the efficient management of the fishery. The MSB Monitoring Committee met on May 27, 2011, to discuss specification related recommendations for the 2012 mackerel and butterfish fisheries, and the 2012-2014 Illex and longfin squid fisheries.

Following the meetings described above, the Council considered the recommendations of the SSC, the Monitoring Committee, and public comments at its June 14-16, 2011, meeting in Port Jefferson, NY, and made their specification recommendations. The Council submitted these recommendations, along with the required analyses, for agency review on August 9, 2011, with final submission on September 15, 2011. NMFS must review the Council's recommendations to assure that they comply with the FMP and applicable law, and conduct notice-and-comment rulemaking to propose and implement the final recommendations.

The structure of specifications for the mackerel and butterfish fisheries was revised by the Council's recently finalized regulations implementing the Omnibus Amendment (76 FR 60606, September 29, 2011), which established annual catch limit (ACL) and accountability measure (AM) provisions for all of the Council's FMPs. Following the specification of ABC, the revised regulations at § 648.22 require the specification of ACLs, which, if exceeded, require payback deductions from the subsequent year's catch limit. In order to avoid ACL overages, and the associated paybacks when ACLs are exceeded, the regulations also require the specification of annual catch targets (ACTs) to provide a buffer for management. Several specifications, including domestic annual harvest (DAH), domestic annual processing (DAP), total allowable level of foreign fishing (TALFF), and joint venture processing for mackerel (JVP), were previously required in the implementing regulations for the FMP, and remain unchanged by the Omnibus Amendment.

For mackerel, the Omnibus Amendment and Amendment 11 to the MSB FMP (approved on September 30, 2011) created distinct allocations for the commercial and recreational mackerel fisheries. The revised mackerel regulations require the specification of ACTs for both the commercial and recreational mackerel fisheries. For butterfish, the regulations require specification of the mortality cap on the longfin squid fishery.

The regulations governing specifications for Illex and longfin squid are largely unchanged; both squid species are exempt from ACL/AM requirements because they have a life cycle of less than 1 year. For both squid species, regulations at § 648.22 require the specification of ABC, initial optimum yield (IOY), DAH, and DAP.

The Mid-Atlantic Research Set-Aside (RSA) Program allows research projects to be funded through the sale of fish that has been set aside from the total annual quota. The RSA may vary between 0 and 3 percent of the overall quota for each species. The Council has recommended that up to 3 percent of the total ACL for mackerel and butterfish, and up to 3 percent of the IOY for Illex and longfin squid, may be set aside to fund projects selected under the 2012 Mid-Atlantic RSA Program. NMFS solicited research proposals under the 2012 Mid-Atlantic RSA Program through a Federal Funding Opportunity announcement that published on January 6, 2011. The project selection and award process for the 2012 Mid-Atlantic RSA Program has not concluded. However, three projects have been preliminarily selected for approval by the Northeast Fisheries Science Center. These projects have collectively requested 250,580 lb (113,681 kg) of longfin squid, 200,000 lb (90,718 kg) of butterfish, 689,932 lb (312,948 kg) of summer flounder, 509,160 lb (230,951 kg) of scup, 184,280 lb (83,588 kg) of black sea bass, and 200,000 lb (90,718 kg) of bluefish. Project awards are pending a review by the NOAA Grants Office. If any portion of the MSB RSA is not awarded, NMFS will return it to the general fishery either through the final 2012 MSB specification rulemaking process or through the publication of a separate notice in the Federal Register notifying the public of a quota adjustment.

These proposed specifications include a brief description of the preliminarily selected 2012 Mid-Atlantic RSA projects, including a description of applicable MSB exemptions that will likely be required to conduct the proposed research and compensation fishing. The Magnuson-Stevens Act requires that interested parties be provided an opportunity to comment on all proposed exempted fishing permits (EFPs).

Vessels harvesting RSA quota in support of approved research projects would be issued EFPs authorizing them to exceed Federal possession limits and to fish during Federal quota closures. With respect to the MSB FMP, such regulations include closure regulations at § 648.24 and possession restrictions at § 648.26. These exemptions are necessary to allow project investigators to recover research expenses, as well as adequately compensate fishing industry participants harvesting RSA. Vessels harvesting RSA would operate within all other regulations that govern the commercial fishery, unless otherwise exempted through a separate EFP. Vessels conducting compensation fishing would harvest RSA quota during the fishing year from January 1-December 31, 2012.

Project #1: The proposed project is the continuation of a scup survey of 10 hard-bottom sites in Southern New England (SNE) that are not sampled by current state and Federal finfish trawl surveys. Unvented fish pots will be fished on each site from June through October in coastal waters of Nantucket Sound, Martha's Vineyard Sound, and Buzzard's Bay, MA, and Rhode Island Sound, RI. The length frequency distribution of the catch will be compared statistically to each of the other collection sites, and to finfish trawl data collected by the NMFS and state agencies to gain greater understanding of the scup stock structure. Vessels conducting research would not require any exemptions from regulations implemented under the MSB FMP. Vessels harvesting RSA quota would require the aforementioned closure and possession limit exemptions to facilitate compensation fishing activities.

Project #2: The proposed project is a black sea bass survey of sites in SNE and Mid‐Atlantic waters. Unvented black sea bass pots will be fished on each site, which will include one in Massachusetts, one south of Rhode Island, one south of New Jersey, and one south of Virginia, for 5 months from June through October in SNE, and April through August in the Mid‐Atlantic. The project is designed to collect black sea bass from sites that are un‐sampled by current state and Federal finfish bottom trawl surveys. The length frequency distribution of the catch will be compared to each of the other collection sites, and to finfish trawl data collected by NMFS and state agencies to gain greater understanding of the black sea bass stock structure. Vessels conducting research would not require any exemptions from regulations implemented under the MSB FMP. Vessels harvesting RSA quota would require the aforementioned closure and possession limit exemptions to facilitate compensation fishing activities.

Project #3: The proposed project would continue a spring and fall trawl survey in shallow waters between Martha's Vineyard, MA, and Cape Hatteras, NC, that are not sampled by the NMFS trawl survey. The project investigators plan to provide stock assessment data for Mid-Atlantic RSA species, including summer flounder, scup, black sea bass, longfin squid, butterfish, and Atlantic bluefish, and assessment-quality data for weakfish, Atlantic croaker, spot, several skate and ray species, smooth dogfish, horseshoe crab, and several unmanaged but important forage species. Vessels conducting this near-shore trawl survey would not require any exemptions from regulations implemented under the MSB FMP. Vessels harvesting RSA quota would require the aforementioned closure and possession limit exemptions to facilitate compensation fishing activities.

The status of the mackerel stock was assessed by the Transboundary Resources Assessment Committee (TRAC) in March 2010. The 2010 TRAC Status Report indicated reduced productivity in the stock and a lack of older fish in both the survey and catch data; however, the status of the mackerel stock is unknown because biomass reference points could not be determined. According to the FMP, mackerel ABC must be calculated using the formula U.S. ABC = Stock-wide ABC − C, where C is the estimated catch of mackerel in Canadian waters for the upcoming fishing year. Due to uncertainty in the assessment, the TRAC recommended that total annual catches not exceed 80,000 mt (average total U.S. and Canadian landings from 2006-2008) until new information is available. The SSC recommended specifying the stock-wide ABC for 2012 at 80,000 mt, consistent with the TRAC recommendation. The Council recommended a U.S. ABC of 43,781 mt (80,000 mt − 36,219 mt (estimated 2012 Canadian catch)).

Consistent with MSB Amendment 11, the Council recommended a recreational allocation of 2,714 mt (6.2 percent of the U.S. ABC). The proposed Recreational ACT of 2,443 mt (90 percent of 2,714 mt) is reduced to account for low precision and time lag of recreational catch estimates, as well as lack of recreational discard estimates. The Recreational ACT is equal to the Recreational Harvest Limit (RHL), which would be the effective cap on recreational catch.

For the commercial mackerel fishery, the Council recommended a commercial fishery allocation of 41,067 mt (93.8 percent of the U.S. ABC, the portion of the ACL that was not allocated to the recreational fishery). The recommended Commercial ACT of 34,907 mt (85 percent of 41,067) is reduced to address uncertainty in estimated 2012 Canadian landings, uncertainty in discard estimates, and possible misreporting. The Commercial ACT would be further reduced by a discard rate of 3.11 percent (mean plus one standard deviation of discards from 1999-2008), to arrive at the proposed DAH of 33,821 mt. The DAH would be the effective cap on commercial catch, as it has been in past specifications.

Consistent with the Council's recommendation, NMFS proposes mackerel specifications that would set the U.S. ABC/ACL at 43,781 mt, the Commercial ACT at 34,907 mt, the DAH and DAP at 33,821 mt, and the Recreational ACT at 2,443 mt.

Additionally, as recommended by the Council, NMFS proposes to maintain JVP at zero (the most recent allocation was 5,000 mt of JVP in 2004). In the past, the Council recommended a JVP greater than zero because it believed U.S. processors lacked the ability to process the total amount of mackerel that U.S. harvesters could land. However, for the past 8 years, the Council has recommended zero JVP because U.S. shoreside processing capacity for mackerel has expanded. The Council concluded that processing capacity was no longer a limiting factor relative to domestic production of mackerel.

The Magnuson-Stevens Act provides that the specification of TALFF, if any, shall be the portion of the optimum yield (OY) of a fishery that will not be harvested by U.S. vessels. TALFF would allow foreign vessels to harvest U.S. fish and sell their product on the world market, in direct competition with U.S. industry efforts to expand exports. While a surplus existed between ABC and the mackerel fleet's harvesting capacity for many years, that surplus has disappeared due to downward adjustments of the specifications in recent years. Based on analysis and a review of the state of the world mackerel market and possible increases in U.S. production levels, the Council concluded that specifying a DAH/DAP resulting in zero TALFF will yield positive social and economic benefits to both U.S. harvesters and processors, and to the Nation. For these reasons, consistent with the Council's recommendation, NMFS proposes to specify DAH at a level that can be fully harvested by the domestic fleet, thereby precluding the specification of a TALFF, in order to support the U.S. mackerel industry. NMFS concurs that it is reasonable to assume that in 2012 the commercial fishery has the ability to harvest 33,821 mt of mackerel.

Finally, this rule proposes that the commercial fishery be closed at 95 percent of the DAH, as recommended by the Council. The current closure threshold of 90 percent of the DAH was designed to accommodate misreporting in the commercial fishery, and the lack of a distinct allocation for the recreational fishery. A 95-percent closure threshold should be sufficient to prevent overages, given that a recreational allocation is now required by the FMP.

The current status of the butterfish stock is unknown because biomass reference points could not be determined in the SAW 49 assessment (February 2010). Though the butterfish population appears to be declining over time, fishing mortality does not seem to be the major cause. Butterfish have a high natural mortality rate, and the current estimated fishing mortality (F = 0.02) is well below all candidate overfishing threshold reference points. The assessment report noted that predation is likely an important component of the butterfish natural mortality rate (currently assumed to be 0.8), but also noted that estimates of consumption of butterfish by predators appear to be very low. In short, the underlying causes for population decline are unknown.

The SSC recommended an ABC of 3,622 mt (100 percent increase from 2011) because butterfish survey indices appear stable or increasing, there have been anecdotal observations of increased butterfish abundance, and fishing mortality appears low when compared to natural mortality.

The Council recommended setting the butterfish ACL equal to the ABC, and establishing a 10-percent buffer between ACL and ACT for management uncertainty, which would result in an ACT of 3,260 mt. Since discards have been roughly 2/3 of catch (1999-2008 average), the Council recommended setting the DAH and DAP at 1,087 mt (3,260 mt−2,173 mt discards). Butterfish TALFF is only specified to address bycatch by foreign fleets targeting mackerel TALFF. Because there is no mackerel TALFF, butterfish TALFF would also be set at zero.

The Council recommended setting the butterfish mortality cap on the longfin squid fishery at 2,445 mt (75 percent of 3,260 mt). If the butterfish mortality cap is harvested during Trimester I (January-April) or Trimester III (September-December), the directed longfin squid fishery will close for the remainder of that trimester.

NMFS proposes specifications, consistent with the Council's recommendation, that would set the butterfish ABC/ACL at 3,622 mt, the ACT at 3,260 mt, the DAH and DAP at 1,087 mt, and the butterfish mortality cap on the longfin squid fishery at 2,445 mt. Additionally, consistent with MSB regulations, NMFS is proposing zero TALFF for butterfish in 2010 because mackerel TALFF is also specified at zero. Consistent with 2011, NMFS proposes that the 2012 butterfish mortality cap be allocated by Trimester as follows:

Finally, the Council recommended, and NMFS proposes, that a 3-inch (76-mm) minimum codend mesh size requirement apply for vessels possessing 2,000 lb (0.9 mt) or more of butterfish (up from 1,000 lb (0.45 mt) in 2011) in order to allow some portion of butterfish discards to be landed.

The Illex stock was most recently assessed at SARC 42 in late 2005. While it was not possible to evaluate current stock status because there are no reliable current estimates of stock biomass or F, qualitative analyses determined that overfishing had not likely been occurring. The SSC recommended the status quo ABC of 24,000 mt based on observations that catches in this range, and up to 26,000 mt, have not caused any apparent harm to the stock.

The Council recommended that the ABC be reduced by a revised discard rate of 4.52 percent (the mean plus one standard deviation of the most recent 10 years of observed discards), which results in an IOY, DAH, and DAP for recommendation of 22,915 mt for the 2012-2014 fishing years.

Consistent with the Council's recommendation, NMFS proposes to specify the Illex ABC as 24,000 mt, and to specify IOY, DAH, and DAP as 22,915 mt for the 2012-2014 fishing years. The FMP does not authorize the specification of JVP and TALFF for the Illex fishery because of the domestic fishing industry's capacity to harvest and to process the OY from this fishery.

The 51st Northeast Regional Stock Assessment Workshop (SAW 51), published in January 2011, found that the longfin squid stock is not overfished, but that the overfishing status is unknown. The SSC used the updated stock assessment information to recommend an ABC of 23,400 mt for the 2012-2014 fishing years, subject to annual review. This recommendation corresponds to catch in the year with the highest observed exploitation fraction (catch divided by estimated biomass) during a period of light exploitation (1976-2009). The SSC interpreted this level of exploitation to be sustainable over the long term.

The Council recommended that the ABC be reduced by a revised discard rate of 4.08 percent (mean plus one standard deviation of the most recent 10 years of observed discards), which results in an IOY, DAH, and DAP for recommendation of 22,445 mt for the 2012-2014 fishing years.

NMFS concurs with the Council's recommendation; therefore, this action proposes an ABC of 23,400 mt, and an IOY, DAH, and DAP of 22,445 mt for the 2012-2014 fishing years. The FMP does not authorize the specification of JVP and TALFF for the longfin squid fishery because of the domestic industry's capacity to harvest and process the OY for this fishery.

The proposed 2012-2014 longfin DAH would be allocated into trimesters, according to percentages specified in the FMP, as follows:

The Council recommended, and NMFS proposes, to allow Longfin Squid/Butterfish moratorium permit holders to possess longfin squid in excess of the 2,500-lb (0.93-mt) possession limit during any closures of the longfin squid fishery resulting from the butterfish mortality cap, provided that all trawl gear is appropriately stowed. The butterfish mortality cap was designed to limit butterfish bycatch in the longfin squid trawl fishery, and jigging for squid is not expected to result in substantial butterfish bycatch.

This proposed rule also contains minor corrections to existing regulations. The corrections would not change the intent of any regulations; they would only clarify the intent of existing regulations by correcting technical errors. The proposed regulatory text restructures § 648.23(a). In addition, the Illex fishery gear exemption in § 648.23(a) (formerly at § 648.23(a)(3)(ii)) would be revised to clarify the timing of the exemption, and to match the stated gear requirements to those implemented for the longfin squid fishery through Amendment 10 to the MSB FMP. Finally, longfin squid was previously referred to as Loligo squid. Due to a recent change in the scientific name of longfin squid from Loligo pealeii to Doryteuthis (Amerigo) pealeii, the Council will now use the common name “longfin squid” in all official documents to avoid confusion. Accordingly, the regulatory text is amended to replace all references to “ Loligo” squid with the term “longfin squid.”

Pursuant to section 304(b)(1)(A) of the Magnuson-Stevens Act, the NMFS Assistant Administrator has determined that this proposed rule is consistent with the Atlantic Mackerel, Squid, and Butterfish FMP, other provision of the Magnuson-Stevens Act, and other applicable law, subject to further consideration after public comment.

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

The Council prepared an IRFA, as required by section 603 of the Regulatory Flexibility Act (RFA). The IRFA describes the economic impact this proposed rule, if adopted, would have on small entities. A summary of the analysis follows. A copy of this analysis is available from the Council or NMFS (see ADDRESSES ) or via the Internet at http://www.nero.noaa.gov.

This action proposes 2012 specifications for mackerel and butterfish, and 2012-2014 specifications for Illex and longfin squid. It also proposes to modify the closure threshold for the commercial mackerel fishery, to adjust the gear requirements for the butterfish fishery, to create an exemption for the use of jigs, should the longfin squid fishery be closed due to reaching the butterfish mortality cap. A complete description of the reasons why this action is being considered, and the objectives of and legal basis for this action, are contained in the preamble to this proposed rule and are not repeated here.

Based on permit data for 2011, the numbers of potential fishing vessels in the 2012 fisheries are as follows: 351 Longfin squid/butterfish moratorium permits; 76 Illex moratorium permits; 2,201 mackerel permits; 1,904 incidental squid/butterfish permits; and 831 MSB party/charter permits. Small businesses operating in commercial and recreational ( i.e., party and charter vessel operations) fisheries have been defined by the Small Business Administration as firms with gross revenues of up to $4.0 and $6.5 million, respectively. There are no large entities participating in this fishery, as that term is defined in section 601 of the RFA. Therefore, there are no disproportionate economic impacts on small entities. Many vessels participate in more than one of these fisheries; therefore, permit numbers are not additive.

There are no new reporting or record keeping requirements contained in any of the alternatives considered for this action. In addition, there are no Federal rules that duplicate, overlap, or conflict with this proposed rule.

The recently finalized Omnibus Amendment, which applies to mackerel and butterfish, changes the structure of specifications compared to that used in past years. In order to facilitate comparison of alternatives, the discussions of mackerel and butterfish specifications below will focus on the effective limit on directed harvest, regardless of the terminology used for the specification. The specifications and terminology for Illex and longfin squid are unchanged from those used in 2011.

The mackerel commercial DAH proposed in this action (33,821 mt) represents a reduction from status quo (2011 DAH = 46,779 mt). Despite the reduction, the proposed DAH is above recent U.S. landings; mackerel landings for 2008-2010 averaged 18,830 mt. Thus, the reduction does not pose a constraint to vessels relative to the landings in recent years. In 2011, there was a soft allocation of 15,000 mt of the mackerel DAH for the recreational mackerel fishery. The Omnibus Amendment and MSB Amendment 11 established an explicit allocation for the recreational fishery, and this action proposes a Recreational ACT/RHL of 2,443 mt. Because recreational harvest from 2008-2010 averaged 738 mt, it does not appear that the new, explicit allocation for the recreational fishery will constrain recreational harvest. Overall, the proposed action is not expected to result in any reductions in revenues for vessels that participate in either the commercial or recreational mackerel fisheries.

The proposed change to the mackerel closure threshold, which would require the closure of the commercial mackerel fishery at 95 percent of the DAH, is a preventative measure intended to ensure that the commercial catch limit is not exceeded. The economic burden on fishery participants associated with this measure is expected to be minimal.

The butterfish DAH proposed in this action (1,087 mt) represents a 117-percent increase over the 2011 DAH (500 mt). Due to market conditions, there has not been a directed butterfish fishery in recent years; therefore, recent landings have been low. The proposed increase in the DAH has the potential to increase revenue for permitted vessels.

The proposed adjustment to the gear requirement for the butterfish fishery, which would require vessels possessing 2,000 lb (0.9 mt) or more of butterfish to fish with a 3-inch (76-mm) minimum codend mesh, is expected to result in a modest increase in revenue for fishery participants. This adjustment would enable additional retention of butterfish by vessels using small-mesh fishing gear. Previously, the mesh size requirement applied to vessels possessing 1,000 lb (0.45 mt) or more of butterfish.

The Illex IOY (22,915 mt) proposed in this action represents a slight decrease compared to status quo (23,328 mt). Though annual Illex landings have totaled over 2/3 of the IOY in the past 3 years (15,900 mt for 2008, 18,419 mt for 2009, and 15,825 for 2010), the landings were lower than the level being proposed. Thus, implementation of this proposed action should not result in a reduction in revenue or a constraint on expansion of the fishery in 2012.

The longfin squid IOY (22,445 mt) represents an increase from the status quo (20,000 mt). Because longfin squid landings from 2008-2010 averaged 9,182 mt, the proposed IOY provides an opportunity to increase landings, though if recent trends of low landings continue, there may be no increase in landings despite the increase in the allocation. No reductions in revenues for the longfin squid fishery are expected as a result of this proposed action.

As discussed in the Final Regulatory Flexibility Analysis (FRFA) for MSB Amendment 10, the butterfish mortality cap has a potential for economic impact on fishery participants. The longfin squid fishery will close during Trimesters I and III if the butterfish mortality cap is reached. If the longfin squid fishery is closed in response to butterfish catch before the entire longfin squid quota is harvested, then a loss in revenue is possible. The potential for longfin squid revenue loss is dependent upon the size of the butterfish mortality cap. The proposed 2012 butterfish mortality cap of 2,445 mt represents a 70-percent increase over status quo (1,436 mt). The 2011 butterfish mortality cap did not result in a closure of the longfin squid fishery in Trimester I. At the start of Trimester III, over 55 percent of the butterfish mortality cap (compared to 31.7 percent allocated at the start of the fishing year) was available for the longfin squid fishery for the duration of the fishing year. Though a majority of the cap is still available, it could still result in a closure of the longfin squid fishery late in the fishing year. Nonetheless, given that the lower cap has not yet constrained the longfin squid fishery, it is reasonable to expect that the proposed increase to the cap will also not constrain the longfin squid fishery. For that reason, additional revenue losses are not expected as a result of this proposed action.

The proposed jigging measure would allow Longfin Squid/Butterfish moratorium permit holders to possess longfin squid in excess of the possession limit during any closures of the longfin squid fishery resulting from the butterfish mortality cap. Jigging for longfin squid has been shown to be commercially infeasible. However, because butterfish bycatch in jig gear is expected to be very minimal, it seems reasonable to allow jig fishing for squid. If attempts to use jig gear for commercial longfin squid fishing are successful, the use of this gear could help mitigate economic impacts on fishery participants if the longfin squid fishery is closed due to the mortality cap.

The Council analysis evaluated four alternatives to the proposed specifications for mackerel. The first (status quo) and second non-selected alternatives were based on the specifications structure that existed prior to the implementation of the Omnibus Amendment, and were not selected because they are no longer in compliance with the MSB FMP. The other alternatives differ in their specification of the stockwide ABC (80,000 mt in the preferred alternative). The same amount of expected Canadian catch (36,219 mt) was subtracted from the stockwide ABC in each alternative. The third alternative (least restrictive) would set the U.S. ABC and ACL at 63,781 mt (100,000 mt stockwide ABC minus 36,219 mt Canadian catch), the Commercial ACT at 50,853 mt, the DAH and DAP at 49,271 mt, and the Recreational ACT at 3,559 mt. The fourth alternative (most restrictive) would set the U.S. ABC and ACL at 23,781 mt (60,000 mt stockwide ABC minus 36,219 mt Canadian catch), the Commercial ACT at 18,961 mt, the DAH and DAP at 18,371 mt, and the Recreational ACT at 1,327 mt. These two alternatives were not selected because they were all inconsistent with the ABC recommended by the SSC.

The status quo closure threshold for the commercial mackerel fishery (90 percent) was considered overly precautionary when compared to the proposed closure threshold (95 percent). The status quo closure threshold, which was designed in part because there was no distinct allocation for the recreational mackerel fishery, is no longer considered appropriate.

There were four alternatives to the preferred action for butterfish that were not selected by the Council. The first (status quo) and second non-selected were based on the specifications structure that existed prior to the implementation of the Omnibus Amendment, and were not selected because they are no longer in compliance with the MSB FMP. The third alternative (least restrictive) would have set the ABC and ACL at 4,528 mt, the ACT at 4,075 mt, the DAH and DAP at 1,358 mt, and the butterfish mortality cap at 3,056 mt. The fourth alternative (most restrictive) would have set the ABC and ACL at 2,717 mt, the ACT at 2,445 mt, the DAH and DAP at 815 mt, and the butterfish mortality cap at 1,834 mt. These two alternatives were not selected because they were all inconsistent with the ABC recommended by the SSC.

There were two alternatives regarding proposed adjustment to the butterfish gear requirement. The status quo alternative requires vessels possessing 1,000 lb (0.45 mt) or more of butterfish to fish with a 3-inch (76-mm) minimum codend mesh. The preferred alternative (3-inch (76-mm) mesh to possess 2,000 lb (0.9 mt)) is expected to create some additional revenue in the form of butterfish landings for vessels using mesh sizes smaller than 3 inches (76 mm).

Three alternatives to the preferred action were considered for Illex, but were not selected by the Council. All alternatives would establish specifications for the 2012-2014 fishing years. The first alternative (status quo), shared the same 24,000-mt ABC as the proposed action. However, a discard rate of 2.8 percent was deducted to reach an IOY, DAH, and DAP at 23,328 mt rather than the 22,915 mt specified in this proposed action. The Council did not select the status quo alternative because it found the updated discard rate of 4.52 percent to be a more appropriate representation of discards in the Illex fishery. The second alternative (least restrictive) would have set ABC at 30,000 mt, and IOY, DAH, and DAP at 28,644 mt (ABC reduced by 4.52 percent for discards). This alternative was not selected because the higher specifications were inconsistent with the results of the most recent stock assessment. The third alternative (most restrictive) would have set ABC at 18,000 mt, and IOY, DAH, and DAP at 17,186 mt (ABC reduced by 4.52 percent for discards). The Council considered this alternative unnecessarily restrictive.

There were three alternatives to the proposed action evaluated for longfin squid. All alternatives would establish specifications for the 2012-2014 fishing years. The first alternative (status quo) would have set the ABC at 24,000 mt, and the IOY, DAH and DAP at 20,000 mt. The second alternative (least restrictive) would have set the ABC at 29,250 mt, and the IOY, DAH, and DAP at 28,057 mt (ABC reduced by 4.08 percent for discards). The third alternative (most restrictive) would have set the ABC at 17,550 mt, and the IOY, DAH and DAP at 16,834 mt (ABC reduced by 4.08 percent for discards). These three alternatives were not selected because they were all inconsistent with the ABC recommended by the SSC.

The alternatives for longfin squid RSA would allow up to 1.65 percent (status quo) or up to 3 percent (preferred) of the longfin squid IOY to be used to fund research projects for the 2012-2014 fishing years. In 2011, butterfish RSA was only awarded to cover butterfish discards by vessels fishing for longfin squid RSA. The small amount of butterfish RSA available in 2011 (15 mt, or 3 percent of 500 mt butterfish DAH) was only sufficient to cover discards for an amount of longfin squid RSA equal to 1.65 percent of the IOY. The recommended increase in the 2012 butterfish quota will allow for enough butterfish RSA (3 percent of the 1,087 mt butterfish DAH) to accommodate discards for longfin squid RSA equal to 3 percent of the IOY.

For the jigging exemption, the status quo alternative prevents Longfin squid/Butterfish moratorium permit holders from possessing or landing over 2,500 lb (1.13 mt) of longfin squid if the directed fishery is closed because of the butterfish mortality cap. The preferred alternative would allow such vessel to posses and land over 2,500 lb (1.13 mt) if using jigging gear. If the use of jigs for commercial longfin squid fishery proves successful, the preferred alternative may help reduce the economic impacts of closures of the longfin squid fishery resulting from the butterfish mortality cap.

For the reasons set out in the preamble, 50 CFR part 648, as amended at 76 FR 60649, September 29, 2011, is proposed to be amended as follows: