Discussion

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA Airworthiness Directive 2011-0075, dated April 29, 2011 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Airbus has issued Mandatory Service Bulletin A340-57-5029, including Appendices 01 and 02, dated February 25, 2011.

For the initial inspection, the compliance time ranges between 4,450 total flight cycles or 35,600 total flight hours and 9,750 total flight cycles or 63,600 total flight hours, whichever occurs first, depending on airplane configuration. For the repetitive intervals, the compliance time ranges between 2,350 flight cycles or 19,000 flight hours, whichever occurs first; and 6,050 flight cycles or 46,200 flight hours, whichever occurs first, depending on airplane configuration.

The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

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

There are no products of this type currently registered in the United States. However, this rule is necessary to ensure that the described unsafe condition is addressed if any of these products are placed on the U.S. Register in the future.

Since there are currently no domestic operators of this product, notice and opportunity for public comment before issuing this AD are unnecessary.

This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2012-0297; Directorate Identifier 2011-NM-093-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

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

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

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

For the reasons discussed above, I certify that this AD:

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

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

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.

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

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

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to include an AD that would apply to the specified products. That NPRM was published in the Federal Register on January 17, 2012 (77 FR 2238). That NPRM proposed to correct an unsafe condition for the specified products. The MCAI states:

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to include an AD that would apply to the specified products. That NPRM was published in the Federal Register on January 17, 2012 (77 FR 2234). That NPRM proposed to correct an unsafe condition for the specified products. The MCAI states:

We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM (77 FR 2234, January 17, 2012) or on the determination of the cost to the public.

We reviewed the relevant data and determined that air safety and the public interest require adopting the AD as proposed except for minor editorial changes. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (77 FR 2234, January 17, 2012) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (77 FR 2234, January 17, 2012).

Discussion

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA Airworthiness Directive 2011-0017, dated February 3, 2011 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Discussion

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA Airworthiness Directive 2011-0035, dated March 2, 2011 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Airbus has issued Mandatory Service Bulletin A320-57-1120, Revision 01, including Appendices 01, 02, and 03, dated November 15, 2006. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

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

There are no products of this type currently registered in the United States. However, this rule is necessary to ensure that the described unsafe condition is addressed if any of these products are placed on the U.S. Register in the future.

Since there are currently no domestic operators of this product, notice and opportunity for public comment before issuing this AD are unnecessary.

This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2012-0294; Directorate Identifier 2011-NM-047-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

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

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

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

For the reasons discussed above, I certify that this AD:

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

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

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.

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 amends 14 CFR part 39 as follows:

We issued a supplemental notice of proposed rulemaking (SNPRM) to amend 14 CFR part 39 to supersede AD 2007-23-01, Amendment 39-15247 (72 FR 62568, November 6, 2007). That AD applies to the specified products. The SNPRM was published in the Federal Register on December 29, 2011 (76 FR 81885). The original NPRM (76 FR 15229, March 21, 2011) proposed to require inspecting to determine the part number of the pressure relief valves on the affected Goodrich evacuation systems and replacing certain pressure relief valves. The original NPRM also added Model A330-223F and -243F airplanes to the applicability. The SNPRM proposed to add Model A330-302 and -303 airplanes to the applicability.

We gave the public the opportunity to participate in developing this AD. We received no comments on the SNPRM (76 FR 81885, December 29, 2011) or on the determination of the cost to the public.

We reviewed the relevant data and determined that air safety and the public interest require adopting the AD as proposed.

We estimate that this AD affects 41 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

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

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

For the reasons discussed above, I certify that this AD:

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

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

(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 amends 14 CFR part 39 as follows:

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA Airworthiness Directive 2010-0252, dated November 29, 2010 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Airbus has issued Mandatory Service Bulletin A330-53-3183, including Appendices 01 and 02, dated September 30, 2010 (for Model A330-200 and -300 series airplanes); and Mandatory Service Bulletin A340-53-5056, including Appendices 01 and 02, dated October 7, 2010 (for Model A340-500 and -600 series airplanes). The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

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

There are no products of this type currently registered in the United States. However, this rule is necessary to ensure that the described unsafe condition is addressed if any of these products are placed on the U.S. Register in the future.

This AD differs from the MCAI and/or service information as follows: The MCAI and the service information include a reporting requirement. This AD does not require reporting of the inspection results to the airplane manufacturer.

Since there are currently no domestic operators of this product, notice and opportunity for public comment before issuing this AD are unnecessary.

This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2012-0292; Directorate Identifier 2011-NM-056-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

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

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

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

For the reasons discussed above, I certify this AD:

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

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

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.

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

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

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to include an AD that would apply to the specified products. That NPRM was published in the Federal Register on November 4, 2011 (76 FR 68368). That NPRM proposed to correct an unsafe condition for the specified products. The MCAI states:

We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM (76 FR 68368, November 4, 2011) or on the determination of the cost to the public.

We reviewed the available data and determined that air safety and the public interest require adopting the AD as proposed, except for minor editorial changes. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (76 FR 68368, November 4, 2011) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (76 FR 68368, November 4, 2011).

We estimate that this AD will affect 110 products of U.S. registry. We also estimate that it will take about 4 work-hours per product to comply with the basic requirements of this AD. The average labor rate is $85 per work-hour. Required parts will cost about $4,000 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 this AD to the U.S. operators to be $477,400, or $4,340 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 AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

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

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

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.

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

You may examine the AD docket 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 AD docket contains the NPRM (76 FR 68368, November 4, 2011), the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone (800) 647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

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

On January 6, 2012, the FAA published in the Federal Register a notice of proposed rulemaking (NPRM) to establish Class E airspace at Marion, AL (77 FR 771) Docket No. FAA-2011-0590. Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received. Class E airspace designations are published in paragraph 6005 of FAA Order 7400.9V dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in the Order.

This amendment to Title 14, Code of Federal Regulations (14 CFR) part 71 establishes Class E airspace extending upward from 700 feet above the surface at Marion, AL, to provide the controlled airspace required to accommodate the new RNAV GPS Standard Instrument Approach Procedures developed for Vaiden Field. This action is necessary for the safety and management of IFR operations at the airport.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current, is non-controversial and unlikely to result in adverse or negative comments. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority.

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

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

The FAA issued the High Density Traffic Airports Rule (HDR), 14 CFR part 93 subpart K, in 1968 to reduce delays at five congested airports: John F. Kennedy International Airport, LaGuardia Airport, O'Hare International Airport, Ronald Reagan Washington National Airport (DCA), and Newark Liberty International Airport.1 Currently, the HDR applies only to DCA. The regulation limits the number of operations during certain hours of the day and requires a slot, which the FAA allocates for a specific 60-minute period, for each scheduled operation.

In 1985, the FAA issued part 93 subpart S (the “Buy/Sell Rule”).2 As part of the Buy/Sell Rule, § 93.226 permits the administrative allocation of slots during low demand periods, which are 6 a.m. to 6:59 a.m. (the 0600 hour) and 10 p.m. to 11:59 p.m. (the 2200 and 2300 hours), on a first come, first served basis. Section 93.226(d) permits the FAA to determine those periods are no longer low demand periods and allocate any available slots by lottery under § 93.225. The FAA may make this determination when it becomes apparent that demand for slots is increasing to the point where a first come, first served allocation procedure is inappropriate. The FAA previously determined the 0600 hour is not a low demand period.3

Currently, the FAA has allocated all but three commuter and all but three air carrier slots in the 2200 hour.

Because of the relatively small number of available slots in the 2200 hour, the FAA now determines that hour no longer is a low demand period. Additional permanent allocation of slots in that time period would undermine the new entrant and limited incumbent allocation priority under § 93.225. The FAA no longer will allocate slots during that time period on a permanent first come, first served basis.

The FAA further determines the present demand for available slots does not justify conducting a lottery at this time. Accordingly, the FAA will allocate slots in the 2200 hour on a temporary basis subject to recall by the FAA under § 93.226(e). However, if the FAA cannot accommodate future requests for slots, especially requests by new entrants or limited incumbents, through temporary allocations, the FAA may recall any temporarily allocated slots and conduct a lottery at that time.

Slots currently allocated are unaffected by this determination, and the HDR continues to apply to all allocated slots.

We are adopting an updated EDGAR Filer Manual, Volume I and Volume II. The Filer Manual describes the technical formatting requirements for the preparation and submission of electronic filings through the EDGAR system.1 It also describes the requirements for filing using EDGARLink Online and the Online Forms/XML Web site.

The revisions to the Filer Manual reflect changes within Volume I entitled EDGAR Filer Manual, Volume I: “General Information,” Version 12 (March 2012) and Volume II entitled EDGAR Filer Manual, Volume II: “EDGAR Filing,” Version 19 (March 2012). The updated manual will be incorporated by reference into the Code of Federal Regulations.

The Filer Manual contains all the technical specifications for filers to submit filings using the EDGAR system. Filers must comply with the applicable provisions of the Filer Manual in order to assure the timely acceptance and processing of filings made in electronic format.2 Filers may consult the Filer Manual in conjunction with our rules governing mandated electronic filing when preparing documents for electronic submission.3

The EDGAR system will be upgraded to Release 12.0 on March 26, 2012 and will introduce the following changes: EDGAR will be updated to support the US GAAP 2012 Taxonomy and Mutual Fund Risk/Return Summary 2012 Taxonomy. Please see http://sec.gov/info/edgar/edgartaxonomies.shtml for a complete listing of supported standard taxonomies.

The Period field validations will be updated for the submission types N-PX-NT, N-PX-VR, N-PX-CR, and their amendments. Currently, these submission types only allow June 30 or September 30 of the current or prior years as valid period date. The Period field on these submission form types can be any valid date other than a future date.

The OMB expiration date will no longer be displayed on the Forms 3, 4, 5, and D. These forms will continue to display other OMB Approval information.

The Confirmation and Acknowledgement screens on the EDGAR Filer Management Web site, which currently display the filer support fax numbers, will be updated to include Division of Investment Management and Division of Trading and Markets filer support fax numbers along with existing Division of Corporation Finance fax numbers.

On July 9, 2012, EDGAR Release 12.1.1 will be deployed to convert the DOS based Form N-SAR application to an online application. The DOS based application to create Form N-SAR documents will be retired as of 5:30, July 6, 2012, and EDGAR will no longer accept filings created by that application. Beginning Monday, July 9, 2012, Form N-SAR may only be filed using the online version of the form available on the EDGAR Filing Web site or constructed by filers according to the new EDGAR N-SAR XML Technical Specification, available on the Commission's public Web site's “Information for EDGAR Filers” Web page (http://www.sec.gov/info/edgar.shtml). Submission form types NSAR-A, NSAR-A/A, NSAR-AT, NSAR-AT/A, NSAR-B, NSAR-BT, NSAR-BT/A, NSAR-U, and NSAR-U/A can be accessed by selecting the `File Form N-SAR' link on the EDGAR Filing Web site. Filers submitting submission type NSAR-U should continue to prepare the text document with the applicable answers and attach it to the NSAR-U submission type accessible from the `File Form N-SAR' link on the EDGAR Filing Web site.

Instructions to file Form N-SAR will be included in two new sections of Chapter 9 (Preparing and Transmitting Online Submissions) of the EDGAR Filer Manual, Volume II: EDGAR Filing, Section 9.2.5 (File Form N-SAR) and Section 9.2.6 (Completing a Form N-SAR Submission). As of July 9, 2012, the EDGAR Filer Manual, Volume III: N-SAR Supplement will be retired.

Along with the adoption of the Filer Manual, we are amending Rule 301 of Regulation S-T to provide for the incorporation by reference into the Code of Federal Regulations of today's revisions. This incorporation by reference was approved by the Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51.

You may obtain paper copies of the updated Filer Manual at the following address: Public Reference Room, U.S. Securities and Exchange Commission, 100 F Street NE., Room 1543, Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. We will post electronic format copies on the Commission's Web site; the address for the Filer Manual is http://www.sec.gov/info/edgar.shtml.

Since the Filer Manual relates solely to agency procedures or practice, publication for notice and comment is not required under the Administrative Procedure Act (APA).4 It follows that the requirements of the Regulatory Flexibility Act 5 do not apply.

The effective date for the updated Filer Manual and the rule amendments is March 30, 2012. In accordance with the APA,6 we find that there is good cause to establish an effective date less than 30 days after publication of these rules. The EDGAR system upgrade to Release 12.0 is scheduled to become available on March 26, 2012. The EDGAR system upgrade to Release 12.1.1 is scheduled to become available on July 9, 2012. The Commission believes that establishing an effective date less than 30 days after publication of these rules is necessary to coordinate the effectiveness of the updated Filer Manual with the system upgrade.

We are adopting the amendments to Regulation S-T under Sections 6, 7, 8, 10, and 19(a) of the Securities Act of 1933,7 Sections 3, 12, 13, 14, 15, 23, and 35A of the Securities Exchange Act of 1934,8 Section 319 of the Trust Indenture Act of 1939,9 and Sections 8, 30, 31, and 38 of the Investment Company Act of 1940.10

In accordance with the foregoing, Title 17, Chapter II of the Code of Federal Regulations is amended as follows:

The Federal Coal Mine Health and Safety Act (FMHSA) of 1969 established the Black Lung program to pay monthly benefits to coal miners, their survivors, and dependents if the miner was disabled by or died due to pneumoconiosis. The FMHSA, as amended, established two program parts. Part B, administered by SSA, governs miners' and survivors' claims filed through June 30, 1973. For those claims awarded, Part B also governs claims filed by certain survivors of these beneficiaries. Part C, administered by DOL, governs all other claims. In 2002, Congress enacted the Black Lung Consolidation of Administrative Responsibility Act (Pub. L. 107-275), which formally transferred all responsibility for administering the Black Lung program to DOL beginning January 31, 2003.

Thus, because we no longer have responsibility for administering the Black Lung Part B program, we are removing the pertinent regulations from our chapter of the CFR. DOL concurs with this final rule removing these regulations from our chapter of the CFR, and concurs that this action does not affect the substantive rights of individuals claiming benefits under the Black Lung Part B program.

We follow the Administrative Procedure Act (APA) rulemaking procedures specified in 5 U.S.C. 553 when we develop regulations. Generally, the APA requires that an agency provide prior notice and opportunity for public comment before issuing a final rule. The APA provides exceptions to its notice and public comment procedures when an agency finds good cause for dispensing with such procedures because they are impracticable, unnecessary, or contrary to the public interest.1

We find that good cause exists for proceeding without prior public notice and comment in this instance. As discussed above, the change we are making in this final rule does not affect the substantive rights of individuals claiming benefits under the Black Lung Part B program. Rather, the change simply reflects Congress' decision in the Black Lung Consolidation of Administrative Responsibility Act to transfer responsibility for administration of the Black Lung Part B program from SSA to DOL. Accordingly, we find that prior public comment would be unnecessary in this instance.

In addition, for the reasons cited above, we also find good cause for dispensing with the 30-day delay in the effective date of this rule.2 Since the change we are making to this rule merely recognizes that we are no longer responsible for administering any aspect of the Part B Black Lung program, we find that it is contrary to the public interest to delay the effective date of our rule. Accordingly, we are making this rule effective upon publication.

We have consulted with the Office of Management and Budget (OMB) and determined that this final rule does not meet the criteria for a significant regulatory action under Executive Order 12866, as supplemented by Executive Order 13563. Thus, it was not subject to OMB review.

We certify that this final rule will not have a significant economic impact on a substantial number of small entities, as it affects individuals only. Therefore, a regulatory flexibility analysis is not required under the Regulatory Flexibility Act, as amended.

This final rule imposes no reporting or recordkeeping requirements subject to OMB clearance.

For the reasons set out in the preamble, under the authority of section 702(a)(5) of the Social Security Act, 42 U.S.C. 902(a)(5), and Public Law 107-275, we amend 20 CFR chapter III, part 410, as set forth below:

On March 31, 2008, EEOC published in the Federal Register a Notice of Proposed Rulemaking (“NPRM”) to address issues related to the United States Supreme Court's decision in Smith v. City of Jackson. 1 73 FR 16807, Mar. 31, 2008. The Court ruled that disparate-impact claims are cognizable under the Age Discrimination in Employment Act (“ADEA”) 2 but that liability is precluded when the impact is attributable to a reasonable factor other than age. The NPRM proposed to revise 29 CFR 1625.7(d) to state that an employment practice that has an adverse impact on individuals within the protected age group on the basis of older age is discriminatory unless the practice is justified by a “reasonable factor other than age” and that the individual challenging the allegedly unlawful employment practice bears the burden of isolating and identifying the specific employment practice responsible for the adverse impact. The Commission also proposed to revise 29 CFR 1625.7(e) to state that, when the RFOA exception is raised, the employer has the burden of showing that a reasonable factor other than age exists factually.

The NPRM sought public comments on the proposed rule and also invited comments on whether the Commission should provide more information on the meaning of “reasonable factors other than age.” Seven of the ten commenters clearly supported efforts to provide more information. One of the seven suggested that reasonable factors should be related to job requirements or job performance. One commenter who preferred that the EEOC not address the matter argued that, if the RFOA definition is subject to regulation, then EEOC should consult case law for a definition and should draft factors relevant to the RFOA determination. One commenter opposed efforts to provide more information on the meaning of RFOA.

As noted below, all commenters who addressed the proposed revision to 29 CFR 1625(d) supported it. Four commenters endorsed the proposal as written and two generally supported the section but suggested changes to the first sentence. For the reasons explained below, the final rule, which has been redesignated 1625.7(c), retains the proposal's substantive language.

Five commenters supported the proposed revision to 29 CFR 1625(e) and four opposed it. The commenters who opposed it argued that plaintiffs, not employers, should bear the RFOA burden of persuasion. As noted below, the final rule, which has been redesignated 1625.7(d), continues to place the burden of persuasion on the employer because the Supreme Court agreed that the employer has the RFOA burden of persuasion.3

Subsequently, on February 18, 2010, EEOC published in the Federal Register a second NPRM to address the meaning of “reasonable factors other than age.” 75 FR 7212, Feb. 18, 2010. The Commission noted that, given public comments and the Supreme Court decisions in Smith and Meacham, it was issuing the NPRM “before finalizing its regulations concerning disparate impact under the ADEA.” The NPRM proposed to revise 29 CFR 1625.7(b) to state that the RFOA determination depends on the facts and circumstances of each specific situation. It defined a reasonable factor as one that is objectively reasonable when viewed from the position of a reasonable employer under like circumstances. It provided that the RFOA defense applies only if the challenged practice is not based on age. In addition, the NPRM provided non-exhaustive lists of factors relevant to whether an employment practice is reasonable and whether a factor is “other than age.”

In response to the February 2010 NPRM, EEOC received 27 comments from groups and individuals and more than 2,300 facsimiles that were similar in form and content. Two commenters on the February 2010 NPRM suggested that the Commission issue a new NPRM if it made any changes to the material contained in the March 2008 NPRM. One of the two also suggested the publication of a new NPRM if the EEOC offered new justifications for the material contained in the February 2010 NPRM. The other commenter suggested that a new NPRM clarify whether the 2008 and 2010 documents should be read in conjunction.

The Commission does not believe that publication of a new NPRM is necessary. The Commission has considered all comments received in response to both notices of proposed rulemaking and has made appropriate changes to the proposed rules in response to those comments. This document sets out the revised paragraphs of §§ 1625.7(b) through (e). Because §§ 1625.7(a) and (f) remain unchanged, they are not reprinted herein.

Some commenters on the February 2010 NPRM, including those who submitted form facsimiles, expressed concern that the EEOC's approach to RFOA would place significant burdens on employers. They argued that the rule would lead to unwarranted scrutiny of business decisions, permit second-guessing of routine decisions, and make it harder for employers to defend against frivolous litigation. Other commenters thought that the rule presented a fair, workable approach to RFOA.

The ADEA and disparate-impact analysis by definition require some scrutiny of employer practices that disproportionately harm older workers. As the Supreme Court held, employers must prove that such practices are based on reasonable factors other than age once plaintiffs have identified a specific employment practice that has a significant disparate impact.4 In holding that the RFOA is an affirmative defense, the Supreme Court recognized that scrutiny of employer decisions that cause an adverse impact is warranted, as employers must persuade “factfinders that their choices are reasonable” and that “this will sometimes affect the way employers do business with their employees.” 5

The EEOC's proposed rule was designed to conform existing regulations to recent Supreme Court decisions and to provide guidance about the application of the RFOA affirmative defense. It was not intended to impose unwarranted burdens on employers. Nonetheless, the Commission recognizes that some commenters interpreted the proposed rule as imposing significant burdens by requiring employers to meet all of the factors relevant to the RFOA determination. As explained below, the Commission has revised the rule to clarify that the factors are not required elements or duties, but considerations that are manifestly relevant to determining whether an employer demonstrates the RFOA defense.

Some commenters argued that the proposed rule improperly imported Title VII standards into ADEA disparate-impact analysis and conflicted with the Supreme Court decisions in Smith, Meacham, and Hazen Paper Co. v. Biggins. 6 Other commenters believed that the proposed rule was consistent with the statute and relevant case law. The Commission, which disagrees with some commenters' interpretations of the statute and Supreme Court decisions, has addressed their comments in the context of specific sections of the rule. For the reasons explained below, the Commission believes that the rule is consistent with the ADEA and case law interpreting the statute. Where appropriate, the Commission has revised the rule to make this clearer.

Former section 1625.7(c) has been redesignated 1625.7(b). The text of the paragraph remains unchanged.

Section 1625.7(c) revises current section 1625.7(d). The 2008 proposed rule stated that any employment practice that has an age-based adverse impact on individuals within the protected age group is discriminatory unless the practice is justified by a reasonable factor other than age. It also stated that the individual challenging the practice is responsible for isolating and identifying the specific employment practice responsible for the adverse impact.

All of the commenters who addressed this section supported it. Four of them endorsed the section as written. Two of them generally supported the section but suggested changes to the first sentence. One commenter argued that the first sentence of the proposed rule inappropriately implied that the RFOA defense is the only defense applicable to disparate-impact claims under the ADEA. The commenter asserted that, although the Smith decision held that RFOA is an appropriate test for determining the lawfulness of an employment practice that has an age-based disparate impact, it did not hold that it was the only test. According to the commenter, section 4(f) 7 of the ADEA permits other practices that might have a disparate impact on members of the protected age group. The commenter did not offer examples of such practices or otherwise explain how other defenses might apply in the disparate-impact context.

The final rule, which has been redesignated 1625.7(c), retains the proposed language. The Supreme Court relied on the RFOA provision to conclude that the ADEA prohibits disparate-impact discrimination.8 The Court's determination that ADEA disparate-impact claims are cognizable because of the RFOA provision logically leads to the conclusion that RFOA is the defense to such claims. As the Court explained in Meacham, the RFOA defense fits 9 as the appropriate defense to a disparate-impact claim because the age-neutral employment practice causing the unlawful impact is “other than age” and “otherwise prohibited.” 10

Another commenter objected to the use of the term “justified.” The commenter asserted that the term is closely associated with Title VII's business-necessity test and that its use could cause confusion between the concepts of business necessity and RFOA. The final rule retains the term “justified.” Use of this term is consistent with the Meacham decision, which noted that the language of section 4(f)(1) “refers to an excuse or justification for behavior that, standing alone, violates the statute's prohibition.” 11 It is also consistent with 29 CFR 1625.7(b), the text of which has not been changed. The term “justified” designates the party who bears the burden of proof, not the content of the defense. There is no question that the RFOA standard is lower than the business-necessity standard, as the rule makes clear.

The Commission has simplified the language in the second sentence of paragraph 1625.7(c). The sentence now refers to the employment practice “that allegedly causes” statistical disparities rather than the employment practice “that is allegedly responsible for” the disparities.

Paragraph 1625.7(c) reflects the Supreme Court's conclusions that disparate-impact claims are cognizable under the ADEA, that the individual alleging disparate impact bears the burden of identifying the specific employment practice causing the alleged impact, and that the RFOA defense is the appropriate standard for determining the lawfulness of a practice that disproportionately affects older workers.12

Section 1625.7(d) revises current section 1625.7(e). The proposed rule stated that, when the RFOA exception is raised, the employer has the burden of showing that a reasonable factor other than age exists factually. Five commenters supported the proposal, and four objected to placing the burden of proof on the employer. One commenter noted that the term “exists factually” was ambiguous and likely to lead to confusion.

Subsequently, in Meacham v. Knolls Atomic Power Laboratory, the Supreme Court confirmed that the employer defending an ADEA claim of disparate impact has the RFOA burden of proof, i.e., the burden of persuasion as well as production.13 The Commission has revised the paragraph, which has been redesignated 1625.7(d), to reflect the Supreme Court's holding that the RFOA provision is an affirmative defense in disparate-impact cases for which the employer bears the burdens of production and persuasion. To avoid confusion, the Commission has deleted the phrase “exists factually.”

The Commission also has revised the rule to clarify that the RFOA affirmative defense is unavailable in disparate-treatment cases. In Smith, the Court rejected the argument that the RFOA exemption acted simply as a “safe harbor” in disparate-treatment cases.14 As the Supreme Court explained in Smith, 15 the “other than age” element of the RFOA provision makes the defense inapplicable to a claim conditioned on an age-based intent to discriminate.

Section 1625.7(e) revises current section 1625.7(b). The proposed rule noted that whether a differentiation is based on reasonable factors other than age must be decided on the basis of all the particular facts and circumstances surrounding each individual situation. The final rule retains this language, which emphasizes that the RFOA determination involves a fact-intensive inquiry.16 For organizational purposes, the Commission has changed the order of the sentences in the paragraph.

The proposed rule divided the discussion of “reasonable factors other than age” into two paragraphs, “reasonable” and “factors other than age,” and listed factors relevant to each paragraph. The “reasonable” paragraph noted that a reasonable factor is one that is objectively reasonable when viewed from the position of a reasonable employer (i.e., a prudent employer mindful of its responsibilities under the ADEA) under like circumstances. It stated that an employer must show that an employment practice was reasonably designed to achieve a legitimate business purpose and was administered in a way that reasonably achieves that purpose in light of the facts that were known or should have been known to the employer. It included a non-exhaustive list of factors relevant to whether an employment practice is reasonable.

The “factors other than age” paragraph noted that the RFOA defense applies only if the practice was not based on age. It stated that, in the typical disparate-impact case, the practice is based on an objective non-age factor and the only question is whether the practice is reasonable. The paragraph noted, however, that a disparate impact may be based on age when decision makers are given unchecked discretion to engage in subjective decision making and, as a result, act on the basis of conscious or unconscious age-based stereotypes. It included a non-exhaustive list of factors relevant to whether a factor is other than age.

Some commenters argued that the “other than age” paragraph conflated disparate treatment and disparate impact and improperly shifted the burden of proof by requiring the employer to prove that the challenged employment action was not based on age. They also argued that the paragraph conflicted with Meacham's statement that the RFOA defense assumes that a non-age factor is at work.

In response to comments, and to ensure that the rule is not misconstrued as placing a disparate-treatment burden of proof on employers, the Commission has revised the discussion into a subsection, which has been redesignated 1625.7(e)(1)-(3), addressing the term “reasonable factors other than age.” The Commission also has revised the lists into a single, non-exhaustive description of considerations relevant to the RFOA defense.

The final rule states that a reasonable factor other than age is a non-age factor that is objectively reasonable when viewed from the position of a prudent employer mindful of its responsibilities under the ADEA under like circumstances. The reference to “non-age factor” recognizes that “other than age” is an express part of the statutory RFOA defense.17

The preamble to the proposed rule stated that, in light of Smith and Meacham, a prudent employer would know that the ADEA was designed in part to avoid the application of neutral standards that disproportionately affect older workers. One commenter, noting that more than thirty years had passed between the enactment of the ADEA and the Supreme Court's determination that the law covered disparate-impact claims, questioned the Commission's statement. Another commenter agreed with the Commission and pointed out that the Court had decided Smith nearly five years, and Meacham nearly two years, before publication of the NPRM.

The Supreme Court's decisions in Smith and Meacham confirmed EEOC's longstanding position 18 that disparate-impact claims are cognizable under the ADEA and that employers have the burden of establishing the RFOA defense. The decisions also validated the 1965 Wirtz Report's concern about “institutional arrangements” that unintentionally limit the opportunities of older workers.19 Courts had applied disparate-impact analysis to ADEA claims for many years,20 and it was only after the Court's 1993 Hazen Paper decision 21 that some courts held that disparate-impact claims were not cognizable under the ADEA.22 Therefore, the Commission continues to believe that a prudent employer mindful of its ADEA responsibilities should know that the law prohibits the use of neutral practices that disproportionately affect older workers and are not based on reasonable factors other than age. A reasonable factor other than age is one that an employer exercising reasonable care would use to avoid limiting the opportunities of older workers, in light of all the surrounding facts and circumstances.23

The proposed rule relied on tort principles when discussing what constitutes a “reasonable” factor other than age. Some commenters thought that the reference to tort law was practical and sensible. Others, however, objected to the use of tort law. They argued that employment discrimination law provides sufficient guidance for determining whether a practice is based on reasonable, nondiscriminatory factors and that the rule inappropriately imports the concept of “reasonable employer” into the RFOA analysis. One commenter asserted that, whereas tort law and sexual-harassment theory assess reasonableness in terms of an individual's efforts to avoid harm, the RFOA analysis assumes and permits disparate impact. Another commenter asserted that it is unfair to rely on some tort principles without including the concepts of contributory negligence and assumption of the risk.

The final rule continues to refer to tort principles. Employment discrimination law includes little discussion of reasonableness whereas tort law extensively analyzes the concept. Indeed, the Supreme Court recently made clear that federal nondiscrimination laws are torts and that “when Congress creates a federal tort [we presume that] it adopts the background of general tort law.” 24 Prior to Staub, the Supreme Court noted in Faragher v. City of Boca Raton  25 that lower courts have unanimously applied tort negligence standards to determine employer liability for co-worker harassment. Similarly, the Court turned to tort principles to determine what mental state warrants punitive damages.26 Lower courts also have turned to tort law for guidance in resolving employment discrimination cases.27

The fundamental objective of employment discrimination statutes, “like that of any statute meant to influence primary conduct, is * * * to avoid harm.” 28 Tort law, too, focuses on the duty to avoid harm and provides guiding principles to help understand reasonableness in this context. Under the ADEA, employers are required to avoid the harm of using facially neutral practices that impair employment opportunities for older workers and are not reasonable.29 Whether a factor is reasonable can be determined only in light of all of the surrounding facts and circumstances, including the employer's duty to be cognizant of the consequences of its choices.

The assertion that the rule should not refer to tort law without importing the concepts of contributory negligence and assumption of the risk into the RFOA analysis misapprehends the rule's reference to tort law. The rule does not import tort principles wholesale; rather, it merely refers to tort law for guidance. Like the defense to harassment, the RFOA defense considers what the employer knew about the harm and what it did to correct it. Negligence principles as applied to co-worker harassment do not address the concepts of contributory negligence and assumption of the risk, and there is no need to address those concepts in the RFOA context. Moreover, employees do not “contribute” (negligently or otherwise) to an employer's use of an employment practice that has an age-based disparate impact. In addition, it would be contrary to the purposes of the anti-discrimination laws to assert that any employee voluntarily assumes the risk of being subject to discrimination.30

The proposed rule looked at “reasonable” from the position of a prudent employer and considered how the challenged employment practice is designed and administered. Some commenters agreed that the rule should look at how the practice is applied as well as at how it is designed. Other commenters, however, argued that this approach inappropriately focuses on the employer's decision-making process rather than on the factor upon which the decision was based. In their view, the RFOA inquiry should focus on the factor underlying the employment practice, not on whether the employer acted reasonably in selecting the factor.

The final rule continues to focus on how the employment practice is designed and administered. The RFOA defense arises after an employment practice has been shown to have an age-based disparate impact. In that context, the concept of “reasonable factor” necessarily includes consideration of the reasonableness of the factor's application. Thus, the Smith Court considered not just the City of Jackson's goal of retaining police officers, but also the design and administration of the pay plan used to achieve that goal.31

The way in which an employer applies the factor is probative of whether it is reasonable; a practice that seems reasonable in the abstract might not be reasonable in its application. For example, an employer might require candidates for jobs in its meat-processing plant to pass a physical strength test. It would be reasonable for the employer to design a test that accurately measures the ability to perform the job successfully. It would be manifestly unreasonable, however, for the employer to administer the test inconsistently, evaluate results unevenly, or judge test takers unreliably. Similarly, although it might well be reasonable for an employer to conduct a reduction-in-force (RIF) to save money, if an identified employment practice caused older workers to be disparately impacted, the cost-cutting goal alone would not be sufficient to establish the RFOA defense. The employer would have to show that the practice was both reasonably designed to further or achieve a legitimate business purpose and administered in a way that reasonably achieves that purpose in light of the particular facts and circumstances that were known, or should have been known, to the employer.

The preamble to the proposed rule noted that the RFOA defense requires that a practice be reasonable, which is different from requiring only that it be rational. Some commenters argued that the RFOA standard should be a rational-basis standard and that “reasonable” means not irrational or not arbitrary. Other commenters commended the EEOC for clarifying that the reasonableness test is not a rational-basis test.

The Commission continues to believe that the RFOA defense is more stringent than a rational-basis or non-arbitrary standard for several reasons. First, the Supreme Court has held that the RFOA provision “confirms that Congress, through the ADEA, has effectively elevated the standard for analyzing age discrimination to heightened scrutiny.” 32 In other words, the Supreme Court has previously recognized that the RFOA reflects a standard of proof higher than a rational-basis standard.

Second, proof that an action was rational or non-arbitrary focuses on whether an articulated reason is a pretext for intentional discrimination.33 Thus, equating the RFOA defense with a rational-basis standard would improperly conflate ADEA disparate-treatment and disparate-impact standards of proof. If an employer attempting to establish the RFOA defense were only required to show that it had acted rationally, then the employer would merely be required to show that it had not engaged in intentional age discrimination. In Smith, the Supreme Court bluntly held that the RFOA provision is not a statutory safe harbor from liability for disparate treatment when the employer merely had a rational justification for its actions.34

Thus, the Supreme Court concluded that the ADEA prohibits more than intentional discrimination; it also prohibits employers from adopting facially neutral practices that disproportionately exclude older workers unless the employer can prove that its actions were based on reasonable factors other than age. In holding that the RFOA provision is the defense to disparate-impact claims, the Supreme Court recognized that the RFOA defense is distinguishable in form and substance from the “legitimate, nondiscriminatory reason” evidence that the employer must produce in individual disparate-treatment cases.35 The RFOA defense necessarily requires more than merely a showing that the employer's action was not irrational or not arbitrary.36 To adopt commenters' assertions would be to nullify the Smith and Meacham holdings and undermine the intent of Congress to address “the consequences of employment practices, not simply the motivation.” 37

Third, a rational basis standard would also undercut the Court's recognition of the RFOA as an affirmative defense. Under a rational-basis standard, an action “may be based on rational speculation unsupported by evidence or empirical data.” 38 The decision maker is not required “to articulate at any time the purpose or rationale supporting its classification,” 39 and an action will be upheld “if there is any reasonably conceivable state of facts that could provide a rational basis for the classification.” 40 By that measure, the “reasonable” requirement would afford no protection against practices that have an age-based disparate impact.41

Finally, equating the RFOA reasonableness requirement with a rational-basis standard would contradict the Smith Court's holding that the “reasonable” requirement shows that the RFOA provision is more stringent than the Equal Pay Act's (“EPA”) “any other factor” defense.42 Indeed, applying the rational-basis test to the RFOA defense would actually make it less stringent than the EPA's “any other factor” defense as the latter has been construed by the EEOC and some courts, which have taken the position that, even under the Equal Pay Act, an employer asserting an “any other factor other than sex” defense must show that the factor is related to job requirements or otherwise is beneficial to the employer's business.43

The February 2010 Notice of Proposed Rulemaking emphasized that the proposed RFOA standard was lower than the business-necessity test of Title VII of the Civil Rights Act of 1964,44 but higher than the Equal Pay Act's “any other factor” test.45 It also stated that the factors relevant to the reasonableness inquiry recognize that the RFOA standard is less stringent than the business-necessity standard and that disparate-impact liability is narrower under the ADEA than under Title VII.

Several commenters expressed the view that the proposed rule impermissibly imposed Title VII's business-necessity test on ADEA defendants. One of the commenters suggested that EEOC revise the language to state that the factors “may” be relevant to the RFOA determination. The commenters' arguments generally centered on the mistaken view that the factors were requirements, and that the factors concerning employers' efforts to assess impact, minimize harm, and weigh options amounted to a business-necessity requirement.

In response, the Commission has made several changes. To address the commenters' view that the factors were required elements or duties, the rule now refers to “considerations” relevant to demonstrating the defense. The rule sets forth a non-exhaustive description of relevant considerations, rather than a list of duties to be met. Because the RFOA determination involves a fact-intensive inquiry, the importance of a consideration depends on the facts of the particular situation. Based on the specific facts raised, one or two considerations may be sufficient to establish the RFOA defense.

In addition, the rule expressly states that no specific consideration or combination of considerations need be present for a differentiation to be based on reasonable factors other than age and that the presence of one consideration does not automatically establish the defense. Just as the absence of a consideration does not automatically defeat the RFOA defense, so too the presence of one consideration does not necessarily prove that a differentiation is based on reasonable factors other than age. Rather, as the rule makes clear, the RFOA determination depends on all of the facts and circumstances in each particular situation.

The Commission disagrees that consideration of efforts to assess impact, reduce harm, and weigh options suggests a Title VII business-necessity analysis. However, the Commission has deleted the factor concerning the availability of options because some commenters misconstrued the factor as imposing the Title VII standard that the employer must search for and select the least discriminatory alternative.46 Removal of the factor does not mean that the availability of measures to reduce harm is irrelevant to reasonableness. There may be circumstances in which the availability of a measure that would noticeably reduce harm was or should have been so readily apparent that it would be manifestly unreasonable for the employer to fail to use it. The removal of the factor does, however, make clear that an employer need not search for alternatives and use the one that is least discriminatory. These changes, along with the clarification that none of the considerations is a required element of the RFOA defense, make clear the distinction between the ADEA RFOA standard and Title VII's business-necessity standard.

Under Title VII, if a particular employment practice has a disparate impact based on race, color, religion, sex, or national origin, then the employer must “demonstrate that the challenged practice is job related for the position in question and consistent with business necessity.” 47 An employer could meet the Title VII standard by proving, for example, that a test has been validated to show that it is “predictive of * * * important elements of work behavior which comprise * * * the job.” 48 In contrast, the RFOA defense involves the less demanding standard of reasonableness.

Application of the rule's considerations to a physical fitness test 49 illustrates the difference between the RFOA and business-necessity standards. For example, suppose a security company mandated that all applicants for security guard positions must be able to run a half mile in three minutes and do 35 push ups in a row. The company's stated purpose is to ensure that guards are physically able to pursue and apprehend suspects (consideration (i)). The test defines and measures the factors of speed and strength and provides clear guidance on how the test is to be applied accurately and fairly (consideration (ii)). The employer performs a disparate-impact analysis and finds that large percentages of older workers and women cannot pass the test. (consideration (iv)). The employer changes the test so that performance standards vary based on age and gender, when it learns that a successful competitor firm uses such standards and is attracting a large pool of qualified candidates. Although the test continues to disproportionately exclude older and female applicants, it excludes fewer of them and still produces qualified hires (consideration (v)).

The security company would not need to perform a validation study to establish the RFOA defense. In contrast, to establish a Title VII business-necessity defense, the employer would need to validate the test to show that it accurately measured safe and efficient performance. In addition, even if the employer could show that the test was validated, proof by female applicants that there were less discriminatory alternatives that the employer refused to adopt would impose liability under Title VII. This is just one example of how the RFOA standard is less stringent than Title VII's business-necessity standard.

The proposed rule set forth non-exhaustive lists of factors relevant to whether an employment practice is reasonable and is based on factors other than age. Although, as discussed above, some commenters objected to some of the factors, other commenters found the lists useful and generally supported them. One commenter suggested that EEOC provide guidance on the types of evidence relevant to the factors and argued that the evidence should be objective, in existence before litigation, and more than mere self-serving statements. Another commenter stated that no single factor should be dispositive of whether an employment practice is reasonable.

Given the context-specific nature of the RFOA inquiry, it is not possible to specify every type of relevant evidence. All relevant evidence should be considered, and such evidence necessarily will vary according to the facts of each particular situation. Depending on the circumstances, relevant evidence might include documents describing the business purpose underlying the challenged practice, copies of any written guidance that the employer provided to decision makers, explanations of how the employer implemented the practice, and impact-related studies that the employer may have conducted. Objective evidence that was in existence prior to litigation will carry more weight than mere self-serving statements or after-the-fact rationales.

The first “reasonable” factor listed in the proposed rule concerned whether the employment practice and its implementation were common business practices. One commenter supported this factor because, as a factor rather than a required element, it would allow employers to defend their actions while ensuring that discriminatory practices that may be common in an industry are not given weight. Other commenters opposed the factor. Some commenters argued, for example, that the factor could stifle employer creativity and was not relevant to whether a particular employer's practice was reasonable under particular circumstances. Others argued that the commonality of a practice has no bearing on whether it is discriminatory and expressed concern that the factor could allow an employer to defend a practice when there is industry-wide discrimination. One commenter suggested that the factor should refer to common practices in comparable settings rather than to common business practices.

In light of the variety of concerns about this factor, the Commission has deleted it from the relevant considerations.

The second item in the proposed rule's list of factors relevant to “reasonableness” concerned the extent to which the factor is related to the employer's stated business goal. One commenter thought that the factor encompassed the essence of the RFOA defense but suggested that the term “stated” be deleted. Another commenter thought that the term “stated” was vague and wondered whether it meant that an employer must state its goal in advance.

The Commission has revised the provision, which has been redesignated 1625.7(e)(2)(i), to refer to an employer's “stated business purpose,” which is the legitimate business purpose that the employer had at the time of the challenged employment practice. This approach is consistent with Smith, which expressly noted that the City's “stated purpose * * * was to `attract and retain qualified people, provide incentive for performance, maintain competitiveness with other public sector agencies and ensure equitable compensation to all employees regardless of age, sex, race and/or disability.' ” 50 The City reasonably achieved this purpose by raising the salaries of junior officers to make them competitive with those of comparable positions in the region.51 Similarly, an employer whose stated purpose is to hire qualified candidates could reasonably achieve this purpose by ensuring that its hiring criteria accurately reflect job requirements.

The proposed rule said that the extent to which the employer took steps to define and apply the factor accurately and provided training, guidance, and instruction to managers was relevant to reasonableness. Three commenters supported this factor. One of them noted that training and guidance are sound business practices that are not burdensome. Two commenters objected to this factor. One argued that this factor is not necessary because it is subsumed under the factor concerning the employment practice's relation to the employer's stated business goals. The other commenter argued that, although providing guidance and training to managers may be good business practice and may enhance an employer's RFOA defense, the ADEA does not require employers to take such steps.

The proposed rule also included consideration of the extent to which supervisors were given guidance or training in the “other than age” section. Two commenters supported this factor as written, one commenter asked for guidance on the type of training that will help supervisors to make decisions based on objective rather than subjective criteria, and one commenter argued that an employer should lose its affirmative defense if the employer does not train its managers on subjective decision making. One commenter opposed this factor and suggested that EEOC work with stakeholders to determine whether an employer's preventive training measures should be a Faragher-type defense 52 to ADEA disparate-treatment claims. Another commenter asked how often training should be conducted and suggested that training should be required for all protected bases if it is required for age discrimination.

As discussed, the Commission has eliminated the “other than age” section and has combined the factors relating to guidance and instruction of managers into a single consideration, which has been designated 1625.7(e)(2)(ii). The Commission has deleted the reference to “took steps” to make clear that the consideration focuses on how the employer actually defined and applied its criteria. Through this consideration, the final rule recognizes the importance of defining an employment criterion carefully and educating managers and supervisors on how to apply it fairly.

As commenters noted, it is in the employer's interest to define and apply accurately the criteria on which it relies. Ensuring that decision makers understand and know how to apply the employer's standard will help to ensure that the employer has the work force it wants. For example, research demonstrates that older workers are commonly perceived to be less productive than younger workers but that such stereotypes are inaccurate.53 In fact, studies show a nonexistent or slightly positive relationship between job performance and older age.54 The output of older workers is equal to that of younger workers; 55 older workers are better in terms of accuracy and steadiness of work output and output level; 56 and they outperform younger workers in the area of sales.57 Thus, educating decision makers to be aware of, and avoid, age-based stereotypes can help to ensure that they apply the employer's standard accurately and do not unfairly limit the opportunities of older workers.

For example, an employer seeking to hire individuals with technological skills could instruct decision makers on the particular skills (e.g., experience using specific software or developing certain types of programs) that it needs. Similarly, rather than simply asking managers to assess an employee's training potential, an employer could instruct managers to identify the times the employee has received or sought training. Using objective criteria as much as possible and providing decision makers with specific job-related information can help to overcome age-based stereotypes.58

The rule does not require employers to train their managers. First, by referring not just to training but to “guidance or training,” it recognizes that employers use a wide range of measures to convey their expectations to managers, depending on the circumstances. For example, a small employer might reasonably rely entirely on brief, informal, verbal instruction. Second, as with all of the considerations in section 1625.7(e), this consideration is a not a required duty. Instead, its importance depends on the particular facts raised. Thus, an employer's RFOA defense will not necessarily fail because, for example, the employer did not train managers on how to apply its standard. On the other hand, steps such as carefully defining a standard and instructing managers on how to apply it are evidence that the employer's actions were based on reasonable factors other than age and will support the employer's defense.

The Commission does not agree with the commenter's suggestion that preventive training measures should be a Faragher-type defense. Employers have a Faragher-type defense to harassment based on age.59 An employer's training measures do not constitute a defense to disparate treatment or disparate impact, but they should go a long way toward preventing conscious or unconscious bias from infecting decision making in the first place. Although training is not a required element of the RFOA defense, it is a key component of efforts to provide a workplace free from discrimination. The Commission urges employers to educate all employees on their rights and responsibilities under all anti-discrimination laws.

Paragraph 1625.7(b)(2) of the proposed rule noted that, in the typical disparate-impact case, an employer has used an objective, non-age factor and the inquiry focuses on reasonableness. Relying on Watson v. Fort Worth Bank and Trust, 60 however, it also said that employers are subject to liability under disparate-impact analysis for granting supervisors unchecked discretion to engage in subjective decision making because the unchecked discretion allows conscious or unconscious age-based stereotypes to infect the decision-making process and, as such, is not “other than age.” It listed three factors relevant to whether an employment practice was “other than age”: the extent to which the employer gave supervisors unchecked discretion to assess employees subjectively, the extent to which supervisors evaluated employees based on factors known to be subject to age-based stereotypes, and the extent to which supervisors were given guidance or training.

Three commenters supported the proposed rule's approach to subjective decision making. They noted that subjective decision making frequently disadvantages older workers and raises the risk of age-based disparate impact. Other commenters who addressed this issue opposed the approach and argued that subjective decision making is not inherently based on age. They asserted that the proposed rule conflicted with Meacham's statement that the RFOA defense assumes that a non-age factor is at work, misconstrued Watson, and conflated disparate impact and disparate treatment. Some commenters asked for more guidance on the meaning of “unchecked discretion.”

The preamble to the proposed rule noted that criteria such as flexibility, willingness to learn, and technological skills are particularly susceptible to age-based stereotyping. One commenter argued that it is appropriate for an employer to consider these qualities, which are relevant to today's workplace. Another commenter asserted that the factor was too broad and could encompass such criteria as “ `energy,' `flexibility,' `adaptability,' `long-term commitment to company,' `success driven,' `tolerance,' [and] `creativity.' ” The commenter argued that the factor would cause parties to focus on whether a criterion was subject to stereotypes rather than on whether an employer evaluated employees negatively because of age.

The rule continues to recognize that giving supervisors unchecked discretion to engage in subjective decision making may result in disparate impact and that employers should take reasonable steps to ensure supervisors exercise their discretion in a manner that does not violate the ADEA. To prevent the misunderstanding reflected in the comments, however, the Commission has revised the rule. First, as noted above, the rule no longer addresses “reasonable” and “other than age” in separate paragraphs, but discusses “reasonable factor other than age” in a single paragraph. Second, the factors listed under “other than age” in the NPRM have been integrated into 1625.7(e)(2)(ii) and (e)(2)(iii). Section 1625.7(e)(2)(ii) addresses the extent to which the employer defined the employment criterion—such as a subjective factor—and provided supervisors with guidance on how to apply it. The Commission also has combined two “other than age” factors into a single consideration addressing subjective decision making and the use of criteria susceptible to age-based stereotypes. Section 1625.7(e)(2)(iii) makes clear that the extent to which the employer attempts to minimize subjectivity and avoid age-based stereotyping is relevant to whether or not it acted reasonably, particularly where the criteria are known to be subject to age-based stereotypes.

The Commission disagrees with commenters' assertions that the proposed rule was inconsistent with the Supreme Court's decisions in Meacham and Watson and believes that the rule is consistent with those decisions. First, Meacham did not say that a practice is “without respect to age” in every impact case, but only that such is the case in the typical disparate-impact case.61 Second, although “[i]t is true * * * that an employer's policy of leaving * * * decisions to the unchecked discretion of lower level supervisors should itself raise no inference of discriminatory conduct,” 62 this does not mean “that the particular supervisors to whom this discretion is delegated always act without discriminatory intent.” 63 As the Supreme Court recognized in Watson, disparate-impact analysis may be the only way to combat “the problem of subconscious stereotypes and prejudices” that may affect subjective decision making.64 Thus, although employers may sometimes deem it necessary to use subjective criteria to assess employees, it is not reasonable to leave the supervisors' discretion unconstrained.

Contrary to some commenters' assertions, the rule does not improperly conflate disparate-treatment and disparate-impact claims. It is not surprising, however, that disparate-treatment and disparate-impact claims may overlap in the context of subjective decision making. As the Supreme Court has noted, “the necessary premise of the disparate impact approach is that some employment practices, adopted without a deliberately discriminatory motive, may in operation be functionally equivalent to intentional discrimination.” 65 As noted above, the final rule's reference to a “non-age factor” reflects the language of the statutory RFOA defense and the Smith decision.66 It also reflects the Watson decision's endorsement of disparate-impact analysis to address the problem of stereotypes and prejudices that impede the elimination of employment discrimination.

The proposed rule used the term “unchecked” discretion, which was also used by the Court in Watson. Nevertheless, to address commenters' confusion about the term, we have eliminated it. The rule now refers to whether the employer “limited supervisors' discretion.”

One commenter, noting that the identification of a specific employment practice is part of a plaintiff's prima facie case, argued that the issue of subjective decision making is not relevant to the RFOA defense. As noted above, the final rule expressly states that the individual challenging the practice is responsible for isolating and identifying the specific employment practice causing the adverse impact. As courts have recognized, however, plaintiffs may challenge an overall decision-making process “if the employer utilizes an `undisciplined system of subjective decision making.' ” 67 If an individual establishes that an employer's use of subjective decision making had an age-based disparate impact, then the burden shifts to the employer to prove that the practice is a reasonable factor other than age. The extent to which the employer limited supervisors' discretion in a manner that minimized the likelihood that age-based stereotypes would infect the process is one of a number of factors relevant to whether the employer's practice is a reasonable, non-age factor.

The proposed rule listed three factors that some commenters interpreted as imposing Title VII's business-necessity test on ADEA disparate-impact claims. One factor addressed the extent to which an employer assessed the impact of its practice on older workers, and another factor concerned the severity of harm to individuals in the protected age group and the extent to which the employer took steps to minimize the harm. The remaining factor looked at whether other options were available and the reasons the employer chose the option it did. Quoting the Smith statement that the RFOA inquiry does not require employers to adopt a less discriminatory alternative,68 a footnote explained that the factor did not mean that an employer must adopt a practice that has the least severe age-based impact. The footnote also quoted a Restatement of Torts (Second) comment concerning unreasonable risk.

Some commenters argued that the factors conflate the concepts of impact and reasonableness, which are analytically distinct. They asserted that the factors improperly impose an affirmative duty to monitor selection procedures for adverse impact, that employers will not have data to conduct mandated impact analyses because they do not collect and report statistics on the ages of employees and applicants, that conducting impact analyses would be too costly for small employers, and that the factors penalize employers that do not conduct analyses. In addition, noting that plaintiffs have the burden of establishing that an employment practice has a disparate impact, some commenters argued that the factors inappropriately place the burden of disproving impact on employers. They also argued that the factor concerning consideration of other options conflicts with the Smith statement. Some commenters noted that, under Title VII, plaintiffs, not employers, have the burden of identifying less discriminatory alternatives. One commenter who opposed the factor argued that, if the Commission retains the factor, it should refer to “other known options” because employers should not be expected to know all potential employment practices. The commenter also argued that the Smith and Restatement quotes in the footnote were contradictory. Another commenter expressed concern that an alternative designed to minimize a practice's age-based impact might have an adverse impact on another protected group.

Two commenters supported the factor concerning consideration of other options. They noted that, as the Supreme Court stated in Watson, evidence that the employer ignored equally effective less discriminatory alternatives suggests that the challenged practice was the “functional equivalent of a pretext for discriminatory treatment.” 69

In response to comments, and to emphasize that the rule reflects a standard that is less stringent than Title VII's business-necessity test, the Commission has revised the rule to make clear that none of the considerations is a required element of the RFOA defense. As noted above, the rule now refers to a non-exhaustive description of “relevant considerations” and expressly states that no specific consideration need be present for a differentiation to be based on reasonable factors other than age. The importance of each consideration will necessarily vary according to the facts of each particular situation.

The final rule retains the impact-assessment and harm considerations, which have been redesignated 1625.7(e)(2)(iv) and 1625.7(e)(2)(v). The Commission has deleted the reference to “took steps” from 1625.7(e)(2)(iv) to make clear that the consideration focuses on the extent to which the employer actually assessed the impact rather than on the steps the employer took to do so. What an employer reasonably should do to assess impact depends on the facts of the particular situation. For example, an employer that assesses the race- and sex-based impact of an employment practice would appear to act unreasonably if it does not similarly assess the age-based impact. A small employer that does not generally conduct impact analyses on any basis, however, may well be able to show that its RIF decisions were reasonable even if it did not conduct a formal disparate-impact analysis during the RIF. Similarly, evidence that a policy was not the type normally subject to disparate-impact analysis would support an employer's argument that it should not reasonably be expected to conduct such analysis. Whether or not a formal disparate-impact analysis is done, if the impact is sufficiently large that the employer was or should have been aware of it, a failure to have taken reasonable steps to avoid or mitigate the impact is relevant to whether the employer's actions were based on reasonable factors other than age.

For purposes of clarity, section 1625.7(e)(2)(v) now refers to the “degree” rather than “severity” of the harm and the “extent” of injury. The final rule also changes the term “minimize” to “reduce” with respect to the assessment of the harm caused by different options to make clear that the rule does not require the adoption of the least discriminatory alternative.

Consideration of the degree of harm on individuals is measured both in terms of the scope of the injury to the individual and the scope of the impact, i.e., the number of persons affected. Smith exemplifies negligible harm in terms of injury and impact. In Smith, the injury was relatively minor as the raises affecting older workers were actually higher in dollar terms, although lower in percentage terms.70 The number of older workers affected was also relatively small.

In contrast, the more severe the harm, the greater the care that ought to be exercised.71 The Meacham case exemplifies significant injury and impact from the loss of jobs affecting a “startlingly skewed” group of older workers.72 In light of such significant injury and impact, it would be reasonable for an employer to investigate the reasons for such results and attempt to reduce the impact as appropriate.

The extent to which the employer took steps to reduce the harm to older workers in light of the burden of undertaking such steps is relevant to reasonableness. Whether an employer knew or reasonably should have known of measures that would reduce harm informs the reasonableness of the employer's choices.73 Thus, the RFOA includes consideration of the availability of measures to reduce harm, and the extent to which the employer weighed the harm to older workers against both the costs and efficiencies of using other measures that will achieve the employer's stated business purpose.

Given the relevance of the availability of measures to reduce harm contemplated by this consideration, the Commission has deleted the last factor concerning the availability of options. In addition, commenters misconstrued the consideration of options as requiring employers to search out every possible alternative and use the least discriminatory alternative, comparable to the Title VII's requirement, which the Supreme Court in Smith reasoned is not mandated by the RFOA defense.74

The Commission disagrees with commenters' views that Smith means that the consideration of alternative or equally effective practices is irrelevant. Smith stated that the RFOA does not impose Title VII's “requirement” that the employer must adopt a less discriminatory alternative.75 This statement does not mean that options or alternatives are irrelevant to the determination of reasonableness. As previously explained, the availability of options is manifestly relevant to the issue of reasonableness.76 A chosen practice might not be reasonable if an employer knew of and ignored an equally effective option that would have had a significantly less severe impact on older workers. Whereas Title VII requires an employer to adopt an equally effective, even marginally less discriminatory alternative, an employer's choice not to use an alternative that only marginally reduces the impact might be reasonable under the ADEA.

The changes to 1625.7(e) clarify that the RFOA standard is lower than Title VII's “business necessity” standard.77 They also clarify that the considerations relevant to the RFOA determination are not required elements of the RFOA defense. These changes ensure that employers may continue to make reasonable business decisions that do not arbitrarily limit the employment opportunities of older workers.

This final rule has been drafted and reviewed in accordance with Executive Order (“E.O.”) 13563 and E.O. 12866. Executive Order 13563 directs agencies to propose or adopt a regulation only upon a reasoned determination that its benefits justify its cost (recognizing that some benefits and costs are difficult to quantify); tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives; and select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). Executive Order 12866 directs agencies to submit a regulatory impact analysis for those regulatory actions that are “economically significant” within the meaning of section 3(f)(1).”78 A regulatory action is economically significant under section 3(f)(1) if it is anticipated (1) to “[h]ave an annual effect on the economy of $100 million or more,” or (2) to “adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities.” 79 Executive Order 13563 reaffirms the principles established by E.O. 12866, and further emphasizes the need to reduce regulatory burden to the extent feasible and permitted by law.80

As reported in the February 2010 NPRM, the Commission determined that the rule is not economically significant under this standard, and therefore that a full regulatory impact analysis was not required. However, some comments received during the notice and comment period suggested, without specifically mentioning the Commission's determination under E.O. 12866, that the rule would impose greater costs on regulated entities than the Commission anticipated. To ensure that regulatory burdens are minimized, the Commission reexamined its basis for determining that the rule is not economically significant in light of the comments. It concluded that the determination did not need to be changed, and that the commenters' stated concerns about costs reflected a misunderstanding of the rule. The final rule has been revised to obviate such misunderstanding. For the record, the Commission presents its analysis of the impact of the rule on regulated entities and responds to the public comments below.

The purpose of the rule is to help explain the implications of the Supreme Court's decisions in Smith 81 and Meacham 82 and the type of conduct that would support an RFOA defense in court. It therefore does not require any action on the part of covered entities.83 Rather, it provides assistance to covered entities regarding what they can do to ensure that their practices are based on reasonable factors other than age. The rule does not expand the coverage of the ADEA to additional employers or employees. It also does not include reporting, recordkeeping, or other requirements for compliance. Accordingly, the Commission concluded that efforts to comply with the rule will not have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State or local tribal governments or communities.

However, the Commission recognizes that some covered entities may choose to modify their business practices in light of the recent Supreme Court decisions reflected in the rule, and the provisions in the rule itself, to avoid disparate-impact liability. Therefore, in addition to determining that the rule imposes no requirements that have an economic impact, the Commission investigated whether this type of voluntary, precautionary behavior would have a significant impact on the economy.

Because paragraph 1625.7(e)(2)(iv) of the rule states that “[t]he extent to which the employer assessed the adverse impact of its employment practice on older workers” is relevant to the RFOA defense, some covered entities may perform additional disparate-impact analyses in response to the rule. The first step of the Commission's inquiry was therefore to determine the economic consequences of performing additional analyses.

The Commission does not anticipate that this final rule will motivate large numbers of employers to perform additional disparate-impact analyses for the following reasons. First, the current regulation assumed that employers would routinely analyze job actions susceptible to disparate-impact claims for potential adverse effects on older workers, and many employers, especially larger ones, already do so. Some do so to reduce potential liability for ADEA claims; others simply wish to avoid disproportionately negative treatment of older workers.

Second, few job actions would be subject to disparate-impact analysis.84 For example, voluntary terminations and individual terminations for cause generally will not be subject to disparate-impact analysis. Third, even actions that involve practices amenable to disparate-impact analysis do not always require such analysis to ensure that a practice is reasonable. The rule states that, to demonstrate the RFOA defense, a covered entity needs to show only that it acted as would a prudent employer mindful of the requirements of the ADEA. In many cases, a prudent employer may reasonably decide that a formal disparate-impact analysis is unnecessary, for example because—

Further, where the covered entity determines that a disparate-impact analysis is warranted, the associated costs will generally be minimal. Larger businesses already routinely employ sophisticated methods of detecting disparate impact on the basis of race, ethnicity, or gender, and therefore already possess the expertise and resources required to analyze age data for impact. Because performing an additional analysis using these pre-existing resources takes little time, the associated costs will be minimal.

Although smaller entities may be less familiar with disparate-impact analysis, such entities are even less likely to incur costs for performing formal analyses, for two reasons. First, the average small entity's involuntary termination or other selection decisions will most often involve such a small number of employees that impact will be readily ascertainable without formal analysis. Second, where the numbers are large enough to warrant a more formal analysis, the RFOA defense only requires an entity to take steps that are reasonable under the circumstances to uncover potential impact. A small entity without many resources will likely be able to show that it acted reasonably by using the same methods it uses to detect disparate impact on the basis of race, ethnicity, or gender, which can often be carried out using free, readily available Internet tools. By conducting a Web search for the term “online disparate-impact analysis calculator,” a small entity may find and use an online calculator that can be easily used by lay people. This tool would enable the entity to test for adverse impact in less than 10 minutes. Additional steps to evaluate adverse impact would be reasonable only if, in light of the circumstances and available resources, a prudent employer mindful of ADEA requirements would take such steps.

Moreover, if a small entity determines that it requires assistance to perform these or other efforts to prevent age discrimination in employment, it may rely on free outreach materials from the Commission. The Commission expects to issue free small-business-oriented guidance materials discussing this rule, including technical assistance specifically designed to instruct small entities how to perform disparate-impact analyses and interpret the results.

Paragraph 1625.7(e)(2)(v) states that “[t]he degree of the harm [to older workers], in terms of both the extent of injury and the numbers of persons adversely affected, and the extent to which the employer took steps to reduce the harm, in light of the burden of undertaking such steps” is relevant to the RFOA determination.

Steps to reduce harm to older individuals only become relevant to the RFOA defense where the employer knew or reasonably should have known of measures to reduce such harm while effectively achieving its stated business purpose. Again, the Commission's analysis is limited by the paucity of data that currently exist. However, because so few job actions involve neutral employment practices that disproportionately harm older workers,85 only a small percentage of employer decisions will even present the opportunity for employers to consider steps to reduce harm to older individuals. Of these cases, only a subset will be ones in which the employer knew or reasonably should have known of measures to reduce such harm while effectively achieving its stated business purpose. Thus, such considerations will be relevant only in a very small percentage of cases. Further, as stated expressly in the consideration, the determination whether steps are relevant to the RFOA defense is made in light of the burdens associated with such steps. Therefore, a business would not be required to take steps that were overly burdensome.

Paragraph 1625.7(e)(2)(ii) states that “[t]he extent to which the employer defined the factor accurately and applied the factor fairly and accurately, including the extent to which managers and supervisors were given guidance or training about how to apply the factor and avoid discrimination” is relevant to the RFOA determination. Paragraph 1625.7(e)(2)(iii) states that “[t]he extent to which the employer limited supervisors' discretion to assess employees subjectively, particularly where the criteria that the supervisors were asked to evaluate are known to be subject to negative age-based stereotypes” is relevant. Therefore, the rule may motivate some employers to provide additional instruction, guidance, and training to their supervisors.

In many cases, no instruction will be required to avoid age discrimination. As noted, voluntary resignations do not raise a question of disparate impact. Even where the employment action involves application of selection or termination criteria, instruction will not always be needed. For example, instruction to avoid age-based stereotyping will be unnecessary if the selection criteria are objective.

Where instruction is needed, the associated costs will generally be de minimis. Larger employers will not incur significant costs because they already provide regular training for supervisors, including regular EEO training. Any instructions necessary to avoid age-biased applications of selection or termination criteria may easily be incorporated into this regular training.

Smaller businesses are even less likely to incur additional training costs. Because of the small number of people involved, many layoff decisions made by small entities are relatively straightforward, making instruction unnecessary to avoid age-biased applications of employment criteria. Further, even where some instruction is appropriate, entities small in size can typically provide such instruction informally, thereby avoiding costs associated with formal training. In addition, a small business wanting help with its training, or with other efforts to reduce adverse impact on older workers, may rely on the Commission's assistance. Each year, the Commission performs a very large number of free outreach presentations for employers, human resource managers, and their counsel, as well as fee-based training sessions offered at approximately $350. In fiscal year 2009 alone, the Commission offered 1,889 no-cost outreach events that addressed ADEA compliance, reaching more than 127,000 people, many of whom were from small businesses, and offered approximately 300 fee-based private-sector trainings that reached more than 13,000 people. In addition, the Commission expects to issue small-business-oriented guidance materials discussing the rule, as it has done in other contexts.86

Under E.O. 13563, the Commission must assess not only the rule's negative effects on the economy but also its positive effects. Here again, the Commission's assessment was necessarily limited by the data that currently exist. Indeed, doing this assessment highlights the need for more focused research on the economic costs and benefits of ensuring equal employment opportunity. Nevertheless, on the basis of the general considerations below, the Commission determined that the rule will have modest positive effects on the economy.

The Commission also concludes that a wide range of qualitative, dignitary, and related intrinsic benefits must be considered. These benefits include the values identified in E.O. 13563, such as equity, human dignity, and fairness. Specifically, the qualitative benefits attributable to the final rule include but are not limited to the following:

The comments suggesting that the rule will impose economic burdens were as follows:

The comments do not alter the Commission's conclusion that the rule will not impose unacceptable or unreasonable costs on society. As previously noted, the comments were based on a misunderstanding of the proposed rule, and the final rule was revised to obviate such misapprehension. As shown above, any costs associated with the rule will be minimal.

The comments overstate the number of disparate-impact analyses that will be performed by employers as a result of the rule. As explained above, a disparate-impact analysis is appropriate in only a small proportion of job actions, is already done by many employers pursuant to existing regulations and case law, and, even where the practice is amenable to disparate-impact analysis, such analysis is not always required to ensure that a practice is reasonable. If an impact analyses is done, neither existing law nor this regulation would require it to compare the practice's impact on individuals of every age with its impact on individuals of every other age. The RFOA defense requires only such steps as would be taken by a prudent employer mindful of the requirements of the ADEA.

The Commission disagrees with the assertion of one commenter that obtaining the required age data would be burdensome. Generally, employees' birth dates are available to employers because they are recorded in personnel files.

As explained above, the Commission has deleted the factor discussing the availability of other ways for the employer to achieve its stated business purpose, because commenters misunderstood the factor to mean that employers must search out every possible alternative (or, in the words of one commenter, a “potentially infinite” number of alternatives) and use the one that is least discriminatory. Of course, as also explained above, the deletion of the factor does not mean that the availability of other measures to achieve the employer's purposes is irrelevant to the defense. Whether an employer knew or reasonably should have known of measures that would reduce harm informs the reasonableness of the employer's choices.

Because so few job actions involve neutral employment practices that disproportionately harm older workers, only a small percentage of employer decisions will even present the opportunity for employers to consider the relative harm of various options.94 Only a subset of these actions will be ones in which the employer knew or reasonably should have known of measures that would reduce harm to older individuals. Further, when an employer does decide to evaluate whether another option would reduce harm to older individuals, it may do so using the same low-cost methods that were described above in the discussion of the cost of disparate-impact analyses. Overall costs are therefore likely to be extremely low.

The comments assert generally that the additional training will be burdensome. As explained in the analysis above, training costs associated with the rule will be minimal.

The Commission has deleted the factor concerning whether a business practice is common from the considerations. Therefore, the Commission need not discuss the commenter's assertion that this factor requires businesses to hire consultants to determine whether their practices are common.

The Commission disagrees with one commenter's assertion that the rule would increase employers' vulnerability to frivolous litigation or make it more difficult for employers to win against frivolous claims at the summary judgment stage. Of course, individuals may file frivolous litigation regardless of the underlying law. Further, even without the rule, determining whether a practice is a based on reasonable factors other than age is a fact-specific inquiry; the commenter provided no reason to conclude that the considerations in the final rule are any more complicated than other facts relevant to the RFOA analysis. Indeed, as noted, the Commission concludes the rule is likely to reduce employers' litigation costs.

For the foregoing reasons, the Commission has determined that the final rule will not have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State or local tribal governments or communities.

The purpose of the Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, is to ensure that statutory goals are achieved without imposing unnecessary and unjustifiable regulatory burdens on small businesses and other small entities, which may have few resources to devote to regulatory compliance. To achieve this purpose, the RFA requires federal agencies to conduct a series of analyses on proposed rules. The analyses are designed to ensure that the agency considers ways of minimizing any significant regulatory burdens imposed on small entities by the rules.

The goal of the analysis is to determine whether the proposed rule will have a significant economic impact on a substantial number of small entities. If it will, the agency must consider alternative regulatory approaches that may minimize the impact. If the rule will not have a significant impact on a substantial number of small entities, it may so certify under 5 U.S.C. 605(b).

In the February 2010 NPRM, the Commission certified under 5 U.S.C. 605(b) that the proposed rule would not have a significant economic impact on a substantial number of small entities, and therefore did not include an initial regulatory flexibility analysis. Although the final rule covers a substantial number of small entities,95 the Commission's threshold analysis indicated that, for the reasons discussed in detail in the section on Executive Order 12866 above, the costs imposed by the rule generally are de minimis and therefore would not significantly impact small business.

Two commenters disagreed with the Commission's decision to certify the rule, and therefore requested further analysis under the RFA. One of these commenters asserted that the rule would economically impact small entities by suggesting that they keep track of alternative employment practices and the reasons for their choices, and that they give supervisors additional guidance and training. In light of these comments and the comments discussed above regarding E.O. 12866, the Commission reexamined the factual basis for its certification.

The comments provide no reason to alter the Commission's initial conclusion that the rule will not impose unnecessary or unjustifiable regulatory burdens on small entities. The comments did not include any factual basis for their assertions and, for reasons specifically discussed in the E.O. 12866 analysis above, the Commission has determined that small entities are unlikely to incur costs as a result of this rule.

As explained above, the rule will seldom be implicated in actions by small employers because issues of age-based disparate impact are most likely to arise in the context of mass terminations, hiring based on tests, or other practices involving significant numbers of individuals. Although there are no data available that speak specifically to this issue, the Commission estimates that the average small entity is unlikely to be involved in even one such practice. If a small employer were to engage in such a practice, moreover, the number of individuals affected is likely to be so small that impact can be ascertained without resort to formal disparate-impact analysis. If the employer wants to do such analysis, free and easy to use tools are available on the Internet. Therefore, the Commission disagrees with the commenter that small entities will be significantly burdened by additional impact analyses performed as a result of the rule.

The Commission also disagrees that small entities will be significantly burdened by the need to keep track of alternative employment practices and the reasons for their choices. As explained above, consideration of alternative employment practices would be relevant only in a very small percentage of cases.96 Further, if a small employer undertook a neutral practice that disproportionately harmed older workers, the determination of the reasonableness of the factor it used would be made in light of its resources. The entity's resources also inform the determination of whether it would be reasonable for it to take, or not to take, further steps to reduce harm. Therefore, small employers will not be disproportionately burdened by this aspect of the rule.

For the reasons explained above, the Commission disagrees with the commenter's assertion that small entities will be significantly burdened by additional guidance and training performed as a result of the rule. Indeed, the rule is likely to have little impact on small employers.

For the foregoing reasons, the Commission certifies pursuant to section 605(b) of the Regulatory Flexibility Act, 5 U.S.C. 605(b), that this rule will not have a significant economic impact on a substantial number of small entities.

This final rule contains no new or revised information collection requirements subject to review by the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

This final rule will not result in the expenditure by state, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year, and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.

To the extent that this rule is subject to the Congressional Review Act, the Commission has complied with its requirements by submitting this final rule to Congress prior to publication in the Federal Register.

For the reasons set forth in the preamble, the Equal Employment Opportunity Commission 29 CFR chapter XIV part 1625 is amended as follows:

On March 16, 2012, Department of Defense published a direct final rule titled Privacy Act; Implementation. Subsequent to the publication of that direct final rule, Department of Defense discovered that paragraphs (l)(2) through (l)(5) in § 322.7 should have read paragraphs (l)(1) through (l)(4).

In the direct final rule (FR Doc. 2012-6170) published on March 16, 2012 (77 FR 15595-15596), make the following corrections:

Regulatory Information

The Coast Guard is issuing this temporary final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because delay would be contrary to the public interest. The event will occur before a notice-and-comment rulemaking could be completed, thereby jeopardizing the safety and security of the commissioning ceremony.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds good cause exists for making this rule effective less than 30 days after publication in the Federal Register. Delay would be contrary to the public interest. Delaying the effective date would be contrary to the security zone's intended objectives of mitigating potential terroristic acts and enhancing public and maritime safety and security. Immediate action is necessary to ensure the safety and security of the commissioning ceremony. The COTP finds that this temporary security zone needs to be effective by March 30, 2012, to ensure the safety of the commissioning ceremony taking place on Coast Guard Island near Alameda, California.

From March 30, 2012, through March 31, 2012, a security zone will take effect around Coast Guard Island near Alameda, California for the USCGC STRATTON Commissioning Ceremony. This area is located adjacent to U.S. navigable waters in the San Francisco Captain of the Port Zone. The Coast Guard is establishing this security zone to ensure the safety and security of the commissioning ceremony.

This temporary final rule will be enforced from 12 p.m. on March 30, 2012 through 4 p.m. on March 31, 2012. The security zone area is located within the San Francisco Captain of the Port Zone (See 33 CFR 3.55-20) and covers all the U.S. navigable waters in the San Francisco Bay from the surface of the water to the ocean floor. This security zone will include the navigable waters around Coast Guard Island near position 37°46′56″ N, 122°14′58″ W (NAD 83).

This temporary security zone will cover the waters surrounding the Dennison Street Bridge connecting Coast Guard Island to Oakland, CA from the surface of the water to the ocean floor within 100 yards of the bridge from 12 p.m. on March 30 until 4 p.m. on March 31, 2012. This temporary security zone will also cover the waters surrounding Coast Guard Island from the surface of the water to the ocean floor within 100 yards of Coast Guard Island from 5 a.m. until 4 p.m. on March 31, 2012.

In accordance with the general regulations in 33 CFR part 165, subpart D, no person or vessel will be permitted to transit into or remain in the security zone except for authorized support vessels, aircraft and support personnel, or other vessels authorized by the Captain of the Port. Any Coast Guard commissioned, warrant, or petty officer, and any other Captain of the Port representative permitted by law, may enforce the security zone. Vessels, aircraft, or persons in violation of this rule would be subject to the penalties set forth in 33 U.S.C. 1232 and 50 U.S.C. 192.

We developed this 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 rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order.

Although this rule restricts access to the waters encompassed by the security zone, the effect of this rule will not be significant because the local waterway users will be notified via public Broadcast Notice to Mariners to ensure the security zone will result in minimum impact. The entities most likely to be affected are pleasure craft engaged in recreational activities.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: the owners and operators of vessels intending to operate in the impacted section of the San Francisco Bay during times when this rule is being enforced.

This rule is most likely to affect owners and operators of pleasure craft engaged in recreational activities and sightseeing.

This rule will not have a significant economic impact on a substantial number of small entities for several reasons: (i) Vessel traffic can pass safely around the area, (ii) vessels engaged in recreational activities and sightseeing have ample space outside of the effected portion of the areas off San Francisco, CA to engage in these activities, (iii) this rule will encompass only a small portion of the waterway for a limited period of time, and (iv) the maritime public will be advised in advance of this security zone via Broadcast Notice to Mariners.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offer to assist small entities in understanding the rule so that they can better evaluate its effects on them and participate in the rulemaking process.

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

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

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

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

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

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

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

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

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

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

We have analyzed this rule under 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 concluded this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule is categorically excluded, under figure 2-1, paragraph (34)(g), of the Instruction. This rule involves establishing a security zone.

An environmental analysis checklist and a categorical exclusion determination are available in the docket where indicated under ADDRESSES.

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

Regional haze is visibility impairment that is produced by a multitude of sources and activities which are located across a broad geographic area and emit fine particles (e.g., sulfates, nitrates, organic carbon, elemental carbon, and soil dust), and their precursors (e.g., sulfur dioxide (SO2), nitrogen oxides (NOX), and in some cases, ammonia and volatile organic compounds (VOC)). Fine particle precursors react in the atmosphere to form fine particulate matter (PM2.5) which impairs visibility by scattering and absorbing light. Visibility impairment reduces the clarity, color, and visible distance that one can see. PM2.5 can also cause serious health effects and mortality in humans and contributes to environmental effects such as acid deposition and eutrophication.

In section 169A of the 1977 Amendments to the CAA, Congress created a program for protecting visibility in the nation's national parks and wilderness areas. This section of the CAA establishes the “prevention of any future, and the remedying of any existing, impairment of visibility in mandatory Class I areas which impairment results from manmade air pollution” as a national goal. On December 2, 1980, EPA promulgated regulations to address visibility impairment in Class I areas that is “reasonably attributable” to a single source or small group of sources, i.e., “reasonably attributable visibility impairment.” See 45 FR 80084. These regulations represented the first phase in addressing visibility impairment. EPA deferred action on regional haze that emanates from a variety of sources until monitoring, modeling, and scientific knowledge about the relationships between pollutants and visibility impairment were improved.

Congress added section 169B to the CAA in 1990 to address regional haze issues. EPA promulgated a rule to address regional haze on July 1, 1999 (64 FR 35713), the Regional Haze Rule (RHR). The RHR revised the existing visibility regulations to integrate into the regulation provisions addressing regional haze impairment and established a comprehensive visibility protection program for Class I areas. The requirements for regional haze, found at 40 CFR 51.308 and 51.309, are included in EPA's visibility protection regulations at 40 CFR 51.300-309. The requirement to submit a regional haze SIP applies to all 50 states, the District of Columbia, and the Virgin Islands. 40 CFR 51.308(b) requires states to submit the first implementation plan addressing regional haze visibility impairment no later than December 17, 2007.

On June 25, 2008, and May 28, 2010, KYDAQ submitted revisions to Kentucky's SIP to address regional haze in the Commonwealth's and other states' Class I areas. On December 16, 2011, EPA published an action proposing a limited approval and a limited disapproval of Kentucky's two SIP revisions to address the first implementation period for regional haze. See 76 FR 78194. EPA proposed a limited approval of Kentucky's two SIP revisions to implement the regional haze requirements for Kentucky on the basis that these revisions, as a whole, strengthen the Kentucky SIP. Also in that action, EPA proposed a limited disapproval of these same SIP revisions because of the deficiencies in the Commonwealth's regional haze SIP revisions arising from the remand of CAIR to EPA by the D.C. Circuit. EPA received comments on the Agency's proposed actions for Kentucky's June 25, 2008, and May 28, 2010, SIP revisions. See section II of this rulemaking for a summary of comments received and EPA's responses to these comments. Also, detailed background information and EPA's rationale for the proposed actions are provided in EPA's December 16, 2011, proposed rulemaking.

Following the remand of CAIR, EPA recently issued a new rule in 2011 to address the interstate transport of NOX and SO2 in the eastern United States. See 76 FR 48208 (August 8, 2011) (“the Transport Rule,” also known as the Cross-State Air Pollution Rule (CSAPR)). On December 30, 2011, EPA proposed to find that the trading programs in the Transport Rule would achieve greater reasonable progress towards the national goal than would best available retrofit technology (BART) in the states in which the Transport Rule applies. See 76 FR 82219. Based on this proposed finding, EPA also proposed to revise the RHR to allow states to substitute participation in the trading programs under the Transport Rule for source-specific BART. EPA has not yet taken final action on that rule.

Also on December 30, 2011, the D.C. Circuit issued an order addressing the status of the Transport Rule and CAIR in response to motions filed by numerous parties seeking a stay of the Transport Rule. In that order, the D.C. Circuit stayed the Transport Rule pending the court's resolutions of the petitions for review of that rule in EME Homer Generation, L.P. v. EPA (No. 11-1302 and consolidated cases). The court also indicated that EPA is expected to continue to administer CAIR in the interim until the court rules on the petitions for review of the Transport Rule.

EPA received three sets of comments on the December 16, 2011, rulemaking proposing a limited approval and limited disapproval of Kentucky's June 25, 2008, and May 28, 2010, SIP revisions. Specifically, the comments were received from the East Kentucky Power Cooperative (EKPC), the Utility Air Regulatory Group, and collectively from the Sierra Club and National Parks Conservation Association. Full sets of the comments provided by all of the aforementioned entities (hereinafter referred to as “the Commenter”) are provided in the docket for today's final action. The docket for this action is available at www.regulations.gov under Docket Identification No. EPA-R04-OAR-2009-0783. A summary of the comments and EPA's responses are provided below.

Comment 1: The Commenter asserts that EPA does not have the authority under the CAA to issue a limited approval and concurrent limited disapproval of Kentucky's regional haze SIP. The Commenter contends that section 110(k) of the Act only allows EPA to fully approve, partially approve and partially disapprove, conditionally approve, or fully disapprove a SIP.

Response 1: As discussed in the September 7, 1992, EPA memorandum cited in the notice of proposed rulemaking,1 although section 110(k) of the CAA may not expressly provide authority for limited approvals, the plain language of section 301(a) does provide “gap-filling” authority authorizing the Agency to “prescribe such regulations as are necessary to carry out” EPA's CAA functions. EPA may rely on section 301(a) in conjunction with the Agency's SIP approval authority in section 110(k)(3) to issue limited approvals where it has determined that a submittal strengthens a given state SIP and that the provisions meeting the applicable requirements of the Act are not separable from the provisions that do not meet the Act's requirements. EPA has adopted the limited approval approach numerous times in SIP actions across the nation over the last twenty years. Limited approval and limited disapproval actions are appropriate here because EPA has determined that Kentucky's SIP revisions addressing regional haze, as a whole, strengthen the Commonwealth's SIP and because the provisions in the SIP revisions are not separable.

The Commenter notes that EPA's action “directly contradicts the plain language of the Clean Air Act” and cites several federal appellate court decisions to support its contention that section 110(k) of the Act limits EPA to “a conditional approval, a partial approval and disapproval, or a full approval.” However, adopting the Commenter's position would ignore section 301 and violate the “ `fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme'* * *. A court must therefore interpret the statute `as a symmetrical and coherent regulatory scheme,'* * * and `fit, if possible, all parts into an harmonious whole.' ” FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 133 (2000) (quoting Davis v. Michigan Dept. of Treasury, 489 U.S. 803, 809 (1989), Gustafson v. Alloyd Co., 513 U.S. 561, 569 (1995), and FTC v. Mandel Brothers, Inc., 359 U.S. 385, 389 (1959)). Furthermore, the cases cited by the Commenter did not involve challenges to a limited approval approach, and one of the cases, Abramowitz v. EPA, 832 F.2d 1071 (9th Cir. 1988) predates the 1990 CAA amendments enacting section 110(k).

Comment 2: The Commenter states that EPA must partially disapprove Kentucky's regional haze SIP submittal because it relied on CAIR, a rule that, in the Commenter's words, has been “declared illegal, remanded and will come to an end.” The Commenter also contends that EPA must specifically “disapprove the LTS [long-term strategy] that rely upon emissions reductions predicted to result from CAIR to supplant NOX and SO2 BART analyses and determinations for EGUs [electric generating units] and otherwise meet RPGs [reasonably progress goals].”

Response 2: In 2008, the D.C. Circuit remanded CAIR back to the Agency because the court believed that CAIR was inconsistent with the requirements of the CAA. Although CAIR may not remain in effect indefinitely, it is currently in force, and the Commonwealth's reliance on CAIR was fully consistent with EPA's regulations at the time that Kentucky developed its regional haze SIP. As explained in the December 16, 2011, proposed rulemaking (76 FR 78194), EPA is taking a limited approval action because the revisions as a whole strengthen the SIP and because this action is consistent with the court's intention to keep CAIR temporarily in place. The limited approval results in an approval of the entire regional haze submission and all of its elements, preserving the visibility benefits offered by the SIP until CAIR is replaced by the Transport Rule and EPA demonstrates that the Transport Rule is better than BART. EPA is taking a limited disapproval action because the Agency cannot fully approve regional haze SIP revisions that rely on CAIR for emissions reduction measures for the reasons discussed in section IV of the December 16, 2011, proposed rulemaking. EPA's response to Comment 1, above, explains the Agency's authority to take limited approval and limited disapproval actions under the CAA.

EPA disagrees with the Commenter's request for a partial disapproval of the SIP. Because the SIP provisions relying on CAIR, including the LTS, do not meet the applicable regional haze requirements and are not separable from the provisions that meet the applicable requirements of the Act, a partial disapproval would prevent any of the SIP's air quality benefits from being realized until EPA promulgated a FIP or approved a revised SIP to address the deficiencies. Furthermore, the two-year clock to promulgate a FIP to remedy the deficiencies is triggered by the limited disapproval just as it would be triggered by a partial disapproval. On December 30, 2011, EPA proposed to find that the trading programs in the Transport Rule would achieve greater reasonable progress towards the national goal than would BART in the states in which the Transport Rule applies. See 76 FR 82219. Based on this proposed finding, EPA also proposed a FIP for Kentucky in that action that would substitute participation in the trading programs under the Transport Rule for participation in CAIR for the purposes of satisfying regional haze requirements and would remedy the CAIR-related deficiencies discussed above.

Comment 3: The Commenter identifies its opposition to EPA's December 30, 2011, proposed rulemaking to find that the Transport Rule is better than BART and to “use the Transport Rule as an alternative to BART” for Kentucky and other states subject to the Transport Rule. The Commenter incorporates its comments on that December 30, 2011, rulemaking “by reference” and outlines several of those comments, including its arguments that the Transport Rule is not “better than BART” and that EPA cannot rely on the Transport Rule as an “alternative program or measure to displace BART requirements for those BART-eligible sources in Transport Rule states.”

Response 3: In today's rule, EPA is taking final action on the limited approval and limited disapproval of Kentucky's regional haze SIP. The Commenter correctly recognizes that EPA did not propose to find that participation in the Transport Rule is an alternative to BART in this rulemaking. As noted above, EPA made this proposed finding in a separate action on December 30, 2011, and the Commenter is merely reiterating and incorporating its comments on that separate action. These comments are therefore beyond the scope of this rulemaking and will be addressed, as appropriate, by EPA in its final action on the December 30, 2011, proposed rule.

Comment 4: The Commenter believes that the 2018 emissions inventory is not approvable because Kentucky relied on the not-yet-approved Charlotte/Gastonia/Rock Hill 1997 8-hr ozone nonattainment area SIP; consent decrees for EKPC and American Electric Power (AEP) that allow for various compliance options; and the Industrial Boiler Maximum Achievable Control Technology (MACT) rule. The Commenter also believes that it is irrational and arbitrary for EPA to expect that the State will issue case-by-case MACT determinations through title V renewal permits in a timely manner.

Response 4: EPA does not expect that minor inventory differences like those alleged, even if they occur, would affect the adequacy of Kentucky's regional haze SIP. The technical information provided in the record demonstrates that the emissions inventory in the SIP adequately reflects projected 2018 conditions and should be approved. Kentucky's 2018 projections are based on the Commonwealth's technical analysis of the anticipated emissions rates and level of activity for EGUs, other point sources, nonpoint sources, on-road sources, and off-road sources based on their emissions in the 2002 base year, considering growth and additional emissions controls to be in place and federally enforceable by 2018. The emissions inventory used in the regional haze technical analyses was developed by Visibility Improvement State and Tribal Association of the Southeast (VISTAS) with assistance from Kentucky. The 2018 emissions inventory was developed by projecting 2002 emissions (the latest region-wide inventory available at the time the submittal was being developed) and applying reductions expected from federal and state regulations affecting the emissions of VOC and the visibility-impairing pollutants NOX, particulate matter (PM), and SO2.

To minimize the differences between the 2018 projected emissions used in the Kentucky regional haze submittal and what actually occurs in 2018, the RHR requires that the five-year review address any expected significant differences due to changed circumstances from the initial 2018 projected emissions, provide updated expectations regarding emissions for the implementation period, and evaluate the impact of these differences on RPGs. It is expected that individual projections within a statewide inventory will vary from actual emissions over a 16-year period. For example, some facilities shut down whereas others expand operations. Furthermore, economic projections and population changes used to estimate growth often differ from actual events; new rules are modified, changing their expected effectiveness; and methodologies to estimate emissions improve, modifying emissions estimates. The five-year review is a mechanism to assure that these expected differences from projected emissions are considered and their impact on the 2018 RPGs is evaluated.

In the specific instances cited by the Commenter, the Commonwealth's analysis of projected emissions meets the requirements of the regional haze regulations and EPA guidance. In the cases of the two NOX sources in Charlotte (Philip Morris and Norandal), the projected emissions reductions have already occurred or installation of control equipment is underway and the differences between projected emissions and actual emissions, if there are any, are likely to be too small to affect any of Kentucky's modeling. For the EGUs in Kentucky (EKPC's Spurlock and Cooper plants and AEP's Big Sandy Plant (Big Sandy)), the Commonwealth adjusted the Integrated Planning Model (IPM) projections that VISTAS used for the inventory projections to postpone the NOX and SO2 controls that IPM projected for 2009 based on the terms of the consent decrees for EKPC and AEP.

Regarding the changes to the Industrial Boiler MACT rule, VISTAS projected that the emissions reductions resulting from the original, vacated Industrial Boiler MACT rule would be 0.1 to 0.2 percent, depending on the pollutant, of the projected 2018 SO2, PM2.5, and coarse particulate matter (PM10) inventory. EPA has re-promulgated an Industrial Boiler MACT rule that is at least equivalent to the one vacated with regard to the issues raised by the Commenter, and EPA expects that this rule will result in lower emissions from the affected facilities than those originally projected for 2018. Further, as discussed in the December 16, 2011, proposed rulemaking, there are provisions for case-by-case controls should the Industrial Boiler MACT rule not be implemented pursuant to its currently anticipated schedule.

Comment 5: The Commenter contends that EPA must disapprove the Kentucky SIP revisions with regard to the modeling if the “modified version” of EPA's Models-3/Community Multiscale Air Quality (CMAQ) model used by the Commonwealth has not been established to be consistent with Appendix W. The Commenter also states that the modeling uses meteorology from 2002 that is out of date and not representative of 2018 or 2064, especially considering climate change. According to the Commenter, EPA must therefore disapprove the modeling, require Kentucky to use recent meteorological data, and require that the modeling consider what impacts climate change will have on future visibility impairment, ozone formation, and other factors that influence visibility impairment such as relative humidity.

Response 5: The modeling used by Kentucky is consistent with Appendix W. EPA's guidance does not require a specific modeling system for evaluating photochemical phenomena. EPA's CMAQ modeling system is one of the photochemical grid models available capable of addressing ozone, PM, visibility, and acid deposition on a regional scale. The photochemical model that VISTAS selected for this study was CMAQ version 4.5. VISTAS modified the module for secondary organic aerosols in an open and transparent manner that was also subjected to outside peer review (see Appendix C of the Kentucky regional haze SIP, located in the docket for this action, for more information on the model selection criteria). The procedures and analyses used in the CMAQ modeling were developed in consultation with the appropriate reviewing authorities and the affected federal land managers (FLMs).

The modeling system based on the CMAQ photochemical model with a modified secondary aerosol module and used in the regional assessment of regional haze was developed and applied consistent with EPA's Guidance on the Use of Models and Other Analyses for Demonstrating Attainment of Air Quality Goals for Ozone, PM 2.5, and Regional Haze, located at http://www.epa.gov/scram001/guidance/guide/final-03-pmrh-guidance.pdf, (EPA-454/B-07-002), April 2007, and the EPA document entitled, Emissions Inventory Guidance for Implementation of Ozone and Particulate Matter National Ambient Air Quality Standards (NAAQS) and Regional Haze Regulations, located at http://www.epa.gov/ttnchie1/eidocs/eiguid/index.html, EPA-454/R-05-001, August 2005, updated November 2005 (“EPA's Modeling Guidance”).

VISTAS developed the technical analyses supporting Kentucky's regional haze SIP in the 2003-2006 time period; therefore, the use of 2002 data is appropriate and consistent with the EPA memorandum authored by Lydia Wegman entitled, 2002 Base Year Emissions Inventory SIP Planning: 8-hr Ozone, PM 2.5 and Regional Haze Programs, located at http://www.epa.gov/ttnchie1/eidocs/2002baseinven_102502new.pdf. With regard to using meteorology from any chosen year, the issue is whether the chosen year is representative, not whether it is “out of date.” VISTAS conducted an in-depth analysis which resulted in the selection of the entire year of 2002 (January 1-December 31) as the best period of meteorology available for conducting the CMAQ modeling for the chosen base year of 2002.

Regarding the comment that the modeling must consider the impacts of climate change, the use of 2002 meteorology without adjustment is more appropriate and more consistent with existing agency guidance. EPA disagrees with the Commenter's position on this issue, a position that the Commenter has raised in prior Kentucky SIP rulemakings. As explained in more detail in those responses, modeling guidance is not yet available for the type of area-specific analysis of effects of climate change required for SIP planning. It is therefore premature to require a precise mathematical accounting in the SIP process for the effect of higher ambient temperatures due to climate change. The use of unadjusted meteorological input is consistent with how photochemical modeling demonstrations are developed for regulatory analyses. The 2002 meteorological data is used to support the base and future year modeling. The rationale for its use in the base year is to test the model's performance in reproducing observed temporal and concentration spatial patterns. It is also used in the future year modeling for 2018 to test how control strategy is sufficient address the conditions observed in the base year of 2002. The 2064 year is not included or addressed in the regional haze SIP in this round of submittals.

Comment 6a: The Commenter states that Kentucky excluded the auxiliary boiler at Big Sandy from a BART analysis because it only operated for short periods of time during startup and emissions tests. According to the Commenter, EPA cites no authority for this proposition, mentions no enforceable conditions that limit Big Sandy's auxiliary boiler operations, and thus, EPA must disapprove the SIP for failure to have a BART analysis for Big Sandy's auxiliary boiler.

Response 6a: Kentucky addressed the exclusion of this auxiliary unit in an approved modeling protocol. Tables B1 through B4 in Appendix L.5 of Kentucky's June 25, 2008, regional haze SIP revision present the operating data for the auxiliary boiler at Big Sandy for the period June 22, 2003, through September 24, 2006. During this time, the boiler had an average annual operating factor of 1.16 percent based on the facility's actual operating hours with a range of 0.3 percent in 2005 to 2.68 percent for January to September 2006. With the exception of September 2003, when the boiler was operated for NOX SIP Call Low Mass Emitter certification testing and related operations checks (this testing is required every five years), and during October 2004, when the boiler was operated periodically over a three-day period while both generating units were out of service, the normal operating pattern of the boiler is for it to only be fired at low load periodically for a few minutes to test its ability to be started and for use in starting up Unit 2. EPA agrees with Kentucky that this data justifies not considering this boiler in the BART analysis.

Comment 6b: The Commenter contends that the BART analysis for Big Sandy units 1 and 2 fails to consider: Wet electrostatic precipitators (ESPs); switching to a lower sulfur coal either entirely or as a blend or co-firing natural gas or biomass; a circulating fluid bed (CFB) scrubber; a spray dry absorption (SDA) scrubber; installing a fabric filter (FF); upgrading the current ESPs to increase the size and/or change from wire to rigid discharge electrode; changing the operation of the air preheater; or trona injection coupled with replacing the ESP with a new ESP. Because the BART analysis allegedly failed to consider all available retrofit technologies, the Commenter states that EPA must disapprove the SIP with regard to the PM BART determination for Big Sandy. The Commenter also believes that EPA must disapprove the SIP because it does not contain a “firm” closure date for unit 1; an enforceable deadline for the installation of the flue gas desulfurization (FGD) on unit 2 and the ammonia injection on unit 1; and an emissions limit for condensable PM from both units.

Response 6b: As stated in Appendix Y of 40 CFR part 51, available retrofit control options are those air pollution control technologies with a practical potential for application to the emissions unit and the regulated pollutant under evaluation. In identifying “all” options, a state must identify the most stringent option and a reasonable set of options for analysis that reflects a comprehensive list of available technologies. It is not necessary to list all permutations of available control levels that exist for a given technology; the list is complete if it includes the maximum level of control that each technology is capable of achieving. Furthermore, EPA does not consider BART as a requirement to redesign the source when considering available control alternatives. For example, where the source subject to BART is a coal-fired EGU, EPA does not require the BART analysis to consider building a natural gas-fired electric turbine although the turbine may be inherently less polluting on a per unit basis.

AEP performed a full BART analysis for particulates, with its primary focus on the condensable fraction due to the minimal impact from the primary particulates since both units are currently equipped with ESPs for primary particulate control. AEP evaluated five combinations of condensable particulate control options for the two units. For unit 1, AEP only considered injecting ammonia or injecting trona, a mineral composed primarily of sodium and carbonate, for the reduction of inorganic condensables. For unit 2, AEP considered injecting ammonia, injecting trona, or installing a wet FGD system.

In addition, AEP determined that the options involving injecting trona on either unit at Big Sandy were technically infeasible. Based on the experience of AEP at units where sorbents are injected for the reduction of inorganic condensables, the presently installed ESPs at both Big Sandy units are unsuitable for trona injection.

For Big Sandy units 1 and 2, the company agreed to install ammonia injection controls on unit 1 and a FGD on unit 2. KYDAQ reviewed the source's BART modeling determination and available data. Considering the statutory factors, Kentucky determined that the controls proposed by AEP are reasonable and appropriate for addressing condensable particulates and their impacts on nearby Class I areas. EPA agrees with Kentucky's analyses and conclusions. EPA has reviewed the Commonwealth's analyses and concluded that they were conducted in a manner that is consistent with EPA's BART Guidelines and EPA's Air Pollution Control Cost Manual (http://www.epa.gov/ttncatc1/products.html#cccinfo).

Regarding AEP's decision not to evaluate installation of a wet FGD on unit 1 because of its age, EPA would generally not rely on an assertion that a unit would shut down without a legally enforceable condition requiring shutdown of the unit at issue. Kentucky has determined that BART for unit 1 is ammonia injection. As noted in EPA's December 16, 2011, proposed rulemaking, on June 9, 2011, AEP announced that Big Sandy unit 1 would be retired by December 31, 2014, and unit 2 would be rebuilt as a natural gas-fired plant by December 31, 2015. Since that announcement, AEP modified its plans to convert unit 2 from coal to gas power. It now plans to construct a dry FGD or “scrubber” system on unit 2, the plant's 800-megawatt electricity generation unit. However, AEP still plans to shut down unit 1 (the older of the two; rated at 278 megawatts) and to retire it at the end of 2014. On December 5, 2011, the company made a formal filing of an Application for a Certificate of Public Convenience and Necessity before the Kentucky Public Service Commission, which must approve the project and investment. As the company continues the required proceedings for closure of unit 1, requiring additional analysis would not likely change the conclusions of the BART analysis. In any case, if the decision to close unit 1 should be reversed, the requirements for an ammonia scrubber remain in place.

Comment 6c: According to the Commenter, EPA should clarify whether the 99 percent removal efficiency for the existing ESP at the E.ON U.S. Mill Creek Station (Mill Creek) is for filterable or condensable PM. If it is filterable, the Commenter believes that it is arbitrary to base a BART analysis on the current removable rate for filterable PM when the BART analysis is supposed to address condensable PM. The Commenter also states that the BART analysis rejects pulse jet fabric filter (PJFF) and wet ESP based solely on the incremental cost and admits that the average cost effectiveness for sorbent injection on all four units is about the same. “Apparently, the BART analysis rejects sorbent injection on units 1 and 2 because it would cost more to install pollution controls on all four units than on just two units. * * * [t]his is not a rationale basis for rejecting sorbent injection in units 1 and 2.” The Commenter further contends that EPA must disapprove Kentucky's regional haze SIP with regard to the PM BART analysis for Mill Creek since the analysis fails to consider: Switching to a lower sulfur coal either entirely or as a blend or co-firing natural gas or biomass; CFB scrubbers; SDA scrubbers; upgrading existing scrubbers; upgrading the current ESPs to increase the size and/or change from wire to rigid discharge electrode; or changing the operation of the air preheater.

Response 6c: The existing ESP removal efficiency referred to by the Commenter is for filterable particulates. These filterable emissions, which are 99 percent controlled, are a substantial portion of the facility's potential PM emissions and maintaining these limits for regional haze is appropriate. For the two units where additional PM controls are being adopted for BART, the Commonwealth has adopted additional emissions limits to handle condensable PM (primarily in the form of SO3/H2SO4), to address those emissions not controlled by the filterable emissions limit. As documented in Kentucky's May 28, 2010, revision to its regional haze SIP, the title V permitted BART emissions limits for Mill Creek Units 3 and 4 are 64.3 pounds per hour (lb/hr) and 76.5 lb/hr, respectively, for sulfuric acid mist (H2SO4). These are new BART limits for the two units for which controls on condensable particulates are being installed.

Regarding the technologies considered in the BART analysis for Mill Creek, as stated in Appendix Y of 40 CFR part 51, available retrofit control options are those air pollution control technologies with a practical potential for application to the emissions unit and the regulated pollutant under evaluation. In identifying “all” options, a state must identify the most stringent option and a reasonable set of options for analysis that reflects a comprehensive list of available technologies. It is not necessary to list all permutations of available control levels that exist for a given technology; the list is complete if it includes the maximum level of control that each technology is capable of achieving. Furthermore, EPA does not consider BART as a requirement to redesign the source when considering available control alternatives. For example, where the source subject to BART is a coal-fired EGU, EPA does not require the BART analysis to consider building a natural gas-fired electric turbine although the turbine may be inherently less polluting on a per unit basis. Similarly, EPA does not interpret the CAA or the RHR as requiring states to consider limiting the type of coal burned as a BART control technology.

For the Mill Creek BART analysis, the Commonwealth concluded that the technically feasible technologies for evaluation in accordance with Step 2 of the BART analysis included the existing cold-side ESP and PJFF for PM, and sorbent injection and a wet ESP for sulfates. From this list of technically feasible control technologies, the existing cold-side ESP is already in place at all four units at Mill Creek. Therefore, only the three additional control technologies were subjected to the remaining engineering analysis process to determine BART technologies for visibility modeling. The existing cold-side ESPs at all four units at Mill Creek are already demonstrating high PM removal efficiencies of 99 percent, and all four units are already equipped with wet FGD systems for SO2 removal, limiting the additional available options for sulfite (SO3) condensable particulate control. The incremental cost effectiveness of PJFF and a wet ESP ranged from $20,380 to $52,190 per ton of PM reduced, and these options were not considered further. Sorbent injection was more cost effective, ranging from $4,293 to $5,017 per ton of PM reduced.

As discussed in the December 16, 2011, proposed rulemaking, Kentucky determined that BART for Mill Creek is the installation of sorbent injection controls on the larger units 3 and 4. Kentucky did not require BART controls on units 1 and 2 because controls on these units would nearly double the cost (an additional $8.8 million beyond the $10.5 million for controls on units 3 and 4) for a visibility improvement of 0.36 deciview (compared with a 0.83 deciview improvement from controlling units 3 and 4). The Commonwealth therefore concluded that controls on units 1 and 2 were not as cost effective.

As is noted in the BART guidelines, the Commonwealth has discretion in assigning the proper weight and significance to each of the five statutory factors that it must consider in making a BART determination. EPA has reviewed the Commonwealth's analyses and concluded they were conducted in a manner that is consistent with EPA's BART Guidelines and EPA's Air Pollution Control Cost Manual (http://www.epa.gov/ttncatc1/products.html#cccinfo). Therefore, Kentucky's determination reflects a reasonable application of EPA's guidance to these sources.

Comment 6d: The Commenter contends that EPA must disapprove the BART determinations for EKPC's Spurlock and Cooper Stations since the BART analysis provides no limit on condensable PM and fails to consider switching to a lower sulfur coal either entirely or as a blend; co-firing natural gas or biomass; or changing the operation of the air preheater.

Response 6d: Regarding the technologies considered in the BART analyses for Spurlock and Cooper, as stated in Appendix Y of 40 CFR part 51, available retrofit control options are those air pollution control technologies with a practical potential for application to the emissions unit and the regulated pollutant under evaluation. In identifying “all” options, a state must identify the most stringent option and a reasonable set of options for analysis that reflects a comprehensive list of available technologies. It is not necessary to list all permutations of available control levels that exist for a given technology; the list is complete if it includes the maximum level of control each technology is capable of achieving. Furthermore, EPA does not consider BART as a requirement to redesign the source when considering available control alternatives. For example, where the source subject to BART is a coal-fired EGU, EPA does not require the BART analysis to consider building a natural gas-fired electric turbine although the turbine may be inherently less polluting on a per unit basis.

EKPC evaluated three options and agreed to install the top ranking option of wet FGD for SO2 control and wet ESP for PM control for both Spurlock and Cooper. These controls are consistent with those in a consent decree that EKPC entered into with EPA that will address condensable particulate emissions and other visibility impairing pollutants. Kentucky subsequently modified this BART determination in its May 28, 2010, regional haze SIP revision with a comparably effective option at Cooper Units 1 and 2 of dry FGD and FF emissions controls for the wet FGD and wet ESP controls. EPA believes that Kentucky has appropriately addressed BART for this facility.

Comment 6e: For the Tennessee Valley Authority's (TVA's) Paradise Fossil Plant (TVA Paradise), the Commenter contends that the BART analysis fails to consider switching to a lower sulfur coal (either entirely or as a blend); co-firing natural gas or biomass; a wet FGD; a dry CFB scrubber; a SDA scrubber; or changing the operation of the air preheater. For these reasons, the Commenter believes that EPA must disapprove this BART determination.

Response 6e: Regarding the technologies considered in the BART analysis for TVA Paradise, as stated in Appendix Y of 40 CFR part 51, available retrofit control options are those air pollution control technologies with a practical potential for application to the emissions unit and the regulated pollutant under evaluation. In identifying “all” options, a state must identify the most stringent option and a reasonable set of options for analysis that reflects a comprehensive list of available technologies. It is not necessary to list all permutations of available control levels that exist for a given technology; the list is complete if it includes the maximum level of control that each technology is capable of achieving. Furthermore, EPA does not consider BART as a requirement to redesign the source when considering available control alternatives. For example, where the source subject to BART is a coal-fired EGU, EPA does not require the BART analysis to consider building a natural gas-fired electric turbine although the turbine may be inherently less polluting on a per unit basis.

All three units at TVA Paradise are already equipped with FGD systems. These systems are in the process of being upgraded, and TVA believes that the work should be completed by December 31, 2012. The BART analysis focused on control of condensable PM (primarily in the form of SO3/H2SO4). TVA concluded that neither of the two control options evaluated (wet ESP and hydrated lime injection) were cost effective, and the Commonwealth concurred. However, as discussed in the December 16, 2011, proposed rulemaking, TVA plans to install hydrated lime injection controls on TVA Paradise units 1-3 to mitigate opacity due to SO3 emissions, and these controls are required to be in place pursuant to the December 15, 2009, title V permit for the facility. EPA therefore believes that Kentucky has appropriately addressed BART for this facility.

Comment 6f: The Commenter makes several statements regarding PM BART emissions limits. First, the Commenter believes that emissions limits at all “subject to BART” units must have an averaging time, testing, and monitoring for condensable PM that assures compliance with the condensable PM limits at all times, including during startup, shutdown, and malfunction. Second, the Commenter asserts that all emissions limits contained in consent decrees must be added to the SIP because consent decrees can be modified without public participation and are eventually terminated. Third, the Commenter explains that, in its opinion, PM BART emissions limits must be effective as soon as practical, and that EPA must determine when this is. The Commenter goes on to state that EPA “cannot just say it has to be effective as soon as practical” since this is “too vague to be enforceable.” For units using existing pollution controls, “the emissions limits should be effective on the date of publication of the final rule. For other units, EPA should determine what is the quickest time the new equipment can be installed and fully operational.” For these reasons, the Commenter claims that EPA must disapprove the SIP submittal.

Response 6f: The adopted BART emissions limits all have testing and monitoring requirements that will be included in the respective title V operating permit. The consent decrees stipulate these requirements and explicitly address how startup, shutdown, and malfunctions are to be considered. These agreements also require that the consent decrees remain in force until the title V permit is issued. Since these limits have been formally adopted by Kentucky in its regional haze SIP, these requirements will become federally enforceable once EPA approves the SIP revisions. The title V permit, which documents all enforceable provisions, will also be updated at the appropriate time. All BART emissions limits are contained in the SIP, including the limits that also appear in consent decrees, and therefore meet the requirement that the limits be federally enforceable. Regarding BART effective dates, 40 CFR 51.308(e)(1)(iv) states that “* * * each source subject to BART be required to install and operate BART as expeditiously as practicable, but in no event later than 5 years after approval of the implementation plan revision,” and Kentucky adopted requirements consistent with this regulation.

Comment 7: The Commenter suggests that EPA should “issue a new proposal and hold a new public comment period” because the “Federal Register notice of EPA's proposed rule does not include the actual language which EPA is proposing to include in the Kentucky SIP.”

Response 7: EPA disagrees with the Commenter's position on the content of EPA's December 16, 2011, proposed rulemaking, a position that the Commenter has raised in several prior SIP rulemakings. Neither the CAA nor the Administrative Procedure Act mandates that the proposed and final Federal Register rulemaking actions include the complete text of the proposed SIP revision. The December 16, 2011, proposed rulemaking satisfies the notice requirements by providing citations to the rules at issue, offering the SIP revisions for public review, and describing the subjects and issues involved in the SIP revisions. Publication in the Federal Register is costly and resource intensive, and EPA makes every effort to provide key information in proposal notices while at the same time using Agency resources efficiently. EPA drafts rulemaking notices to enable public understanding of the subjects and issues at hand. EPA included the complete text of the SIP revisions in the docket at the time that it issued the proposed rule and it remains available for public view. The docket for this action is available at www.regulations.gov under Docket Identification No. EPA-R04-OAR-2009-0783. In addition, the public may also contact the listed contacts for any further information or questions.

Comment 8: The Commenter contends that Kentucky's regional haze SIP must require revisions to address Reasonably Attributable Visibility Impairment (RAVI) within three years of a FLM certifying visibility impairment and that the Commonwealth's commitment to address RAVI should a FLM certify visibility impairment is not enough. The Commenter also contends that the SIP must require Kentucky to submit a report to EPA on progress towards the RPGs and that the Commonwealth's commitment to do so is not sufficient.

Response 8: The SIP revisions do not address RAVI requirements since this was the subject of previous rulemakings (see the response to Comment 11). EPA's visibility regulations direct states to coordinate their RAVI LTS provisions with those for regional haze and the RAVI portion of a SIP must address any integral vistas identified by the FLMs. However, as stated in the December 16, 2011, proposed rulemaking, the FLMs have not identified any integral vistas in Kentucky, the Class I area in Kentucky is not experiencing RAVI, and no Kentucky sources are affected by the RAVI provisions. Thus, the June 25, 2008, Kentucky regional haze SIP revisions did not explicitly address the coordination of the regional haze with the RAVI LTS although Kentucky made a commitment to address RAVI should the FLM certify visibility impairment from an individual source. EPA finds that Kentucky's regional haze SIP appropriately supplements and augments the Commonwealth's RAVI visibility provisions to address regional haze by updating the LTS provisions as Kentucky has done.

Regarding reports on progress toward RPGs, 40 CFR 51.308(g) requires states to “submit a report to [EPA] every 5 years evaluating progress towards the reasonable progress goal for each mandatory Class I Federal area located within the State and in each mandatory Class I Federal area located outside the State which may be affected by emissions from within the State.” It is unnecessary for a state rule to make this enforceable since it is part of EPA's regional haze regulations (i.e., an enforceable requirement). The progress reports must be in the form of a SIP revision and are therefore subject to the requirements for SIP revisions in the CAA and to EPA's review and approval. The commitments in Kentucky's SIP are consistent with the regulatory requirements for this provision.

Comment 9a: The Commenter claims that Kentucky's regional haze SIP does not explain how monitoring data and other information is used to determine the contribution of emissions from within the Commonwealth to regional haze visibility impairment at Class I areas within and outside Kentucky. Therefore, the Commenter believes that EPA must disapprove Kentucky's regional haze SIP.

Comment 9b: The Commenter states that the SIP must clearly state the method by which the Commonwealth intends to report visibility modeling to the EPA. Additionally, the Commenter states that if Kentucky plans to rely on the referenced Visibility Information Exchange Web System (VIEWS) Web site for reporting, the SIP must clearly state, not imply, that Kentucky intends to use the Web site as its way of reporting visibility monitoring data. “If Kentucky intends to use another method of reporting visibility, the proposal need to explain this. If Kentucky intends to use this web site, it is not sufficient that Kentucky is `encouraging' VISTAS to maintain this web site.” The Commenter also states that the Kentucky SIP needs to have an enforceable mechanism to transmit the Interagency Monitoring of Protected Visual Environments (IMPROVE) data to EPA as well as an enforceable mechanism to ensure that the IMPROVE data is continually gathered. The “SIP must include an enforceable requirement that the data is gathered by Kentucky unless it is gathered by other entities such as VISTAS and the National Park Service.” The Commenter concludes by stating that “EPA must disapprove the SIP submittal in this regard because such an enforceable requirement is missing.”

Response 9a, 9b: The primary monitoring network for regional haze in Kentucky is the IMPROVE network. There is currently one IMPROVE site in the Commonwealth, which serves as the monitoring site for Mammoth Cave National Park in Kentucky. IMPROVE monitoring data from 2000-2004 serves as the baseline for the regional haze program, and is relied upon in the Kentucky regional haze submittal. Monitoring data is different from emissions data or analyses conducted to attribute contribution. These analyses are part of the ten-year planning period updates conducted by the states.

In its SIP revisions, Kentucky states its intention to rely on the IMPROVE network for complying with the regional haze monitoring requirement in EPA's RHR for the current and future regional haze implementation periods. Data produced by the IMPROVE monitoring network will be used nearly continuously for preparing the five-year progress reports and the 10-year SIP revisions, each of which relies on analysis of the preceding five years of data. The VIEWS Web site has been maintained by VISTAS and the other regional planning organizations (RPOs) to provide ready access to the IMPROVE data and data analysis tools. Kentucky is encouraging VISTAS and the other RPOs to maintain the VIEWS or a similar data management system to facilitate analysis of the IMPROVE data. Kentucky cannot legally bind federal and state legislatures to continue to fund the monitoring program for regional haze. Kentucky's SIP adequately addresses this provision and explains how monitoring data and other information has been and will be used to determine the contribution of emissions from within the Commonwealth to regional haze visibility impairment at Class I areas.

Comment 9c: According to the Commenter, there is no indication that Kentucky developed an emissions inventory for the most recent year for which data are available (2008, 2009 or 2010), and EPA must disapprove the SIP on this point. The Commenter also states that there are no requirements for reporting, recordkeeping, and other measures necessary to assess and report on visibility, and therefore, EPA must also disapprove on this point.

Response 9c: There are no requirements relating to reporting and recordkeeping of emissions to assess and report on visibility other than those that relate to the submittal the five-year review. The analyses performed in support of Kentucky's SIP revisions were conducted in the 2003-2006 time period. EPA therefore finds the use of the 2002 emissions inventory to be appropriate. The necessary data to assess the SIP submission are contained in the appendices to the Commonwealth's 2008 regional haze submittal. For the more voluminous data such as modeling files, please see Appendix I of the 2008 SIP submittal for data access instructions. The next inventory submittal will be part of the five-year review, and VISTAS has been working with its states to develop a comprehensive baseline inventory (expected to be for 2007 and updated with appropriate additional later information) which will be part of the five-year submittal. The record demonstrates that Kentucky's SIP adequately addresses the emissions inventory requirement.

Comment 10: The Commenter states that Kentucky did not adequately respond to requests from Maine, Vermont, New Jersey, and New Hampshire for a 28 percent reduction in SO2 emissions from non-EGU sources and a 90 percent reduction in SO2 emissions from 14 Kentucky EGUs. With regard to the EGUs, the Commenter further explains that Kentucky's assertion that 93 percent of these 14 EGUs have or will have SO2 controls by 2015 or earlier is flawed because having SO2 controls on EGUs does not necessarily mean that those EGUs will achieve a 90 percent reduction in SO2 emissions. The Commenter also asserts that Kentucky did not establish that having SO2 controls on these EGUs will address Kentucky's apportioned emissions reductions under 40 CFR 51.308(d)(3)(ii)-(iii) for the Class I areas in Maine, Vermont, New Jersey, and New Hampshire. For these reasons, the Commenter believes that EPA must disapprove Kentucky's SIP with regard to its obligations under 40 CFR 51.308(d)(3) to address visibility impacts in these states.

Response 10: The letters sent in 2007 from Maine, Vermont, New Jersey, and New Hampshire, (states in the Mid-Atlantic/Northeast Visibility Union (MANE-VU) RPO), invite Kentucky to participate in future consultation meetings because visibility impacts from Kentucky's sources exceeded one of the minimum thresholds used by MANE-VU to identify sources with potential visibility impacts at one or more of the Class I areas in the MANE-VU region. These thresholds for reasonable control consideration were used to identify states to invite to the first set of inter-RPO consultation meetings. The states' letters cite to the report entitled, Contributions to Regional Haze in the Northeast and Mid-Atlantic United States, NESCAUM, August 2006, http://www.nescaum.org/documents/contributions-to-regional-haze-in-the-northeast-and-mid-atlantic--united-states. In accordance with 40 CFR 51.308(d)(i), Kentucky participated in consultation calls and meetings in 2007 as requested, and in the Commonwealth's final SIP submittal dated June 25, 2008, Kentucky provided its final response regarding the MANE-VU requests. Kentucky received no adverse comments from any of the MANE-VU states during the public comment period on its proposed regional haze SIP, nor did the Commonwealth receive any additional correspondence from these states once Kentucky submitted its final SIP to EPA.

Kentucky's position is that the significant existing and expected EGU emissions controls more than adequately respond to the EGU and non-EGU requests from the MANE-VU RPO. Kentucky provided supporting information to address its apportionment of emissions reductions in Appendix H of its SIP; and in Appendix H.4, the Commonwealth documents the existing and planned controls for the Commonwealth's EGUs, including those EGUs identified by MANE-VU. These EGU SO2 controls reflect what is predicted or has occurred to address CAIR requirements. Kentucky demonstrated in its SIP that no additional SO2 controls beyond CAIR are reasonable for reasonable progress for the first implementation period. Kentucky states in its SIP that it plans to assess the EGU controls predicted under CAIR with what is actually occurring at these sources for the first periodic report due five years after initial submittal of the first regional haze SIP (i.e., June 2013).

As explained in EPA's December 16, 2011, proposed rulemaking, prior to the CAIR remand by the D.C. Circuit, EPA believed the Commonwealth's demonstration that no additional controls beyond CAIR are reasonable for SO2 for affected Kentucky EGUs for the first implementation period to be acceptable. However, the Commonwealth's demonstration regarding CAIR and reasonable progress for EGUs, and other provisions in the Kentucky regional haze SIP, are based on CAIR, and thus, the Agency is issuing a limited approval of the Kentucky regional haze SIP revisions.

Regarding non-EGU SO2 emissions, the Commonwealth established a threshold to determine which emissions units would be evaluated for reasonable progress controls, and found no additional SO2 controls for these sources are reasonable for the first implementation period. EPA believes that Kentucky has adequately addressed its apportionment of emissions reductions determined through the VISTAS process, and shared via consultation with the other RPOs, in accordance with 40 CFR 51.308(d)(3).

Comment 11: The Commenter states that there is no evidence that Kentucky's regional haze SIP revisions comply with the requirement in 40 CFR 51.306(d) that the LTS provides for review of the impacts from any new major stationary source or major modifications on visibility in any mandatory Class I area in accordance with 40 CFR 51.307, 51.166, 51.160 and any binding guidance insofar as these provisions pertain to protection of visibility. The Commenter also contends that EPA must therefore disapprove Kentucky's SIP revisions in part with regard to 40 CFR 51.306(d) and the provisions cited therein.

Response 11: The Kentucky regional haze SIP revisions subject to this rulemaking address the regional haze requirements of 40 CFR 51.308 whereas the regulation cited by the Commenter, 40 CFR 51.306(d), is specific to the LTS requirements for RAVI. Furthermore, as identified in footnote 18 2 of EPA's December 16, 2011, proposed rulemaking, Kentucky has already addressed the new source review requirements for visibility (40 CFR 51.307) and RAVI LTS (40 CFR 51.306) in its SIP and EPA has fully approved these provisions.

Comment 12: The Commenter contends that EKPC agreed to install wet FGDs and wet ESPs at Spurlock and Cooper Stations pursuant to a BART analysis, and not pursuant to EKPC's July 2, 2007, consent decree with the United States (United States v. EKPC, 04-34-KSF (E.D. Ky)). The Commenter requests that EPA “clarify the language in the Proposed Rule” accordingly.

Response 12: The consent decree was a separate action from the BART determination, and EPA did not intend to imply that the consent decree was entered into to address regional haze. Kentucky structured its SIP to meet the BART requirements, recognizing the existence of similar requirements in the consent decrees. EPA relied on the following language found in the Kentucky regional haze SIP revision (see the May 28, 2010, revised Kentucky regional haze SIP revision, Table 7.5.3-1):

Comment 13: According to the Commenter, EPA's December 16, 2011, proposed rulemaking incorrectly states that the EKPC consent decree provides for a filterable PM emissions rate of 0.03 pound per million British Thermal Unit (lb/MMBtu), and therefore, EPA should delete any reference indicating that the consent decree provides for this 0.03 lb/MMBtu rate for any EKPC unit and any references to this emissions rate.

Response 13: EPA reviewed the consent decree and the SIP language again in response to this comment. EPA concludes that the Commenter is correct that the consent decree provided other alternatives to developing a filterable particulate limit. However, Kentucky's regional haze SIP is explicit in several instances that EKPC identified, and the Commonwealth accepted, the 0.03 lb/MMBtu limit as BART. EPA points the Commenter to the following statements in Kentucky's regional haze SIP revisions:

“In the 2007 BART Submittal, EKPC determined that a WFGD/WESP control train capable of achieving 0.030 lb/mmBtu filterable PM and 0.052lb/mmBtu total PM was BART for Cooper Units 1 and 2. EKPC is requesting that it be allowed to substitute a DFGD/FF control train capable of achieving 0.030 lb/mmBtu filterable PM and 0.045 lb/mmBtu total PM for the WFGD/WESP control train previously approved * * *” (Appendix L.11, p. 197 (March 18, 2009 submittal from EKPC to KYDAQ)).

Accordingly, EPA considers the 0.03 lb/MMBtu filterable PM emissions limit to be an appropriately adopted and enforceable SIP limit and part of the BART determination for EKPC Cooper Units 1 and 2 and Spurlock Units 1 and 2.

Comment 14: The Commenter contends that EPA should fully approve Kentucky's regional haze SIP revisions because they are consistent with EPA's regional haze rules. In support of its position, the Commenter states that the regulations allowing states to rely on CAIR to satisfy BART are still legally valid and effective, and therefore, Kentucky can continue to rely on CAIR. The Commenter also believes that EPA should fully approve Kentucky's regional haze SIP in response to the D.C. Circuit's order staying the implementation of the Transport Rule pending resolution of the legal challenges to the Rule.

Response 14: EPA has the authority to issue a limited approval (see response to Comment 1) and it is appropriate and necessary to promulgate a limited approval and limited disapproval of Kentucky's regional haze SIP revisions at this time (see response to Comment 2). This action results in an approval of the entire regional haze SIP and all of its elements, preserving the visibility benefits offered by the SIP while providing EPA with the opportunity to demonstrate that the Transport Rule is better than BART. As noted above, EPA has already published a proposed rule reflecting this demonstration. EPA cannot fully approve regional haze SIP revisions that rely on CAIR for emissions reduction measures for the reasons discussed in section IV of the December 16, 2011, proposed rulemaking, and therefore proposed to grant limited approval and limited disapproval of the Kentucky regional haze SIP revisions. The D.C. Circuit's order staying the Transport Rule has no effect on the court's 2008 ruling in North Carolina v. EPA, 550 F.3d 1176 (D.C. Cir. 2008). Therefore, the proposed limited approval and limited disapproval actions remain appropriate for the reasons discussed in section IV of the December 16, 2011 proposed rulemaking cited above.

Comment 15: The Commenter states that “EPA should promulgate regulations that will avoid any asserted need to propose or promulgate limited disapprovals of regional haze SIPs or to propose or promulgate regional haze FIPs for states that have relied on CAIR or that may rely on CSAPR, or both, as a BART alternative for NOX and SO2 emissions from EGUs.” The Commenter believes that EPA should promulgate regulations that would provide expressly that a state that becomes subject to CSAPR may choose to adopt a “CSAPR=BART policy that would apply at such time as CSAPR takes effect.” The Commenter also states that the “visibility-improvement benefits from CAIR's emissions reductions * * * are likely to be replicated, or indeed exceeded, by the visibility benefits projected to result from CSAPR if CSAPR takes effect in the future.”

Response 15: As noted in the response to Comment 3, this action is focused solely on the limited approval and limited disapproval of Kentucky's regional haze SIP revisions submitted on June 25, 2008, and May 28, 2010. Given that the Transport Rule, or CSAPR, was not signed until 2011, neither SIP revision mentions the Transport Rule nor suggests that the Commonwealth intended to rely on the reductions from this rule to meet the regional haze requirements. EPA did not propose to find that participation in the Transport Rule is an alternative to BART in this rulemaking. EPA made this proposed finding in a separate action on December 30, 2011; therefore, these comments are beyond the scope of this rulemaking and will be addressed by EPA in its final action on the December 30, 2011, proposed rule.

Under CAA sections 301(a) and 110(k)(6) and EPA's long-standing guidance, a limited approval results in approval of the entire SIP revision, even of those parts that are deficient and prevent EPA from granting a full approval of the SIP revision (see EPA's 1992 Calcagni Memorandum). Today, EPA is finalizing a limited approval of Kentucky's June 25, 2008, and May 28, 2010, regional haze SIP revisions. This limited approval results in approval of Kentucky's entire regional haze SIP and all the elements. EPA is taking this approach because Kentucky's SIP will be stronger and more protective of the environment with the implementation of those measures by the Commonwealth and having federal approval and enforceability than it would without those measures being included in Kentucky's SIP.

In this action, EPA is also finalizing a limited disapproval of Kentucky's June 25, 2008, and May 28, 2010, regional haze SIP revisions insofar as these SIP revisions rely on CAIR to address the impact of emissions from the Commonwealth's EGUs. As explained in the 1992 Calcagni Memorandum, “[t]hrough a limited approval, EPA [will] concurrently, or within a reasonable period of time thereafter, disapprove the rule * * * for not meeting all of the applicable requirements of the Act. * * * [T]he limited disapproval is a rulemaking action, and it is subject to notice and comment.” Final limited disapproval of a SIP submittal does not affect the federal enforceability of the measures in the subject SIP revision nor prevent state implementation of these measures. The legal effect of the final limited disapproval for Kentucky's June 25, 2008, and May 28, 2010, SIP revisions is to provide EPA the authority to issue a FIP at any time, and to obligate the Agency to take such action no more than two years after the effective date of EPA's final action. As explained in the 1992 Calcagni Memorandum, “[t]hrough a limited approval, EPA [will] concurrently, or within a reasonable period of time thereafter, disapprove the rule * * * for not meeting all of the applicable requirements of the Act. * * * [T]he limited disapproval is a rulemaking action, and it is subject to notice and comment.”

EPA is finalizing a limited approval and a limited disapproval of two revisions to the Kentucky SIP submitted by the Commonwealth of Kentucky on June 25, 2008, and May 28, 2010, as meeting some of the applicable regional haze requirements as set forth in sections 169A and 169B of the CAA and in 40 CFR 51.300-308.

The Office of Management and Budget (OMB) has exempted this regulatory action from Executive Order 12866, entitled “Regulatory Planning and Review.”

Under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., OMB must approve all “collections of information” by EPA. The Act defines “collection of information” as a requirement for answers to * * * identical reporting or recordkeeping requirements imposed on ten or more persons * * *. 44 U.S.C. 3502(3)(A). The Paperwork Reduction Act does not apply to this action.

The RFA generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small not-for-profit enterprises, and small governmental jurisdictions.

This rule will not have a significant impact on a substantial number of small entities because SIP approvals under section 110 and subchapter I, part D of the CAA do not create any new requirements but simply approve requirements that the Commonwealth is already imposing. Therefore, because the federal SIP approval does not create any new requirements, I certify that this action will not have a significant economic impact on a substantial number of small entities.

Moreover, due to the nature of the federal-state relationship under the CAA, preparation of flexibility analysis would constitute federal inquiry into the economic reasonableness of state action. The CAA forbids EPA to base its actions concerning SIPs on such grounds. Union Electric Co., v. EPA, 427 U.S. 246, 255-66 (1976); 42 U.S.C. 7410(a)(2).

Under sections 202 of the UMRA of 1995 (“Unfunded Mandates Act”), signed into law on March 22, 1995, EPA must prepare a budgetary impact statement to accompany any proposed or final rule that includes a federal mandate that may result in estimated costs to state, local, or tribal governments in the aggregate; or to the private sector, of $100 million or more. Under section 205, EPA must select the most cost-effective and least burdensome alternative that achieves the objectives of the rule and is consistent with statutory requirements. Section 203 requires EPA to establish a plan for informing and advising any small governments that may be significantly or uniquely impacted by the rule.

EPA has determined that today's action does not include a federal mandate that may result in estimated costs of $100 million or more to either state, local, or tribal governments in the aggregate, or to the private sector. This federal action approves pre-existing requirements under state or local law, and imposes no new requirements. Accordingly, no additional costs to state, local, or tribal governments, or to the private sector, result from this action.

Federalism (64 FR 43255, August 10, 1999) revokes and replaces Executive Orders 12612 (Federalism) and 12875 (Enhancing the Intergovernmental Partnership). Executive Order 13132 requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have Federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government.” Under Executive Order 13132, EPA may not issue a regulation that has Federalism implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the federal government provides the funds necessary to pay the direct compliance costs incurred by state and local governments, or EPA consults with state and local officials early in the process of developing the proposed regulation. EPA also may not issue a regulation that has Federalism implications and that preempts state law unless the Agency consults with state and local officials early in the process of developing the proposed regulation.

This rule will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132, because it merely approves a state rule implementing a federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the CAA. Thus, the requirements of section 6 of the Executive Order do not apply to this rule.

Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000), requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” This rule does not have tribal implications, as specified in Executive Order 13175. It will not have substantial direct effects on tribal governments. Thus, Executive Order 13175 does not apply to this rule.

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

This rule is not subject to Executive Order 13045 because it does not involve decisions intended to mitigate environmental health or safety risks.

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

Section 12 of the NTTAA of 1995 requires federal agencies to evaluate existing technical standards when developing a new regulation. To comply with NTTAA, EPA must consider and use “voluntary consensus standards” (VCS) if available and applicable when developing programs and policies unless doing so would be inconsistent with applicable law or otherwise impractical.

EPA believes that VCS are inapplicable to this action. Today's action does not require the public to perform activities conducive to the use of VCS.

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

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by May 29, 2012. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. See section 307(b)(2).

40 CFR part 52 is amended as follows:

I. General Information A. Does this action apply to me?

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

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

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

You may access a frequently updated electronic version of 40 CFR part 180 through the Government Printing Office's e-CFR site at http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl. To access the OCSPP test guidelines referenced in this document electronically, go to: http://www.epa.gov/ocspp and select “Test Methods and Guidelines.”

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2010-0536 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before May 29, 2012. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing that does not contain any CBI for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit a copy of your non-CBI objection or hearing request, identified by docket ID number EPA-HQ-OPP-2010-0536, by one of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments.

• Mail: Office of Pesticide Programs (OPP) Regulatory Public Docket (7502P), Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

• Delivery: OPP Regulatory Public Docket (7502P), Environmental Protection Agency, Rm. S-4400, One Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington, VA. Deliveries are only accepted during the Docket Facility's normal hours of operation (8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays). Special arrangements should be made for deliveries of boxed information. The Docket Facility telephone number is (703) 305-5805.

In the Federal Register of September 30, 2010 (75 FR 60452) (FRL-8837-2), EPA issued a notice pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide tolerance petition (PP 0F7698) by Premier Horticulture, 1, Avenue Premier, Riviere-du-Loup, Quebec, Canada. The petition requested that 40 CFR part 180 be amended by establishing an exemption from the requirement of a tolerance for residues of Bacillus pumilus GHA 180. This notice referenced a summary of the petition prepared by the petitioner Premier Horticulture, which is available in the docket via http://www.regulations.gov. There were no comments received in response to the notice of filing.

Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the exemption is “safe.” Section 408(c)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Pursuant to FFDCA section 408(c)(2)(B), in establishing or maintaining in effect an exemption from the requirement of a tolerance, EPA must take into account the factors set forth in FFDCA section 408(b)(2)(C), which require EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. * * *” Additionally, FFDCA section 408(b)(2)(D) requires that the Agency consider “available information concerning the cumulative effects of a particular pesticide's residues” and “other substances that have a common mechanism of toxicity.”

EPA performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. First, EPA determines the toxicity of pesticides. Second, EPA examines exposure to the pesticide through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings.

Consistent with FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action and considered its validity, completeness and reliability, and the relationship of this information to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children.

Bacillus pumilus strain GHA 180 is a bacterium discovered in the root zone of apple trees in Mexico. It colonizes plant roots and produces metabolites that suppress the fungal plant pathogens Pythium ultimum, Fusarium oxysporum, Rhizoctonia solani and Alternaria spp.

Adequate mammalian toxicology data and information were submitted to support Bacillus pumilus strain GHA 180 pesticide products. The Draft Biopesticide Registration Action Document (BRAD) for Bacillus pumilus strain GHA 180 provides detailed information regarding these tests (Ref. 1), which are summarized in this unit.

1. Acute Injection Toxicity/Pathogenicity (OCSPP Guideline 885.3200; Master Record Identification Number (MRID) No. 48005025): Bacillus pumilus GHA 180 was not toxic and/or pathogenic to laboratory rats given a single intravenous dose of 6.8 × 107 colony forming units (CFU).

2. Acute Oral Toxicity (OCSPP Guideline 870.1100; MRID No. 48005020): Bacillus pumilus GHA 180 was not toxic to rats given a single oral dose by gavage [median lethal dose (LD50) >5,000 milligrams/kilograms (mg/kg) body weight (bw), Toxicity Category IV].

3. Acute Dermal Toxicity (OCSPP Guideline 870.1200; MRID 48005021): Bacillus pumilus GHA180 was not toxic to rats when applied to the skin (LD50 >5050 mg/kg bw, Toxicity Category IV).

4. Acute Inhalation Toxicity (OCSPP Guideline 870.1300; MRID 48005022): No signs of toxicity or other adverse effects occurred in rats exposed nose-only to an aerosol containing Bacillus pumilus GHA 180 Technical Grade of the Active Ingredient (TGAI) (2.18 mg/L) for 4 hours (LC50 >2.18 mg/L, EPA Toxicity Category IV).

5. Acute Eye Irritation (OCSPP Guideline 870.2400; MRID 48005023): Bacillus pumilus GHA 180 was mildly irritating to the eyes of rabbits (Toxicity Category III).

6. Primary Dermal Irritation (OCSPP Guideline 870.2500; MRID 48005024): Bacillus pumilus GHA 180 TGAI was nonirritating to the skin of rabbits (Toxicity Category IV).

In examining aggregate exposure, FFDCA section 408 directs EPA to consider available information concerning exposures from the pesticide residue in food and all other non-occupational exposures, including drinking water from ground water or surface water and exposure through pesticide use in gardens, lawns, or buildings (residential and other indoor uses).

1. Food. Bacillus species, including Bacillus pumilus, are common in soils (Ref. 2). Dried food, such as spices, milk powder and grains, often contain large amounts of Bacillus spores (Ref. 3), and Bacillus pumilus is a natural component of fermented fish sauce and cocoa bean fermentations (Ref. 4). Bacillus pumilus strain GHA 180 is not known to produce mammalian toxins, and no foodborne disease outbreaks have been reported. Based on the results of toxicity studies conducted with Bacillus pumilus strain GHA 180 TGAI, no toxicity, infectivity, pathogenicity or other adverse effects from dietary exposure to this bacterium from its pesticide uses are expected (see Unit III.).

2. Drinking water exposure. According to the World Health Organization, Bacillus species are often detected in drinking water even after going through disinfection processes at water treatment facilities (Ref. 5). If residues of Bacillus pumilus GHA 180 occur in drinking water from its pesticide uses, no adverse effects are expected based on the results of toxicity studies described in Unit III.

Pesticide products with the active ingredient Bacillus pumilus strain GHA 180 are only used in greenhouses and contained nurseries. Non-occupational exposures may occur in populations that access residential greenhouses and apply these pesticide products or handle soils that have been treated with Bacillus pumilus GHA 180. The personal protective equipment indicated on the label are expected to be adequate to minimize human exposure to those handling pesticide products containing Bacillus pumilus GHA 180. Should human exposure occur, however, no adverse effects are expected based on the lack of toxicity, infectivity and pathogenicity in the studies described in Unit III.

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

EPA has not found Bacillus pumilus strain GHA 180 to share a common mechanism of toxicity with any other substances, and Bacillus pumilus strain GHA 180 does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that Bacillus pumilus strain GHA 180 does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative.

FFDCA section 408(b)(2)(C) provides that EPA shall assess the available information about consumption patterns among infants and children, special susceptibility of infants and children to pesticide chemical residues, and the cumulative effects on infants and children of the residues and other substances with a common mechanism of toxicity. In addition, FFDCA section 408(b)(2)(C) provides that EPA shall apply an additional tenfold (10X) margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the FQPA Safety Factor. In applying this provision, EPA either retains the default value of 10X or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

Based on the acute toxicity and pathogenicity data summarized in Unit III., EPA concludes that there is a reasonable certainty that no harm will result to the U.S. population, including infants and children, from aggregate exposure to the residues of Bacillus pumilus strain GHA180. This includes all anticipated dietary exposures and all other exposures for which there is reliable information. EPA has arrived at this conclusion because the data and information available on Bacillus pumilus strain GHA 180 does not demonstrate toxic, pathogenic, and/or infective potential to mammals. Because there are no threshold effects of concern, the provision requiring an additional margin of safety does not apply.

An analytical method is not required for enforcement purposes since the Agency is establishing an exemption from the requirement of a tolerance without any numerical limitation.

In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

The Codex has not established a MRL for Bacillus pumilus strain GHA 180.

Therefore, an exemption is established for residues of Bacillus pumilus strain GHA180 in or on all food commodities when used in accordance with good agricultural practices.

This final rule establishes an exemption from the requirement of a tolerance under section 408(d) of FFDCA in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993). Because this final rule has been exempted from review under Executive Order 12866, this final rule is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq., nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance exemption in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.) do not apply.

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

Therefore, 40 CFR chapter I is amended as follows:

The Federal Emergency Management Agency (FEMA) makes the final determinations listed below for the modified BFEs for each community listed. These modified elevations have been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.

This final rule is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67. FEMA has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.

Interested lessees and owners of real property are encouraged to review the proof Flood Insurance Study and FIRM available at the address cited below for each community. The BFEs and modified BFEs are made final in the communities listed below. Elevations at selected locations in each community are shown.

National Environmental Policy Act. This final rule is categorically excluded from the requirements of 44 CFR part 10, Environmental Consideration. An environmental impact assessment has not been prepared.

Regulatory Flexibility Act. As flood elevation determinations are not within the scope of the Regulatory Flexibility Act, 5 U.S.C. 601-612, a regulatory flexibility analysis is not required.

Regulatory Classification. This final rule is not a significant regulatory action under the criteria of section 3(f) of Executive Order 12866 of September 30, 1993, Regulatory Planning and Review, 58 FR 51735.

Executive Order 13132, Federalism. This final rule involves no policies that have federalism implications under Executive Order 13132.

Executive Order 12988, Civil Justice Reform. This final rule meets the applicable standards of Executive Order 12988.

Accordingly, 44 CFR part 67 is amended as follows:

This summary contains corrections to the DATES section of a Federal Register document, 77 FR 12952, March 2, 2012. This document also contains corrections to the final rule regulations in part 54. The full text of the Commission's Report and Order in WC Docket Nos. 11-42, 03-109, 12-23 and CC Docket No. 96-45; FCC 12-11 released on February 6, 2012 is available for public inspection during regular business hours in the FCC Reference Center, Room CY-A257, 445 12th Street SW., Washington, DC 20554. Or at the following Internet address: http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0207/FCC-12-11A1.doc.

1. Background. Part 54 rules are issued pursuant to the Communications Act of 1934, as amended. The purpose of the part 54 rules is to implement section 254 of the Communications Act of 1934, as amended. 47 U.S.C. 254. This action corrects the final regulation implemented at § 54.410 of the Commission's rules. 47 CFR 54.410. Specifically, this action corrects the numbering of paragraphs (d)(3)(iii) through (d)(3)(ix).

2. Need for Correction. The Federal Register Summary published at 77 FR 12952, March 2, 2012 listed paragraph (d)(3)(ii) in § 54.410 twice. This document corrects the paragraph numbering.

In rule FR Doc. 2012-4978 published at 77 FR 12952, March 2, 2012 make the following corrections.

This final rule reduces the threshold for DoD peer reviews of noncompetitive contracts from the current level of $1 billion to $500 million. Previously, DoD published a final rule in the Federal Register at 74 FR 37625 on July 29, 2009, to address the requirements for peer reviews of DoD solicitations and contracts. DFARS Case 2008-D035, entitled “Peer Reviews of Contracts,” added DFARS 201.170, Peer Reviews, which (1) specified that the Office of the Director, Defense Procurement and Acquisition Policy, will organize teams of reviewers and will facilitate peer reviews for all solicitations and contracts for services valued at $1 billion or more, and (2) required the military departments, defense agencies, and DoD field activities to establish procedures for preaward and postaward peer review of solicitations and contracts for services valued at less than $1 billion.

This final rule—

• Clarifies DoD peer review phases and revises the threshold for peer reviews of noncompetitive procurements;

• Requires military departments and defense agencies to establish procedures for preaward peer reviews for noncompetitive procurements valued at less than $500 million; and

• Adds an email address for the submission of rolling annual forecasts of acquisitions.

“Publication of proposed regulations”, 41 U.S.C. 1707, is the statute which applies to the publication of the Federal Acquisition Regulation. Paragraph (a)(1) of the statute requires that a procurement policy, regulation, procedure or form (including an amendment or modification thereof) must be published for public comment if it relates to the expenditure of appropriated funds, and has either a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure or form, or has a significant cost or administrative impact on contractors or offerors. This final rule is not required to be published for public comment, because this rule concerns DoD's internal review processes and does not have a significant cost or administrative impact on contractors or offerors. These requirements affect only the internal operating procedures of the Government.

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

The Regulatory Flexibility Act does not apply to this rule because this final rule does not constitute a significant DFARS revision within the meaning of FAR 1.501-1, and 41 U.S.C. 1707 does not require publication for public comment.

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

Therefore, 48 CFR part 201 is amended as follows:

This interim rule revises the DFARS to implement section 814(b) of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81). Section 814(b) requires that the dollar limitation established in 10 U.S.C. 2253(a)(2) for the acquisition of right-hand drive passenger sedans be included on the list of dollar thresholds subject to inflation adjustment in accordance with the requirements of 41 U.S.C. 1908, and to adjust the threshold, as appropriate. 10 U.S.C. 2253(a)(2) is based on section 101(b) of the Fiscal Year 1986 Department of Defense Appropriations Act (Pub. L. 99-190). The threshold was previously amended from $12,000 per vehicle to $30,000 per vehicle in 1997 through section 805 of the Fiscal Year 1998 Department of Defense Appropriations Act (Pub. L. 105-85), enacted on November 18, 1997.

This interim rule revises the DFARS to implement section 814(b) of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81) as follows:

• Adds DFARS 201.109(a) to include the dollar limitation for the acquisition of right-hand drive passenger sedans in the list of statutory acquisition-related dollar thresholds to be adjusted for inflation.

• Adds DFARS 212.271 to provide the escalated threshold of $40,000 per vehicle when acquiring right-hand drive passenger sedans.

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

DoD does not expect this rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because it merely adjusts upward the current limitation for acquisition of right-hand drive passenger vehicles from $30,000 to $40,000 due to inflation. Therefore, an initial regulatory flexibility analysis has not been performed. DoD invites comments from small business concerns and other interested parties on the expected impact of this rule on small entities.

DoD will also consider comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (DFARS Case 2012-D016), in correspondence.

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

A determination has been made under the authority of the Secretary of Defense that urgent and compelling reasons exist to promulgate this interim rule without prior opportunity for public comment. This action is necessary because it implements section 814(b) of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81), enacted on December 31, 2011. Section 814(b) requires escalating the current threshold for acquisition of right-hand drive passenger sedans from $30,000 to $40,000. Pursuant to paragraph (d) of 41 U.S.C. 1908, revised thresholds take effect on the date of publication in the Federal Register. The threshold was last amended from $12,000 per vehicle to $30,000 per vehicle in 1997 through section 805 of the National Defense Authorization Act for Fiscal Year 1998 (Pub. L. 105-85), enacted on November 18, 1997. Delaying implementation of the threshold adjustment may negatively impact contracting officers and the defense customers they support who require right-hand drive passenger sedans by restricting the purchase authority to the 1997 cost limitation of $30,000, without providing for adjustment due to inflation. Transportation of personnel in right-hand drive passenger sedans is needed overseas for reasons of safety and security and will allow personnel to move to work locations necessary to achieve the mission of the United States military worldwide, including support of overseas contingency operations. However, pursuant to 41 U.S.C. 1707 and FAR 1.501-3(b), DoD will consider public comments received in response to this interim rule in the formation of the final rule.

Therefore, 48 CFR parts 201 and 212 are amended as follows:

This final rule amends the DFARS by adding text at 203.806 to provide guidance to explain how and where to report violations or potential violations of the Lobbying Disclosure Act (31 U.S.C. 1352).

Therefore, 48 CFR part 203 is amended as follows:

I. Background

DoD published a proposed rule in the Federal Register at 76 FR 71922 on November 21, 2011, to separate provisions and clauses that are currently combined in order to comply with DFARS drafting conventions. A provision is included only in the solicitation, and generally includes representations and certifications, to which the offeror responds in its offer. A contract clause is included in both the solicitation and the resultant contract, and provides the terms that apply throughout contract performance. It is inconsistent with DFARS drafting conventions to combine a provision and a clause in a single clause. This rule removes the representations from the following five DFARS clauses and creates five new provisions to be used in solicitations that include the associated clauses:

Conforming changes are also required to DFARS 252.204-7007, Alternate A, Annual Representations and Certifications, and the associated prescriptions at DFARS 204.1202(2) to list the new provisions in lieu of the current DFARS clauses.

There were no public responses submitted that pertained to the proposed rule. Minor changes made to the proposed rule include adding new clause numbers and dates, edits to section titles as required to reflect the addition of new provisions, and minor editorial and grammatical changes to paragraph (a) of 252.229-7005, Tax Exemptions (Spain).

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

DoD certifies that this final rule will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because it does not add any new requirements—it only reformats existing requirements of five clauses into separate provisions and clauses.

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

Therefore, 48 CFR parts 204, 209, 216, 229, and 252 are amended as follows:

This rule implements section 809(b) of the NDAA for FY 2012 (Pub. L. 112-81), which removes the requirement that the head of the agency must notify the congressional defense committees within 30 days for each single source task- or delivery-order contract award over $103 million.

“Publication of proposed regulations”, 41 U.S.C. 1707, is the statute that applies to the publication of the Federal Acquisition Regulation. Paragraph (a)(1) of the statute requires that a procurement policy, regulation, procedure or form (including an amendment or modification thereof) must be published for public comment if it relates to the expenditure of appropriated funds, and has either a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure or form, or has a significant cost or administrative impact on contractors or offerors. This final rule is not required to be published for public comment, because the rule merely removes the requirement for the head of the agency to notify congressional defense committees for each single source task- or delivery-order contract award over $103 million. These requirements affect only the internal operating procedures of the Government.

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

The Regulatory Flexibility Act does not apply to this rule because this final rule does not constitute a significant DFARS revision as defined at FAR 1.501-1, and 41 U.S.C. 1707 does not require publication for public comment.

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

Therefore, 48 CFR Part 216 is amended as follows:

Table of Contents I. Background II. Location of Exterior Release Mechanism (Exterior Handle) III. Figure 3D IV. Window or Roof Emergency Exit Release V. Removing Reference to Figure 6B VI. Rulemaking Analyses and Notices I. Background

Federal Motor Vehicle Safety Standard (FMVSS) No. 217, “Bus emergency exits and window retention and release,” 1 applies to buses, including school buses, except buses manufactured for the purpose of transporting persons under physical restraint. The purpose of the standard is to minimize the likelihood of occupants being thrown from the bus and to provide a means of readily accessible emergency egress. The standard establishes requirements for the retention of windows other than windshields in buses, and establishes operating forces, opening dimensions, and markings for bus emergency exits.

In this final rule, we make several housekeeping amendments to FMVSS No. 217. First, NHTSA amends the standard to specify that the exterior release (the exterior handle) for school bus rear emergency exit doors may be located at the side opposite the door hinges, rather than located in the middle of the door. Second, this final rule also clarifies the standard as to the number of force applications that are required to open a window or roof emergency exit. Third, this document removes a reference to a no-longer existent figure.

The notice of proposed rulemaking (NPRM) upon which this final rule is based was published on December 28, 2009 (74 FR 68558) (Docket No. NHTSA-2009-0190).

We received seven comments on the NPRM from school bus manufacturers and private individuals.2 None of the commenters opposed the proposal, several made suggested changes to specific provisions, and some commented on matters beyond the scope of the rulemaking.

FMVSS No. 217 (S5.3.3.1(a)) specifies requirements for the location of the interior and exterior releases (handles) for side and rear emergency door exits for school buses with a gross vehicle weight rating (GVWR) greater than 4,536 kilograms (10,000 pounds) (“large school buses”).

The standard currently specifies at S5.3.3.1(a) and Figure 3D of the standard that both the interior and exterior releases (handles) for rear emergency exit doors be located in the center of the door.3 However, school bus manufacturers have always understood the standard as requiring only interior releases (interior handles) to be in the center of the door. They believed that the exterior handle may be near the edge of the door on the side opposite the hinges. They further believed that an exterior release (exterior handle) so located provides more leverage and may be designed to require less force to open the rear emergency exit door as compared to an exterior handle located in the center of the door.4

SBMTC petitioned the agency to amend FMVSS No. 217 to specify that the exterior release (exterior handle) for school bus rear emergency exit doors may be located near the edge of the door on the side opposite the hinges. Regarding interior releases (interior handles), the petitioner believed that the interior handles should be in the center of the door so that it is visible to bus occupants and not obscured by seat backs if the door is wider than the bus's center aisle.

In the NPRM, we tentatively agreed that the school bus manufacturers' current practice of placing the exterior rear emergency exit door release (exterior handle) near the edge of the door on the side opposite the hinges better meets the need for safety than placing the exterior release in the center of the door. Releases (exterior handles) placed opposite the hinges would require less force to pull open the door for persons outside the school bus than comparable releases located in the center.

Accordingly, we proposed to amend FMVSS No. 217 to specify that the exterior release (exterior handle) for the exit must only be in the high force access region shown in the left-side drawing (side view) of current Figure 3D; that is, only the vertical dimensions of the high force region are specified for the location of the exterior handle. We sought comment on whether we should require the exterior release to be no further than 51 millimeters (mm) (two inches) away from the edge of the door opposite the hinges.

We also clarified the requirement that the interior release (interior handle) for a rear emergency exit must be in the high force access region shown in both drawings of current Figure 3D, i.e., in the center of the door.

In addition, to make Figure 3D easier to understand, we proposed to rename the left-side drawing “Figure 3D(1)” and the right-side drawing “Figure 3D(2).”

All commenters responding to this issue agreed with NHTSA that FMVSS No. 217 should be amended so that it specifies that the exterior release (exterior handle) for school bus rear emergency exit doors be located near the edge of the door on the side opposite the hinges.

However, no commenter supported the idea to limit placement of the exterior release to no further than 51 mm (two inches) from the edge of the door opposite the hinges. SBMTC stated that the NPRM did not give an explanation on the reasoning behind this proposal. SBMTC stated that the shaft of the exterior emergency door release handle on the majority of school buses is located approximately 76 to 127 mm (3 to 5 inches) from the edge of the door. SBMTC also noted that due to current school bus emergency door construction and because emergency exits are already required to meet release forces as specified in FMVSS No. 217, it does not see any benefit or need to limit the maximum distance from the edge of the door to 51 mm (two inches).

Thomas Built believed that the 51 mm (two inch) limitation was arbitrary. Thomas Built requested that the edge dimension be determined by each individual manufacturer's design parameters because it would give the manufacturers some tolerance and flexibility in their respective designs.

NTEA believed that most manufacturers' exterior release handles on emergency doors are farther away than 51 mm (two inches) from the edge of the door. NTEA is unaware of any safety need to require design changes such that exterior release handles are no further than 51 mm (2 inches) from the edge of the door.

We are adopting the proposed amendment, except for the requirement that the exterior release handle must be no further than 51 mm (two inches) away from the edge of the door. The purpose of the limitation would have been to ensure the emergency exit door opened within the force requirements set forth in the standard. After reviewing the comments, we agree with SBMTC that the force requirements specified in the standard for opening emergency exits are sufficient to meet this goal. It is the opening force, not the closeness to the edge of the door, that is important for opening the door from the outside.

We also agree with Thomas Built that the location of the exterior release handle should be determined by the individual manufacturer's design parameters because the door design may vary based on each manufacturer's model. Thus, specifying an exact location would be overly design restrictive when the standard already prescribes the maximum force to open the exit.

We received no comment on the issue of the effective date for the changes to the exterior release handle for the school bus rear emergency exit door.

In its comment, Blue Bird stated that Figure 3D already has the required two drawings and only needs to change the width of the “ACCESS REGION FOR HIGH FORCES” in the right-hand drawing to span the entire door. Blue Bird stated that the proposal to split Figure 3D into Figures 3D(1) and 3D(2) did not seem necessary and may recreate the problem of using a single two-dimensional drawing to communicate three-dimensional information.

We do not agree with Blue Bird's suggestion that the high access region depicted in Figure 3D(2) (right side drawing) extends across the entire width of the door. The access region depicted in Figure 3D(2) (front view of the access regions for the rear emergency exit without rear obstruction) provides the location requirement for the interior release mechanism (interior handle) and ensures that it is in a location accessible from inside of the school bus. As we explained in the NPRM, the interior release handle for the emergency exit was intentionally required to be located in the center of the door so that it is visible to bus occupants and the view of the handle is not obstructed by seat backs. Further, as noted by SBMTC, the exit would be opened from inside by a pushing motion rather than a pulling motion, so locating the handle in the center of the door does not markedly increase the difficulty of opening the door.

Further, we do not agree with Blue Bird's suggestion not to split Figure 3D into Figures 3D(1) and 3D(2). Splitting Figure 3D into two parts allows referencing the two figures individually, to provide separate location requirements for the interior and exterior release mechanisms. As explained earlier, we intentionally described the interior handle as being in the center of the door, as indicated by Figures 3D(1) (side view) and 3D(2) (front view). However, for exterior release handles, which are not at risk of being obscured, we are only specifying the vertical dimensions of the high force region and are providing flexibility to the manufacturer to place the exterior release handle anywhere along the width of the door, as indicated by Figure 3D(1) alone (with vertical dimensions shown in the front view—3D(2)).

FMVSS No. 217 (S5.3.3.2) specifies the number, location, type, and magnitude of force applications to open emergency exit windows in all school buses, and S5.3.3.3 does the same for school bus emergency roof exits. At S5.3.2, the standard specifies the number, location, type and magnitude of force applications to open emergency exits in buses other than school buses.

These paragraphs of the standard specify, among other things: “In the case of [an exit] with one release mechanism, the mechanism shall require two force applications to release the exit. In the case of [an exit] with two release mechanisms, each mechanism shall require one [force] application to release the exit.” The language first appeared in a November 2, 1992 final rule (57 FR 49423).

In a June 13, 1994 interpretation letter to Blue Bird, NHTSA stated that the sentence in S5.3.3.2, “In the case of windows with one release mechanism, the mechanism shall require two force applications to release the exit,” was incorrect. The agency stated that the sentence was meant to read: “In the case of windows with one release mechanism, the exit shall require two force applications to open.” (Emphasis added.) That is to say, the agency intended a window or roof exit with one release mechanism to be able to be opened with only two force applications: One force application that undoes the release mechanism, and a second force application that opens the exit. The concern is that, because of the current wording of S5.3.3.2, the paragraph could be read as specifying that two force applications are used to activate the single mechanism and that a third force application is applied to open the exit.

The NPRM proposed to change the wording so that it states more clearly what the agency had intended. NHTSA proposed to make S5.3.2, S5.3.3.2, and S5.3.3.3 clearer by separating the requirements for operating an exit's release mechanism(s) from the requirements for opening the exit. NHTSA proposed to specify, for exits with one release mechanism, the exit must require two force applications to open: One to release the mechanism and another to open the exit. For exits with two release mechanisms, there must be a total of three force applications to open the exit: One force application must be applied to each of the two mechanisms to release the mechanism, and another force must be applied to open the exit.

We viewed this rulemaking as primarily a housekeeping measure and stated our belief in the NPRM that all emergency window and roof exits are currently designed to meet the requirements as the agency had intended to be understood.

We received no comments on this issue. Thus, no manufacturer disagreed with our statement that all emergency window and roof exits are currently designed to meet the existing requirements regarding the number of force applications. Blue Bird stated generally that it was “supportive of this NPRM's housekeeping measures,” which we assume refers to this as well as the other proposed amendments.

For the reasons in the NPRM, we are adopting the changes proposed in the December 2009 NPRM.

In its comment, Blue Bird pointed out another housekeeping measure. In an August 12, 2005 final rule (70 FR 47131), we amended FMVSS No. 217 by, among other things, removing Figure 6B from the standard. Inadvertently, we did not remove a reference to Figure 6B in the regulatory text of S5.4.3.1(a). Today's final rule corrects S5.4.3.1(a) by removing the reference to Figure 6B.

This rulemaking document was not reviewed by the Office of Management and Budget under E.O. 12866. It is not considered to be significant under E.O. 12866 or the Department's Regulatory Policies and Procedures (44 FR 11034; February 26, 1979). This final rule is of a housekeeping nature. We believe that all vehicles currently meet the changes discussed in this final rule and that there will be no costs associated with this rule.

Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq., as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996), whenever an agency is required to publish a notice 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 governmental jurisdictions), except as provided below. The Small Business Administration's regulations at 13 CFR part 121 define a small business, in part, as a business entity “which operates primarily within the United States.” (13 CFR 121.105(a)). No regulatory flexibility analysis for a rule is required if the head of an agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. The SBREFA amended the Regulatory Flexibility Act to require Federal agencies to provide a statement of the factual basis for certifying that a rule will not have a significant economic impact on a substantial number of small entities.

NHTSA has considered the effects of this rulemaking action under the Regulatory Flexibility Act. I hereby certify that this final rule will not have a significant economic impact on a substantial number of small entities. The basis for the certification is that this final rule is of a housekeeping nature. It does not change any FMVSS No. 217 requirements that school bus manufacturers are now meeting.

NHTSA has analyzed this rulemaking action for the purposes of the National Environmental Policy Act. The agency has determined that implementation of this action does not have any significant impact on the quality of the human environment.

NHTSA has examined today's final rule pursuant to Executive Order 13132 (64 FR 43255, August 10, 1999) and concluded that no additional consultation with States, local governments or their representatives is mandated beyond the rulemaking process. The agency has concluded that this housekeeping rulemaking does not have sufficient federalism implications to warrant consultation with State and local officials or the preparation of a federalism summary impact statement. The final rule does not have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.”

NHTSA rules can preempt in two ways. First, the National Traffic and Motor Vehicle Safety Act contains an express preemption provision: When a motor vehicle safety standard is in effect under this chapter, a State or a political subdivision of a State may prescribe or continue in effect a standard applicable to the same aspect of performance of a motor vehicle or motor vehicle equipment only if the standard is identical to the standard prescribed under this chapter. 49 U.S.C. 30103(b)(1). It is this statutory command by Congress that preempts any non-identical State legislative and administrative law addressing the same aspect of performance.

The express preemption provision described above is subject to a savings clause under which “[c]ompliance with a motor vehicle safety standard prescribed under this chapter does not exempt a person from liability at common law.” 49 U.S.C. 30103(e) Pursuant to this provision, State common law tort causes of action against motor vehicle manufacturers that might otherwise be preempted by the express preemption provision are generally preserved. However, the Supreme Court has recognized the possibility, in some instances, of implied preemption of such State common law tort causes of action by virtue of NHTSA's rules, even if not expressly preempted. This second way that NHTSA rules can preempt is dependent upon there being an actual conflict between an FMVSS and the higher standard that would effectively be imposed on motor vehicle manufacturers if someone obtained a State common law tort judgment against the manufacturer, notwithstanding the manufacturer's compliance with the NHTSA standard. Because most NHTSA standards established by an FMVSS are minimum standards, a State common law tort cause of action that seeks to impose a higher standard on motor vehicle manufacturers will generally not be preempted. However, if and when such a conflict does exist—for example, when the standard at issue is both a minimum and a maximum standard—the State common law tort cause of action is impliedly preempted. See Geier v. American Honda Motor Co., 529 U.S. 861 (2000).

Pursuant to Executive Order 13132 and 12988, NHTSA has considered whether this rule could or should preempt State common law causes of action. The agency's ability to announce its conclusion regarding the preemptive effect of one of its rules reduces the likelihood that preemption will be an issue in any subsequent tort litigation.

To this end, the agency has examined the nature (e.g., the language and structure of the regulatory text) and objectives of today's rule and finds that this rule prescribes only housekeeping amendments. Accordingly, NHTSA does not intend that this rule preempt state tort law.

With respect to the review of the promulgation of a new regulation, section 3(b) of Executive Order 12988, “Civil Justice Reform” (61 FR 4729, February 7, 1996) requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect; (2) clearly specifies the effect on existing Federal law or regulation; (3) provides a clear legal standard for affected conduct, while promoting simplification and burden reduction; (4) clearly specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. This document is consistent with that requirement.

Pursuant to this Order, NHTSA notes as follows. The preemptive effect of this rule is discussed above. NHTSA notes further that there is no requirement that individuals submit a petition for reconsideration or pursue other administrative proceeding before they may file suit in court.

Under the Paperwork Reduction Act of 1995, a person is not required to respond to a collection of information by a Federal agency unless the collection displays a valid Office of Management and Budget (OMB) control number. There are no collections of information associated with today's final rule. Thus, the Paperwork Reduction Act does not apply.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272) directs NHTSA to use voluntary consensus standards in its regulatory activities unless doing so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies, such as the Society of Automotive Engineers (SAE). The NTTAA directs the agency to provide Congress, through the OMB, explanations when we decide not to use available and applicable voluntary consensus standards.

After carefully reviewing the available information, NHTSA has determined that there are no voluntary consensus standards relevant to this rulemaking, as this final rule clarifies existing FMVSS No. 217 requirements.

Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) requires Federal agencies to prepare a written assessment of the costs, benefits, and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million in any one year (adjusted for inflation with base year of 1995). This final rule will not result in the expenditure by State, local, or tribal governments, in the aggregate, or by the private sector of more than $100 million annually.

Executive Order 13211 (66 FR 28355, May 18, 2001) applies to any rulemaking that: (1) Is determined to be economically significant as defined under E.O. 12866, and is likely to have a significantly adverse effect on the supply of, distribution of, or use of energy; or (2) that is designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. This rulemaking is not subject to E.O. 13211.

The Department of Transportation assigns a regulation identifier number (RIN) to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. You may use the RIN contained in the heading at the beginning of this document to find this action in the Unified Agenda.

Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477 at 19478).

In consideration of the foregoing, NHTSA amends 49 CFR part 571 as follows:

The small-mesh multispecies complex is composed of five stocks of three species of hakes (northern silver hake, southern silver hake, northern red hake, southern red hake, and offshore hake), and the fishery is managed through a series of exemptions from the other provisions of the Northeast Multispecies Fishery Management Plan (FMP). Amendment 19 to the FMP was initiated by the New England Fishery Management Council (Council) in 2009 to establish a mechanism for specifying annual catch limits (ACLs) and accountability measures (AMs) for the small-mesh multispecies fishery, as required by the 2007 reauthorization of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), 16 U.S.C. 1801 et seq. The Council postponed development of the amendment in order to include the results of an updated stock assessment in November 2010. Developing the amendment has been further delayed by the Council due to other pressing actions, and Amendment 19 is not scheduled to be implemented until October 2012, well past the Magnuson-Stevens Act's deadline of 2011 for implementing ACLs and AMs. NMFS has determined that it is necessary and appropriate, under section 304(c)(1)(A) of the Magnuson-Stevens Act, to develop a Secretarial Amendment in order to bring the small-mesh multispecies fishery into compliance with the Magnuson-Stevens Act requirements concerning ACLs and AMs. A description of the steps NMFS took to comply with the Magnuson-Stevens Act requirements for implementing a Secretarial Amendment was included in the proposed rule published on December 23, 2011 (76 FR 80318) and is not repeated here.

The Magnuson-Stevens Act requires that each FMP establish “a mechanism for specifying annual catch limits * * * at such a level that overfishing does not occur in the fishery, including measures to ensure accountability.” In order to do establish ACLs and AMs for the small-mesh multispecies fishery, the first step is to estimate the overfishing limit (OFL) for each stock. The OFL is the amount of catch above which overfishing is deemed to be occurring; that is, it is a status determination criterion for overfishing. It is an annual limit derived as the product of current exploitable biomass and the current rate of fishing, after taking into account the variance of each factor. To calculate the OFL for each stock, the Council's Small-Mesh Multispecies Plan Development Team (PDT) derived a distribution of OFLs for each species; each OFL is equal to the 50th percentile of that distribution. The 3-year moving average biomass for silver hake is estimated using the fall trawl survey and the 3-year moving average biomass estimate for red hake is estimated using the spring trawl survey, based on guidance from the Council's Scientific and Statistical Committee (SSC) and the November 2010 stock assessment. No reliable estimates for offshore hake are available.

For fishing years 2012-2014, the OFLs are as follows:

The second step in establishing ACLs is to account for uncertainty in the OFL estimate by estimating the acceptable biological catch (ABC). ABC is the level of catch that accounts for scientific uncertainty in the estimate of the OFL and any other scientific uncertainty. Based on guidance from the SSC, the ABCs are set equal to the 40th percentile of the OFL distribution for both red hake stocks, and the 25th percentile for both silver hake stocks (Table 2). In order to account for offshore hake, which are caught incidentally in the southern silver hake fishery and are marketed together as “whiting,” the southern silver hake ABC is increased by 4 percent.

The final step in setting the ACLs, after estimating OFL and ABC, is to take into account any uncertainty in the ability of managers to effectively implement the recommended catch levels. The Council has recommended that ACLs for the small-mesh multispecies fishery be set equal to 95 percent of the corresponding ABC to account for management uncertainty. The mechanism to establish ACLs for the small-mesh multispecies fishery results in four ABCs (northern red hake, northern silver hake, southern red hake, and southern whiting), set below their respective OFLs to account for scientific uncertainty, and four corresponding ACLs, set below ABC to account for management uncertainty, where ACL = 95 percent ABC (Table 3.)

This final rule implements total allowable landings (TAL) on a stock area basis, with southern silver and offshore hake combined. This results in four TALs (Table 4) that relate directly to the ACLs recommended by the SSC and the Council. Discards and estimated state landings are deducted from the ACLs, and stock area TALs are used as the management limit. At its September 2011 meeting, the Council recommended a 3-percent allowance for state landings. The Council also recommended using a discard estimate based on the average discards from 2008-2010 for all stocks.

After the publication of the proposed rule, the Council's PDT corrected a calculation error in the information provided to the Whiting Oversight Committee, upon which NMFS based the measures in the proposed rule. The PDT inadvertently used the 2007-2009 discard rates instead of the 2008-2010 discard rates as was intended by the Council. Correcting this error results in a slight decrease in the TALs for both northern silver hake and southern whiting (southern silver hake plus offshore hake), a slight increase in the TAL for southern red hake, and a relatively significant decrease in the TAL for northern red hake. The northern red hake TAL set by this rule is the only TAL that is close to or below recent landings levels: Based on the updated information, the discard rate for northern red hake changed from 58 percent to 65 percent, which reduced the northern red hake TAL from the proposed 108 mt to 90.3 mt. The Whiting Oversight Committee and the Council did not object to correcting the data for Amendment 19, and do not objecting to doing the same in the Secretarial Amendment.

Specifications will be set on a 3-year cycle, starting with the first year of implementation of the Secretarial Amendment. This process will be used to update the OFLs, ABCs, ACLs, and TALs based on the most recent available information using the calculations described above. Data expected to be used in the specifications setting process include, but are not limited to, new survey biomass indices, reported landings, estimated discards, and estimates of state-waters landings.

The Council, the PDT, and the Whiting Oversight Committee will monitor the status of the small-mesh multispecies fishery and resource. The Small-Mesh Multispecies PDT will meet to review the status of the stocks and the fishery. Based on this review, the PDT will report to the Council any changes or new information about the small-mesh multispecies stocks and/or fishery, and the PDT should recommend whether the specifications for the upcoming year(s) need to be modified. If necessary, the PDT will provide advice and recommendations to the Whiting Oversight Committee and the Council regarding the need to adjust measures for the small-mesh multispecies fishery to better achieve the FMP's objectives.

The PDT's recommendations will include the following information: OFL and ABC estimates for the next 3 fishing years, based on the control rules; ACLs that are set equal to 95 percent of the corresponding ABC; TALs that are calculated using an estimate of discards based on the most recent 3-year moving average for which data are available and an appropriate estimate of state-waters landings; an evaluation of catches compared to the ABCs in recent years; and any other measures that the PDT determines may be necessary to successfully implement the ACL framework, including, but not limited to, adjustments to the management uncertainty buffer between ABC and ACL.

The PDT will provide these recommendations to the SSC for review. The SSC will either approve the PDT's recommendations or provide alternative recommendations to the Council. The Council will then consider the SSC's and PDT's recommendations and make a decision on the specifications for the next 3 fishing years. The Council must establish ACLs that are equal to or lower than the SSC's recommended ABCs. Once the Council has approved ACLs, they will be submitted to NMFS for approval and implementation. After receiving the Council's ACLs, NMFS will review the recommendations and implement the ACLs in a manner consistent with the Administrative Procedure Act, if it is determined that the ACLs are consistent with applicable law. If the ACLs are determined to be inconsistent with applicable law, NMFS may publish alternative specifications that do not exceed the SSC's recommendations and are consistent with applicable law. If new ACLs are not implemented for the start of the new specifications cycle, the old ACLs will remain in effect until they are replaced.

This final rule implements both a proactive (in-season) and a reactive (post-season) AM framework for the small-mesh multispecies fishery. NMFS intends for the two AMs to complement each other and to work jointly to ensure that the catch limits are not exceeded, and, if they are, to mitigate the potential harm to the small-mesh multispecies stocks.

This final rule implements an AM that will reduce the possession of a particular stock to an incidental level when a trigger limit for that stock's TAL is projected to be reached. Under this approach, even if the TAL is exceeded, the possession limit will remain at the incidental level until the end of the fishing year. Based on a review of recent data and recommendations from the Council, this final rule implements the following incidental limits and triggers (Table 5).

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

The B season allowance of the 2012 Pacific cod total allowable catch (TAC) specified for AFA trawl catcher/processors in the BSAI is 1,340 metric tons (mt) as established by the final 2012 and 2013 harvest specifications for groundfish in the BSAI (77 FR 10669, February 23, 2012).

In accordance with § 679.20(d)(1)(i) and (d)(1)(ii)(B), the Administrator, Alaska Region, NMFS (Regional Administrator), has determined that the B season allowance of the 2012 Pacific cod TAC allocated to AFA trawl catcher/processors in the BSAI will be taken as incidental catch in the directed fishing for other species. Therefore, the Regional Administrator is establishing a directed fishing allowance of 0 mt for Pacific cod allocated to AFA trawl catcher/processors in the BSAI, and is setting aside the remaining 1,340 mt as incidental catch to support other anticipated groundfish fisheries. In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Pacific cod by AFA trawl catcher/processors in the BSAI.

After the effective date of this closure the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.

This action responds to the best available information recently obtained from the fishery. The Acting Assistant Administrator for Fisheries, NOAA, (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of directed fishing for Pacific cod by AFA trawl catcher/processors in the BSAI. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of March 26, 2012.

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

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

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

NMFS closed directed fishing for pollock in the West Yakutat District of the GOA under § 679.20(d)(1)(iii) on March 17, 2012 (77 FR 16481, March 21, 2012).

As of March 20, 2012, NMFS has determined that approximately 950 metric tons of pollock remain in the directed fishing allowance for pollock in the West Yakutat District of the GOA. Therefore, in accordance with § 679.25(a)(1)(i), (a)(2)(i)(C), and (a)(2)(iii)(D), and to fully utilize the 2012 TAC of pollock in the West Yakutat District of the GOA, NMFS is terminating the previous closure and is reopening directed fishing pollock in the West Yakutat District of the GOA.

The Administrator, Alaska Region (Regional Administrator) considered the following factors in reaching this decision: (1) The current catch of pollock in the West Yakutat District of the GOA and, (2) the harvest capacity and stated intent on future harvesting patterns of vessels in participating in this fishery.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the opening of the pollock fishery in the West Yakutat District of the GOA. Immediate notification is necessary to allow for the orderly conduct and efficient operation of this fishery, to allow the industry to plan for the fishing season, and to avoid potential disruption to the fishing fleet and processors. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of March 20, 2012.

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

Without this inseason adjustment, NMFS could not allow pollock fishery in West Yakutat District of the GOA to be harvested in an expedient manner and in accordance with the regulatory schedule. Under § 679.25(c)(2), interested persons are invited to submit written comments on this action to the above address until April 10, 2012.

This action is required by § 679.25 and is exempt from review under Executive Order 12866.

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

The first seasonal apportionment of the Pacific halibut bycatch allowance specified for the shallow-water species fishery in the GOA is 450 metric tons as established by the final 2012 and 2013 harvest specifications for groundfish of the GOA (77 FR 15194, March 14, 2012), for the period 1200 hrs, A.l.t., January 20, 2012, through 1200 hrs, A.l.t., April 1, 2012.

In accordance with § 679.21(d)(7)(i), the Administrator, Alaska Region, NMFS, has determined that the first seasonal apportionment of the Pacific halibut bycatch allowance specified for the trawl shallow-water species fishery in the GOA has been reached. Consequently, NMFS is prohibiting directed fishing for the shallow-water species fishery by vessels using trawl gear in the GOA. The species and species groups that comprise the shallow-water species fishery are pollock, Pacific cod, shallow-water flatfish, flathead sole, Atka mackerel, skates, squids, sharks, octopuses, and sculpins. This prohibition does not apply to fishing for pollock by vessels using pelagic trawl gear in those portions of the GOA open to directed fishing for pollock.

After the effective date of this closure the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of the shallow-water species fishery by vessels using trawl gear in the GOA. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of March 23, 2012.

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

This action is required by § 679.21 and is exempt from review under Executive Order 12866.

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

NMFS closed directed fishing for Pacific cod by catcher vessels using trawl gear in the BSAI under § 679.20(d)(1)(iii) on February 29, 2012 (77 FR 13013, March 5, 2012).

As of March 21, 2012, NMFS has determined that approximately 3,000 metric tons of Pacific cod remain in the 2012 A season directed fishing allowance allocated to trawl catcher vessels in the BSAI. Therefore, in accordance with § 679.25(a)(1)(i), (a)(2)(i)(C), and (a)(2)(iii)(D), and to fully utilize the A season apportionment of the 2012 Pacific cod TAC allocated to trawl catcher vessels in the BSAI, NMFS is terminating the previous closure and is reopening directed fishing for Pacific cod by catcher vessels using trawl gear in the BSAI.

The Administrator, Alaska Region (Regional Administrator) considered the following factors in reaching this decision: (1) The current catch for Pacific cod by catcher vessels using trawl gear in the BSAI, and (2) the harvest capacity and stated intent on future harvesting patterns of vessels in participating in this fishery.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the opening of directed fishing for Pacific cod by catcher vessels using trawl gear in the BSAI. Immediate notification is necessary to allow for the orderly conduct and efficient operation of this fishery, to allow the industry to plan for the fishing season, and to avoid potential disruption to the fishing fleet and processors. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of March 21, 2012.

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

Without this inseason adjustment, NMFS could not allow Pacific cod fishery by catcher vessels using trawl gear in the BSAI to be harvested in an expedient manner and in accordance with the regulatory schedule. Under § 679.25(c)(2), interested persons are invited to submit written comments on this action to the above address until April 10, 2012.

This action is required by § 679.25 and is exempt from review under Executive Order 12866.